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2021 ReportPeers and competitors of Musgrave Minerals Limited:
Sihayo Gold LimitedABN 12 143 890 671
Gound Floor,
5 Ord Street
West Perth WA 6005
Telephone: +61 (8) 9324 1061
Facsimile: +61 (8) 9324 1014
Email:
Web:
info@musgraveminerals.com.au
www.musgraveminerals.com.au
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9
CORPORATE DIRECTORY
DIRECTORS
Graham Ascough
Non-Executive Chairman
Robert Waugh
Managing Director
Kelly Ross
John Percival
Brett Lambert
Non-Executive Director
Non-Executive Director
Non-Executive Director
COMPANY SECRETARY
Patricia (Trish) Farr
REGISTERED OFFICE & PRINCIPAL PLACE OF BUSINESS
Ground Floor, 5 Ord Street
West Perth, WA 6005
Telephone:
+61 (8) 9324 1061
Facsimile:
+61 (8) 9324 1014
Email: info@musgraveminerals.com.au
Web: www.musgraveminerals.com.au
AUDITOR
BDO Audit (WA) PTY LTD
38 Station Street
Subiaco, WA 6008
LEGAL ADVISORS
O’Loughlins Lawyers
Level 2, 99 Frome Street
Adelaide, SA 5000
SHARE REGISTRY
Computershare Investor Services Pty Ltd
Level 11, 172 St Georges Terrace
Perth, WA 6000
Telephone:
+61 (8) 9323 2000
Facsimile:
+61 (8) 9323 2033
SECURITIES EXCHANGE LISTING
The Company is listed on the Australian Securities Exchange Ltd (“ASX”)
Home Exchange: Perth, Western Australia
ASX Code: MGV
Musgrave Minerals Ltd (“Musgrave”
or “the Company”) (ASX: MGV) is an
Australian company focused on gold
exploration, resource growth and near-
term development at the Cue Project
in the Murchison Province of Western
Australia.
A description of the Company’s
operations and principal activities is
included in the Review of Operations and
the Directors’ Report.
Photo credit:
Travis Dean, Bernadette Waugh
CONTENTS
CHAIRMAN’S LETTER
REVIEW OF OPERATIONS
TENEMENT SCHEDULE
DIRECTORS’ REPORT
AUDITOR’S INDEPENDENCE DECLARATION
FINANCIAL STATEMENTS
DIRECTORS’ DECLARATION
INDEPENDENT AUDITOR’S REPORT
ADDITIONAL INFORMATION
2
3
15
16
26
27
51
52
57
PAGE 1
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 CHAIRMAN’S LETTER
On behalf of the Board of Directors, it is my pleasure to
present the 2021 Annual Report for Musgrave Minerals
Limited (“Musgrave” or “Company”).
The Company’s Cue Project (“Cue”) in the well-
endowed, gold producing Murchison region of Western
Australia continues to deliver new discoveries and the
outstanding success of our exploration programs at Cue
have been transformational for Musgrave.
Building on the discovery of the high-grade Starlight and
White Light gold lodes at Break of Day in 2020, the team
implemented a regional exploration program to search
for further gold positions at Cue and were successful in
identifying several promising targets that have delivered
significant gold intersections to date. White Heat, Big
Sky and Target 14 are examples of this success. It is still
early days but the results are exciting. The extensive
and broad gold intersections that we have intersected in
shallow drilling at Big Sky and Target 14 have defined a
new gold corridor with over 7km of strike. This area will
be a focus of the Company’s exploration efforts in the
coming months with the objective of identifying new
resources to grow the already significant resource base
that we have at Break of Day and Lena.
During the year, Musgrave completed a mineral resource
update for Break of Day that includes the new Starlight
and White Light gold lodes. Break of Day is now
estimated to host approximately 797kt grading 10.2g/t
gold for ~262,000 ounces of gold. We believe this is
one of the highest grade, undeveloped, near-surface
gold resources in Australia. When combined with the
Lena deposit, located only 130m to the west, Inferred
and Indicated Resources total 5.1Mt @ 3.6g/t gold for
~587,000 ounces of contained gold, a significant portion
of which will be amenable to open pit mining. This will
form the basis for development studies that are currently
underway and the pathway to production.
In addition, a substantial drilling program on Lake Austin
is continuing under our Joint Venture with Evolution
Mining Ltd. The initial large-scale aircore drilling
completed on the Lake in 2020 and early 2021, identified
several extensive, high tenor, regolith gold targets that
are now being tested as part of the on-going diamond
drilling program. Basement drilling at the West Island
prospect has returned significant intersections and
further follow-up is underway.
The Company continually reviews the ongoing situation
relating to COVID-19 and the implications for the health
and wellbeing of our employees, contractors and
PAGE 2
stakeholders. We are pro-active with respect to our
response and have operational procedures and plans
in-place in-line with official health advice and government
directives. Musgrave will continue to operate within
these guidelines, and I’m pleased to say that, to date,
we remain incident free. Logistics and planning are more
complex and while there have been delays in assay
turn-around times there have not been significant cost
impacts on our programs to date related to COVID-19.
I would like to take this opportunity, on behalf of
the Board, to thank all our Shareholders for their
ongoing support. I would also like to thank the staff,
management, contractors and my fellow Directors for
their ongoing efforts. We are committed to progressing
the Cue Project and growing the Company by identifying
and testing new targets, increasing our resources and
progressing towards development, through high-quality
exploration and technical studies for the benefit of all
Musgrave shareholders.
Graham Ascough
Chairman
Regional drilling - Cue Project
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 REVIEW OF OPERATIONS
Musgrave Minerals Ltd (“Musgrave” or “the Company”)
(ASX: MGV) is an Australian resources company focused
within gold exploration and development at the Cue
Project in the Murchison Province of Western Australia.
Exploration activities for the financial year have been
focused on gold exploration at Cue.
Musgrave has an estimated 659Koz of gold in resources
within the Cue Project and completed more than
90,000m of drilling during the year. The total Indicated
and Inferred JORC Mineral Resources on the project
are 6.4Mt @ 3.2g/t Au for 659Koz of gold (see MGV ASX
announcement 11 November 2020, “Break of Day High-
Grade Mineral Resource Estimate”). The Break of Day
Mineral Resource has increased to 797kt @ 10.2g/t Au
for 262Koz contained gold.
The new Big Sky and White Heat gold discoveries are
not included in the current resource estimate.
The Company’s focus continues to be on the Cue
Project (“Cue”) which is located in the well-endowed,
gold producing Murchison region of Western Australia.
Musgrave’s intent is to continue to grow the resource
base, accelerate exploration and continue prefeasibility
level studies at the Break of Day and Lena deposits
to define a low-cost operation that returns value to
shareholders.
FY21 was a successful year for Musgrave following
the high-grade Starlight gold discovery at Break of Day
and subsequent resource update in November 2020.
A capital raising and the implementation of significant
exploration programs have led to further gold discoveries
at White Heat, Target 14 and Big Sky, enhancing the
potential to grow the existing resource base.
After the discovery of the Starlight deposit at Break of
Day in 2020, the Company applied the knowledge and
experience gained back into regional target selection
and followed this up with a strong focus on exploration
drilling to grow the resource base at Cue.
The exploration drilling program has been very
successful and has identified high-grade gold
mineralisation at the White Heat Prospect and thick, near-
surface modest grade mineralisation over a 2.6km strike
extent at Big Sky.
Musgrave also has tenement applications in the Musgrave
Geological Province of South Australia (Figure 1).
“Musgrave will maximise its exploration expertise to drive discovery success and resource
growth to progress the Company towards its development goals”
Figure 1: Musgrave Minerals’ Project Location Map
PAGE 3
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 REVIEW OF OPERATIONS
Corporate
During the year, Musgrave spent $6.9M on exploration
activities.
Musgrave successfully completed a capital raising
in December 2020 to raise $16.0M (before costs)
through a share placement to institutional, corporate,
and sophisticated investors. Musgrave also completed
a Share Purchase Plan (“SPP”) that raised $3.523M
(before costs) and closed in January 2021. Musgrave’s
cash position at 30 June 2021 was $20.9M.
There have been a number of changes to the Company’s
unlisted options with some expiring and some being
exercised. During the year, 14.2 million unlisted options
were exercised, raising $1.65 million.
At 30 June 2021 the Company’s capital structure
comprised:
•
•
533,222,949 fully paid ordinary shares; and
16,080,000 unlisted options at various exercise
prices and expiry dates
During the first quarter of 2021, Mr Brett Lambert
was appointed as a Non-executive Director. Mr
Lambert brings extensive skills and expertise across
project development and mining which will be of
significant benefit as the Company progresses through
development studies to mining.
Musgrave will progress the Cue Gold Project in two
strategic directions, exploration discovery and resource
growth, and development studies to maximise the
value of the resources. The Company will accelerate
drilling across high-priority targets at Cue with the aim
of making further high-grade gold discoveries that would
add value to a stand-alone operation. Development
studies are currently focused on long lead-time items
required to advance development of the existing
resources.
Gold panning at White Heat Prospect
PAGE 4
The Company holds 12.5 million shares in Legend
Mining Ltd (ASX: LEG) currently valued at approximately
$0.9M. Musgrave also holds 1,308,750 ordinary shares
in Cyprium Metals Ltd (ASX: CYM) currently valued at
approximately $250,000.
During financial year 2021, Musgrave successfully
secured an Exploration Incentive Scheme (“EIS”)
co-funded drilling grant of up to $150,000 to drill test
regional targets at Cue that aided in the discovery of the
White Heat and Big Sky gold systems.
Response to COVID-19
The impact of the Coronavirus (COVID-19) pandemic is
ongoing and while it has not significantly impacted the
Company to date, it is not practicable to estimate the
potential impact, positive or negative, after the reporting
date. The situation continues to evolve and future
scenarios are dependent on measures imposed by the
State and Federal governments. The Company will work
towards maintaining its operations and developing its
projects while aiming to keep its employees, contractors
and the communities in which we operate safe.
The Company has operational procedures and guidelines
in place that are in-line with official health advice
and government directives. Musgrave will continue
to operate within these guidelines and will adapt its
procedures as required. COVID-19 has created some
bottlenecks in the industry with regard to assay turn-
around, supply and resourcing. The Company remains
an active explorer and will continue to advance the Cue
Gold Project.
Exploration Activities
Cue Project
During the year the Company focused on exploration
and resource growth at the Cue Gold Project
while progressing long lead-time items to advance
development studies at Break of Day and Lena. This
culminated in the discovery of the new Starlight and
White Light gold lodes at Break of Day in 2020, which
led to a resource update at Break of Day in November
2020.
The Company has had continued exploration success
with the recent discoveries of the White Heat, Target 14
and Big Sky gold systems to the south of Break of Day.
Musgrave has an estimated 659Koz of gold in resources
at the Cue Project and completed more than 90,000m
of drilling during the year. The total Indicated and
Inferred JORC Mineral Resources on the project are
6.4Mt @ 3.2g/t Au for 659Koz of gold (see MGV ASX
announcement 11 November 2020, “Break of Day High-
Grade Mineral Resource Estimate”).
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 REVIEW OF OPERATIONS
On the Evolution Joint Venture on Lake Austin, the
Company completed over 26,000m of regional aircore
drilling and over 2,700m of follow-up diamond drilling.
Evolution has committed to a further $5M in exploration
on the joint venture in FY22. As part of this commitment
a further program of 17,000m of aircore drilling and
7,000m of follow-up diamond drilling has commenced.
Break of Day Deposit
Following the Starlight and White Light discoveries in
2020, the Break of Day Mineral Resource has increased
to 797kt @ 10.2g/t Au for 262Koz contained gold. The
recent update from the previous July 2017 Mineral
Resource delivered a:
•
•
31% increase in total contained ounces;
58% increase in Indicated Resources to 175,900
ounces of gold; and
•
42% increase in gold grade to 10.2g/t Au.
The new Big Sky and White Heat gold discoveries are
not included in this resource estimate.
Some of the key attributes of the Starlight and White
Light resources (360kt @ 13.9g/t gold for 161Koz of
contained gold), (see MGV ASX announcement 11
November 2020, “Break of Day High-Grade Mineral
Resource Estimate”) are the very high-grade and near-
surface nature (only 2-4m of cover) of the gold system,
the concentration of 85% of the resource into five main
lodes and the proximity to infrastructure. The Break of
Day mineralisation remains open in several parts of the
deposit including down dip.
A significant infill resource definition program is planned
in FY22 at Lena and Break of Day to convert Inferred
resources to the higher confidence Indicated category to
align with the advancement of development studies.
Lena Deposit
The Lena deposit has a Mineral Resource estimate
of 4.3Mt @ 2.3g/t Au for 325Koz gold (see ASX
announcement 17 February 2020, “Lena Resource
Update”).
Drilling at Lena extends to a maximum depth of 400m
below surface, where the mineralisation remains open
down plunge. The mineralisation has been interpreted
and estimated to a depth of 430m and remains open
over much of the 1.5km strike length of the deposit.
A significant infill resource definition program is planned
in FY22 at Lena and Break of Day to convert Inferred
resources to the higher confidence Indicated category to
align with the advancement of development studies.
“The Starlight deposit is an exceptional near-surface high-grade gold discovery with the
potential to return high margins.”
Figure 2: Schematic 3D model showing Starlight and White Light lodes at Break of Day, Cue Project
PAGE 5
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 REVIEW OF OPERATIONS
Regional Exploration
Following the discovery of the Starlight deposit at
Break of Day, the Company applied the knowledge and
experience gained back into regional target selection,
and followed this up with a strong focus on exploration
with the aim of growing the resource base at Cue.
During the year Musgrave completed 90,000m of
resource and exploration drilling, including approximately
30,000m on the Evolution Joint venture.
The exploration drilling program has been very
successful in identifying high-grade gold mineralisation at
the White Heat and Target 14 prospects and thick, near-
surface modest grade mineralisation over a 2.6km strike
extent at Big Sky.
White Heat Prospect
White Heat is 300m south of Break of Day (Figures 3
and 6), has a strike extent of approximately 70m and is
open down plunge. Significant intersections at White
Heat, include:
•
•
•
•
11m @ 19.6g/t Au from 48m (21MORC039)
1.2m @ 303.2g/t Au from 74.6m and 8.4m @ 6.8g/t
Au from 27.3m (21MODD018) including:
o
1.2m @ 37.2 g/t Au from 27.3m
6.8m @ 17.8g/t Au from 47m (21MODD019) in the
hanging wall lode including:
o
0.7m @ 112.9g/t Au from 48.1m; and
3.4m @ 107.6g/t Au from 74.6m (21MODD019) in
the footwall lode including:
Figure 3: Plan showing deposit and prospect location,
Cue Gold Project
o
1.2m @ 303.2g/t Au from 74.6m
(see MGV ASX announcements dated 19
March 2021 and 16 August 2021).
