And Controlled Entities
ABN: 83 127 620 482
ANNUAL REPORT
For the Year Ended 30 June 2024
CONTENTS
Nelson Resources Limited and Controlled Entities
CORPORATE DIRECTORY
1
DIRECTORS’ REPORT
2
AUDITOR’S INDEPENDENCE DECLARATION
21
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
22
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
23
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
24
CONSOLIDATED STATEMENT OF CASH FLOWS
25
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
26
CONSOLIDATED ENTITY DISCLOSURE STATEMENT
50
DIRECTORS’ DECLARATION
51
INDEPENDENT AUDITOR’S REPORT
52
ADDITIONAL INFORMATION FOR PUBLIC LISTED COMPANIES
57
CORPORATE DIRECTORY
Nelson Resources Limited and Controlled Entities
1
DIRECTORS
Peter Bird
Non-Executive Chairman (appointed 20 November 2022)
Nicholas Ong
Non-Executive Director (appointed 20 November 2022)
Daniel Smith
Non-Executive Director (appointed 15 August 2022)
SECRETARY
Nicholas Ong (appointed 21 November 2022)
REGISTERED AND BUSINESS OFFICE
Level 8, 99 St Georges Terrace
Perth WA 6000
Telephone: +61 8 9486 4036
WEBSITE & EMAIL
www.nelsonresources.com.au
info@nelsonresources.com.au
STOCK EXCHANGE LISTINGS
Australian Securities Exchange
ASX Code: NES
AUDITORS
Criterion Audit Pty Ltd
Suite 2, 642 Newcastle Street
Leederville WA 6902
SHARE REGISTRY
Automic Registry Services Pty Ltd
Level 5, 191 St Georges Terrace
Perth WA 6000
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
2
Your Directors submit the annual financial report of the Consolidated Entity for the year ended
30 June 2024.
PRINCIPAL ACTIVITIES
The principal activities of the Consolidated Entity during the year were the exploration and
development of natural resources. There have been no other significant changes in the activities
of the Consolidated Entity during the year other than matters noted in this report.
REVIEW OF RESULTS
The loss after tax for the year ended 30 June 2024 was $6,400,075 (2023: $1,307,070 ).
DIVIDENDS
No dividends were paid or declared during the year ended 30 June 2024 (2023: nil).
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
3
OPERATIONS
Figure 1 – Nelson Resources Project Locations
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
4
Project Activity
Nelson Resources has completed the following work at each of its projects (Figure 1) during the
year:
Fortnum Gold Project
The Fortnum project (E52/3695) is a 21km² tenement located within the Peak Hill Mineral Field,
approximately 14km southwest of the Fortnum Mining centre (Figure 1). The geology of the
tenure consists of a fault bounded package of schists derived from the Labouchere Formation
constrained by the Despair Granite to the east and Yarlarweelor Gneiss complex to the West.
Previous drilling has not fully tested the anomalous gold-in-soil results on the existing targets that
has been the focus of previous drilling. Historical drilling returned significant results including 5m
@ 4.71g/t Au from 35m in FRB3032, 8m @ 2.41g/t Au from 52m in FRB1117 and 3m @ 2.43g/t
Au from 2m in FRB3032. These results present a compelling target for follow-up drilling. The
Company believes that Fortnum is an excellent short-term exploration opportunity with its
historical results and proximity to processing facilities at Fortnum.
Following agreement with the traditional owners of the land on which the Fortnum Project is
located, an aircore drilling program was completed in the first half of FY2024. A total of 46 holes
were drilled for 2,640m
The significant intercepts from this work include:
Hole
From To
Intercept
Including
FTA003
8
16 8m @ 0.29g/t from 8m.
FTA003
40
56 16m @ 0.17g/t from 40m.
FTA007
36
44 8m @ 0.54g/t from 36m.
FTA007
84
86 2m @ 0.32g/t from 84m.
EOH
FTA008
108 116 8m @ 0.23g/t from 108m.
FTA018
28
36 8m @ 0.52g/t from 28mn.
FTA023
60
63 3m @ 0.14g/t from 60m.
EOH
FTA052
16
28 12m @ 0.45g/t from 16m.
FTA052
44
56 12m @ 2.59g/t from 44m.
including 4m @ 7.31 g/t from 48m
FTA052
64
66 2m @ 0.19g/t from 64m.
EOH
FTA056
64
68 4m @ 0.24g/t from 64m.
