Annual Report 2022 A N N U A L R E P O R T 2 0 2 2 CORPORATE DIRECTORY DIRECTORS Graham Ascough Non-Executive Chairman Robert Waugh Managing Director Kelly Ross Non-Executive Director John Percival Non-Executive Director Brett Lambert 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 Level 9, Mia Yellagonga Tower 5 Spring Street Perth, WA 6000 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 ANNUAL REPORT 2022 PAGE 1 CONTENTS CHAIRMAN’S LETTER 2 REVIEW OF OPERATIONS 3 TENEMENT SCHEDULE 17 DIRECTORS’ REPORT 19 AUDITOR’S INDEPENDENCE DECLARATION 28 FINANCIAL STATEMENTS 29 DIRECTORS’ DECLARATION 52 INDEPENDENT AUDITOR’S REPORT 53 ADDITIONAL INFORMATION 57 Musgrave Minerals Ltd (“Musgrave” or “the Company”) (ASX: MGV) is dedicated to building a sustainable and profitable gold mining business driven by exploration and development success. A description of the Company’s operations and principal activities is included in the Review of Operations and the Directors’ Report. Photo credit: Matthew Battrick, Masha Pastuhov and Michael Washbourne MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 2 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 CH AIRM AN’ S L ETTER On behalf of the Board of Directors, it is my pleasure to present the 2022 Annual Report for Musgrave Minerals Limited (“Musgrave” or “Company”). The Company’s Cue Gold 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 continue to grow our resource base. In the June Quarter the Company delivered an updated Mineral Resource Estimate (“MRE”) for Cue that incorporates several recent discoveries as well as updating existing resources. The updated MRE includes significant additions from the new White Heat-Mosaic and Big Sky deposits and the Total Mineral Resource at Cue has grown 41% to 12.3Mt @ 2.3g/t Au for 927koz of contained gold. Significantly the near surface high- grade Break of Day Trend is now estimated to host 982kt @ 10.4g/t Au for 327koz of contained gold. The updated MRE strengthens our economic modelling for the development studies that are currently underway for the project to define a pathway to production. Exploration success continues at Cue and we are confident that the resource base will grow further in the near term. At White Heat and Big Sky, drilling to date has only focussed on the top 100 to 160m and as such both areas have strong potential to further contribute to resource growth with extensional and infill drilling programs currently underway. New discoveries not yet included in the MRE include Amarillo and Waratah and regional drilling programs continue to identify further targets for follow up on our extensive land holding at Cue with the objective of identifying new resources to grow the already significant resource base. Exploration on Lake Austin continued under the Evolution Mining Limited (“Evolution”) Earn-in and Exploration Joint Venture and drilling results to date have identified multiple new gold lodes at West Island along with a number of highly prospective regional targets that require further drill testing. Evolution are now operating the Joint Venture and a significant amount of basement drilling will be completed in the first half of the 2023 financial year. The Company recently completed a sustainability review led by an external consultant to identify key focus areas to further integrate environmental, social and governance considerations into our decision making process. The outcomes will be implemented throughout the business as we continue to safely and responsibly deliver exploration success and advance our vision of building a profitable gold mining business at Cue. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 3 REV IEW OF OPERATIONS Musgrave increased its resource base to an estimated 927koz of gold within the Cue Gold Project and completed more than 100,000m of drilling during the year. The total Indicated and Inferred JORC Mineral Resources at the project are 12.3Mt @ 2.3g/t Au for 927koz of gold (see MGV ASX announcement 31 May 2022, “Cue Mineral Resource Increases to 927,000 Ounces”). During the year the Company also acquired new tenure south of Mt Magnet approximately 40km south of the Cue Project. This under explored ground is expected to create an early stage pipeline of targets to complement the more advanced exploration program at Cue. Musgrave also has tenement applications in the Musgrave Geological Province of South Australia (Figure 1). “Musgrave’s intent is to continue to grow the resource base, accelerate exploration and continue prefeasibility level studies at Cue to define a high margin operation that returns value to shareholders.” Musgrave Minerals Ltd (“Musgrave” or “the Company”) (ASX: MGV) is an Australian resources company focused on gold exploration and development at the Cue Project (“Cue”) in the Murchison Province of Western Australia. Musgrave’s intent is to continue to grow the resource base, accelerate exploration and continue prefeasibility level studies at Cue to define a high margin operation that returns value to shareholders. The Company is continuing prefeasibility level studies and will include the new White Heat-Mosaic and Big Sky deposits in future development planning. It has been a successful year for Musgrave with new mineralised gold zones identified at Amarillo and Waratah and the announcement of maiden Mineral Resource Estimates at White Heat-Mosaic and Big Sky. Figure 1: Musgrave Minerals’ Project Location Map MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 4 REV IEW OF OPERATIONS Corporate During the year, Musgrave spent $9.5M on exploration activities. At 30 June 2022 the Company’s capital structure comprised: • 537,172,949 fully paid ordinary shares; and • 19,670,000 unlisted options at various exercise prices and expiry dates. There were a number of changes to the Company’s unlisted options on issue with 3.95 million options being exercised, raising $503,625 and 8.54 million new options issued during the year. In late June 2022 the Company announced the appointment of Mr Anthony Buckingham as General Manager-Development. Mr Buckingham, who commenced with Musgrave in early July, will initially focus on development studies, defining an optimal development path and subject to the completion of a positive feasibility study, oversee the establishment of a mining operation at the Company’s wholly owned Cue Gold Project. The Company holds 12.5 million shares in Legend Mining Ltd (ASX: LEG) currently valued at approximately $460,000. Musgrave also holds 1,308,750 ordinary shares in Cyprium Metals Ltd (ASX: CYM) currently valued at approximately $130,000. During financial year 2022, Musgrave successfully secured an Exploration Incentive Scheme (“EIS”) co- funded drilling grant of up to $150,000 to aid in the drill testing of the Big Sky gold system. Response to COVID-19 The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has not materially impacted the Company’s operations to date, it is not practicable to estimate the potential of future impacts. The Company is maintaining its operations and developing its projects while aiming to keep its employees, contractors, and the communities in which we operate safe. Musgrave has operational procedures and guidelines in place that are in line with official health advice and government directives. Early winter morning at Cue Gold Project Panning RC drill chips at White Heat MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 5 REV IEW OF OPERATIONS Environment, Social, Governance (ESG) Musgrave is dedicated to building a sustainable and profitable mining business driven by exploration and development success. Musgrave’s vision comes with a commitment to safely and responsibly deliver exploration success and advance development opportunities to build a profitable gold mining business for the benefit of our shareholders and the communities in which we operate. This commitment extends to integrating environmental, social and governance considerations into our decision making. The United Nations Sustainable Development Goals (“SDGs”) are a call to action by all Governments and Businesses to address the world’s greatest challenges and to create a more sustainable future by 2030. Musgrave recognises the importance of all 17 SDGs, however, we have prioritised the following nine goals. Going forward, we will expand our commitment in these areas as our projects progress, and the integration into our future activities will be key to delivering a sustainable business for future generations. “Sustainability has been a focus area for Musgrave Minerals as we recognise the need to incorporate sustainability into all aspects of our business. Building a sustainable business that delivers value to all our stakeholders is a key objective.” Figure 2: Key ESG topics most relevant to our business as per alignment with the United Nations sustainable development goals As part of our focus on sustainability, in 2022 we were assisted by an external consultant to conduct a Sustainability Review to identify the sustainability topics most important to us. This process identified key topics most relevant to our business and the broader gold mining industry that resulted in the development of our ESG commitments (Figure 2). A follow up review process will be conducted to assess the changes to our business and our stakeholders to ensure we continue to build and deliver a sustainable gold mining company. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 6 REV IEW OF OPERATIONS Our ESG Commitments Figure 3: Musgrave’s ESG commitments Governance Act with integrity and fair dealing in business affairs and hold a duty of care to all employees and stakeholders. Maintain a diverse mix of gender, skills and experience on the Board of Directors that ensures sufficient expertise to meet both responsibilities to stakeholders and strategic objectives. Social Consult and communicate openly with host communities, government and other stakeholders. Treat all people equally and fairly, regardless of their culture/ethnicity, gender, language, age, sexual orientation, religion, socio-economic status, physical and mental ability, thinking styles, marital status, pregnancy, experience and education. Implement and maintain effective health, hygiene and safety. Develop long term mutually beneficial relationships with Indigenous peoples and communities who are impacted by our exploration, development and operations. Minimise our carbon footprint. Regularly monitor and strive to continually improve our environmental performance. Environment MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 7 REV IEW OF OPERATIONS It was a successful year for Musgrave with resource growth and new gold discoveries at Cue while also progressing PFS level studies at the Break of Day and Lena deposits. The new appointment of Anthony Buckingham to the position of General Manager- Development will enhance the Company’s ability to progress these studies and include the new gold resources at White Heat-Mosaic and Big Sky. Exploration Activities Cue Project Exploration activities for the financial year have been focused on gold exploration and prefeasibility level studies at Cue, aimed at growing and de-risking the project. The Company has had significant exploration success during the year with a Mineral Resource Estimate update in May, following the White Heat- Mosaic and Big Sky gold discoveries. “Musgrave will continue a dual stream approach, with exploration focusing on delivering resource growth while we also progress the development opportunity that the existing resources present.” Musgrave has an estimated 927koz of gold in resources on the Cue Project and completed more than 100,000m of drilling during the year. The total Indicated and Inferred JORC Mineral Resources on the project are; 12.3Mt @ 2.3g/t Au for 927,000 ounces of gold. The high-grade Mineral Resources on the Break of Day Trend increased to 982kt @ 10.4g/t Au for 327koz contained gold (see MGV ASX announcement 31 May 2022, “Cue Mineral Resource Increases to 927,000 Ounces”). The resource update delivered a: • 41% increase in total contained ounces; and a • 44% increase in Indicated Resources to 435,000 ounces gold. Maiden Mineral Resource Estimates at White Heat- Mosaic and Big Sky, included in the above totals, are: • White Heat-Mosaic: 185kt @ 11.0g/t Au for 65,000oz gold • Big Sky: 4.65Mt @ 1.2g/t Au for 173,000oz gold Mineral Resource estimates were also updated for a number of satellite deposits (Figure 4) including Numbers, Leviticus, Rapier South, Jasper Queen and Gilt Edge to comply with JORC 2012 reporting standards. There were no significant material changes to the total ounces in these resource estimates however they can now be reported as complying with JORC 2012. A small oxide gold resource was added at Hollandaire which sits as a gold cap to the Hollandaire copper-gold deposit. Gold mineralisation was also discovered at Amarillo and Waratah and further drilling is planned at these prospects so they can be included in future Mineral Resource Estimate updates. Figure 4: Plan showing deposit and prospect location, Cue Gold Project MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 8 REV IEW OF OPERATIONS White Heat-Mosaic Deposit The Mineral Resource at White Heat-Mosaic, part of the high-grade Break of Day trend is only 300m south of Break of Day (Figure 4) and extends over a combined strike length of more than 150m with individual gold lodes (Figure 5) drill tested to varying depths with the deepest resource lode estimation to 200m vertical depth. In May 2022 an initial Mineral Resource (Indicated and Inferred) at White Heat-Mosaic was estimated as: 185kt @ 11.0g/t Au for 65,000oz gold (see MGV ASX announcement 31 May 2022, “Cue Mineral Resource Increases to 927,000 Ounces”) 80% of the resource is in the higher confidence Indicated category with the high-grade mineralisation commencing at less than 10m below surface. Figure 5: Schematic 3D model showing White Heat and Mosaic lodes along the High-grade Break of Day trend, Cue Project (Brown and blue lodes – White Heat, Green lode – Mosaic) The mineralisation remains open down dip where further exploration drilling is ongoing. Recent infill and extension drilling, post the May 2022 resource update has returned strong results (Figure 6). Drilling results from programs completed after the Mineral Resource Estimate to extend the plunge of the high grade mineralisation include: o 7m @ 149.7g/t Au from 143m (22MORC130), including; o 1m @ 1,040g/t Au from 143m o 3m @ 25.8g/t Au from 184m (22MORC129) o 5m @ 6.9g/t Au from 135m (22MORC110) These intersections extend the mineralisation approximately 30m below previous high-grade drill results and beyond the current Mineral Resource boundary. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 9 REV IEW OF OPERATIONS Drill intersections within the current Mineral Resource boundary at White Heat-Mosaic, completed after the Resource estimate (infill drilling) include: o 4m @ 116.5g/t Au from 50m (22MORC111), including; o 2m @ 230.5g/t Au from 51m o 4m @ 24.9g/t Au from 44m (22MORC113) o 6m @ 17.3g/t Au from 92m (22MORC115) o 4m @ 9.6g/t Au from 14m (22MORC109) o 0.5m @ 365g/t Au from 115.1m (22MODD029), and o 1.5m @ 9.5g/t Au from 91.5m in a splay lode “It would be hard to find better results from a recent Australian exploration program and the Cue Gold Project is fast becoming one of the richest undeveloped, near surface, high-grade gold deposits in Australia.” Significantly, a new lode of mineralisation was identified at White heat that requires further drilling to determine its extent (depth and strike). Initial results included a high-grade intersection of: o 6m @ 14.0g/t Au from 127m (22MORC137) (see MGV ASX announcement 2 August 2022, “Bonanza Grades from Further Drilling at White Heat-Mosaic”) Figure 6: Schematic long section at White Heat showing plunge of high-grade gold mineralisation MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 10 REV IEW OF OPERATIONS Big Sky Deposit The Mineral Resource at Big Sky is on a shear trend south-west of Break of Day (Figure 4) and extends over a combined strike length of more than 2.6km. The mineralisation has been interpreted and estimated to a maximum depth of 225m although the mineralisation across the majority of the deposit has only been drilled and estimated to approximately 100m. The mineralisation remains open down dip where further exploration drilling is warranted on the higher-grade zones. In May 2022 an initial Mineral Resource (Indicated and Inferred) at Big Sky was estimated as: 4.65Mt @ 1.20g/t Au for 173,000oz gold (see MGV ASX announcement 31 May 2022, “Cue Mineral Resource Increases to 927,000 Ounces”) 28% of the resource is in the higher confidence Indicated category with the mineralisation commencing at less than 2m below surface in some areas. Infill and extension drilling, post the May 2022 resource update (Figure 7), has returned strong results, including: o 4m @ 20.9g/t Au from 19m (22MORC159) o 3m @ 10.1g/t Au from 95m (22MORC168) o 2m @ 6.7g/t Au from 60m (22MORC169) o 18m @ 4.4g/t Au from 20m (22MORC173), including o 5m @ 14.0g/t Au from 33m o 4m @ 6.9g/t Au from 53m (22MORC177) o 8m @ 7.8g/t Au from 18m (22MORC178), including o 1m @ 32.2g/t Au from 18m o 7m @ 2.5g/t Au from 32m (22MORC180) o 51m @ 1.2g/t Au from 32m (22MORC182) o 6m @ 3.3g/t Au from 32m to EOH (22MORC184) o 5m @ 6.7g/t Au from 44m (22MORC185) o 1m @ 20.3g/t Au from 52m (22MORC201) o 18m @ 5.4g/t Au from 31m (22MORC204), including; o 1m @ 70.2g/t Au from 33m (see MGV ASX announcement 30 August 2022, “Further High grades from Drilling at Big Sky”) Figure 7a: Inset B plan showing Big Sky drilling results, southern zone, Cue Gold Project Figure 7: Plan showing Big Sky drilling and detail of assay results in Inset B, Cue Gold Project MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 11 REV IEW OF OPERATIONS Regional Exploration A strong focus on exploration has led to further gold discoveries including gold mineralisation at the Amarillo prospect and along the Waratah trend east of Break of Day (Figure 4). Significant intersections at Amarillo include: o 3m @ 14.6g/t Au from 60m (22MORC088) o 17m @ 2.5g/t Au from 18m (22MORC094), including; o 2m @ 12.7g/t Au from 33m o 9m @ 8.7g/t Au from 44m (21MORC371), including; o 2m @ 35.1g/t Au from 51m o 23m @ 4.2g/t Au from 26m (21MORC185) (See MGV ASX announcements 26 October 2021, 6 January 2022 and 29 April 2022) Figure 8: Cue prospect Location Map “Musgrave has an excellent team built on exploration and discovery success and is working to enhance that team as we progress towards development.” At Waratah, 600m west of Break of Day significant drill intersections include: o 2m @ 28.1g/t Au from 78m (21MORC359) o 4m @ 29.9g/t Au from 17m (22MORC228) o 3m @ 9.8g/t Au from 12m (22MORC231) (See MGV ASX announcement 6 January 2022 and 19 September 2022) Exploration and resource definition drilling is continuing on these and other targets with a possible Mineral Resource update likely in the first quarter of 2023. A significant exploration program across multiple prospects and targets is planned for the coming year. The objective is to continue to grow the resource base while progressing development studies to define a clear path to a stand-alone operation which will generate significant cashflow for the Company. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 12 REV IEW OF OPERATIONS 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. New gold targets have been generated and a follow-up drilling program is currently being planned. Development Studies The Company is continuing prefeasibility level studies to advance on previous work and to include the new White Heat-Mosaic and Big Sky deposits in development planning. Ongoing work includes pit optimisations, underground assessments, metallurgy, geotechnical and hydrological assessments, waste rock characterisation, heritage assessment and environmental studies together with resource conversion. These works will be used as a basis for a conversion of the Exploration Licence to a Mining Lease at Big Sky (Break of Day, Lena and White Heat-Mosaic are already on a granted Mining Lease) and the submission of permit applications and prescribed licence requests. Resource conversion drilling (Inferred to Indicated) is continuing at White Heat-Mosaic and Big Sky with a focus on the top 120m at Big Sky and deeper extensions at the high-grade White Heat-Mosaic deposit. The Company continues works to advance the economic assessment of the project and to progress long lead time studies related to environmental approvals and permitting. With continued exploration success at Cue, the Company expects to grow the resource base to underpin these studies and advance the project to a development decision. Evolution JV – Lake Austin The Lake Austin area, part of the Evolution Mining Limited (Evolution) Earn-in and Exploration Joint Venture (Figure 9), is highly prospective for gold and is significantly underexplored. Evolution can earn a 75% interest in the JV area by sole funding a total of A$18M on exploration over a five-year period (see MGV ASX announcement dated 17 September 2019). To date Evolution has spent approximately $13M on the JV and subsequent to 30 June 2022, has proposed a further $5M for H1 FY23. The existing gold resources on the Cue Gold Project together with the Mainland option area are excluded from the Evolution JV. Evolution has drilled 13 diamond holes for 6,100m since electing to manage the joint venture in January 2022. Results of diamond drilling continue to identify multiple new lodes oblique to the favourable dolerite host unit at West Island. Diamond drilling will progress through the September and December quarters to delineate the potential scale of the mineral system at West Island. Lake Austin diamond drilling, West Island Prospect MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 13 REV IEW OF OPERATIONS Figure 9: Location plan showing Evolution JV area, Evolution drill hole locations and includes historical drill holes with maximum gold in hole coloured Significant recent drill intercepts at West Island include: • 2.0m @ 66.0g/t Au from 438.0m (22CUDD008) including; • 0.6m @ 219g/t Au from 438m, and • 4.0m @ 3.2g/t Au from 330.0m (22CUDD008), and • 3.5m @ 4.1g/t Au from 215m (22CUDD008), and • 3.8m @ 5.0g/t Au from 127.9m (22CUDD008) • 3.5m @ 16.2g/t Au from 366.0m (22CUDD007) including; • 1.0m @ 50.1g/t Au from 366m • 3.3m @ 4.9g/t Au from 293.7m (22CUDD003) (See MGV ASX announcement 21 July 2022, “Further high-grade gold intersected at West Island, Cue JV”) More regionally, evolution has drilled 235 aircore holes for approximately 23,782m since electing to manage the joint venture in January 2022. Aircore drilling has continued to define the northern extents of the West Island favourable host dolerite stratigraphy. Drilling has confirmed the quartz dolerite unit within the favourable host unit extends for at least 6km north of the West Island prospect. “Following the drilling success at the West Island prospect, Evolution is continuing to evaluate the gold potential of the joint venture tenure to determine the potential size of the gold opportunity under Lake Austin.” Mt Magnet South Project In March 2022, Musgrave Exploration Pty Ltd, a wholly owned subsidiary of Musgrave Minerals Limited, entered into a sale and purchase agreement with private company Eastern Goldfields Exploration Pty Ltd to acquire a 100% interest in 297sqkm of tenure (Figure 1) south of Mt Magnet (Mt Magnet South Project). The project area covers the southern extensions of the Hill 50 and Latecomer faults that are associated with the Hill 50, Galaxy and Morning Star gold deposits at Mt Magnet and has had very little historical drilling. Multi-client aeromagnetic data has been purchased and processed and a regional gravity survey has been completed over selected areas of the tenements. The datasets are currently being integrated with existing geological data to refine targets for follow-up field checking and surface geochemical sampling. This is an early stage project and is expected to deliver a pipeline of targets over the coming years to integrate with the Cue Project and the development timeline. 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. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 14 REV IEW OF OPERATIONS Musgrave Minerals Ltd (“Musgrave” or the “Company”) is pleased to provide this annual review and summary of Musgrave’s Mineral Resource Estimate as at 30 June 2022. The Company’s Mineral Resource Estimate is reported in accordance with the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the 2012 JORC Codes) and are based on documentation compiled by a Competent Person as defined by the 2012 JORC Code. The significant changes to the Mineral Resource Estimate in the last 12 months are the additions of maiden resources for the new Big Sky and White Heat-Mosaic deposits as described in Table 1 below. Minor changes have also been added through the addition of a small Hollandaire Gold Cap resource, an updated Numbers deposit resource and updates to satellite deposits including Leviticus, Rapier South, Jasper Queen and Gilt Edge to comply with JORC 2012 reporting standards. All information compiled in this resource table has previously been released to the ASX, with the Company’s last resource update to the ASX on 31 May 2022. No changes to the Mineral Resource estimates have occurred since 31 May 2022. Table 1: Summary of JORC Resources and Reserves for the Cue Project Mineral Resources as at 30 June 2022 Gold Mineral Resources Deposit Indicated Resources Inferred Resources TOTAL RESOURCES Tonnes ‘000s Au g/t Ounces Au ‘000s Tonnes ‘000s Au g/t Ounces Au ‘000s Tonnes ‘000s Au g/t Ounces Au ‘000s Moyagee – Break of Day High-Grade Trend Break of Day 451 12.1 176 346 7.7 86 797 10.2 262 White Heat-Mosaic 116 14.1 52 70 5.8 13 185 11.0 65 SUBTOTAL – Break of Day High Grade Trend 567 12.5 228 416 7.4 99 982 10.4 327 Moyagee Western Trend Lena 2,253 1.7 121 2,053 3.1 204 4,305 2.3 325 Big Sky 1,170 1.3 48 3,480 1.1 125 4,650 1.2 173 Leviticus – – – 42 6.0 8 42 6.0 8 Numbers 438 1.4 19 378 1.3 16 817 1.3 35 SUBTOTAL – Western Trend 3,861 1.5 188 5,953 1.8 353 9,815 1.7 541 SUBTOTAL – Southern Area 4,428 2.9 417 6,369 2.2 452 10,797 2.5 868 Eelya *Hollandaire Cu-Au (Total) 2,179 0.3 21 605 0.4 8 2,784 0.3 29 *Hollandaire Cu-Au (MGV Attributable) 436 0.3 4 121 0.4 2 557 0.3 6 Hollandaire Gold Cap 197 1.3 9 62 1.2 2 260 1.3 11 Rapier South 258 1.7 14 258 1.7 14 SUBTOTAL - Eelya 633 0.6 13 441 1.3 18 1,075 0.9 31 Tuckabianna Jasper Queen – – – 332 1.7 19 332 1.7 19 Gilt Edge 69 2.6 6 34 3.6 4 102 2.9 10 SUBTOTAL - Tuckabianna 69 2.6 6 365 1.9 23 434 2.0 28 SUBTOTAL – Northern Area 702 0.8 18 806 1.6 41 1,509 1.2 59 GRAND TOTAL 5,130 2.6 435 7,175 2.1 492 12,306 2.3 927 (see MGV ASX announcement 31 May 2022, “Cue Mineral Resource Increases to 927,000 Ounces”) * Note 1: The Hollandaire Cu-Au Resource Estimate is on 100% basis (MGV has a 20% attributable interest in the Hollandaire Cu-Au deposit, free carried to completion of DFS).Totals and sub-totals are on an attributable interest basis. Gold mineralisation not associated with the copper resource at Hollandaire, is 100% attributable to MGV (Hollandaire Gold Cap) and is also reported in compliance with JORC 2012. Note: Due to the effects of rounding, the totals may not represent the sum of all components MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 15 REV IEW OF OPERATIONS Copper Mineral Resources (1) Deposit Indicated Resources Inferred Resources TOTAL RESOURCES Tonnes ‘000s Grade % Tonnes Cu ‘000s Tonnes ‘000s Grade % Tonnes Cu ‘000s Tonnes ‘000s Grade % Tonnes Cu ‘000s Hollandaire Copper 2,179 2.0 42.2 605 1.6 9.3 2,784 1.9 51.5 Silver Mineral Resources (1) Deposit Indicated Resources Inferred Resources TOTAL RESOURCES Tonnes ‘000s Grade % Tonnes Ag ‘000s Tonnes ‘000s Grade % Tonnes Ag ‘000s Tonnes ‘000s Grade % Tonnes Ag ‘000s Hollandaire Silver 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. COMPETENT PERSON’S STATEMENT Mineral Resources The information in this report that relates to Mineral Resources for the Break of Day, Lena, White Heat-Mosaic, Big Sky, Numbers, Leviticus, Jasper Queen, Gilt Edge, Rapier South and the Hollandaire Gold Cap deposits 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. Figure 10: Resource Inventory Change MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 16 REV IEW OF OPERATIONS The information in this report that relates to Mineral Resources for the Hollandaire Copper-Gold 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 announcements by Musgrave Minerals Ltd (MGV) entitled “Lena Mineral Resource more than doubles and gold grade increases” released on 17 February 2020, “Break of Day High-Grade Mineral Resource Estimate” released on 11 November 2020 and “Cue Mineral Resource Increases to 927,000 ounces” released on 31 May 2022 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. 