It is envisaged that White Heat could be
a satellite pit to a larger development
at Break of Day and Lena. Drilling at
White Heat is continuing with the aim of
defining a maiden resource in Q2 2022.
Big Sky Prospect
A focus on exploration drilling (aircore, RC
and diamond) and resource growth has
led to the discovery of extensive regolith
gold mineralisation over a continuous
2.6km long trend, 2km south-west of
Break of Day, referred to as Big Sky
(Figure 3). The mineralisation is part of a
7km-long gold corridor with near-surface
mineralisation identified over thick
intervals below a thin veneer (1-10m) of
transported hardpan cover (Figures 6 &
7). Infill resource definition RC drilling has
commenced to test the continuity, grade
PAGE 6
Figure 4: Long section at White Heat showing near-surface nature and
plunge of high-grade gold mineralisation
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
REVIEW OF OPERATIONS
and down dip extent of the mineralisation in oxide and
fresh basement rock. RC drilling results to date comprise
a combination of 6m composite and 1m individual
assays.
•
60m @ 1.0g/t Au from 42m (21MORC196), 50m
south of 21MORC101 (73m @ 1.4g/t Au)
(see MGV ASX announcements dated 19 July 2021, 12
August 2021 and 13 September 2021).
RC results from the Big Sky prospect include:
•
•
•
•
•
•
•
•
•
•
36m @ 1.3g/t Au from 30m (21MORC082),
including:
o
11m @ 3.0g/t Au from 55m
21m @ 1.3g/t Au from 39m (21MORC100)
73m @ 1.4g/t Au from 41m (21MORC101),
including:
o
5m @ 10.1g/t Au from 72m
6m @ 4.5g/t Au from 108m (21MORC121)
18m @ 2.0g/t Au from 18m (21MORC124)
18m @ 1.2g/t Au from 18m (21MORC130)
24m @ 1.7g/t Au from 24m (21MORC132)
30m @ 1.0g/t Au from 30m (21MORC141)
6m @ 6.9g/t Au from 12m (21MORC157)
18m @ 1.1g/t Au from 36m (21MORC160)
It is envisaged that Big Sky could be a significant feed
source to a development centred at Break of Day and
Lena. Drilling at Big Sky is continuing with the aim of
defining a maiden resource in Q2 2022.
Target 14 Prospect
Target 14, approximately 1km west of Lena and 800m
north of Big Sky is defined by anomalous gold in the
regolith over a strike length of more than 3km (Figure
3). A higher-grade zone has been defined by RC drilling,
extending for more than 500m. Target 14 is part of the
new 7km-long gold corridor that includes Big Sky. RC
drilling results comprise a combination of 6m composite
and 1m individual assays.
Significant RC results from Target 14 include:
•
24m @ 3.0g/t Au from 40m (21MORC019),
including:
o
9m @ 6.1g/t Au from 40m
•
14m @ 1.9g/t Au from 43m (21MORC105)
Figure 5: Cross section at White Heat showing high-grade gold mineralisation and hanging wall and footwall lodes
PAGE 7
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
REVIEW OF OPERATIONS
Figure 6: Plan showing Big Sky drilling, Cue Gold Project
PAGE 8
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 Figure 7: Cross section at Big Sky showing gold
mineralisation
Figure 8: Cue prospect Location Map
•
•
•
•
36m @ 2.9g/t Au from 12m (21MORC185),
including:
o
24m @ 4.1g/t Au from 24m
12m @ 1.7g/t Au from 84m (21MORC189)
6m @ 2.2 g/t Au from 30m (21MORC191)
12m @ 1.6g/t Au from 48m (21MORC194)
(see MGV ASX announcement dated 21 April 2021, 12
August 2021 and 13 September 2021).
Further drilling is planned at Target 14 for late in 2021.
Numbers Deposit
The Numbers prospect, approximately 3.5km south
of Break of Day (Figure 3), has an Inferred Resource
of 278,000t @ 2.46g/t Au for 22Koz of gold (see MGV
ASX release 16 October 2020, “Annual Report to
Shareholders”). It is envisaged that Numbers could be a
satellite pit to a larger development at Break of Day and
Lena.
An RC drill program focused on upgrading the resource
estimate to the higher confidence Indicated category is
ongoing. RC, resource definition drill holes are spaced
on an approximate 20m x 20m grid. The majority of drill
holes intersected mineralisation consistent with the
existing model. Preliminary metallurgical test work is
planned before a resource update in Q2 2022.
New mineralised RC intersections include:
•
•
•
•
•
•
•
•
•
18m @ 2.4g/t Au from 60m (21MORC057)
17m @ 2.3g/t Au from 78m (21MORC062)
6m @ 3.0g/t Au from 21m (21MORC063)
16m @ 3.0g/t Au from 52m (21MORC064)
7m @ 2.6g/t Au from 135m (21MORC068)
12m @ 2.0g/t Au from 86m (21MORC070)
10m @ 5.6g/t Au from 50m (21MORC071)
including:
o
1m @ 46.4g/t Au from 55m
4m @ 3.9g/t Au from 92m (21MORC076)
12m @ 5.4g/t Au from 12m (21MORC077)
including:
o
5m @ 11.1g/t Au from 14m
A significant exploration program across multiple
prospects and targets with accelerated drilling is planned
for the coming year. The objective is to continue to grow
the resource base and progress development studies to
define a clear path to a stand-alone operation which will
deliver first gold production for the Company.
PAGE 9
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
REVIEW OF OPERATIONS
“As the team continues to build its knowledge and understanding of the controls on
mineralisation in the region, we strongly believe exploration success will continue to
deliver new discoveries like the high-grade Starlight lode. This will in turn grow the
existing resource base and enhance the economics of any potential future development.”
Mainland
The Mainland Prospect area covers the northern
extension of the shear corridor that hosts Musgrave’s
Break of Day/Starlight and Lena gold deposits and the
Lake Austin North gold discovery.
A number of new gold targets have been generated and a
follow-up drilling program is currently being scheduled for
early 2022.
View looking south, old building, Mainland Prospect, Cue
Development Studies
The Company has commenced prefeasibility level
studies on a number of key elements for any potential
future development at Break of Day and Lena. This
work comprises environmental assessment, including
collection of baseline flora and fauna data, heritage
assessments, hydrology and surface water management,
metallurgy, waste rock and tailings geochemistry
and storage, geotechnical and structural analysis and
preliminary pit and underground mine, processing plant
and infrastructure design. All new resource discoveries
will require this level of assessment.
Due to the ASX constraints on publication of economic
data relating to Inferred Resources and incomplete
assessments and the continued exploration success and
its effect on design parameters, the Company has not
yet set a date for the delivery of a preliminary economic
assessment of the project.
In conjunction with these studies Musgrave will continue
to maximise its exploration strengths and accelerate
drilling across high-priority gold targets at Cue with the
PAGE 10
aim of expanding the current resources and making
further high-grade gold discoveries that would enhance a
stand-alone operation.
Evolution JV – Lake Austin
The Lake Austin area, part of the Evolution Earn-in
and Exploration Joint Venture executed in September
2019, is highly prospective for gold and significantly
underexplored.
Evolution has met its minimum commitment in the first
two years and can earn a 75% interest in the JV area by
sole funding $18M in exploration within a total of five
years. If Evolution does not spend the entire $18M within
five years, Musgrave will retain 100% ownership (see
MGV ASX announcement dated 17 September 2019).
Musgrave is managing the exploration during the initial
period with strong technical input from Evolution. The
existing gold resources, including Lena and Break of Day/
Starlight and the Mainland option area, are excluded from
the Evolution Agreement (Figure 9).
A 26,000 aircore drilling program and a seven drill hole,
2,720m diamond drilling program were completed
on Lake Austin to follow-up the extensive, high-tenor,
regolith gold anomalies at the West Island and Lake
Austin North prospects. Four diamond holes were drilled
at West Island over a strike length of 400m with all
returning significant gold intercepts:
•
•
•
•
11.5m @ 3.2g/t Au from 245m (21MODD006),
including;
o
3.0m @ 10.6g/t Au from 247.5m
11.0m @ 3.6g/t Au from 272m (21MODD001),
including;
o
5.0m @ 5.5g/t Au from 276m
5.0m @ 2.7g/t Au from 169m (21MODD002)
0.4m @ 23.5g/t Au from 144.7m (21MODD007)
(see MGV ASX announcement dated 30 June 2021).
Subsequent to 30 June 2021, Evolution committed to
a further $5M in exploration for FY22 including a Phase
2, 17,000m follow-up aircore drill program and a 7,000m
follow-up diamond drilling program. Both these programs
have commenced and are ongoing.
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
REVIEW OF OPERATIONS
Other Projects
Musgrave currently holds tenement applications in the
central Musgrave province of South Australia. No field
activity was completed by Musgrave on these projects
during the period.
Environment, Social and Governance (ESG)
The Company has a focused approach to ESG stemming
from our corporate governance policies which is driven
by our people and practices. Key focus areas are:
•
•
•
•
People: Our people are a priority – to keep them
safe, healthy and engaged
Indigenous Stakeholders: Commitment to forming
long-term relationships and providing opportunities
Community and Social: Provide positive
contributions to the local communities in which we
operate through working relationships, education,
employment (both direct and indirect) and
sponsorships
Environment: To minimise our impact on the
environment
“Evolution is an excellent joint venture partner and we continue to work together with
the goal of making a significant gold discovery under Lake Austin.”
Figure 9: Location plan showing EVN JV area. EVN drill hole locations and includes historical drill holes with
maximum gold in hole coloured
PAGE 11
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 REVIEW OF OPERATIONS
Table 1: Summary of mineral resources by JORC Classification for the Cue Project
Gold Mineral Resources as at 30 June 2021
Indicated Resources
Inferred Resources
Total Resources
Tonnes
‘000s
Au
Grade
g/t
Total
oz Au
‘000s
Tonnes
‘000s
Au
Grade
g/t
Total
oz Au
‘000s
Tonnes
‘000s
Au
Grade
g/t
Total
oz. Au
‘000s
Deposit
Moyagee
Break of Day
Lena
Leviticus
Numbers
451
2,253
12.1
1.7
–
–
176
121
–
–
346
2,053
42
278
297
2,719
21
4
–
4
–
–
–
605
121
171
292
175
96
271
–
–
3.4
0.3
0.3
–
0.3
–
–
–
Total Moyagee
2,704
Eelya
*Hollandaire (100%)
2,179
*Hollandaire
(MGV 20%)
Rapier South
Total Eelya
Tuckabianna
Jasper Queen
Gilt Edge
Total Tuckabianna
436
–
436
–
–
–
7.7
3.1
6.0
2.5
3.7
0.4
0.4
2.1
1.4
2.6
3.1
2.8
3.4
86
204
8
22
319
8
2
12
13
15
9
24
797
4,305
42
278
5,422
2,784
557
171
728
175
96
271
358
6,422
10.2
2.3
6.0
2.5
3.5
0.3
0.3
2.1
0.6
2.6
3.1
2.8
3.2
262
325
8
22
616
27
5
12
17
15
9
24
659
Total Cue Project
3,140
3.0
301
3,282
* Note 1: The Hollandaire Resource Estimate is on 100% basis (MGV has a 20% attributable interest in the Hollandaire
deposit, free carried to completion of DFS). Totals are on an attributable interest basis. Gold mineralisation not
associated with the copper resource at Hollandaire, that is 100% attributable to MGV, is yet to be modelled and
reported in compliance with JORC 2012.
Note 2: Due to the effects of rounding, the total may not reflect the sum of all components.
Copper Mineral Resources (1) as at 30 June 2021
Deposit
Hollandaire
Copper
Indicated Resources
Inferred Resources
TOTAL RESOURCES
Tonnes
‘000s
Grade
%
Tonnes
Cu
‘000s
Tonnes
‘000s
Grade
%
Tonnes
Cu
‘000s
Tonnes
‘000s
Grade
%
Tonnes
Cu
‘000s
2,179
2.0
42.2
605
1.6
9.3
2,784
1.9
51.5
Silver Mineral Resources (1) as at 30 June 2021
Deposit
Hollandaire
Silver
Indicated Resources
Inferred Resources
TOTAL RESOURCES
Tonnes
‘000s
Grade
g/t
Ounces
Ag
‘000s
Tonnes
‘000s
Grade
g/t
Ounces
Ag
‘000s
Tonnes
‘000s
Grade
g/t
Ounces
Ag
‘000s
2,179
6.4
450
605
6.4
124
2,784
6.4
574
* Due to effects of rounding, the total may not represent the sum of all components.
(1) On 1 May 2020, Musgrave entered into a joint venture with Cyprium Australia Pty Ltd (“Cyprium”) on the non-gold
rights over the northern Cue tenure including the Hollandaire copper deposit. Cyprium (ASX: CYM) has earned an 80%
interest in the non-gold rights over the area with Musgrave retaining 20% and is free carried to a definitive feasibility
study. Musgrave also retains 100% of the rights to any gold dominant mineralisation. The farm-out of base metals at
Hollandaire has allowed Musgrave to focus on its priority gold targets, resulting in the discovery of the Starlight and
White Light gold lodes at Break of Day and delivering significant value accretion to its shareholders.
PAGE 12
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 REVIEW OF OPERATIONS
Notes to Table 1
The Break of Day and Lena Mineral Resources at Moyagee are reported in accordance with the 2012 Edition of the
Australian Code of Reporting of Mineral Resources and Ore Reserves (JORC 2012). The remaining gold Mineral
Resources and Ore Reserve estimates were first prepared and disclosed in accordance with the 2004 Edition of the
Australian Code of Reporting of Mineral Resources and Ore Reserves (JORC 2004) and have not been updated since
to comply with JORC 2012 on the basis that the information has not materially changed since it was last reported. For
further details refer to Musgrave Minerals Ltd (MGV) ASX announcements 11 November 2020, “Break of Day High-
Grade Mineral Resource Estimate”, 17 February 2020, “Lena Resource Update” and Silver Lake Resources Limited
(SLR) ASX Announcement 26 August 2016, “Mineral Resources and Ore Reserves Update”. The Hollandaire Resources
are reported in accordance with the 2012 Edition of the Australian Code of Reporting of Mineral Resources and Ore
Reserves (JORC 2012). For further details refer to Cyprium Metals Limited (CYM) ASX announcement 29 September
2020, “Hollandaire Copper-Gold Mineral Resource Estimate”.