FTA056
92
102 10m @ 0.45g/t from 92m.
including 2m @ 1.13 g/t from 100m (EOH).
These intercepts are distributed through a wide range of lithologies and through every part of the
regolith. Together with the historical results, they define a narrow, 4km long, zone, within
deformed Labouchere Formation along the interpreted western edge of the Despair Granite. This
zone is interpreted to be related to mineralisation in the basement.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
5
Yarri Project
Nelson have explored the Yarri project since 2017 and have completed substantial
exploration programs, including:
•
Aerial photography over the individual tenements.
•
Ground magnetic survey over the individual tenements.
•
112 RC drill holes for 10,580m.
From this work, the mineralised system at Yarri was successfully targeted and a number of
significant intersections were reported, including:
•
8m @ 18.1g/t Au from 101 m in hole YWRC11, including 3m @ 44.1g/t Au.
•
9m @ 14.6 g/t Au from 70 m in hole YWRC05, including 4m @ 30.2g/t Au.
•
4m @ 4.2g/t Au from 52 m in hole YWRC18, including 1m @ 13.8g/t Au.
•
4m @ 4.1g/t Au from 92 m in hole YWRC 26, including 1m @ 12.2g/t Au.
•
6m @ 13.2g/t Au from 15 m in hole YGRC03, including 1m @ 69.9g/t Au.
•
3m @ 4.8g/t Au from 33 m in hole YBRC04, including 1m @ 10.2g/t Au.
The small size of Nelson’s Yarri Project placed severe restrictions on what could be achieved over
the project. The purchase of additional tenements from Rock Mining Australia Ltd (RMA), which
was completed during the first half of FY2024, has made the project significantly more viable.
RMA’s Yarri tenements completely surround the Nelson Yarri Project.
RMA have held their Yarri Project since 2017 and during that period have completed a significant
amount of work, including RC drilling (39 holes for 2267m) and photogrammetry. The drilling has
produced a number of significant intersections at Hidden Treasure, including:
•
8m @ 4.62 g/t gold from 40m, including 2m @ 10.87 g/t from 44m (TP6).
•
15m @ 1.33g/t gold from 12m, including 3m @ 3.31 g/t from 20m (TP21).
•
6m @ 1.38 g/t gold from 41m, including 1m @ 4.01 g/t from 44m (TP33).
This work is shown on Figure 2.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
6
Figure 2: Yarri Project, Wallaby-Hidden Treasure significant intersections from Nelson and
RMA work.
More funding is required to continue to test the depth and length of the known mineralisation.
Woodline Gold Project
The Woodline Project (Figure 3) lies 140km South East of Kalgoorlie and is halfway between the
Trans Australia Rail line and the Eyre Highway. The Woodline Project consists of the Grindall,
Redmill, Harvey, Socrates & Morris Projects which makes up 1,220km² of prime exploration
tenure.
The Project lies across the boundary of the Archaean Yilgarn Craton and the Proterozoic Northern
Foreland of the Albany-Fraser Orogen.
Work carried out by Nelson at Socrates has returned several significant gold intersections,
suggesting a large underlying gold system. The Company believes that Grindall, Redmill, and
Harvey each have the potential to host a Tropicana scale gold deposit.
N
200 m
5m @ 1.13 g/t
RMA drilling
intercepts
6m @ 13.2 g/t
Nelson drilling
intercepts
Drill holes
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
7
The Woodline Project incorporates:
-
65km of the Cundeelee fault within its tenure and contains an identified >20km gold
geochemical and bedrock gold anomaly which is in the same geological structural
setting 2 as the 7.7 million ounce Tropicana Gold Mine.
-
30km of significantly unexplored greenstones within the Norseman-Wiluna
greenstone belt, and a significant and unique holding within the confluence of the
Keith-Kilkenny Fault / the Claypan Shear Zone and the Cundeelee Shear Zone. These
three Shears have hosted many of the largest gold projects in Western Australia.
-
Recent drilling geophysics has identified several mineralised zones and extensions at
Socrates Main, Socrates West and Socrates East.
Tempest Gold Project
The Tempest gold project is located 250km ESE of Kalgoorlie and 90km NE from Nova-Bollinger
Mine in the Albany-Fraser orogen. The project has an area of 105 km² and borders the IGO /
Rumble Resources Thunderstorm JV project. Drilling at the Thunderstorm JV includes an
exceptional intercept of 25m @ 2.42g/t Au at the Themis Prospect and 4m @ 3.8g/t Au at the Pion
Prospect. More recent drilling includes an equally exceptional intercept of 16m @ 6.69g/t Au from
42m (including 4m @ 22.2g/t Au from 50m).