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. Mineral Resources and Ore Reserves Governance Controls Musgrave Minerals Ltd ensures that the Minerals Resources quoted are subject to governance arrangement 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 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 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. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 17 TENEM ENT S CH EDU L E As at 14 September 2022 Tenement ID Project State Status MGV Interest E21/129 Cue WA Granted 100% (EVN JV) E21/177 Cue WA Granted 100% (EVN JV) E21/194 Cue WA Granted 100% (EVN JV) E21/200 Cue WA Granted 100% (EVN JV) E21/204 Cue WA Granted 100% (EVN JV) E21/207 Cue WA Granted 100% (EVN JV) E21/208 Cue WA Granted 100% (EVN JV) M21/106 Cue WA Granted 100% (EVN JV in part) M21/107 Cue WA Granted 100% (EVN JV) P21/757 Cue WA Granted 100% (EVN JV) E21/144 Cue WA Granted 100% E58/507 Cue WA Granted 100% (EVN JV) E58/335 Cue WA Granted 100% M58/224 Cue WA Granted 100% M58/225 Cue WA Granted 100% P58/1709 Cue WA Granted 100% P58/1710 Cue WA Granted 100% E20/606 Cue WA Granted 20% base metals & 100% gold only rights E20/608 Cue WA Granted 20% base metals & 100% gold only rights E20/616 Cue WA Granted 20% base metals & 100% gold only rights E20/629 Cue WA Granted 20% base metals & 100% gold only rights E20/630 Cue WA Granted 20% base metals & 100% gold only rights E20/659 Cue WA Granted 20% base metals & 100% gold only rights E20/836 Cue WA Granted 20% base metals & 100% gold only rights E20/698 Cue WA Granted 20% base metals & 100% gold only rights E20/699 Cue WA Granted 20% base metals & 100% gold only rights E20/700 Cue WA Granted 20% base metals & 100% gold only rights M20/225 Cue WA Granted 20% base metals & 100% gold only rights M20/245 Cue WA Granted 20% base metals & 100% gold only rights M20/277 Cue WA Granted 20% base metals & 100% gold only rights M20/526 Cue WA Granted 20% base metals & 100% gold only rights P20/2279 Cue WA Granted 20% base metals & 100% gold only rights L20/57 Cue WA Granted 100% L58/42 Cue WA Granted 100% P21/731 Cue WA Granted 0% (MGV Option) P21/732 Cue WA Granted 0% (MGV Option) P21/735 Cue WA Granted 0% (MGV Option) P21/736 Cue WA Granted 0% (MGV Option) P21/737 Cue WA Granted 0% (MGV Option) MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 18 As at 14 September 2022 (continued) Tenement ID Project State Status MGV Interest P21/739 Cue WA Granted 0% (MGV Option) P21/741 Cue WA Granted 0% (MGV Option) E58/473 Mt Magnet South WA Granted 100% E58/524 Mt Magnet South WA Granted 100% E59/2157 Mt Magnet South WA Granted 100% E59/2448 Mt Magnet South WA Granted 100% P58/1683 Mt Magnet South WA Granted 100% P58/1694 Mt Magnet South WA Granted 100% P58/1695 Mt Magnet South WA Granted 100% P58/1696 Mt Magnet South WA Granted 100% P58/1707 Mt Magnet South WA Granted 100% P58/1725 Mt Magnet South WA Granted 100% P58/1738 Mt Magnet South WA Granted 100% P58/1808 Mt Magnet South WA Granted 100% P58/1809 Mt Magnet South WA Granted 100% P58/1810 Mt Magnet South WA Granted 100% P58/1811 Mt Magnet South WA Granted 100% P58/1812 Mt Magnet South WA Granted 100% P58/1830 Mt Magnet South WA Granted 100% P58/1853 Mt Magnet South WA Granted 100% P58/1854 Mt Magnet South WA Granted 100% EL2008/154 Musgrave SA Application 100% EL1996/260 Musgrave SA Application 100% EL1996/262 Musgrave SA Application 100% EL1996/340 Musgrave SA Application 100% EL1996/341 Musgrave SA Application 100% EL1996/342 Musgrave SA Application 100% EL1996/534 Musgrave SA Application 100% EL1997/040 Musgrave SA Application 100% EL1997/143 Musgrave SA Application 100% EL1997/144 Musgrave SA Application 100% EL1997/186 Musgrave SA Application 100% EL1997/297 Musgrave SA Application 100% EL1997/321 Musgrave SA Application 100% EL1997/468 Musgrave SA Application 100% EL2001/031 Musgrave SA Application 100% TENEM ENT S CH EDU L E MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 19 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 2022. DIRECTORS The following persons were Directors of the Company during the whole of the financial year and up to the date of this report: • 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 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 2022 was $1,582,727 (2021: loss of $2,881,297). This included a share-based payment expense of $561,486 (2021: $2,035,342). As at 30 June 2022, the Group had net assets of $46,666,222 (2021: $48,022,199) including cash and cash equivalents of $10,636,210 (2021: $20,910,936). 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: Exploration activities for the financial year have been focused on gold exploration and prefeasibility level studies at Cue, aimed at growing and de-risking the project. The Company has completed more than 100,000m of drilling during the year and has had significant exploration success with a Mineral Resource Estimate update in May, following the White Heat- Mosaic and Big Sky gold discoveries. The Mineral Resource update increased the total estimated gold in resources to 927koz on the Cue Project. The total Indicated and Inferred JORC Mineral Resources on the project are; 12.3Mt @ 2.3g/t Au for 927,000 ounces of gold (see MGV ASX announcement 31 May 2022, “Cue Mineral Resource Increases to 927,000 Ounces”). 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 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. ENVIRONMENTAL REGULATION 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. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 20 DIRECTORS ’ REPORT 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 2022. However, reporting requirements may change in the future. INFORMATION ON DIRECTORS 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 3,341,172 2,250,000 Mr Robert Waugh MSc, BSc, FAusIMM, MAIG (Managing Director), Director since 6 March 2011 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 Unlisted options – Musgrave Minerals Limited 5,300,000 6,000,000 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 21 DIRECTORS ’ REPORT Mrs Kelly Ross BBus, CPA, ACG (CS, CGP) (Non- Executive Director), Director since 26 May 2010 Experience and expertise 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 directorships 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 1,500,000 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 1,000,000 1,300,000 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 22 DIRECTORS ’ REPORT 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 Unlisted options – Musgrave Minerals Limited Nil 1,500,000 COMPANY SECRETARY Ms Patricia (Trish) Farr, GradCertProfAcc, GradDipACG, GAICD FGIA FCG (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 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 2022, and the numbers of meetings attended by each Director were: Board of Directors Audit Committee A B A B Graham Ascough 10 10 2 2 Robert Waugh 10 10 n/a n/a Kelly Ross 10 10 2 2 John Percival 10 10 2 2 Brett Lambert 10 10 2 2 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 Graham Ascough, being the Director retiring by rotation who, being eligible, will offer himself for re- election at the 2022 Annual General Meeting. REMUNERATION REPORT (AUDITED) The Directors present the Musgrave Minerals Limited 2022 Remuneration Report, outlining key aspects of the Company’s remuneration policy and framework, and remuneration awarded this year. The report contains the following sections: a) Key management personnel covered in this report b) Remuneration governance and the use of remuneration consultants MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 23 DIRECTORS ’ REPORT 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 last Annual General Meeting g) Details of remuneration h) Service agreements i) Details of share-based compensation and bonuses j) Equity instruments held by key management personnel k) Loans to key management personnel l) Other transactions with key management personnel. a) Key management personnel covered in this report Non-Executive and Executive Directors (see pages 20 to 22 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 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 2022. 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 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 24 DIRECTORS ’ REPORT 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 last Annual General Meeting Musgrave Minerals Limited received more than 92% of “yes” votes on its remuneration report for the 2021 financial year. The Company did not receive any specific feedback at the Annual General Meeting or throughout the year on its remuneration practices. 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 Total $ Options % Perf. Related % Salary & fees $ Bonus $ Non- monetary Benefit $ Super- annuation $ Options $ 2022 Directors G Ascough 71,647 – – – 67,706 139,353 48.6 – R Waugh 289,093 57,059 (1) – 34,615 135,413 516,180 26.2 11.1 K Ross 49,376 – – 4,938 45,138 99,452 45.4 – J Percival 49,376 – – 4,938 45,138 99,452 45.4 – B Lambert 49,376 -– – 4,938 45,138 99,452 45.4 – TOTALS 508,868 57,059 – 49,429 338,533 953,889 – – 2021 Directors G Ascough 68,250 -– – – 355,350 423,600 83.9 – R Waugh 281,493 68,858 (2) – 33,283 355,350 738,984 48.1 9.3 K Ross 47,250 – – 4,489 236,900 288,639 82.1 – J Percival 47,250 – – 4,489 236,900 288,639 82.1 – B Lambert 19,082 – – 1,813 155,700 176,595 88.2 – TOTALS 463,325 68,858 – 44,074 1,916,457 – – (1) Bonus for meeting the Company’s Short Term Incentive Plan objectives in relation to the Discovery Bonus following the drilling results at the Big Sky Prospect. (2) 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. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 25 DIRECTORS ’ REPORT 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 $289,093 plus statutory superannuation, as amended on 1 July 2021. 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. Mr Waugh also participated in the Discovery Bonus payment for the Big Sky Prospect. 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 3,750,000 options issued to Mr Ascough, Mr Waugh, Ms Ross, Mr Percival and Mr Lambert (Option Series AA) were approved by shareholders at the 18 November 2021 Annual General Meeting. 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. The options vest on 18 November 2022. Option series Grant date Vesting and exercise date Expiry date Exercise price Value per option at grant date % Vested AA 18 Nov 2021 18 Nov 2022 18 Nov 2024 $0.590 $0.1471 61% 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. The fair value of options is determined at grant date and is expensed over the vesting period for those options. There is a service condition attached to the options issued, being continuous service for 12 months from grant date. 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. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 26 DIRECTORS ’ REPORT 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 2022, Robert Waugh was eligible for the STIP and a Discovery Bonus of $57,059 was paid. STIP and Recovery Bonus Total Opportunity Awarded % Forfeited % R Waugh $72,723 79 21 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. Options Opening balance at 1 July Granted as remun- eration Options exercised Fair value of options exercised $ (1) Balance at 30 June Vested and exercisable Vested during the year 2022 Directors G Ascough 3,000,000 750,000 (1,500,000) $378,752 2,250,000 1,500,000 – R Waugh 5,500,000 1,500,000 (1,000,000) $252,501 6,000,000 4,500,000 – K Ross 1,000,000 500,000 – – 1,500,000 1,000,000 – J Percival 1,800,000 500,000 (1,000,000) $257,501 1,300,000 800,000 – B Lambert 1,000,000 500,000 – – 1,500,000 1,000,000 – TOTAL 12,300,000 3,750,000 (3,500,000) $888,754 12,550,000 8,800,000 – (1) During the year, 3,500,000 ordinary shares in the Company were provided to key management personnel as a result of the exercise of remuneration options. The consideration paid by key management personnel for the exercise of these options was $446,250. No amounts were unpaid at 30 June 2022 on these options by key management personnel. The value at the exercise date of options that were granted as part of remuneration and were exercised during the year has been determined as the intrinsic value of the options at that date. Shareholdings Opening balance at 1 July Granted as remun- eration Options exercised Net change (other) Balance at 30 June 2022 Directors G Ascough 1,841,172 – 1,500,000 – 3,341,172 R Waugh 4,300,000 – 1,000,000 – 5,300,000 K Ross 1,581,492 – – – 1,581,492 J Percival 600,000 – 1,000,000 (500,000) 1,100,000 TOTAL 8,322,664 – 3,500,000 (500,000) 11,322,664 k) Loans to key management personnel 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) MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 27 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 2019 21 November 2022 $0.1045 3,450,000 20 August 2020 20 August 2023 $0.932 5,900,000 28 August 2020 20 August 2023 $0.932 780,000 29 June 2021 24 June 2024 $0.56 1,000,000 31 August 2021 27 August 2024 $0.47 500,000 23 September 2021 23 September 2024 $0.45 1,790,000 18 November 2021 18 November 2024 $0.59 3,750,000 6 July 2022 19 June 2025 $0.45 2,500,000 TOTAL: 19,670,000 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 3,950,000 ordinary shares upon the exercise of 3,950,000 options having an exercise price of $0.1275 and expiring on 16 November 2021. CORPORATE GOVERNANCE STATEMENT The Company’s 2022 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 2022 no fees were paid or were payable for non- audit services provided by the auditors of the consolidated entity (2021: $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, 23 September 2022 Level 9, Mia Yellagonga Tower 2 5 Spring Street Perth WA 6000 PO Box 700 West Perth WA 6872 Australia Tel: +61 8 6382 4600 Fax: +61 8 6382 4601 www.bdo.com.au DECLARATION OF INDEPENDENCE BY MELISSA REID TO THE DIRECTORS OF MUSGRAVE MINERALS LIMITED As lead auditor of Musgrave Minerals Limited for the year ended 30 June 2022, I declare that, to the best of my knowledge and belief, there have been: 1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and 2. No contraventions of any applicable code of professional conduct in relation to the audit. This declaration is in respect of Musgrave Minerals Limited and the entity it controlled during the period. Melissa Reid Director BDO Audit (WA) Pty Ltd Perth, 23 September 2022 1 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. AU DITOR’ S INDEPENDENCE DECL ARATION MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 28 CONS OL IDATED S TATEM ENT OF PROF IT OR L OS S AND OTH ER COM PREH ENS IV E INCOM E F OR TH E YEAR ENDED 30 J U NE 2022 Notes 2022 2021 $ $ Revenue from continuing operations 3(a) 57,407 63,010 Other income 3(a) 323,442 274,226 Employee benefits expense 3(b) (1,216,465) (2,594,400) Depreciation expense (163,642) (132,783) Finance costs (10,420) (22,570) Other expenses 3(c) (573,049) (468,780) Profit / (loss) from continuing operations before income tax (1,582,727) (2,881,297) Income tax benefit 5 – – Profit / (loss) after income tax for the year attributable to the owners of Musgrave Minerals Limited (1,582,727) (2,881,297) Other comprehensive income / (loss) Items that will not be reclassified to profit or loss Change in fair value of financial assets at fair value through OCI 9 (833,225) (369,125) Other comprehensive income / (loss) for the year (net of tax) (833,225) (369,125) Total comprehensive profit / (loss) for the year attributable to the owners of Musgrave Minerals Limited (2,415,952) (3,250,422) Cents per share Cents per share Profit / (loss) per share attributable to the owners of Musgrave Minerals Limited Basic profit / (loss) per share 17 (0.30) (0.57) Diluted profit / (loss) per share 17 (0.30) (0.57) The Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes. PAGE 29 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 30 CONS OL IDATED S TATEM ENT OF F INANCIAL POS ITION AS AT 30 J U NE 2022 Notes 2022 2021 $ $ ASSETS Current Assets Cash and cash equivalents 6 10,636,210 20,910,936 Trade and other receivables 7 337,157 322,014 Other current assets 8 16,649 12,951 Total Current Assets 10,990,016 21,245,901 Non-Current Assets Financial assets 9 743,963 1,577,188 Property, plant and equipment 565,382 373,969 Right of use assets 69,726 103,393 Exploration and evaluation 10 36,538,037 26,009,600 Total Non-Current Assets 37,917,108 28,064,150 TOTAL ASSETS 48,907,124 49,310,051 LIABILITIES Current Liabilities Trade and other payables 11 1,913,459 971,325 Provisions 12 254,204 202,590 Lease liabilities 13 62,489 75,124 Total Current Liabilities 2,230,152 1,249,039 Non-Current Liabilities Lease liabilities 13 10,750 38,813 Total Non-Current Liabilities 10,750 38,813 TOTAL LIABILITIES 2,240,902 1,287,852 NET ASSETS 46,666,222 48,022,199 EQUITY Contributed equity 14 73,438,246 72,739,946 Reserves 15 1,866,390 2,581,338 Accumulated losses 16 (28,638,414) (27,299,085) TOTAL EQUITY 46,666,222 48,022,199 The Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes. PAGE 31 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 CONS OL IDATED S TATEM ENT OF CH ANG ES IN EQ U ITY F OR TH E YEAR ENDED 30 J U NE 2022 ATTRIBUTABLE TO EQUITY HOLDERS OF THE ENTITY Contributed Equity $ Options Reserve $ Financial Asset Reserve $ Accumulated Losses $ Total Equity $ At 1 July 2020 52,004,639 876,921 693,716 (24,466,468) 29,108,808 Total comprehensive loss for the year – – – (2,881,297) (2,881,297) Other comprehensive loss – -– (369,125) – (369,125) Total comprehensive loss for the year (net of tax) – – (369,125) (2,881,297) (3,250,422) Transactions with owners in their capacity as owners: Issue of shares 21,175,422 – – – 21,175,422 Transaction costs of issuing shares (1,046,951) – – – (1,046,951) Issue of options (Note 23) – 2,035,342 – – 2,035,342 Transfer from share option reserve: - Due to exercise of options 606,836 (606,836) – – – - Due to expiry / lapse of options – (48,680) – 48,680 – At 30 June 2021 72,739,946 2,256,747 324,591 (27,299,085) 48,022,199 At 1 July 2021 72,739,946 2,256,747 324,591 (27,299,085) 48,022,199 Total comprehensive loss for the year – – – (1,582,727) (1,582,727) Other comprehensive loss – – (833,225) - (833,225) Total comprehensive loss for the year (net of tax) – – (833,225) (1,582,727) (2,415,952) Transactions with owners in their capacity as owners: Issue of shares 503,625 – – – 503,625 Transaction costs of issuing shares (5,136) – – – (5,136) Issue of options (Note 23) – 561,486 – – 561,486 Transfer from share option reserve: - Due to exercise of options 199,811 (199,811) – – – - Due to expiry / lapse of options – (243,398) – 243,398 – At 30 June 2022 73,438,246 