COMPETENT PERSON’S STATEMENT
Mineral Resources
The Information in this report that relates to Mineral Resources at Break of Day and Lena is based on information
compiled by Mr Paul Payne, a Competent Person who is a Fellow of the Australasian Institute of Mining and
Metallurgy. Mr Payne is a full-time employee of Payne Geological Services. Mr Payne has sufficient experience
that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being
undertaken to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting
of Exploration Results, Mineral Resources and Ore Reserves”. Mr Payne consents to the inclusion in the report
of the matters based on his information in the form and context in which it appears. The Company confirms that it
is not aware of any new information or data that materially effects the information included in the original market
announcement and, in the case of estimates of Minerals Resources that all material assumptions and technical
parameters underpinning the estimates in the relevant market announcement continue to apply and have not
materially changed. The Company confirms that the form and context in which the Competent Person’s findings are
presented, have not been materially modified from the original market announcement.
The information in this report that relates to the Rapier South, Jasper Queen, Gilt Edge, Leviticus and Numbers
Mineral Resource is extracted from the report created by Silver Lake Resources Limited entitled “Mineral
Resources and Ore Reserves Update”, 26 August 2016 and is available to view on the ASX (www.asx.com.au).
The Company confirms that it is not aware of any new information or data that materially effects the information
included in the original market announcement and, in the case of estimates of Minerals Resources that all material
assumptions and technical parameters underpinning the estimates in the relevant market announcement continue
to apply and have not materially changed. The Company confirms that the form and context in which the Competent
Person’s findings are presented, have not been materially modified from the original market announcement.
The information in this report that relates to Mineral Resources for the Hollandaire deposit is an accurate
representation of the available data and is based on information compiled by external consultants and Mr Peter
van Luyt a competent person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves” who is a member of the Australian Institute of Geoscientists (2582).
Mr van Luyt is the Chief Geologist of Cyprium Metals Limited. Mr van Luyt has sufficient experience that is relevant
to the style of mineralisation and type of deposit under consideration and the activity which he is undertaking to
qualify as a Competent Person (CP). Mr van Luyt consents to the inclusion in the report of the matters based on his
information in the form and context in which it appears.
The Company confirms that it is not aware of any further new information or data that materially affects the
information included in the original market announcement by Cyprium Metals Limited (CYM) entitled “Hollandaire
Copper-Gold Mineral Resource Estimate” released on 29 September 2020 and in the case of estimates of Minerals
Resources, that all material assumptions and technical parameters underpinning the estimates in the relevant
market announcement continue to apply and have not materially changed. To the extent disclosed above, the
Company confirms that the form and context in which the Competent Person’s findings are presented have not
been materially modified from the original market announcement.
PAGE 13
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 REVIEW OF OPERATIONS
Mineral Resource and Ore Reserve Governance Controls
Musgrave Minerals Limited ensures that the Minerals Resources quoted are subject to governance arrangements and
internal controls. Internal and external reviews of Mineral Resource estimation procedures and results are carried out
by a team of experienced technical personnel that is comprised of highly competent and qualified professionals. These
reviews have not identified any material issues.
Musgrave reports its Mineral Resources on at least an annual basis in accordance with the Australasian Code for
Reporting of Exploration Results, Minerals Resources and Ore Reserves (the JORC Code), 2012 or 2004 Edition as
stated. Competent Persons named in this report are Members or Fellows of the Australasian Institute of Mining and
Metallurgy and/or the Australian Institute of Geoscientists and qualify as Competent Persons as defined in the JORC
Code.
The Company’s procedures for drilling, sampling techniques and analysis are regularly reviewed and audited by
independent experts. Assays are undertaken by independent, internationally accredited laboratories with a QA/QC
program delivering acceptable levels of accuracy and precision.
Exploration Results
The information in this report that relates to Exploration Targets and Exploration Results is based on information
compiled and/or thoroughly reviewed by Mr Robert Waugh, a Competent Person who is a Fellow of the Australasian
Institute of Mining and Metallurgy (AusIMM) and a Member of the Australian Institute of Geoscientists (AIG). Mr
Waugh is Managing Director and a full-time employee of Musgrave Minerals Ltd. Mr Waugh has sufficient experience
that is relevant to the style of mineralisation and type of deposit under consideration to qualify as a Competent Person
as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves’. Mr Waugh consents to the inclusion in the report of the matters based on his information in the form and
context in which it appears.
Forward-Looking Statements
This document may contain certain forward-looking statements. Forward-looking statements include but are not limited
to statements concerning Musgrave Minerals Limited’s (Musgrave’s) current expectations, estimates and projections
about the industry in which Musgrave operates, and beliefs and assumptions regarding Musgrave’s future performance.
When used in this document, words such as “anticipate”, “could”, “plan”, “estimate”, “expects”, “seeks”, “intends”, “may”,
“potential”, “should”, and similar expressions are forward-looking statements. Although Musgrave believes that its
expectations reflected in these forward-looking statements are reasonable, such statements are subject to known and
unknown risks, uncertainties and other factors, some of which are beyond the control of Musgrave and no assurance
can be given that actual results will be consistent with these forward-looking statements.
PAGE 14
Lake Austin
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 TENEMENT SCHEDULE
As at 24 September 2021
Tenement ID
E21/129
E21/177
E21/194
E21/200
E21/204
E21/207
E21/208
M21/106
M21/107
E21/144
P21/757
E58/335
E58/507
M58/224
M58/225
P58/1709
P58/1710
E20/606
E20/608
E20/616
E20/629
E20/630
E20/659
E20/836
E20/698
E20/699
E20/700
M20/225
M20/245
M20/277
M20/526
P20/2279
L20/57
L58/42
P21/731
P21/732
P21/735
P21/736
P21/737
P21/739
P21/741
EL1996/260
EL1996/262
EL1996/340
EL1996/341
EL1996/342
EL1996/534
EL1997/040
EL1997/143
EL1997/144
EL1997/186
EL1997/297
EL1997/321
EL1997/468
EL2001/031
EL2008/154
Project
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Cue
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
Musgrave
State
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
WA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
SA
Status
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Granted
Application
Application
Application
Application
Application
Application
Application
Application
Application
Application
Application
Application
Application
Application
Application
MGV Interest
100% (EVN JV)
100% (EVN JV)
100% (EVN JV)
100% (EVN JV)
100% (EVN JV)
100% (EVN JV)
100% (EVN JV)
100% (EVN JV in part)
100% (EVN JV)
100%
100% (EVN JV)
100%
100% (EVN JV)
100%
100%
100%
100%
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
20% (100% gold only rights)
100%
100%
0% (MGV Option)
0% (MGV Option)
0% (MGV Option)
0% (MGV Option)
0% (MGV Option)
0% (MGV Option)
0% (MGV Option)
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
PAGE 15
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 DIRECTORS’ REPORT
Your Directors present their report on the consolidated
entity consisting of Musgrave Minerals Limited (“the
Company”) and its subsidiary (“the Group” or “the
Consolidated Entity”) at the end of the year ended 30
June 2021.
DIRECTORS
The following persons were Directors of the Company
during the whole of the financial year and up to the date
of this report, unless otherwise stated:
• Mr Graham Ascough, Non-Executive Chairman
• Mr Robert Waugh, Managing Director
• Ms Kelly Ross, Non-Executive Director
• Mr John Percival, Non-Executive Director
• Mr Brett Lambert, Non-Executive Director
(appointed 4 February 2021)
PRINCIPAL ACTIVITIES
During the year, the principal continuing activities of the
Group consisted of:
•
•
•
•
exploration of mineral tenements, both on a joint
venture basis and by the Group in its own right,
with the intent to progress to development in the
near to mid-term;
development and production studies on existing
resources;
continuing to seek extensions of areas held and to
seek out new areas with mineral potential; and
evaluating results received through surface
sampling, geophysical surveys and drilling activities
carried out during the year.
FINANCIAL RESULTS
The loss of the Group after providing for income tax for
the year ended 30 June 2021 was $2,881,297 (2020:
profit of $992,169). This included a share-based payment
expense of $2,035,342 (2020: $136,072).
As at 30 June 2021, the Group had net assets of
$48,022,199 (2020: $29,108,808) including cash and
cash equivalents of $20,910,936 (2020: $9,122,692).
DIVIDENDS
No dividends have been paid or declared since the
start of the financial year. No recommendation for the
payment of a dividend has been made by the Directors.
OPERATIONS AND FINANCIAL REVIEW
Information on the operations of the Group and its
prospects is set out in the “Review of Operations”
section of this Report.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Significant changes in the state of affairs of the Group
during the financial year were as follows:
PAGE 16
Exploration has continued to be a major focus for the
Company with continued exploration at Cue and more
than 90,000 metres were drilled during the year.
The Company also announced, in November 2020, an
increase to the Break of Day Mineral Resource to 797kt
@ 10.2g/t Au for 262koz contained gold (see MGV ASX
announcement 11 November 2020, “Break of Day High-
Grade Mineral Resource Estimate”). The total Indicated
and Inferred JORC Mineral Resources on the project are
now 6.4 Mt @ 3.2g/t Au for 659,000 ounces of gold.
On 18 December 2020, the Company completed a
placement (“Placement”) to corporate, institutional,
professional and sophisticated investors of 44.4 million
ordinary shares at an issue price of $0.36 cents per
share raising $16 million before costs.
Aligned with the Placement the Company also
completed a Share Purchase Plan (“SPP”) in January
2021 at an issue price of $0.36 per share. The SPP
was heavily supported and exceeded the target
raising of $2 million. Given the strong support shown
by Shareholders, the Board decided to exercise its
discretion under the terms of the SPP to increase the
size of the SPP to $3.5 million with the issue of 9.8
million ordinary shares.
There were no other significant changes in the state of
affairs of the Group during the financial year.
EVENTS SINCE THE END OF THE FINANCIAL YEAR
The impact of the Coronavirus (COVID-19) pandemic
is ongoing and while it has not significantly impacted
the entity up to 30 June 2021, it is not practicable to
estimate the potential impact, positive or negative, after
the reporting date. The situation is rapidly developing and
is dependent on measures imposed by the State and
Federal Governments, such as vaccinations, maintaining
social distancing requirements, quarantine, travel
restrictions and any economic stimulus that may be
provided.
There has not arisen in the interval between the end of
the financial year and the date of this report any item,
transaction or event of a material and unusual nature
likely, in the opinion of the Directors, to significantly
affect the operations, the results of those operations, or
the state of affairs of the Group in future financial years.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
OF OPERATIONS
The Directors are not aware of any developments that
might have a significant effect on the operations of
the Group in subsequent financial years not already
disclosed in this report.
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 DIRECTORS’ REPORT
ENVIRONMENTAL REGULATION
INFORMATION ON DIRECTORS
The Group is subject to significant environmental
regulation in respect of its exploration activities.
Tenements in Western Australia and South Australia
are granted subject to adherence to environmental
conditions with strict controls on clearing, including
a prohibition on the use of mechanised equipment
or development without the approval of the relevant
Government agencies, and with rehabilitation required
on completion of exploration activities. These regulations
are controlled by the Department of Mines, Industry
Regulation and Safety (Western Australia) and the
Department for Energy and Mining (South Australia).
Musgrave Minerals Limited conducts its exploration
activities in an environmentally sensitive manner and the
Group is not aware of any breach of statutory conditions
or obligations.
GREENHOUSE GAS AND ENERGY DATA REPORTING
REQUIREMENTS
The Directors have considered compliance with the
National Greenhouse and Energy Reporting Act 2007
which requires entities to report annual greenhouse gas
emissions and energy use. The Directors have assessed
that there are no current reporting requirements for
the year ended 30 June 2021. However, reporting
requirements may change in the future.
Graham Ascough BSc, PGeo, MAusIMM
(Non-Executive Chairman),
Director since 26 May 2010
Experience and expertise
Graham Ascough is a senior resources executive
with more than 30 years of industry experience
evaluating mineral projects and resources in Australia
and overseas. He has had broad industry involvement
ranging from playing a leading role in setting the
strategic direction for significant country-wide
exploration programs to working directly with mining
and exploration companies.
Mr Ascough is a geophysicist by training and was the
Managing Director of ASX listed Mithril Resources
Ltd from October 2006 until June 2012. Prior to
joining Mithril in 2006, Mr Ascough was the Australian
Manager of Nickel and PGM Exploration at the major
Canadian resources house, Falconbridge Ltd (acquired
by Xstrata Plc in 2006).
He is a Member of the Australasian Institute of Mining
and Metallurgy (“AusIMM”) and is a Professional
Geoscientist of Ontario, Canada.
Other current directorships
PNX Metals Ltd (appointed 10 December 2012)
Sunstone Metals Ltd (appointed 29 November 2013)
Black Canyon Ltd (appointed 2 September 2013)
Former directorships in last three years
Mithril Resources Ltd (9 October 2006 to 15 May 2019)
Special responsibilities
Chair of the Board
Member of the Audit Committee
Interests in shares and options
Ordinary shares – Musgrave Minerals
Limited
Unlisted options – Musgrave Minerals
Limited
1,841,172
3,000,000
PAGE 17
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 DIRECTORS’ REPORT
Mr Robert Waugh MSc, BSc, FAusIMM, MAIG
Mrs Kelly Ross BBus, CPA, ACG (CS, CGP)
(Managing Director),
Director since 6 March 2011
Experience and expertise
(Non-Executive Director),
Director since 26 May 2010
Experience and expertise
Robert Waugh has over 30 years of experience in
the resources sector and has been involved in new
mineral discoveries across multiple commodities over
his career including the Nebo-Babel nickel-copper
discoveries in the West Musgrave, uranium discoveries
in Queensland, gold at Norseman and most recently
the new gold discoveries on the Cue Project in
Western Australia.
Mr Waugh has held senior exploration management
roles in a number of companies including WMC
and BHP Billiton Exploration Ltd and has extensive
exploration and mining experience across a range of
commodities including gold, nickel, copper, uranium
and PGMs.
Mr Waugh holds a Bachelor of Science degree
majoring in geology from the University of Western
Australia and a Master of Science in Mineral
Economics from Curtin University and the Western
Australian School of Mines. Mr Waugh is a Fellow of
the AusIMM and a Member of the Australian Institute
of Geoscientists.
Other current directorships
None
Former directorships in last three years
None
Special responsibilities
Managing Director
Interests in shares and options
Ordinary shares – Musgrave Minerals
Limited 4,300,000
Unlisted options – Musgrave Minerals
Limited
4,300,000
5,500,000
Mrs Ross is a qualified accountant holding a Bachelor
of Business (Accounting) and has the designation
CPA from the Australian Society of Certified Practicing
Accountants. Mrs Ross is a Chartered Secretary
with over 30 years’ experience in accounting and
administration in the mining industry.