The project is located in the Fraser Complex of the Proterozoic Albany-Fraser Orogen and is east
of the Archean Yilgarn Craton. The Proterozoic geology is completely obscured by Tertiary fluvio-
marine sediments associated with the Eucla Basin, which cover much of the region. The project
has the potential to host gold resources and historical exploration is both limited and early stage.
Historical work completed is unrelated to the potential extension of the gold-bearing
paleochannel identified at the neighbouring Thunderstorm project.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
8
Figure 3: Location of passive seismic survey showing IGO/Rumble tenement & significant results on NES
aeromagnetic survey.
Competent Persons Statement
The information in this report that relates to Exploration Results is based on information compiled
by Mr Derek Shaw, a geologist employed by Nelson Resources Limited. Mr Shaw is a Member
Australian Institute of Geoscientists and has sufficient experience that is relevant to this style of
mineralisation and type of deposit under consideration and to the activity that is being reported
on 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 Shaw consents to the
inclusion in the report of the matters in the form and context in which it appears.
MATERIAL BUSINESS RISKS
The Company has exposure to a number of material economic, environmental and social
sustainability risks, as is typical for a mineral exploration company. Some of these risks are
mitigated by the use of safeguards and appropriate controls, however, some of the risks are
outside the control of the Directors and management of the Company and cannot be mitigated.
The risks described in this section are not an exhaustive list of all the risks faced by the Company.
The risks described below could in the future materially affect the financial performance and
position of the Company.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
9
Security of Tenure
The exploration tenements comprising the Company’s projects are subject to the Mining Act and
Mining Regulations (or equivalent) in the relevant State or Territory jurisdictions. Exploration
tenements are subject to periodic renewal, which is subject to the discretion of the relevant
authority and may be subject to conditions. Renewal conditions may include increased
expenditure and work commitments or compulsory relinquishment of areas of the tenements
comprising the Company’s projects. The imposition of new conditions or the inability to meet
those conditions may adversely affect the operations, financial position and/or performance of
the Company.
Although the Company has no reason to think that the Company’s tenements will not be renewed,
there is no assurance that such renewals will be given as a matter of course and there is no
assurance that new conditions will not be imposed by the relevant granting authority. The
Company considers the likelihood of tenure forfeiture to be low given the laws and regulations
governing exploration in the relevant State or Territory jurisdictions and the ongoing expenditure
budgeted by the Company.
Exploration and Development Risks
Resource exploration and development involves significant risks which only occasionally provide
high rewards. In addition to the normal competition for prospective ground and the high costs of
discovery and development of an economic deposit, factors such as demand for commodities,
stock market fluctuations affecting access to new capital, sovereign risk, environmental issues,
labour disruption, project financing, and technical problems all affect the ability of a company to
profit from a discovery.
There is no assurance that the Company’s exploration operations will result in the discovery of an
economic resources. Even if an apparently viable deposit is identified, there is no guarantee that
it can be economically exploited. The success of the Company will also depend upon the Company
having access to sufficient development capital, being able to maintain title to its projects and
obtaining all required approvals for its activities. In the event that exploration programs prove to
be unsuccessful this could lead to a diminution in the value of the tenements, a reduction in the
cash reserves of the Company and/or possible relinquishment of its projects.
Environmental Risk
The Company’s projects are subject to State and Federal laws and regulations regarding
environmental matters. The Governments and other authorities that administer and enforce
environmental laws and regulations determine these requirements.
Additional approvals may be required to undertake activities that are likely to impact the
environment. Delays in obtaining such approvals can result in the delay to anticipated exploration
programs. As with most exploration projects, the Company’s activities are expected to have an
impact on the environment, particularly if advanced exploration proceeds. It is the Company’s
intention to conduct its activities to the highest standard of environmental obligation, including
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
10
compliance with all environmental laws. There is a risk that environmental laws and regulations
become more onerous with time making the Company’s activities more expensive.
Reliance on key personnel
The Company’s future depends, in part, on its ability to attract and retain key personnel. It may
be particularly difficult for the Company to attract and retain suitably qualified and experienced
personnel, given the current high demand in the industry and small size of the Company, relative
to other industry participants. The Company’s future also depends on the continued contributions
of its key management and technical personnel, the loss of whose services would be difficult to
replace. In addition, the inability to continue to attract appropriately qualified personnel could
have a material adverse effect on the Company’s business.