2,375,024 (508,634) (28,638,414) 46,666,222 The Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 32 CONS OL IDATED S TATEM ENT OF CAS H F L OW S F OR TH E YEAR ENDED 30 J U NE 2022 Notes 2022 2021 $ $ CASH FLOWS FROM OPERATING ACTIVITIES Joint venture management fees 3(a) 320,442 254,941 Payments to suppliers and employees (1,557,549) (1,220,333) Interest received 55,709 60,533 Interest paid (10,420) (22,570) Government grants received – 79,500 Net advances from joint venture partner (29,767) (57,925) NET CASH FLOWS USED IN OPERATING ACTIVITIES 24 (1,221,585) (905,854) CASH FLOWS USED IN INVESTING ACTIVITIES Payments for property, plant and equipment (274,340) (357,568) Payments for tenements (100,000) (100,000) Payments for exploration activities (9,096,329) (6,887,065) NET CASH FLOWS USED IN INVESTING ACTIVITIES (9,470,669) (7,344,633) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares 14(b) – 19,523,039 Proceeds from exercise of options 503,625 1,652,383 Share issue costs 14(b) (5,136) (1,046,951) Lease principal repayments (80,961) (89,740) NET CASH FLOWS FROM FINANCING ACTIVITIES 417,528 20,038,731 Net increase/(decrease) in cash and cash equivalents (10,274,726) 11,788,244 Cash and cash equivalents at beginning of the year 20,910,936 9,122,692 CASH AND CASH EQUIVALENTS AT END OF THE YEAR 6 10,636,210 20,910,936 The Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 33 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 33 MUSGRAVE MINERALS LTD ANNUAL REPORT 2021 1 CORPORATE INFORMATION The financial report of Musgrave Minerals Limited (“the Company”) and controlled entity (“the Group”), for the year ended 30 June 2022 was authorised for issue in accordance with a resolution of the Directors on 23 September 2022. 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 2022 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 34 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 2022 $ 2021 $ Revenue from continuing operations Interest revenue 57,407 63,010 Other Income Joint venture management fees 320,442 254,941 Government grants – 12,000 Other income 3,000 7,285 Total other income 323,442 274,226 Total revenue and other income 380,849 337,236 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 35 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 3 REVENUE AND EXPENSES (continued) b) Employee benefits expense 2022 $ 2021 $ Wages, salaries, directors’ fees and other remuneration expenses 2,199,685 1,802,269 Superannuation contributions 212,804 170,125 Transfer to / (from) annual leave provision 74,800 43,150 Transfer to / (from) long service leave provision (23,186) 23,860 Share-based payments expense (Note 23) 561,486 2,035,342 Transfer to capitalised exploration expenditure (1,809,124) (1,480,346) Total employee benefits expense 1,216,465 2,594,400 c) Other expenses 2022 $ 2021 $ ASX / ASIC 83,473 89,866 Employer related on-costs 109,752 73,888 Occupancy costs 21,688 3,042 Promotion, advertising and sponsorship 230,087 168,846 Secretarial, professional and consultancy costs 145,290 143,837 Share register maintenance 50,821 52,822 Other expenses 273,989 231,245 Transfer to capitalised exploration expenditure (342,051) (294,766) Total other expenses 573,049 468,780 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 36 5 INCOME TAX 2022 $ 2021 $ Statement of Profit or Loss and Other Comprehensive Income Current income tax: - Current income tax benefit at a rate of 25% (2021: 26%) – – Deferred income tax: - Relating to origination and reversal of temporary differences – (1,628,100) - Deferred tax liability offset by deferred tax asset losses – 2,215,081 - Temporary difference not recognised in the current period – (586,981) 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 (1,582,727) (2,881,297) At the statutory income tax rate of 25% (2021: 26%) (395,682) (749,137) Add: - Immediate write-off of capital expenditure 140,372 (1,831,304) - Expenditures not allowable / income assessable 1,978 588,731 - Other deductible items (1,284) (223,372) - Tax losses not recognised due to not meeting recognition criteria 254,616 2,215,082 – – 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 37 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 5 INCOME TAX (continued) 2022 $ 2021 $ Deferred income tax Recognised on the Statement of Financial Position, deferred income tax at the end of the reporting period relates to the following: (25%, 2021: 26%) Deferred income tax liabilities: - Capitalised expenditure deductible for tax purposes 8,833,403 6,446,745 - Trade and other receivables 16,649 14,932 - Financial assets at fair value through other comprehensive income 5,540 222,400 8,855,592 6,684,077 Deferred income tax assets: - Trade and other payables (5,200) (5,070) - Employee benefits (63,551) (52,673) - Capital raising costs (202,498) (309,513) - Net lease liability (878) (2,741) - Tax losses available to offset deferred tax liability (8,583,465) (6,314,080) 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 $53,993,354 (2021: $42,092,723). Musgrave Minerals Limited is considered a base rate entity for income tax purposes and is therefore subject to income tax at a rate of 25% (2021: 26%). 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 2022 $ 2021 $ Cash at bank and on hand 3,059,885 2,334,611 Short-term deposits 7,576,325 18,576,325 10,636,210 20,910,936 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 0.34% (2021: 0.38%). 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 38 7 TRADE AND OTHER RECEIVABLES 2022 $ 2021 $ Current GST receivable 285,007 277,534 Other 52,150 44,480 337,157 322,014 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 2022 $ 2021 $ Accrued interest 14,649 12,951 Other 2,000 – 16,649 12,951 9 FINANCIAL ASSETS Financial assets at fair value through other comprehensive income 2022 $ 2021 $ Non-Current Opening balance 1,577,188 1,946,313 Change in fair value (833,225) (369,125) Closing balance 743,963 1,577,188 The Group holds 12,500,000 shares in Legend Mining Limited (ASX:LEG) and 1,308,750 shares in Cyprium Metals Limited (ASX:CYM). 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 through 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 39 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 9 FINANCIAL ASSETS (continued) 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 2022 $ 2021 $ Opening balance 26,009,600 18,966,123 Exploration expenditure incurred during the year 10,528,437 7,043,477 Closing balance 36,538,037 26,009,600 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. Exploration and evaluation assets are only recognised if the rights to the area of interest are current and either: a) the expenditures are expected to be recouped through successful development and exploitation or from sale of the area of interest; or b) 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. The recoverability of the capitalised exploration and evaluation expenditure assets are dependent on the successful development and commercial exploration, or alternatively sale, of the respective areas of interest. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 40 11 TRADE AND OTHER PAYABLES 2022 $ 2021 $ Trade creditors and accruals 1,888,855 920,547 Amounts due to joint venture partner 24,604 50,778 1,913,459 971,325 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 2022 $ 2021 $ Short-term Annual leave 151,840 77,040 Long service leave 102,364 125,550 254,204 202,590 Short–term obligations 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. 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 2022 $ 2021 $ Current Lease liabilities 62,489 75,124 62,489 75,124 Non-current Lease liabilities 10,750 38,813 10,750 38,813 73,239 113,937 The Company leases its corporate office and IT equipment. The Company has elected not to recognize a lease liability for ‘low-value’ and short-term leases. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 41 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 13 LEASE LIABILITIES (continued) Future minimum lease payments as at 30 June 2022 were as follows: Within one year $ One to two years $ Two to five years $ Total $ 30 June 2022 Lease payments 65,910 11,000 – 76,910 Finance charges (3,421) (250) – (3,671) Net present values 62,489 10,750 – 73,239 30 June 2021 Lease payments 83,166 39,910 – 123,076 Finance charges (8,042) (1,097) – (9,139) Net present value 75,124 38,813 – 113,937 14 CONTRIBUTED EQUITY a) Share capital 2022 $ 2021 $ Ordinary shares fully paid 73,438,246 72,739,946 b) Movements in ordinary shares on issue Number $ Placement – 18 December 2020 44,444,445 16,000,000 Share purchase plan – 20 January 2021 9,786,219 3,523,039 Options exercised - various 14,250,000 2,259,219 Share issue costs – (1,046,951) Balance at 30 June 2021 533,222,949 72,739,946 Options exercised - various 3,950,000 703,436 Share issue costs – (5,136) Balance at 30 June 2022 537,172,949 73,438,246 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 2022 Number 2021 Number Opening balance 16,080,000 21,650,000 Options granted 6,070,000 8,880,000 Options exercised (Note 14(b)) (3,950,000) (14,250,000) Options expired / lapsed (1,000,000) (200,000) Balance at the end of the financial year 17,200,000 16,080,000 NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 42 15 RESERVES 2022 $ 2021 $ Share option reserve Opening balance 2,256,747 876,921 Issue of director and employee options (Note 23) 561,486 2,035,342 Exercise of director and employee options (199,811) (606,836) Expiry / lapse of options (Note 16) (243,398) (48,680) Balance at the end of the financial year 2,375,024 2,256,747 The option reserve is used to recognise the fair value of options issued to Directors, employees and contractors. 