Mrs Ross was part of the team that floated
Independence Group NL (“IGO”). IGO listed on the
ASX in 2002 and Mrs Ross was Company Secretary
and CFO for 10 years. Mrs Ross was a Director of IGO
for 12 years from 2002 to 2014. Mrs Ross retired from
the Board of IGO on 24 December 2014.
Prior to IGO, Mrs Ross was a senior accountant at
Resolute Ltd from 1987 to 2000 during which time
Resolute became a gold producer in Ghana, Tanzania
and at several mines in Western Australia.
Mrs Ross was appointed a Director of Musgrave
Minerals Limited on 26 May 2010 and is the Chair of
the Audit Committee.
Other current directorship
None
Former directorships in last three years
Yandal Resources Ltd (6 April 2018 to 17 February
2021)
Special responsibilities
Chair of the Audit Committee
Interests in shares and options
Ordinary shares – Musgrave Minerals
Limited
Unlisted options – Musgrave Minerals
Limited
1,581,492
1,000,000
PAGE 18
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 DIRECTORS’ REPORT
Mr John Percival
(Non-Executive Director),
Director since 26 May 2010
Experience and expertise
John Percival has been involved in investment and
merchant banking for over 25 years including 15
years as Investment Manager of Barclays Bank New
Zealand Ltd. In addition, he has extensive experience
in stockbroking, corporate finance and investment
management. In 1995 Mr Percival was appointed to
the Board of Goldsearch Limited and was an Executive
Director from 2000 to 2014. In May 2014, Goldsearch
changed direction and Mr Percival resigned his
executive position.
Other current directorships
None
Former directorships in last three years
None
Special responsibilities
Member of the Audit Committee
Interests in shares and options
Ordinary shares – Musgrave Minerals
Limited
Unlisted options – Musgrave Minerals
Limited
600,000
1,800,000
Mr Brett Lambert
(Non-Executive Director),
Director since 4 February 2021
Experience and expertise
Mr Lambert is a mining engineer and experienced
company director. He has over 35 years’ involvement
in the Australian and international resources
industry encompassing mining operations, project
development, business development and corporate
administration.
Mr Lambert is a graduate of the Western Australian
School of Mines and commenced his professional
career with Western Mining Corporation (WMC) in
1983. He was a member of the senior management
team at WMC’s Mt Magnet gold operations that
initiated the transition to large scale open pit mining
and construction of the current Checker processing
plant.
Post WMC, Mr Lambert held executive roles with a
number of junior and mid-tier resource companies
where his responsibilities included overseeing
several resource projects through feasibility study,
development and commissioning.
Mr Lambert has served as a director of companies
listed on the Australian Securities Exchange, London’s
AIM market, the Toronto Stock Exchange and the Stock
Exchange of Thailand.
Other current directorships
Mincor Resources Limited NL (appointed 1 January
2017)
Australian Potash Ltd (appointed 11 May 2017)
Metal Hawk Limited (appointed 3 July 2019)
Saturn Metals Limited (appointed 9 April 2020)
Former directorships in last three years
De Grey Mining Limited (28 October 2017 to 24 July
2019)
Metals X Limited (24 October 2019 to 10 July 2020)
Special responsibilities
Member of the Audit Committee
Interests in shares and options
Ordinary shares – Musgrave Minerals
Limited
Nil
Unlisted options – Musgrave Minerals
Limited
1,000,000
PAGE 19
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 DIRECTORS’ REPORT
COMPANY SECRETARY
Ms Patricia (Trish) Farr, GradCertProfAcc,
GradDipACG, GAICD, FGIA/FCIS (CS, CGP)
Appointed 30 June 2015
Trish Farr is an experienced Chartered Secretary
with over 20 years’ experience in the exploration and
mining industry in the areas of corporate governance,
compliance and administration. Ms Farr provides
company secretarial services to several ASX listed and
unlisted companies predominately in the resources
and health sectors. Ms Farr is also a Director and the
Company Secretary of Jindalee Resources Limited.
Ms Farr is a fellow member of Chartered Secretaries
& Administrators and the Governance Institute of
Australia (formerly Chartered Secretaries Australia)
and a graduate member of the Australian Institute of
Company Directors.
MEETINGS OF DIRECTORS
The numbers of meetings of the Company’s Board of
Directors and of each Board committee held during the
year ended 30 June 2021, and the numbers of meetings
attended by each Director were:
Graham Ascough
Robert Waugh
Kelly Ross
John Percival
Brett Lambert
Board of
Directors
Audit
Committee
A
10
10
10
10
4
B
10
10
10
10
4
A
2
B
2
n/a
n/a
2
2
2
2
n/a
n/a
A = Number of meetings attended.
B = Number of meetings held during the time the
Director held office or was a member of the
committee during the year.
RETIREMENT, ELECTION AND CONTINUATION IN
OFFICE OF DIRECTORS
Mr Lambert was appointed to the Board on 4 February
2021 and by virtue of clause 9.1 of the Company’s
Constitution and ASX Listing Rule 14.4 will stand for
election at the 2021 Annual General Meeting.
Mr John Percival, being the Director retiring by rotation
who, being eligible, will offer himself for re-election at
the 2021 Annual General Meeting.
REMUNERATION REPORT (AUDITED)
The Directors present the Musgrave Minerals Limited
2021 Remuneration Report, outlining key aspects of the
Company’s remuneration policy and framework, and
remuneration awarded this year.
PAGE 20
The report contains the following sections:
a)
Key management personnel covered in this report
b) Remuneration governance and the use of
remuneration consultants
c)
Executive remuneration policy and framework
d) Relationship between remuneration and
performance
e) Non-executive director remuneration policy
f)
Voting and comments made at the Company’s 2020
Annual General Meeting
g) Details of remuneration
h)
Service agreements
i)
j)
k)
l)
Details of share-based compensation and bonuses
Equity instruments held by key management
personnel
Loans to key management personnel
Other transactions with key management
personnel.
a) Key management personnel covered in this
report
Non-Executive and Executive Directors (see
pages 17 to 19 for details about each director)
Name
Position
Graham Ascough
Non-Executive Chairman
Robert Waugh
Managing Director
Kelly Ross
Non-Executive Director
John Percival
Non-Executive Director
Brett Lambert
Non-Executive Director
b) Remuneration governance and the use of
remuneration consultants
The Company does not have a Remuneration
Committee. Remuneration matters are handled by
the full Board of the Company. In this respect the
Board is responsible for:
•
•
•
•
the over-arching executive remuneration
framework;
the operation of the incentive plans which
apply to executive directors and senior
executives (the executive team), including
key performance indicators and performance
hurdles;
remuneration levels of executives; and
non-executive director fees.
The objective of the Board is to ensure that
remuneration policies and structures are fair
and competitive and aligned with the long-term
interests of the Company.
In addition, all matters of remuneration are handled
in accordance with the Corporations Act 2001
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
DIRECTORS’ REPORT
requirements, especially with regard to related
party transactions. That is, none of the Directors
participate in any deliberations regarding their own
remuneration or related issues.
Independent external advice is sought from
remuneration consultants when required, however
no advice was sought during the year ended 30
June 2021.
c)
Executive remuneration policy and framework
In determining executive remuneration, the Board
aims to ensure that remuneration practices are:
•
•
•
•
competitive and reasonable, enabling the
Company to attract and retain key talent;
aligned to the Company’s strategic and
business objectives and the creation of
shareholder value;
transparent and easily understood; and
acceptable to shareholders.
All executives receive consulting fees or a salary,
part of which may be taken as superannuation.
Executives may also participate in both long
and short-term incentive schemes. Long-term
incentives consist of options which may be offered
to executives at the discretion of the Board and
with shareholder approval from time to time. The
Company’s Short-Term Incentive Plan is based
on key performance criteria including discovery,
resource growth, production and share price
performance and is contingent on satisfactory
work health and safety targets. The Board reviews
executive packages annually by reference to
the executive’s performance and comparable
information from industry sectors and other listed
companies in similar industries.
All remuneration paid to specified executives is
valued at the cost to the Group and expensed.
Options are valued using a Black-Scholes option
pricing model.
d) Relationship between remuneration and
performance
Emoluments of Directors are set by reference to
payments made by other companies of similar size
and industry, and by reference to the skills and
experience of Directors. Fees paid to Non-Executive
Directors are not linked to the performance of the
Group. This policy may change once the exploration
phase is complete and the Group is generating
revenue. At present the existing remuneration
policy is not impacted by the Group’s performance
including earnings and changes in shareholder
wealth (e.g. changes in share price).
The Board has not set short term performance
indicators, such as movements in the Company’s
share price, for the determination of Non-
Executive Director emoluments as the Board
believes this may encourage performance
which is not in the long-term interests of the
Company and its shareholders. The Board has
structured its remuneration arrangements in
such a way it believes is in the best interests of
building shareholder wealth. The Board believes
participation in the Company’s Employee Share
Option Plan motivates and aligns key management
and executives with the long-term interests of
shareholders.
e) Non-executive director remuneration policy
On appointment to the Board, all Non-Executive
Directors enter into a service agreement with the
Company in the form of a letter of appointment.
The letter summarises the Board policies and
terms, including remuneration relevant to the office
of Director.
The Board policy is to remunerate Non-Executive
Directors at commercial market rates for
comparable companies for their time, commitment
and responsibilities. Non-Executive Directors
receive a Board fee but do not receive fees for
chairing or participating on Board committees.
Board members are allocated superannuation
guarantee contributions as required by law, and do
not receive any other retirement benefits. From
time to time, some individuals may choose to
sacrifice their salary or consulting fees to increase
payments towards superannuation.
The maximum annual aggregate Non-Executive
Directors’ fee pool limit is $400,000 as approved
by Shareholders at the Company’s 2020 Annual
General Meeting held on 19 November 2020.
Fees for Non-Executive Directors are not linked
to the performance of the Group. Non-Executive
Directors’ remuneration may also include an
incentive portion consisting of options, subject to
approval by shareholders.
f) Voting and comments made at the Company’s
2020 Annual General Meeting
Musgrave Minerals Limited received more than
94% of “yes” votes on its remuneration report
for the 2020 financial year. The Company did not
receive any specific feedback at the Annual General
Meeting or throughout the year on its remuneration
practices.
PAGE 21
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
DIRECTORS’ REPORT
g) Details of remuneration
The following table shows details of the remuneration received by the Group’s key management personnel for the
current and previous financial year.
Short-term employment
benefits
Post-
employment
benefits
Share-
based
payments
Salary &
fees
$
Bonus
$
Non-
monetary
Benefit
$
Superannu-
ation
$
Options
$
Total
$
Options
%
Perf.
Related
%
2021
Directors
G Ascough
68,250
–
R Waugh
K Ross
J Percival
B Lambert (2)
TOTALS
2020
Directors
G Ascough
R Waugh
K Ross
J Percival
TOTALS
281,493
68,858(1)
47,250
47,250
19,082
–
–
–
463,325
68,858
65,000
275,433
45,000
45,000
430,433
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
355,350
423,600
33,283
355,350
738,984
4,489
4,489
1,813
236,900
288,639
236,900
288,639
155,700
176,595
44,074 1,340,200 1,916,457
–
–
65,000
26,166
61,110
362,709
4,275
4,275
–
–
49,275
49,275
34,716
61,110
526,259
83.9
48.1
82.1
82.1
88.2
–
16.8
–
–
–
–
–
–
–
–
–
–
–
(1) Bonus for meeting the Company’s Short Term Incentive Plan objectives in relation to share price performance
and work health and safety targets for the year ended 30 June 2020.
(2) Appointed 4 February 2021.
h) Service agreements
On appointment to the Board, all Non-Executive Directors enter into a service agreement with the Company in
the form of a letter of appointment. The letter summarises the Board policies and terms of appointment, including
compensation relevant to the office of Director. Remuneration and other terms of employment for other members
of key management personnel are formalised in service agreements as summarised below.
R Waugh, Managing Director
Mr Waugh is remunerated pursuant to an Executive Services Agreement. Under the agreement the Company
agrees to employ Mr Waugh as Managing Director of the Company with a base salary of $281,493 plus statutory
superannuation, as amended on 1 July 2020. Either party may terminate the employment contract without cause
by providing six months written notice or by making payment in lieu of notice (in the case of the Company), based
on the annual salary component. Termination payments are generally not payable on resignation or dismissal for
serious misconduct. In the instance of serious misconduct, the Company can terminate employment at any time.
i)
Details of share-based compensation and bonuses
Options
Options over ordinary shares in Musgrave Minerals Limited are granted under the Employee Share Option Plan
(“ESOP”). Participation in the ESOP and any vesting criteria are at the Board’s discretion and no individual has
a contractual right to participate in the scheme or to receive any guaranteed benefits. Any options issued to
Directors of the Company are subject to shareholder approval. The 5,000,000 options issued to Mr Ascough, Mr
Waugh, Ms Ross and Mr Percival (Option Series V) were approved by shareholders at the 20 August 2020 General
Meeting. The 1,000,000 options issued to Mr Lambert (Option Series X) were approved by shareholders at the 24
June 2021 General Meeting.
PAGE 22
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
DIRECTORS’ REPORT
The terms and conditions of each grant of options during the period affecting the remuneration of key
management personnel in the current or future reporting periods are set out below. All options vested
immediately.
Option series
Grant date
Vesting and
exercise date
Expiry date
Exercise price
V
X
20 Aug 2020
20 Aug 2020
20 Aug 2023
24 Jun 2021
29 Jun 2021
24 Jun 2024
$0.932
$0.560
Value per
option at
grant date
$0.2369
$0.1557
% Vested
100%
100%
The fair value of options at grant date are determined using a Black-Scholes option pricing model that takes into
account the exercise price, the term of the option, the share price at grant date and expected price volatility of the
underlying share, the expected dividend yield and the risk-free interest rate for the term of the option.
Further information on the fair value of share options and assumptions is set out in Note 23 to the financial
statements.
Short-term incentive plan
The Company has a Short-Term Incentive Plan (“STIP”) comprising four elements namely, a Discovery Bonus, a
Production Bonus, a Share Price Performance Bonus and a Resources Growth Bonus. A bonus payment under
the STIP may be up to 25% of base salary subject to meeting the relevant criteria, a minimum standard of
performance and meeting the Company’s work place health and safety targets. Eligibility, timing and the amount
of any payment is at the absolute discretion of the Board. Only one bonus is payable in any twelve month period.
Discovery Bonus: A discovery being defined as two drill holes spaced a minimum of 75m apart with ore-grade
mineralisation over potentially mineable widths with a deposit showing the likelihood to host more than 100koz
Au. This must be a new discovery and have the potential to make a material impact for the Company. The Board
has absolute discretion as to what constitutes a discovery.
Production Bonus: Production being defined as the commencement of production from the Company’s
tenement/s and the receipt of payment from the sale of first product. The Board has absolute discretion as to
what constitutes production.
Share Price Performance Bonus: Defined as at least a 100% increase in the Company’s share price based on
the 12 month volume weighted share price (“VWAP”) as at 30 June as compared to the 12 month VWAP of the
previous 30 June.
Resource Growth Bonus: Defined as increasing the existing gold ounces in JORC compliant Mineral Resources at
the Cue Project to over 1M oz (combined Indicated & Inferred) at a minimum grade cut-off of 0.5g/t Au.
During the year ended 30 June 2021, Robert Waugh was eligible for the STIP and a Share Price Performance
Bonus of $68,858 was paid.
j)
Equity instruments held by key management personnel
The following tables detail the number of fully paid ordinary shares and options over ordinary shares in the
Company that were held during the financial year by key management personnel of the Group, including their
close family members and entities related to them.
PAGE 23
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
DIRECTORS’ REPORT
Options
2021
Directors
Opening
balance at
1 July
Granted as
remun-
eration
Options
exercised
Net change
(other)
Balance at
30 June
Vested and
exercisable
Vested
during the
year
–
–
–
–
–
–
G Ascough
2,250,000
1,500,000
(750,000)
8,300,000
1,500,000
(4,300,000)
1,500,000
1,000,000
(1,500,000)
R Waugh
K Ross
J Percival
–
–
–
3,000,000
3,000,000
5,500,000
5,500,000
1,000,000
1,000,000
1,500,000
1,000,000
(500,000)
(200,000)(1)
1,800,000
1,800,000
B Lambert (2)
–
1,000,000
–
–
1,000,000
1,000,000
TOTAL
13,550,000
6,000,000
(7,050,000)
(200,000) 12,300,000
12,300,000
(1) Of the 1,000,000 options approved at the 20 August 2020 General Meeting, 200,000 were issued to Mr
Percival’s adult child.
(2) Appointed 4 February 2021.
During the year, 7,050,000 ordinary shares in the Company were provided to key management personnel as a
result of the exercise of remuneration options.
Shareholdings
2021
Directors
G Ascough
R Waugh
K Ross
J Percival
TOTAL
Opening
balance at
1 July
1,091,172
1,717,172
181,492
894,559
3,884,395
Granted as
remunera-
tion
–
–
–
–
–
k)
Loans to key management personnel
Options
exercised
750,000
4,300,000
1,500,000
500,000
7,050,000
Net change
(other)
–
(1,717,172)
(100,000)
(794,559)
(2,611,731)
Balance at
30 June
1,841,172
4,300,000
1,581,492
600,000
8,322,664
There were no loans to individuals or any key management personnel during the financial year or the previous
financial year.
l) Other transactions with key management personnel
There were no other transactions with key management personnel during the financial year or the previous
financial year.
END OF REMUNERATION REPORT (AUDITED)
PAGE 24
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
DIRECTORS’ REPORT
SHARES UNDER OPTION
Unissued ordinary shares of the Company under option at the date of this report are as follows:
Date options issued
Expiry date
Issue price of shares
Number under option
21 November 2018
30 November 2018
21 November 2019
20 August 2020
28 August 2020
29 June 2021
31 August 2021
16 November 2021
16 November 2021
21 November 2022
20 August 2023
20 August 2023
24 June 2024
24 August 2024
$0.1275
$0.1275
$0.1045
$0.932
$0.932
$0.56
$0.47
3,500,000
450,000
3,450,000
5,900,000
780,000
1,000,000
500,000
TOTAL:
15,580,000
No option holder has any right under the options to participate in any other share issue of the Company or any other
entity.
SHARES ISSUED ON THE EXERCISE OF OPTIONS
During the year the Company issued a total of 14,250,000 ordinary shares upon the exercise of options having various
expiry dates and exercise prices.
CORPORATE GOVERNANCE STATEMENT
The Company’s 2021 Corporate Governance Statement has been released as a separate document and is located on
the Company’s website at http://www.musgraveminerals.com.au/corporate-governance.
PROCEEDINGS ON BEHALF OF THE GROUP
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of the Company, or to intervene in any proceedings to which the Company is a party, for the purpose of taking
responsibility on behalf of the Company for all or part of those proceedings.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
During the financial year, the Company paid a premium to insure the Directors and Officers of the consolidated entity
against any liability incurred as a Director or Officer to the extent permitted by the Corporations Act 2001. The contract
of insurance prohibits the disclosure of the nature of the liabilities covered or the amount of the premium paid.
The Group has not entered into any agreement with its current auditors indemnifying them against claims by a third
party arising from their position as auditor.
NON-AUDIT SERVICES
The Company may decide to employ the auditor on assignments additional to their statutory audit duties where the
auditor’s expertise and experience with the Company and/or the Group are important.
Details of the amounts paid or payable to the auditors BDO Audit (WA) Pty Ltd for audit and non-audit services provided
during the year are set out in Note 18. During the year ended 30 June 2021 no fees were paid or were payable for non-
audit services provided by the auditors of the consolidated entity (2020: $Nil).
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the Auditor’s Independence Declaration as required under section 307C of the Corporations Act 2001 is set
out on the following page.
Signed in accordance with a resolution of the Directors.
Graham Ascough
Chairman
Perth, 21 September 2021
PAGE 25
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 AUDITOR’S INDEPENDENCE DECLARATION
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
38 Station Street
Australia
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY GLYN O'BRIEN TO THE DIRECTORS OF MUSGRAVE MINERALS
LTD
DECLARATION OF INDEPENDENCE BY GLYN O'BRIEN TO THE DIRECTORS OF MUSGRAVE MINERALS
LTD
As lead auditor of Musgrave Minerals Ltd for the year ended 30 June 2021, I declare that, to the
best of my knowledge and belief, there have been:
As lead auditor of Musgrave Minerals Ltd for the year ended 30 June 2021, I declare that, to the
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
best of my knowledge and belief, there have been:
relation to the audit; and
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
2. No contraventions of any applicable code of professional conduct in relation to the audit.
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Musgrave Minerals Ltd and the entity it controlled during the
period.
This declaration is in respect of Musgrave Minerals Ltd and the entity it controlled during the
period.
Glyn O'Brien
Director
Glyn O'Brien
Director
BDO Audit (WA) Pty Ltd
Perth, 21 September 2021
BDO Audit (WA) Pty Ltd
Perth, 21 September 2021
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275,
an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and
form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275,
an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and
form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation.
PAGE 26
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2021
Revenue from continuing operations
Other income
Employee benefits expense
Depreciation expense
Impairment expense
Finance costs
Other expenses
Change in fair value of derivative financial instruments
Profit / (loss) from continuing operations before income tax
Income tax benefit
Profit / (loss) after income tax for the year attributable to the
owners of Musgrave Minerals Limited
Other comprehensive income / (loss)
Items that will not be reclassified to profit or loss
Notes
3(a)
3(a)
3(b)
10
3(c)
9(a)
5
2021
$
63,010
274,226
(2,594,400)
(132,783)
–
(22,570)
2020
$
52,911
320,674
(411,248)
(118,465)
(3,434)
(30,378)
(468,780)
(205,891)
–
1,388,000
(2,881,297)
992,169
–
–
(2,881,297)
992,169
Change in fair value of financial assets at fair value through OCI
9(b)
(369,125)
Other comprehensive income / (loss) for the year (net of tax)
(369,125)
561,352
561,352
Total comprehensive profit / (loss) for the year attributable to
the owners of Musgrave Minerals Limited
Profit / (loss) per share attributable to the owners of Musgrave
Minerals Limited
(3,250,422)
1,553,521
Cents per share
Cents per share
Basic profit / (loss) per share
Diluted profit / (loss) per share
17
17
(0.57)
(0.57)
0.24
0.23
The Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the
accompanying notes.
PAGE 27
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2021
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Total Current Assets
Non-Current Assets
Financial assets
Property, plant and equipment
Right of use assets
Exploration and evaluation
Total Non-Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and other payables
Provisions
Lease liabilities
Total Current Liabilities
Non-Current Liabilities
Lease liabilities
Total Non-Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
Notes
2021
$
2020
$
6
7
8
20,910,936
9,122,692
322,014
12,951
273,652
10,475
21,245,901
9,406,819
9(b)
1,577,188
1,946,313
373,969
103,393
56,031
266,745
10
26,009,600
18,966,123
28,064,150
21,235,212
49,310,051
30,642,031
11
12
13
13
14
15
16
971,325
202,590
75,124
1,116,981
135,580
94,782
1,249,039
1,347,343
38,813
38,813
185,880
185,880
1,287,852
1,533,223
48,022,199
29,108,808
72,739,946
52,004,639
2,581,338
1,570,637
(27,299,085)
(24,466,468)
48,022,199
29,108,808
The Statement of Financial Position should be read in conjunction with the accompanying notes.
PAGE 28
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2021
ATTRIBUTABLE TO EQUITY HOLDERS OF THE ENTITY
Financial
Asset Reserve
$
Accumulated
Losses
$
Options
Reserve
$
Issued
Capital
$
Total
Equity
$
At 1 July 2019
44,592,770
996,288
132,364
(25,628,978)
20,092,444
Total comprehensive profit for the
year
Other comprehensive income
Total comprehensive profit for
the year (net of tax)
Transactions with owners in
their capacity as owners:
–
–
–
Issue of shares
7,723,232
Transaction costs of issuing shares
(396,461)
–
–
–
–
–
Issue of options (Note 23)
Transfer from share option
reserve:
–
136,072
– Due to exercise of options
85,098
(85,098)
– Due to expiry / lapse of options
–
(170,341)
–
992,169
992,169
561,352
–
561,352
561,352
992,169
1,553,521
–
–
–
–
–
–
–
–
–
170,341
7,723,232
(396,461)
136,072
–
–
At 30 June 2020
52,004,639
876,921
693,716
(24,466,468)
29,108,808
At 1 July 2020
52,004,639
876,921
693,716
(24,466,468)
29,108,808
Total comprehensive loss for the
year
Other comprehensive loss
Total comprehensive loss for the
year (net of tax)
Transactions with owners in
their capacity as owners:
–
–
–
Issue of shares
21,175,422
Transaction costs of issuing shares
(1,046,951)
–
–
–
–
–
Issue of options (Note 23)
Transfer from share option
reserve:
–
2,035,342
– Due to exercise of options
606,836
(606,836)
– Due to expiry / lapse of options
–
(48,680)
–
(2,881,297)
(2,881,297)
(369,125)
–
(369,125)
(369,125)
(2,881,297)
(3,250,422)
–
–
–
–
–
–
–
–
–
48,680
21,175,422
(1,046,951)
2,035,342
–
–
At 30 June 2021
72,739,946
2,256,747
324,591
(27,299,085)
48,022,199
The Statement of Changes in Equity should be read in conjunction with the accompanying notes.
PAGE 29
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Joint venture management fees
3(a)
254,941
191,632
Payments to suppliers and employees
(1,220,333)
(644,868)
Notes
2021
$
2020
$
Interest received
Interest paid
Government grants received
Net advances from joint venture partner
60,533
(22,570)
79,500
(57,925)
63,647
(30,378)
50,000
165,535
NET CASH FLOWS USED IN OPERATING ACTIVITIES
24
(905,854)
(204,432)
CASH FLOWS USED IN INVESTING ACTIVITIES
Payments for property, plant and equipment
Payments for tenements
Payments for exploration activities
Payments to acquire investments
Proceeds from disposal of investments
(357,568)
(100,000)
(7,689)
-
(6,887,065)
(2,097,362)
-
-
(400,000)
1,039,614
NET CASH FLOWS USED IN INVESTING ACTIVITIES
(7,344,633)
(1,465,437)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Proceeds from exercise of options
Share issue costs
Lease principal repayments
14(b)
19,523,039
7,500,000
1,652,383
223,232
14(b)
(1,046,951)
(396,461)
(89,740)
(77,942)
NET CASH FLOWS FROM FINANCING ACTIVITIES
20,038,731
7,248,829
Net increase in cash and cash equivalents
11,788,244
5,578,960
Cash and cash equivalents at beginning of the year
9,122,692
3,543,732
CASH AND CASH EQUIVALENTS AT END OF THE YEAR
6
20,910,936
9,122,692
The Statement of Cash Flows should be read in conjunction with the accompanying notes.
PAGE 30
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 1
CORPORATE INFORMATION
The financial report of Musgrave Minerals Limited for the year ended 30 June 2021 was authorised for issue in
accordance with a resolution of the Directors on 21 September 2021.
Musgrave Minerals Limited is a for profit company incorporated in Australia and limited by shares which are
publicly traded on the Australian Securities Exchange. The nature of the operation and principal activities of the
consolidated entity are described in the attached Directors’ Report.
The principal accounting policies adopted in the preparation of these financial statements are set out below
and have been applied consistently to all periods presented in the financial statements and by all entities in the
consolidated entity.
2
STATEMENT OF COMPLIANCE
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards, other authoritative pronouncements of the Australian Accounting Standards Board, Urgent Issues
Group Interpretations and the Corporations Act 2001.
Compliance with IFRS
The financial statements of Musgrave Minerals Limited also comply with International Financial Reporting
Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).
New and amended accounting standards and interpretations adopted by the Group
No new standards or interpretations relevant to the operations of the Group have come into effect for the
reporting period.
New accounting standards and interpretations
There are no new or amended accounting standards and interpretations relevant to the operations of the Group
that come into effect in subsequent reporting periods at this time.
a) Basis of measurement
Historical cost convention
These financial statements have been prepared under the historical cost convention, except where stated.
Critical accounting estimates
The preparation of financial statements requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of applying the Group’s accounting policies.
The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates
are significant to the financial statements, are disclosed where appropriate.
b) Going concern
These financial statements have been prepared on the going concern basis, which contemplates continuity
of normal business activities and the realisation of assets and the settlement of liabilities in the ordinary
course of business.
c)
Principles of consolidation
Subsidiaries
The financial statements incorporate the assets and liabilities of the Company’s subsidiary at 30 June 2021
and the results of its subsidiary for the year then ended. The Company and its subsidiary together are
referred to in this financial report as the Group or the Consolidated Entity.
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group
controls an entity when the Group is exposed to, or has rights to, variable returns from its investment with
the entity and has the ability to affect those returns through its power to direct the activities of the entity.
The acquisition method of accounting is used to account for business combinations by the Group.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de
consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are
eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment
of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure
consistency with the policies adopted by the Group.