2022 $ 2021 $ Financial asset reserve Opening balance 324,591 693,716 Financial assets at fair value through other comprehensive income (Note 9) (833,225) (369,125) Balance at the end of the financial year (508,634) 324,591 Total Reserves 1,866,390 2,581,338 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 2022 $ 2021 $ Opening balance (27,299,085) (24,466,468) Net profit / (loss) attributable to members (1,582,727) (2,881,297) Transfer from share option reserve (Note 15) 243,398 48,680 Balance at the end of the financial year (28,638,414) (27,299,085) 17 EARNINGS PER SHARE 2022 Cents 2021 Cents Basic profit / (loss) loss per share (0.30) (0.57) Diluted profit / (loss) loss per share (0.30) (0.57) The following reflects the profit/(loss) and share data used in the calculations of basic and diluted loss per share: 2022 $ 2021 $ Profit / (loss) used in calculating basic and diluted earnings per share (1,582,727) (2,881,297) 2022 Number 2021 Numbers Weighted average number of ordinary shares used in calculating basic and diluted profit / (loss) per share 535,982,538 504,196,131 Weighted average number of ordinary shares used in calculating basic and diluted profit / (loss) per share 535,982,538 504,196,131 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 43 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 17 EARNINGS PER SHARE (continued) 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 2022 $ 2021 $ Audit services BDO Audit (WA) Pty Ltd - Audit and review of the financial reports 33,000 30,000 Total remuneration 33,000 30,000 19 CONTINGENT ASSETS AND LIABILITIES Contingent liabilities The Group had contingent liabilities in respect of: Future royalty payments Musgrave holds a 100% interest in the key tenure hosting gold resources at Cue including the Break of Day/ Starlight, White Heat-Mosaic, Big Sky and Lena deposits and other gold 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, White Heat-Mosaic and Lena gold deposits. Future consideration and royalty payments In March 2019, the Company entered into an Option Agreement (“Mainland 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 Mainland Agreement. The vendor will be entitled to a 1% gross royalty on any non-alluvial gold produced by the Company from the Mainland tenements. In March 2022 the Company, via its wholly owned subsidiary Musgrave Exploration Pty Ltd, entered into a Sale and Purchase Agreement with an unrelated proprietary company, Eastern Goldfields Exploration Pty Ltd (”Eastern”) to acquire a 100% interest in a number of tenements that comprise the Mt Magnet South Project. Eastern will sell its 100% interest in the Mt Magnet South Project to the Company for the following consideration (a) $100,000 payable on Completion (this has been paid); (b) on the second anniversary of Completion the Company must pay either $150,000 in cash or shares, at Musgrave’s election, to Eastern; (c) on the third anniversary of Completion the Company must pay either $125,000 in cash or shares, at Musgrave’s election, to Eastern; and (d) 0n the fourth anniversary of Completion the Company must pay either $125,000 in cash or shares, at Musgrave’s election, to Eastern. Following Completion Eastern will be entitled to receive a 1.0% NSR royalty in respect of any gold and rare earth elements produced from the Mt Magnet South Project. 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 on the Menninnie Dam Project. 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 the Menninnie Dam Project. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 44 19 CONTINGENT ASSETS AND LIABILITIES (continued) 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 2022. 20 EVENTS OCCURRING AFTER THE REPORTING PERIOD There have been no 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 $1,100,500 (2021: $1,063,380) per annum. Of this amount $920,800 is to be met by the Group’s joint venture partners as part of their earn-in obligations (2021: $928,180). 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 45 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 22 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) The Group’s principal financial instruments are tabled below. 2022 $ 2021 $ Financial assets Current Cash and cash equivalents (at amortised cost) 10,636,210 20,910,936 Trade and other receivables (at amortised cost) 337,157 322,014 10,973,367 21,232,950 Non-Current Financial assets at fair value through other comprehensive income (“FVOCI”) 743,963 1,577,188 743,963 1,577,188 Financial liabilities Current Trade and other payables (at amortised cost) 1,913,459 971,325 Lease liabilities (at amortised cost) 62,489 75,124 1,975,948 1,046,449 Non-Current Lease liabilities (at amortised cost) 10,750 38,813 10,750 38,813 Interest rate risk 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 46 22 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) The following table sets 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 Non- interest bearing $ Total $ 1 year or less $ Over 1 to 5 years $ More than 5 years $ 2022 Financial assets Cash and cash equivalents – 7,576,325 – – 3,059,885 10,636,210 Trade and other receivables – – – – 337,157 337,157 – 7,576,325 – – 3,397,042 10,973,367 Weighted average interest rate – 0.41% – – – – Financial liabilities Trade and other payables – – – – 1,913,459 1,913,459 Lease liabilities – 62,489 10,750 – – 73,239 – 62,489 10,750 – 1,913,459 1,986,698 Weighted average interest rate – 10% 10% – – – 2021 Financial assets Cash and cash equivalents – 18,576,325 – – 2,334,611 20,910,936 Trade and other receivables – – – – 322,014 322,014 – 18,576,325 – – 2,656,625 21,232,950 Weighted average interest rate – 0.45% – – – – Financial liabilities Trade and other payables – – – – 971,325 971,325 Lease liabilities – 75,124 38,813 – 113,937 113,937 – 75,124 38,813 – 1,085,262 1,085,262 Weighted average interest rate – 10% 10% – – – 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: 2022 $ 2021 $ Impact on profit / (loss) and equity Increase of 100 basis points 169,771 166,001 Decrease of 100 basis points (169,771) (166,001) Credit risk Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Group’s receivables from customers and investment securities. 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 47 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 22 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) 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. 2022 $ 2021 $ Cash and cash equivalents 10,636,210 20,910,936 Trade and other receivables 337,157 322,014 10,973,367 21,232,950 Foreign currency risk 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: Less than 6 months $ Total Contractual cash flows $ Carrying amount $ 2022 Trade and other payables 1,913,459 1,913,459 1,913,459 Lease liabilities 50,356 73,239 73,239 1,963,815 1,986,698 1,986,698 2021 Trade and other payables 971,325 971,325 971,325 Lease liabilities 35,456 113,937 113,937 1,006,781 1,085,262 1,085,262 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: 2022 $ 2021 $ Impact on profit / (loss) and equity Increase of 10% 74,396 157,718 Decrease of 10% (74,396) (157,718) NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 48 22 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) Fair value of financial assets and liabilities 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 2022 and 30 June 2021: Level 1 $ Level 2 $ Level 3 $ Total $ 30 June 2022 Financial assets at FVOCI 743,963 – – 743,963 743,963 – – 743,963 30 June 2021 Financial assets at FVOCI 1,577,188 – – 1,577,188 1,577,188 – – 1,577,188 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. 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. NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 49 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 23 SHARE-BASED PAYMENTS (continued) 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 S (1) 3,500,000 21 Nov 2018 16 Nov 2021 Immediate $0.1275 $0.0506 T (1) 450,000 30 Nov 2018 16 Nov 2021 Immediate $0.1275 $0.0506 U 3,450,000 21 Nov 2019 21 Nov 2022 Immediate $0.1045 $0.0203 V 5,900,000 20 Aug 2020 20 Aug 2023 Immediate $0.932 $0.2369 W (2) 1,780,000 28 Aug 2020 20 Aug 2023 Immediate $0.932 $0.2434 X 1,000,000 29 Jun 2021 24 Jun 2024 Immediate $0.56 $0.1557 Y 500,000 31 Aug 2021 27 Aug 2024 Immediate $0.47 $0.1590 Z 1,820,000 23 Sep 2021 23 Sep 2024 1 Oct 2022 $0.45 $0.1050 AA 3,750,000 18 Nov 2021 18 Nov 2024 18 Nov 2022 $0.59 $0.1471 (1) These options were exercised during the financial year. (2) 1,000,000 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 options is determined at grant date and is expensed over the vesting period for those options. A total of 6,070,000 Director or employee options were issued during the reporting period. The fair value of share options expensed during the year was $561,486 of which $338,533 relate to key management personnel (2021: $2,035,342 and $1,340,200 respectively). The model inputs for options granted during the year ended 30 June 2022 are as follows: Inputs Issue Y Issue Z Issue AA Number 500,000 1,820,000 3,750,000 Exercise price $0.47 $0.45 $0.59 Issue date 31 Aug 2021 23 Sep 2021 18 Nov 2021 Expiry date 27 Aug 2024 23 Sep 2024 18 Nov 2024 Vesting date Immediate 1 Oct 2022 18 Nov 2022 Share price at grant date $0.335 $0.285 $0.385 Expected price volatility 87.5% 75.0% 75.0% Risk-free interest rate 0.01% 0.18% 0.97% Expected