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
PAGE 31
PAGE 31
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
2
STATEMENT OF COMPLIANCE (continued)
c)
Principles of consolidation continued
Non-controlling interests in the results and equity of subsidiaries are shown separately in the Statement
of Profit or Loss and Other Comprehensive Income, Statement of Financial Position and the Statement of
Changes in Equity respectively.
d) Critical accounting judgements and key sources of estimation uncertainty
The application of accounting policies requires the use of judgments, estimates and assumptions about
carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and
associated assumptions are based on historical experience and other factors that are considered to be
relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are recognised in
the period in which the estimate is revised if it affects only that period, or in the period of the revision and
future periods if the revision affects both current and future periods.
e)
Functional and presentation currency
The financial statements are presented in Australian dollars, which is the Group’s functional and presentation
currency.
f)
Leases
Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Group
as lessee are classified as operating leases. Payments made under operating leases (net of any incentives
received from the lessor) are charged to profit or loss as incurred over the period of the lease.
Leases in which a significant portion of the risks and rewards of ownership are transferred to the Group
as lessee are classified as finance leases. At the commencement date of a lease, the Group recognises
a liability to make lease payments (i.e. the lease liability) and an asset representing the right to use the
underlying asset during the lease term (i.e. the right-of-use asset). The Group separately recognises the
interest expense on the lease liability and the depreciation expense on the right-of-use asset.
g) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST
incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of
acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of
GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in
the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing
or financing activities which are recoverable from, or payable to the taxation authority, are presented as
operating cash flows.
3
REVENUE AND EXPENSES
a) Revenue and other income
Revenue from continuing operations
Interest revenue
Other Income
Joint venture management fees
Government grants
Other income
Total other income
Total revenue and other income
PAGE 32
2021
$
2020
$
63,010
52,911
254,941
12,000
7,285
274,226
337,236
191,632
117,500
11,542
320,674
373,585
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
3
REVENUE AND EXPENSES (continued)
a) Revenue and other income (continued)
Revenue is recognised at an amount that reflects the consideration to which the Group expects to be
entitled to in exchange for transferring services to a customer. Revenue and expenses are recognised on an
accrual’s basis.
Interest income is recognised on a time proportion basis using the effective interest method.
b) Employee benefits expense
2021
$
Wages, salaries, directors’ fees and other remuneration expenses
1,802,269
Superannuation contributions
Transfer to / (from) annual leave provision
Transfer to / (from) long service leave provision
Share-based payments expense (Note 23)
170,125
43,150
23,860
2,035,342
2020
$
1,204,600
102,640
(2,350)
20,970
136,072
Transfer to capitalised exploration expenditure
(1,480,346)
(1,050,684)
Total employee benefits expense
2,594,400
411,248
c) Other expenses
Secretarial, professional and consultancy costs
Occupancy costs
Share register maintenance
ASX / ASIC
Promotion, advertising and sponsorship
Employer related on-costs
Other expenses
Transfer to capitalised exploration expenditure
Total other expenses
2021
$
143,837
3,042
52,822
89,866
168,846
73,888
231,245
(294,766)
468,780
2020
$
109,655
4,980
15,079
61,249
88,749
15,487
123,423
(212,731)
205,891
4
SEGMENT INFORMATION
The Group operates in one geographical segment, being Australia and in one operating category, being mineral
exploration. Therefore, information reported to the chief operating decision maker (the Board of Musgrave
Minerals Limited) for the purposes of resource allocation and performance assessment is focused on mineral
exploration within Australia. The Board has considered the requirements of AASB 8: Operating Segments and
the internal reports that are reviewed by the chief operation decision maker in allocating resources and have
concluded at this time that there are no separately identifiable segments.
PAGE 33
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
5
INCOME TAX
2021
$
2020
$
Statement of Profit or Loss and Other Comprehensive Income
Current income tax:
- Current income tax benefit at a rate of 26% (2020: 27.5%)
–
–
Deferred income tax:
- Relating to origination and reversal of temporary differences
(1,628,100)
(1,070,889)
- Deferred tax liability offset by deferred tax asset losses
- Temporary difference not recognised in the current period
2,215,081
(586,981)
768,825
302,064
Income tax expense / (benefit) reported in the
Statement of Profit or Loss and Other Comprehensive Income
–
–
A reconciliation of income tax expense / (benefit) applicable to
accounting profit / (loss) before income tax at the statutory income tax
rate to income tax expense / (benefit) at the Company’s effective income
tax is as follows:
Accounting profit / (loss) from continuing operations before income tax
(2,881,297)
At the statutory income tax rate of 26% (2020: 27.5%)
(749,137)
Add:
- Immediate write-off of capital expenditure
- Expenditures not allowable / income assessable
- Other deductible items
- Tax losses not recognised due to not meeting recognition criteria
(1,831,304)
588,731
(223,372)
2,215,082
–
992,169
272,846
(823,009)
414,809
(633,471)
768,825
–
The income tax expense or benefit for the period is the tax payable on the current period’s taxable income
based on the applicable income tax rate, adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the
end of the reporting period. Management periodically evaluates positions taken in tax returns with respect to
situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate
on the basis of amounts expected to be paid to the tax authorities.
PAGE 34
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
5
INCOME TAX (continued)
2021
$
2020
$
Deferred income tax
Recognised on the Statement of Financial Position, deferred income tax
at the end of the reporting period relates to the following: (26%, 2020:
27.5%)
Deferred income tax liabilities:
- Capitalised expenditure deductible for tax purposes
6,446,745
4,851,925
- Trade and other receivables
- Financial assets at fair value through other comprehensive income
Deferred income tax assets:
- Trade and other payables
- Employee benefits
- Capital raising costs
- Net lease liability
14,932
222,400
11,949
336,740
6,684,077
5,200,614
(5,070)
(52,673)
(309,513)
(2,741)
(21,883)
(37,284)
(181,295)
(3,828)
- Tax losses available to offset deferred tax liability
(6,314,080)
(4,956,324)
-Net deferred tax asset / (liability)
–
–
The Company and its 100% owned controlled entity have formed a tax consolidated group. The head entity of the
tax consolidated group is Musgrave Minerals Limited. The tax consolidated group has potential revenue tax losses
of $42,096,419 (2020: $33,576,879).
Musgrave Minerals Limited is considered a base rate entity for income tax purposes and is therefore subject to
income tax at a rate of 26% (2020: 27.5%).
The deductible temporary differences and tax losses do not expire under current tax legislation. Deferred tax
assets have not been recognised in respect of these items because it is not probable that future taxable profit will
be available against which the Group can utilise benefits.
The utilisation of tax losses is dependent on the Group satisfying the continuity of ownership test or the same
business test at the time the tax losses are applied against taxable income.
6
CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short-term deposits
2021
$
2,334,611
18,576,325
20,910,936
2020
$
1,896,367
7,226,325
9,122,692
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, and other short-
term, highly liquid investments with maturities of three months or less.
The weighted average interest rate for the year was 0.38% (2020: 1.21%).
The Group’s exposure to interest rate risk is set out in Note 22. The maximum exposure to credit risk at the end of
the reporting period is the carrying amount of each class of cash and cash equivalents mentioned above.
PAGE 35
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
7
TRADE AND OTHER RECEIVABLES
Current
GST receivable
Other
2021
$
277,534
44,480
322,014
2020
$
174,722
98,930
273,652
Trade and other receivables are generally due for settlement within 30 days. They are presented as current assets
unless collection is not expected for more than 12 months after the reporting date.
Trade and other receivables are recognised at amortised cost using the effective interest rate method, less any
allowance for expected credit losses.
The Group assesses at each balance date whether there is objective evidence that a financial asset or group of
financial assets is impaired. For trade and other receivables, the Group applies the simplified approach permitted
by AASB 9: Financial Instruments to determine any allowances for expected credit losses, which requires
expected lifetime losses to be recognised from initial recognition of the receivables. The expected credit losses
on these financial assets are estimated using a provision matrix based on the Group’s historical credit loss
experience. The amounts held in trade and other receivables do not contain impaired assets and are not past due.
Based on the credit history of these trade and other receivables, it is expected that the amounts will be received
when due.
The Group’s financial risk management objectives and policies are set out in Note 22.
Due to the short-term nature of these receivables their carrying value is assumed to approximate their fair value.
8 OTHER CURRENT ASSETS
Accrued interest
9
FINANCIAL ASSETS
a) Derivative financial instruments
Current
Opening balance
Change in fair value
Disposal
Closing balance
b)
Financial assets at fair value through other comprehensive income
Non-Current
Opening balance
Acquisition
Change in fair value
Disposal
Closing balance
PAGE 36
2021
$
12,951
12,951
2020
$
10,475
10,475
2021
$
2020
$
–
–
–
–
2021
$
1,946,313
–
(369,125)
–
1,577,188
131,000
1,388,000
(1,519,000)
–
2020
$
505,575
1,919,000
561,352
(1,039,614)
1,946,313
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
9
FINANCIAL ASSETS (continued)
b)
Financial assets at fair value through other comprehensive income (continued)
In February 2017, the Company entered into a Tenement Sale Agreement with Legend Mining Limited
(ASX:LEG) (“Legend”) in respect of the Group’s non-core tenements (E28/2404 and E28/2405) in the Fraser
Range area of Western Australia. Under the terms of the Agreement, the Company transferred 100% of
its interests in the two tenements to Legend and as consideration received 10,000,000 fully paid ordinary
shares in Legend and 10,000,000 unlisted options exercisable at $0.04 exercisable by 30 March 2021.
In April 2020, the Company sold 7,500,000 of the shares it held in Legend and exercised all of the 10,000,000
unlisted options in Legend at $0.04 per share. The Company retains 12,500,000 Legend shares acquired due
to the transaction.
In February 2019, Musgrave entered into an agreement with Cyprium Metals Limited (ASX:CYM)
(“Cyprium”) regarding an option to earn-in and joint venture on the non-gold rights over the northern Cue
tenure including the Hollandaire copper deposit. As part of the farm-out the Company received 1,308,750
shares in Cyprium which the Company still holds.
Financial assets are recognised and derecognised on settlement date where the purchase or sale of an
investment is under a contract whose terms require delivery of the investment within the timeframe
established by the market concerned. They are initially measured at fair value, net of transaction costs,
except for those financial assets classified as fair value through profit or loss, which are initially measured
at fair value. Transaction costs of financial assets carried at fair value through profit or loss are expensed in
profit or loss.
The Group classifies its financial assets as either financial assets at fair value though profit or loss (“FVPL”),
fair value though other comprehensive income (“FVOCI”) or at amortised cost. The classification depends on
the entity’s business model for managing the financial assets and the contractual terms of the cash flows.
For investments in equity instruments, the classification depends on whether the Group has made an
irrevocable election at the time of initial recognition to account for the equity investment at FVPL or FVOCI.
Financial assets at FVPL
For assets measured at FVPL, gains and losses will be recorded in profit or loss. The Group’s derivative
financial instruments are recognised at FVPL. Assets in this category are subsequently measured at fair
value. The fair values of financial assets in this category are determined by reference to active market
transactions or using a valuation technique where no active market exists. Refer to Note 22 for additional
details.
Financial assets at FVOCI
For assets measured at FVOCI, gains and losses will be recorded in other comprehensive income. There is
no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of
the investment. Dividends from such investments continue to be recognised in profit or loss as other income
when the Group’s right to receive payments is established. Impairment losses (and reversal of impairment
losses) on equity investments measured at FVOCI are not reported separately from other changes in fair
value. The Group has elected to measure its listed equities at FVOCI.
Assets in this category are subsequently measured at fair value. The fair values of quoted investments are
based on current bid prices in an active market. Refer to Note 22 for additional details.
10 EXPLORATION AND EVALUATION
Opening balance
Exploration expenditure incurred during the year
Impairment expense
Closing balance
2021
$
18,966,123
7,043,477
-
2020
$
15,976,794
2,992,763
(3,434)
26,009,600
18,966,123
Exploration and evaluation expenditure, including the costs of acquiring licences and permits, are capitalised as
exploration and evaluation assets on an area of interest basis. Costs incurred before the Company has obtained
the legal rights to explore an area are recognised in the Statement of Profit or Loss and Other Comprehensive
Income.
PAGE 37
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
10 EXPLORATION AND EVALUATION (continued)
Exploration and evaluation assets are only recognised if the rights to the area of interest are current and either:
a)
b)
the expenditures are expected to be recouped through successful development and exploitation or from sale
of the area of interest; or
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 assessed for impairment if sufficient data exists to determine technical
feasibility and commercial viability, and facts and circumstances suggest that the carrying amount exceeds the
recoverable amount. For the purposes of impairment testing, exploration and evaluation assets are allocated to
cash-generating units to which the exploration activity relates. The cash generating unit shall not be larger than the
area of interest.
Once the technical feasibility and commercial viability of the extraction of minerals in an area of interest are
demonstrable, exploration and evaluation assets attributable to that area of interest are first tested for impairment
and then reclassified to mineral property and development assets within property, plant and equipment.
When an area of interest is abandoned or the Directors decide that it is not commercial, any accumulated costs in
respect of that area are written off in the financial period the decision is made.
Significant estimate and judgement
There is some subjectivity involved in the carry forward of capitalised exploration and evaluation expenditure or,
where appropriate, the write off to the Statement of Profit or Loss and Other Comprehensive Income, however
management give due consideration to areas of interest on a regular basis and are confident that decisions to
either write off or carry forward such expenditure fairly reflect the prevailing situation.
11 TRADE AND OTHER PAYABLES
Trade creditors and accruals
Amounts due to joint venture partner
2021
$
920,547
50,778
971,325
2020
$
965,975
151,006
1,116,981
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial
year and which are unpaid. Trade creditors are unsecured, non-interest bearing and are normally settled on 30-day
terms. The Group’s financial risk management objectives and policies are set out in Note 22. Due to the short-term
nature of these payables their carrying value is assumed to approximate their fair value.
12 PROVISIONS
Short-term
Annual leave
Long service leave
Short–term obligations
2021
$
77,040
125,550
202,590
2020
$
33,890
101,690
135,580
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled
within 12 months, are recognised in respect of employees’ services up to the end of the reporting period and
are measured at the amounts expected to be paid when the liabilities are settled. The liability for annual leave is
recognised in the provision for employee benefits. All other short-term employee benefit obligations are presented
as payables.
The obligations are presented as current liabilities in the Statement of Financial Position of the Group.
PAGE 38
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
12 PROVISIONS (continued)
Long-term obligations
The liability for long service leave and annual leave which is not expected to be settled within 12 months after
the end of the period in which the employees render the related service is recognised as a non-current provision
for employee benefits and measured as the present value of expected future payments to be made in respect of
services provided by employees up to the end of the reporting period.
13 LEASE LIABILITIES
Current
Lease liabilities
Non-current
Lease liabilities
2021
$
75,124
75,124
38,813
38,813
113,937
2020
$
94,782
94,782
185,880
185,880
280,662
The Company leases its corporate office and IT equipment. During the year the Company purchased the core yard
in Cue that it had been leasing and the lease liability at 30 June 2021 has reduced accordingly. The Company has
elected not to recognize a lease liability for ‘low-value’ and short-term leases.
Future minimum lease payments as at 30 June 2021 were as follows:
Within one year
$
One to two years
$
Two to five years
$
Total
$
30 June 2021
Lease payments
Finance charges
Net present values
30 June 2020
Lease payments
Finance charges
Net present values
83,166
(8,042)
75,124
118,615
(23,833)
94,782
39,910
(1,097)
38,813
121,363
(13,778)
107,585
-
-
-
81,727
(3,432)
78,295
123,076
(9,139)
113,937
321,705
(41,043)
280,662
PAGE 39
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
14 CONTRIBUTED EQUITY
a) Share capital
Ordinary shares fully paid
b) Movements in ordinary shares on issue
Balance at 30 June 2019
Placement – 9 October 2019
Placement – 4 May 2020
Options exercised - various
Share issue costs
Balance at 30 June 2020
Placement – 18 December 2020
Share purchase plan – 20 January 2021
Options exercised - various
Share issue costs
Balance at 30 June 2021
2021
$
2020
$
72,739,946
52,004,639
Number
$
386,782,066
44,592,770
18,587,361
57,142,858
2,230,000
–
464,742,285
44,444,445
9,786,219
14,250,000
1,500,000
6,000,000
308,330
(396,461)
52,004,639
16,000,000
3,523,039
2,259,219
–
(1,046,951)
533,222,949
72,739,946
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. Ordinary shares have the right to
receive dividends as declared, and in the event of winding up the Company, to participate in the proceeds
from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held.
Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
c) Movements in options on issue
Opening balance
Options granted
Options exercised
Options expired / lapsed
2021
Number
21,650,000
8,880,000
(14,250,000)
(200,000)
2020
Number
19,800,000
6,680,000
(2,230,000)
(2,600,000)
Balance at the end of the financial year
16,080,000
21,650,000
PAGE 40
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
15 RESERVES
$
Share option reserve
Opening balance
Issue of director and employee options (Note 23)
Exercise of director and employee options
Expiry / lapse of options (Note 16)
Balance at the end of the financial year
2021
$
876,921
2,035,342
(606,836)
(48,680)
2,256,747
2020
$
996,288
136,072
(85,098)
(170,341)
876,921
The option reserve is used to recognise the fair value of options issued to Directors, employees and contractors.
Financial asset reserve
Opening balance
Financial assets at fair value through other comprehensive income (Note
9(b))
Balance at the end of the financial year
Total Reserves
2021
$
2020
$
693,716
132,364
(369,125)
324,591
2,581,338
561,352
693,716
1,570,637
The financial asset reserve is used to recognise the fair value movement on financial assets at fair value through
other comprehensive income.
The financial asset reserve is used to recognise the fair value movement on financial assets at fair value through
other comprehensive income.
16 ACCUMULATED LOSSES
Opening balance
Net profit / (loss) attributable to members
Transfer from share option reserve
Balance at the end of the financial year
17 EARNINGS PER SHARE
Basic profit / (loss) loss per share
Diluted profit / (loss) loss per share
2021
$
2020
$
(24,466,468)
(25,628,978)
(2,881,297)
48,680
992,169
170,341
(27,299,085)
(24,466,468)
2021
Cents
(0.57)
(0.57)
2020
Cents
0.24
0.23
The following reflects the profit/(loss) and share data used in the calculations of basic and diluted loss per share:
Profit / (loss) used in calculating basic and diluted earnings per share
(2,881,297)
992,169
2021
$
2020
$
Weighted average number of ordinary shares used in calculating basic
and diluted profit / (loss) per share
Weighted average number of ordinary shares used in calculating basic
and diluted profit / (loss) per share
2021
Number
2020
Number
504,196,131
409,344,645
504,196,131
430,994,645
PAGE 41
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
17 EARNINGS PER SHARE (continued)
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the Group, excluding
any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year and
excluding treasury shares.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into
account the “after income” tax effect of interest and other financing costs associated with dilutive potential
ordinary shares and the weighted average number of additional ordinary shares that would have been outstanding
assuming the conversion of all dilutive potential ordinary shares.
18 AUDITOR’S REMUNERATION
Audit services
BDO Audit (WA) Pty Ltd
- Audit and review of the financial reports
Total remuneration
19 CONTINGENT ASSETS AND LIABILITIES
Contingent liabilities
The Group had contingent liabilities in respect of:
Future royalty payments
2021
$
30,000
30,000
2020
$
30,000
30,000
Musgrave holds a 100% interest in the key tenure hosting gold resources at Cue including the Break of Day/
Starlight and Lena deposits and other prospects. Some of the Cue tenements are subject to third party royalty
payments on future gold production including the mining licence hosting the Break of Day/Starlight and Lena gold
deposits.
Future consideration and royalty payments
In March 2019, the Company entered into an Option Agreement (“Agreement”) to acquire the non-alluvial
gold rights to the Mainland Project which is located within the boundaries of the Company’s Cue Gold Project.
Musgrave paid $125,000 to execute the option to acquire 100% interest in the tenements (excluding the vendors’
interest in alluvial gold). A further $100,000 was paid in August 2020 and an additional $300,000 is to be paid as
milestone payments in Musgrave shares or cash (at the Company’s discretion) before the fourth anniversary of the
Agreement. The vendor will be entitled to a 1% gross royalty on any non-alluvial gold produced by the Company
from the tenements.
Contingent assets
The Group had contingent assets in respect of:
Future royalty payments
In January 2014, the Group entered into a Mining Farm-in and Joint Venture Agreement (“Agreement”) with
Menninnie Metals Pty Ltd. In August 2015, the parties agreed to terminate the Agreement (“Termination
Agreement”). As part of the Termination Agreement the Group retains a 1% Net Smelter Return Royalty on all
ores, concentrates or other primary, intermediate or final product of any minerals produced from two of the
tenements.
Deferred consideration
Cyprium Australia Pty Ltd (“Cyprium”) has earned an 80% interest in the non-gold rights over the northern
tenements (“Tenements”) of the Company’s Cue Project. Musgrave retains 20% of the non-gold rights and is free
carried to the completion of a definitive feasibility study and retains 100% of the rights to gold dominant deposits.
Should Cyprium delineate 80,000 tonnes of contained copper over the Tenements, $200,000 in cash or the
equivalent value of Cyprium shares (at Cyprium’s election) will be due to the Company. Upon a Decision to Mine,
$300,000 in cash or the equivalent value of Cyprium shares (at Cyprium’s election) will be due to the Company.
There are no other material contingent assets or liabilities as at 30 June 2021.
PAGE 42
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
20
EVENTS OCCURRING AFTER THE REPORTING PERIOD
The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has not significantly impacted the
entity up to 30 June 2021, it is not practicable to estimate the potential impact, positive or negative, after the
reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian
Government and other countries, such as maintaining social distancing requirements, quarantine, travel
restrictions and any economic stimulus that may be provided.
There have been no other events subsequent to reporting date which are sufficiently material to warrant
disclosure.
21 COMMITMENTS
In order to maintain an interest in the exploration tenements in which the Group is involved, the Group is
committed to meeting the conditions under which the tenements were granted. The timing and amount of
exploration expenditure commitments and obligations of the Group are subject to the minimum expenditure
commitments required as per the Mining Act 1978 (Western Australia) and the Mining Act 1971 (South Australia)
and may vary significantly from the forecast based upon the results of the work performed which will determine
the prospectivity of the relevant area of interest. Currently, the minimum expenditure commitments for the
granted tenements is $1,063,380 (2020: $1,009,380) per annum. Of this amount $928,180 will be met by the
Group’s joint venture partners as part of their earn-in obligations.
22 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
Financial risk management
Overview
The Group has exposure to the following risks from their use of financial instruments:
•
•
•
•
•
Interest rate risk
Credit risk
Foreign currency risk
Commodity risk
Liquidity risk
• Market risk
This note presents information about the Group’s exposure to each of the above risks, their objectives, policies
and processes for measuring and managing risk, and the management of capital. The Board of Directors has
overall responsibility for the establishment and oversight of the risk management framework.
Risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate
risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are
reviewed regularly to reflect changes in market conditions and the Group’s activities.
The Audit Committee oversees how management monitors compliance with the Group’s risk management
policies and procedures and reviews the adequacy of the risk management framework in relation to the risks
faced by the Group.
The Group’s principal financial instruments are tabled below.
Financial assets
Current
Cash and cash equivalents
Trade and other receivables
Non-Current
Financial assets at fair value through other comprehensive income
(“FVOCI”)
2021
$
2020
$
20,910,936
322,014
21,232,950
9,122,692
273,652
9,396,344
1,577,188
1,946,313
1,577,188
1,946,313
PAGE 43
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
22 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued)
Financial liabilities
Current
Trade and other payables
Lease liabilities
Non-Current
Lease liabilities
Interest rate risk
2021
$
2020
$
971,325
75,124
1,046,449
38,813
38,813
1,116,981
94,782
1,211,763
185,880
185,880
Interest rate risk is the risk that the value of a financial instrument or cash flows associated with the instrument
will fluctuate due to changes in market interest rates. Interest rate risk arises from fluctuations in interest bearing
financial assets and liabilities that the Group uses.
Interest bearing assets comprise cash and cash equivalents which are considered to be short-term liquid assets.
It is the Group’s policy to settle trade payables within the credit terms allowed and therefore not incur interest on
overdue balances.
The following table set out the carrying amount, by maturity, of the financial instruments that are exposed to
interest rate risk:
Floating
interest
rate $
Fixed interest rate maturing in
1 year or
less $
Over 1 to 5
years $
More than
5 years $
Non-
interest
bearing $
Total $
2021
Financial assets
Cash and cash equivalents
Trade and other receivables
Weighted average interest
rate
Financial liabilities
Trade and other payables
Lease liabilities
Weighted average interest
rate
2020
Financial assets
–
–
–
–
–
–
–
–
18,576,325
–
18,576,325
0.45%
–
–
–
–
Cash and cash equivalents
1,896,067
7,226,325
Trade and other receivables
–
–
Weighted average interest
rate
Financial liabilities
Trade and other payables
Lease liabilities
Weighted average interest
rate
1,896,067
7,226,325
0.57%
1.43%
–
–
–
–
–
–
–
–
PAGE 44
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
2,334,611
20,910,936
322,014
322,014
2,656,625
21,232,950
–
–
971,325
113,937
971,325
113,937
1,085,262
1,085,262
–
–
300
9,122,692
273,652
273,652
273,952
9,396,344
–
–
1,116,981
1,116,981
280,662
280,662
1,397,643
1,397,643
–
–
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
22 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued)
Sensitivity analysis for interest rate exposure
A change of 100 basis points in interest rates at the reporting date would have increased / (decreased) equity and
profit or loss by the amounts shown below:
Impact on profit / (loss) and equity
Increase of 100 basis points
Decrease of 100 basis points
Credit risk
2021
$
166,001
(166,001)
2020
$
43,629
(43,629)
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails
to meet its contractual obligations and arises principally from the Group’s receivables from customers and
investment securities. The Group trades only with recognised, creditworthy third parties. It is the Group policy
that all customers who wish to trade on credit terms are subject to credit verification procedures. In addition,
receivable balances are monitored on an ongoing basis with the result that the Group’s exposure to bad debts is
not significant. The maximum exposure to credit risk is the carrying value of the receivable, net of any provision for
expected credit loss.
With respect to credit risk arising from the other financial assets of the Group, which comprise cash and cash
equivalents, the Group’s exposure to credit risk arises from default of the counter party, with a maximum
exposure equal to the carrying amount of these instruments. This risk is minimised by reviewing term deposit
accounts from time to time with approved banks of a sufficient credit rating which is -AA and above.
Exposure to credit risk
The carrying amount of the Group’s financial assets represents the maximum credit exposure. The Group’s
maximum exposure to credit risk is tabled below.
Cash and cash equivalents
Trade and other receivables
Foreign currency risk
2021
$
20,910,936
322,014
21,232,950
2020
$
9,122,692
273,652
9,396,344
The Group’s exposure to foreign currency risk is minimal at this stage of its operations.
Commodity price risk
The Group’s exposure to commodity price risk is minimal at this stage of its operations.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet
its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or
risking damage to the Group’s reputation.
The Group’s objective is to maintain a balance between continuity of funding and flexibility. The following are the
contractual maturities of financial liabilities:
2021
Trade and other payables
Lease liabilities
2020
Trade and other payables
Lease liabilities
Less than
6 months
$
Total Contractual
cash flows
$
Carrying
amount
$
971,325
35,456
971,325
113,937
971,325
113,937
1,006,781
1,085,262
1,085,262
1,116,981
45,620
1,162,601
1,116,981
280,662
1,397,643
1,116,981
280,662
1,397,643
PAGE 45
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
22 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued)
Market risk
Price risk
The Group’s exposure to equity securities price risk arises from investments held by the Group and classified in
the Statement of Financial Position as financial assets at FVOCI.
Sensitivity analysis for price risk
A change of 10% in the price of securities held at reporting date on the Group’s equity and/or profit or loss by is
shown below:
Impact on profit / (loss) and equity
Increase of 10%
Decrease of 10%
Fair value of financial assets and liabilities
2021
$
2020
$
157,718
(157,718)
194,631
(194,631)
The fair value of cash and cash equivalents and non-interest bearing financial assets and financial liabilities of the
Group is equal to their carrying value.
Fair value measurement of financial instruments
Financial assets and financial liabilities measured at fair value in the Statement of Financial Position are grouped
into three levels of a fair value hierarchy. The three levels are defined based on the observability of significant
inputs to the measurement, as follows:
•
•
•
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly or indirectly; and
Level 3: unobservable inputs for the asset or liability.
The following table shows the levels within the hierarchy of financial assets and liabilities measured at fair value
on a recurring basis at 30 June 2021 and 30 June 2020:
Level 1
$
1,577,188
1,577,188
1,946,313
1,946,313
Level 2
$
Level 3
$
Total
$
–
–
–
–
–
–
–
–
1,577,188
1,577,188
1,946,313
1,946,313
30 June 2021
Financial assets at FVOCI
30 June 2020
Financial assets at FVOCI
Capital risk management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern
in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital
structure to reduce the cost of capital. The management of the Group’s capital is performed by the Board.