dividend yield 0% 0% 0% Movements in share options during the year Movement in the number of share options held by Directors, employees and consultants: 2022 2021 Number of options Weighted average exercise price $ Number of options Weighted average exercise price $ Outstanding at the beginning of the year 16,080,000 0.534 21,650,000 0.116 Granted and vested during the year 500,000 0.470 8,880,000 0.890 Granted but not vested during the year 5,570,000 0.544 – – Exercised during the year (3,950,000) 0.128 (14,250,000) 0.116 Expired / lapsed during the year (1,000,000) 0.932 (200,000) 0.932 Outstanding at the end of the year 17,200,000 0.605 16,080,000 0.534 Exercisable at the end of the year 11,630,000 0.635 16,080,000 0.534 The weighted average remaining contractual life of share options outstanding at the end of the year was 1.46 years (2021: 1.60 years). NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 50 23 SHARE-BASED PAYMENTS (continued) 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 $ 2022 Number 2021 Number 16 November 2021 0.1275 – 3,950,000 21 November 2022 0.1045 3,450,000 3,450,000 20 August 2023 0.9320 6,680,000 7,680,000 24 June 2024 0.5600 1,000,000 1,000,000 27 August 2024 0.4700 500,000 – 23 September 2024 0.4500 1,820,000 – 18 November 2024 0.5900 3,750,000 – Totals 17,200,000 16,080,000 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 2022 $ 2021 $ Cash flows from operating activities Profit / (loss) for the year (1,582,727) (2,881,297) Non-cash flows in profit / (loss): - Other income – 79,500 - Depreciation 163,642 132,783 - Share based remuneration 561,486 2,035,342 Changes in assets and liabilities - Decrease / (Increase) in trade and other receivables (14,455) (31,835) - Decrease / (Increase) in other current assets (3,698) (2,476) - Increase / (Decrease) in trade and other payables (397,447) (304,881) - Increase / (Decrease) in employee entitlements 51,614 67,010 Net cash used in operating activities (1,221,585) (905,854) 25 RELATED PARTY DISCLOSURE a) Parent entity Class Country of incorporation Investment at cost 2022 $ 2021 $ Musgrave Minerals Limited Ordinary Australia – – b) Subsidiaries Class Country of incorporation Investment at cost 2022 $ 2021 $ Musgrave Exploration Pty Ltd Ordinary Australia 100 100 NOTES TO TH E CONS OL IDATED F INANCIAL S TATEM ENTS F OR TH E YEAR ENDED 30 J U NE 2022 PAGE 51 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 25 RELATED PARTY DISCLOSURE (continued) c) Key management personnel compensation 2022 $ 2021 $ Short-term employee benefits 508,868 463,325 Post-employment benefits 49,429 44,074 Bonus payments 57,059 68,858 Share-based payments 338,533 1,340,200 953,889 1,916,457 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 Proportion of ownership 2022 2021 Musgrave Exploration Pty Ltd Exploration Australia 100% 100% 27 PARENT ENTITY DISCLOSURE 2022 $ 2021 $ Financial Performance Profit / (loss) for the year (1,582,727) (2,881,297) Other comprehensive income (833,225) (369,125) Total comprehensive profit / (loss) (2,415,952) (3,250,422) Financial Position ASSETS Current assets 10,990,016 21,245,901 Non-Current assets 37,917,108 28,064,150 TOTAL ASSETS 48,907,124 49,310,051 LIABILITIES Current liabilities 2,230,152 1,249,039 Non-Current liabilities 10,750 38,813 TOTAL LIABILITIES 2,240,902 1,287,852 NET ASSETS 46,666,222 48,022,199 EQUITY Contributed equity 73,438,246 72,739,946 Reserves 1,866,390 2,581,338 Accumulated losses (28,638,414) (27,299,085) TOTAL EQUITY 46,666,222 48,022,199 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 2022 other than the commitments as disclosed in Note 21. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 52 The Directors of Musgrave Minerals Limited declare that: 1) in the Directors’ opinion, the financial statements and notes set out on pages 29 to 51 and the Remuneration Report in the Director’s Report are in accordance with the Corporations Act 2001, including: a) giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its performance, for the financial year ended on that date; and b) complying with Australian Accounting Standards (including the Australian Accounting Interpretations), Corporations Regulations 2001 and mandatory professional reporting requirements. 2) the financial statements also comply with International Financial Reporting Standards as disclosed in Note 2; and 3) 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 2022. Signed in accordance with a resolution of the Directors. Mr Graham Ascough Chairman Perth, Western Australia 23 September 2022 DIRECTORS ’ DECL ARATION PAGE 53 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 INDEPENDENT AU DITOR’ S REPORT 1 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. Level 9, Mia Yellagonga Tower 2 5 Spring Street Perth WA 6000 PO Box 700 West Perth WA 6872 Australia Tel: +61 8 6382 4600 Fax: +61 8 6382 4601 INDEPENDENT AUDITOR'S REPORT To the members of Musgrave Minerals Limited Report on the Audit of the Financial Report Opinion We have audited the financial report of Musgrave Minerals Limited (the Company) and its subsidiary (the Group), which comprises the consolidated statement of financial position as at 30 June 2022, 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 2022 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. 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. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 54 INDEPENDENT AU DITOR’ S REPORT 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. Other information The directors are responsible for the other information. The other information comprises the information contained in director’s report for the year ended 30 June 2022, 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 55 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 INDEPENDENT AU DITOR’ 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. MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 56 INDEPENDENT AU DITOR’ S REPORT Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in pages 22 to 26 of the directors’ report for the year ended 30 June 2022. In our opinion, the Remuneration Report of Musgrave Minerals Limited, for the year ended 30 June 2022, 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 Melissa Reid Director Perth, 23 September 2022 PAGE 57 MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 ADDITIONAL INF ORM ATION The following additional information not shown elsewhere in this report is required by the ASX Listing Rules and is current as at 14 September 2022. Securities Quotation has been granted for 537,172,949 ordinary shares of the Company on the Australian Securities Exchange. Quoted Securities ASX Code Number of Holders Security Description Total Securities MGV 4,810 Ordinary Fully Paid 537,172,949 Unquoted Securities ASX Code Number of Holders Security Description Total Securities MGVAB 3 Options expiring 21/11/2022 3,450,000 Exercisable at $0.1045 MGVAC 16 Options expiring 20/08/2023 6,680,000 Exercisable at $0.932 MGVAB 1 Options expiring 24/06/2024 1,000,000 Exercisable at $0.56 MGVAZ 1 Options expiring 27/08/2024 500,000 Exercisable at $0.47 MGVAD 11 Options expiring 23/09/2024 1,790,000 Exercisable at $0.45 MGVAB 5 Options expiring 18/11/2024 3,750,000 Exercisable at $0.59 MGVAAA 1 Options expiring 19/06/2025 2,500,000 Exercisable at $0.45 One holder Mr Robert Waugh and Mrs Sara Waughholds 6,000,000 unlisted options (equivalent to 31% of total unlisted options) Voting Rights The voting rights attached to each class of security are as follows: • Ordinary Fully Paid shares – one vote per share held. • Options – no voting rights are attached to unexercised options. Distribution schedule Spread of Holdings - Ordinary Shares (ASX Code: MGV) Holders Units % Units 1 - 1,000 285 103,618 0.02 1,001 - 5,000 1,135 3,257,554 0.61 5,001 - 10,000 786 6,428,471 1.20 10,001 - 100,000 2,007 74,453,464 13.86 100,001 and over 597 452,929,842 84.31 TOTAL 4,810 537,172,949 100% MUSGRAVE MINERALS LTD ANNUAL REPORT 2022 PAGE 58 ADDITIONAL INF ORM ATION Substantial Shareholding The Company has received the following notices of substantial holding: • Westminex Group in relation to 50,016,159 ordinary shares Unmarketable Parcel There are 718 Shareholders holding less than a marketable parcel of fully paid ordinary shares (a minimum parcel is $500 shares, being 2,084 shares using a market value of $0.24). Buyback No on-market share buy-back is current. Top Holders The names of the twenty largest holders of quoted securities are listed below: Rank Name Units held % of Units 1 WESTMINEX PTY LTD 50,888,325 9.47% 2 JETOSEA PTY LTD 44,981,535 8.37% 3 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 42,383,097 7.89% 4 EVOLUTION MINING LIMITED 21,705,979 4.04% 5 CITICORP NOMINEES PTY LIMITED 14,970,371 2.79% 6 BUZI BEAR PTY LTD 14,358,919 2.67% 7 EQUITY TRUSTEES LIMITED 10,563,726 1.97% 8 MR DOUGLAS JOHN KIRWIN 7,197,994 1.34% 9 JAYLEAF HOLDINGS PTY LTD 7,000,000 1.30% 10 THE A SHARP FAMILY PTY LTD 6,644,439 1.24% 11 MR STACEY RADFORD 6,100,000 1.14% 12 J P MORGAN NOMINEES AUSTRALIA PTY LIMITED 5,737,594 1.07% 13 BNP PARIBAS NOMINEES PTY LTD 5,535,382 1.03% 14 MR ROBERT SCOTT WAUGH & MRS SARA RUTH WAUGH 5,300,000 0.99% 15 SOUDURE S/F PTY 4,450,000 0.83% 16 MERCHANT GROUP PTY LTD 4,063,140 0.76% 17 MR GRAHAM LESLIE ASCOUGH & MRS PATRICIA LYNN ASCOUGH 3,341,172 0.62% 18 OLGEN PTY LTD 3,000,000 0.56% 19 GS GROUP AUSTRALIA PTY LTD 2,742,296 0.51% 20 PRECISION OPPORTUNITIES FUND LTD 2,539,533 0.47% Gound 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 ABN 12 143 890 671