The capital structure of the Group consists of net debt (trade and other payables, provisions and lease liabilities
detailed in Notes 11, 12 and 13 offset by cash and bank balances) and equity of the Group (comprising contributed
equity and reserves, offset by accumulated losses detailed in Notes 14, 15 and 16).
The Group is not subject to any externally imposed capital requirements. None of the Group’s entities are subject
to externally imposed capital requirements.
PAGE 46
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
23 SHARE-BASED PAYMENTS
Employee Share Option Plan
The Group has an Employee Share Option Plan (“ESOP”) for executives and employees of the Group. In
accordance with the provisions of the ESOP, as approved by shareholders at a previous Annual General Meeting,
executives and employees may be granted options at the discretion of the Directors.
Each share option converts into one ordinary share of Musgrave Minerals Limited on exercise. No amounts are
paid or are payable by the recipient on receipt of the option. The options carry neither rights of dividends nor
voting rights. Options may be exercised at any time from the date of vesting to the date of their expiry.
Options issued to Directors are subject to approval by shareholders.
The following share-based payment arrangements were in existence during the reporting period:
Option
series
Number
Issue
date
Expiry
date
Vesting
date
Exercise
price
Fair value at
grant date
P (1)
Q (1)
R (1)
S (2)
T (3)
U (4)
V
W (5)
X
800,000
4 Nov 2016
3 Nov 2021
Immediate
3,250,000
29 Nov 2017
29 Nov 2020
Immediate
1,770,000
29 Nov 2017
29 Nov 2020
Immediate
6,900,000
21 Nov 2018
16 Nov 2021
Immediate
2,550,000
30 Nov 2018
16 Nov 2021
Immediate
6,380,000
21 Nov 2019
21 Nov 2022
Immediate
5,900,000
20 Aug 2020
20 Aug 2023
Immediate
1,980,000
28 Aug 2020
20 Aug 2023
Immediate
1,000,000
29 Jun 2021
24 Jun 2024
Immediate
$0.195
$0.097
$0.097
$0.1275
$0.1275
$0.1045
$0.932
$0.932
$0.56
$0.0628
$0.0436
$0.0436
$0.0506
$0.0506
$0.0203
$0.2369
$0.2434
$0.1557
(1) These options were exercised during the financial year.
(2) 3,400,000 of these options were exercised during the financial year.
(3) 2,100,000 of these options were exercised during the financial year.
(4) 2,930,000 of these options were exercised during the financial year.
(5) 200,000 of these options lapsed during the financial year.
Fair value of share options granted during the year
The fair value of share options at grant date is determined using a Black-Scholes option pricing model that takes
into account the exercise price, the term of the option, the share price at grant date, the expected price volatility
of the underlying share and the risk-free rate for the term of the option. The fair value of share options issued
during the year was $2,035,342 of which $1,340,200 relate to key management personnel (2020: $136,072 and
$61,110 respectively).
The model inputs for options granted during the year ended 30 June 2021 are as follows:
Inputs
Number
Exercise price
Issue date
Expiry date
Share price at grant date
Expected price volatility
Risk-free interest rate
Expected dividend yield
Issue V
5,900,000
$0.932
20 Aug 2020
20 Aug 2023
$0.59
80%
0.26%
0%
Issue W
1,980,000
$0.932
28 Aug 2020
20 Aug 2023
$0.60
80%
0.26%
0%
Issue X
1,000,000
$0.56
29 Jun 2021
24 Jun 2024
$0.35
87.5%
0.07%
0%
PAGE 47
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
23 SHARE-BASED PAYMENTS
Movements in share options during the year
Movement in the number of share options held by Directors, employees and consultants:
2021
2020
Number
of
options
Weighted average
exercise price
$
Number
of
options
Weighted average
exercise price
$
Outstanding at the beginning of the
year
21,650,000
Granted and vested during the year
8,880,000
Exercised during the year
Expired / lapsed during the year
(14,250,000)
(200,000)
Outstanding at the end of the year
16,080,000
Exercisable at the end of the year
16,080,000
0.116
0.890
0.116
0.932
0.534
0.534
19,800,000
6,680,000
(2,230,000)
(2,600,000)
21,650,000
21,650,000
0.125
0.105
0.100
0.166
0.116
0.116
The weighted average remaining contractual life of share options outstanding at the end of the year was 1.60
years (2020: 1.45 years).
Share options outstanding at the end of the year
Share options issued and outstanding at the end of the year have the following exercise prices:
Expiry date
Exercise price $
2021 Number
2020 Number
29 November 2020
3 November 2021
16 November 2021
21 November 2022
20 August 2023
24 June 2024
Totals
0.0974
0.1950
0.1275
0.1045
0.9320
0.5600
–
–
3,950,000
3,450,000
7,680,000
1,000,000
16,080,000
5,020,000
800,000
9,450,000
6,380,000
–
–
21,650,000
Significant estimates and judgement
The Group measures the cost of equity-settled transactions with Directors, employees and consultants by
reference to the fair value of the equity instruments at the date at which they are granted. The fair value is
determined using a Black-Scholes option pricing model.
24 RECONCILIATION OF CASH FLOWS FROM OPERATING ACTIVITIES
Cash flows from operating activities
Profit / (loss) for the year
Non-cash flows in profit / (loss):
- Other income
- Depreciation
- Impairment expense
- Share based remuneration
2021
$
2020
$
(2,881,297)
992,169
79,500
132,783
-
2,035,342
50,000
118,465
3,434
136,072
- Change in fair value of derivative financial instruments
-
(1,388,000)
Changes in assets and liabilities
- Decrease / (Increase) in trade and other receivables
- Decrease / (Increase) in other current assets
- Increase / (Decrease) in trade and other payables
- Increase / (Decrease) in employee entitlements
Net cash used in operating activities
(31,835)
(2,476)
(304,881)
67,010
(905,854)
(120,140)
10,736
(25,788)
18,620
(204,432)
PAGE 48
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
24 RECONCILIATION OF CASH FLOWS FROM OPERATING ACTIVITIES (continued)
Non-cash investing and financing activities
Additions to the right of use assets
Exercise of Legend options
25 RELATED PARTY DISCLOSURE
a) Parent entity
Musgrave Minerals Limited
Ordinary
Australia
Class
Country of
incorporation
b) Subsidiaries
Class
Country of
incorporation
Musgrave Exploration Pty Ltd
Ordinary
Australia
c) Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Bonus payments
Share-based payments
2021
$
–
–
–
2020
$
198,620
1,519,000
1,717,620
Investment at cost
2021
$
–
2021
$
100
2021
$
463,325
44,074
68,858
1,340,200
1,916,457
2020
$
–
2020
$
100
2020
$
430,433
34,716
–
61,110
526,259
Detailed remuneration disclosures are provided in the Remuneration Report.
26 SUBSIDIARIES
Details of the Company’s subsidiary are as follows:
Subsidiary
Principal activity
Country of
incorporation
Musgrave Exploration Pty Ltd
Exploration
Australia
Proportion of ownership
2021
100%
2020
100%
PAGE 49
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
27 PARENT ENTITY DISCLOSURE
Financial Performance
Profit / (loss) for the year
Other comprehensive income
Total comprehensive profit / (loss)
Financial Position
ASSETS
Current assets
Non-Current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Non-Current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
2021
$
(2,881,297)
(369,125)
(3,250,422)
21,245,901
28,064,150
49,310,051
1,249,039
38,813
1,287,852
48,022,199
2020
$
992,169
561,352
1,553,521
9,406,819
21,235,212
30,642,031
1,347,343
185,880
1,533,223
29,108,808
72,739,946
2,581,338
52,004,639
1,570,637
(27,299,085)
(24,466,468)
48,022,199
29,108,808
No guarantees have been entered into by Musgrave Minerals Limited in relation to the debts of its subsidiary.
Musgrave Minerals Limited had no expenditure commitments as at 30 June 2021 other than the
commitments as disclosed in Note 21.
PAGE 50
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
DIRECTORS’ DECLARATION
The Directors of Musgrave Minerals Limited declare that:
1)
in the Directors’ opinion, the financial statements and notes set out on pages 27 to 50 and the Remuneration
Report in the Director’s Report are in accordance with the Corporations Act 2001, including:
a)
b)
giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its performance, for the
financial year ended on that date; and
complying with Australian Accounting Standards (including the Australian Accounting Interpretations),
Corporations Regulations 2001 and mandatory professional reporting requirements.
2)
3)
the financial statements also comply with International Financial Reporting Standards as disclosed in Note 2; and
there are reasonable grounds to believe that the consolidated entity will be able to pay its debts as and when they
become due and payable.
The Directors have been given the declarations required by Section 295A of the Corporations Act 2001 by the Managing
Director and Chief Financial Officer for the financial year ended 30 June 2021.
Signed in accordance with a resolution of the Directors.
Mr Graham Ascough
Chairman
Perth, Western Australia
21 September 2021
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
PAGE 51
PAGE 51
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021
INDEPENDENT AUDITOR’S REPORT
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR'S REPORT
To the members of Musgrave Minerals Ltd
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Musgrave Minerals Ltd (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2021, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement
of changes in equity and the consolidated statement of cash flows for the year then ended, and notes
to the financial report, including a summary of significant accounting policies and the directors’
declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275,
an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and
form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation.
PAGE 52
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 INDEPENDENT AUDITOR’S REPORT
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
Recoverability of exploration and evaluation expenditure
Key audit matter
How the matter was addressed in our audit
As disclosed in Note 10 to the Financial Report,
the carrying value of capitalised exploration and
evaluation expenditure represents a significant
asset of the Group.
Refer to Note 10 of the Financial Report for a
description of the accounting policy and
significant judgements applied to capitalised
exploration and evaluation expenditure.
In accordance with AASB 6 Exploration for and
Evaluation of Mineral Resources (AASB 6), the
recoverability of exploration and evaluation
expenditure requires significant judgment by
management in determining whether there are
any facts or circumstances that exist to suggest
that the carrying amount of this asset may
exceed its recoverable amount. As a result, this is
considered a key audit matter.
Our procedures included, but were not limited to:
•
•
•
•
•
Obtaining a schedule of the areas of interest
held by the Group and assessing whether the
rights to tenure of those areas of interest
remained current at balance date;
Considering the status of the ongoing
exploration programmes in the respective
areas of interest by holding discussions with
management, and reviewing the Group’s
exploration budgets, ASX announcements and
directors’ minutes;
Considering whether any such areas of
interest had reached a stage where a
reasonable assessment of economically
recoverable reserves existed;
Considering whether any facts or
circumstances existed to suggest impairment
testing was required; and
Assessing the adequacy of the related
disclosures in Note 10 to the Financial
Report.
PAGE 53
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 INDEPENDENT AUDITOR’S REPORT
Accounting for share-based payments
Key audit matter
How the matter was addressed in our audit
As disclosed in Note 23 to the Financial Report,
during the financial year ended 30 June 2021, the
Group agreed to issue options to key management
personnel, employees and consultants, which
have been accounted for as share-based
payments as disclosed in Note 23 of the Financial
Report.
Refer to Note 23 of the Financial Report for a
description of the accounting policy and
significant estimates and judgements applied to
these arrangements.
Share-based payments are a complex accounting
area and due to the complex and judgemental
estimates used in determining the fair value of
the share-based payments, we consider the
accounting for share-based payments to be a key
audit matter.
Our procedures included, but were not limited to
the following:
•
•
•
•
•
•
Reviewing the relevant agreements to obtain
an understanding of the contractual nature
and terms and conditions of the share-based
payment arrangements;
Holding discussions with management to
understand the share-based payment
transactions in place;
Reviewing management’s determination of
the fair value of the share-based payments
granted, considering the appropriateness of
the valuation methodology used;
Testing key fair value inputs, using internal
specialists where required;
Assessing the allocation of the share-based
payment expense over the relevant vesting
period; and
Assessing the adequacy of the related
disclosures in Note 23 to the Financial
Report.
Other information
The directors are responsible for the other information. The other information comprises the
information contained in directors’ report for the year ended 30 June 2021, but does not include the
financial report and our auditor’s report thereon, which we obtained prior to the date of this auditor’s
report, and the annual report, which is expected to be made available to us after that date.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
PAGE 54
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 INDEPENDENT AUDITOR’S REPORT
In connection with our audit of the financial report, our responsibility is to read the other information
identified above and, in doing so, consider whether the other information is materially inconsistent
with the financial report or our knowledge obtained in the audit or otherwise appears to be materially
misstated.
If, based on the work we have performed on the other information that we obtained prior to the date
of this auditor’s report, we conclude that there is a material misstatement of this other information,
we are required to report that fact. We have nothing to report in this regard.
When we read the annual report, if we conclude that there is a material misstatement therein, we are
required to communicate the matter to the directors and will request that it is corrected. If it is not
corrected, we will seek to have the matter appropriately brought to the attention of users for whom
our report is prepared.
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
PAGE 55
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 INDEPENDENT AUDITOR’S REPORT
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 15 to 20 of the directors’ report for the
year ended 30 June 2021.
In our opinion, the Remuneration Report of Musgrave Minerals Ltd, for the year ended 30 June 2021,
complies with section 300A of the Corporations Act 2001.
Responsibilities
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.
BDO Audit (WA) Pty Ltd
Glyn O'Brien
Director
Perth, 21 September 2021
PAGE 56
MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 ADDITIONAL INFORMATION
The following additional information not shown elsewhere in this report is required by the ASX Listing Rules and is
current as at 24 September 2021.
Securities
Quotation has been granted for 533,222,949 ordinary shares of the Company on the Australian Securities Exchange.
Quoted Securities
ASX Code
MGV
Unquoted Securities
ASX Code
Number of
Holders
4,865
Number of
Holders
MGVAB
MGVAB
MGVAC
MGVAB
MGVAZ
MGVAD
5
3
16
1
1
12
Security
Description
Ordinary Fully Paid
Security
Description
Options expiring 16/11/2021
Exercisable at $0.1275
Total
Securities
533,222,949
Total
Securities
3,950,000
Options expiring 21/11/2022
3,450,000
Exercisable at $0.1045
Options expiring 20/08/2023
6,680,000
Exercisable at $0.932
Options expiring 24/06/2024
1,000,000
Exercisable at $0.56
Options expiring 27/08/2024
500,000
Exercisable at $0.47
Options expiring 23/09/2024
1,820,000
Exercisable at $0.45
One holder Mr Robert Waugh and Mrs Sara Waugh
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