Additional Requirement for Funding
The Company’s funding requirements depend on numerous factors including the Company’s
future exploration and work programs. Furthermore, the Company may require further capital in
addition to current cash reserves to fund future exploration activities. If required funding cannot
be sourced, then this may limit the capacity of the Company to execute its business strategy and
exploration programs.
Additional equity funding, if available, may be dilutive to Shareholders and at lower prices than
the current market price. Debt funding, if available, may involve restrictions on financing and
operating activities and be subject to risks relating to movements in interest rates. Increases in
interest rates may make it more expensive for the Company to fund its operations.
Climate Risk
The Company acknowledges that climate change issues could constitute a risk to its operations
but has assessed the risks to be very low. The largest concern for the Company is water
management during its exploration activities and access to site during major rain events. Most of
the Company’s operations occur in remote areas with scarce access to water and the Company
believes that climate change may exacerbate this issue as weather patterns potentially become
less predictable. The Company’s approach is to be flexible and adaptive in its response to manage
this potential issue whilst adding water bores and improving site access in all-weather conditions.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
11
DIRECTORS’ QUALIFICATIONS AND EXPERIENCE
The Directors’ qualifications and experience are set out below:
Current Directors
Director
Details
Peter Bird
Qualifications
BSc (Hons) (Geology)
Position
Non-executive Chairman
Appointment Date
20 November 2022
Length of Service
19 months
Biography
Peter Bird has a wide experience in operational mining geology and
exploration in large multinational corporations. He has worked in
business development and treasury, with extensive experience as a
mining analyst and in investor relations and human resources
before becoming a company director. Peter was Deputy Chairman
and CEO of Asiamet Resources Limited, Australia, from 2017 (listed
on the AIM market of the London Stock Exchange), prior to joining
Zenith. He has previously served as Managing Director of
Heemskirk Consolidated Ltd, of which he was a joint founder, and
was Non-Executive Chairman of Excelsior Gold Ltd.
Current Listed
Directorships
Cosmo Metals Limited (since 10 November 2021)
Former Listed
Directorships within last
3 years
Zenith Minerals Limited
Nicholas Ong
Qualifications
MBA, BCom, GradDipAppFin, GradDipACG, FCIS, FGIA
Position
Non-Executive Director
Appointment Date
20 November 2022
Length of Service
19 months
Biography
Mr Ong brings 19 years’ experience in IPO, listing rules compliance
and corporate governance. He is experienced in mining project
finance, mining and milling contract negotiations, mine CAPEX &
OPEX management, and toll treatment gold reconciliation. Nicholas
is a Fellow of the Governance Institute of Australia and holds a
Bachelor of Commerce and a Master of Business Administration
from the University of Western Australia. Nicholas is currently a
Company Secretary of several ASX listed companies.
Current Listed
Directorships
Beroni Group Limited (since 1 March 2021)
CFOAM Ltd (since 24 October 2020)
Former Listed
Directorships within last
3 years
White Cliff Resources Limited
Helios Energy Limited
Vonex Limited
Miepay Limited
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
12
Daniel Smith
Qualifications
BA, GradDipACG, FGIA, RG146
Position
Non-Executive Director
Appointment Date
15 August 2022
Length of Service
22 months
Biography
Mr Smith holds a Bachelor of Arts, is a Fellow of the Governance
Institute of Australia, and has over 15 years primary and secondary
capital markets expertise. He has advised on and been involved in
over a dozen IPOs, RTOs and capital raisings on the ASX, AIM and
NSX. Dan is currently non-executive director and/or company
secretary for a number of companies operating in the resources
sector, and has been heavily involved in project origination and
evaluation.
Current Listed
Directorships
White Cliff Minerals Limited (since 14 December 2018)
QX Resources Limited (since 13 June 2018)
Lachlan Star Limited (since 18 January 2018)
DY6 Metals Ltd (since 3 November 2022)
Europa Metals Ltd (since 16 January 2018)
Artemis Resources Limited (since 5 February 2019)
Former Listed
Directorships within last
3 years
Alien Metals Ltd
COMPANY SECRETARY
Company Secretary
Details
Nicholas Ong
Position
Company Secretary
Appointment Date
20 November 2022
Resignation Date
N/A
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
13
MEETINGS OF DIRECTORS
The number of meetings held during the year and the number of meetings attended by each
Director was as follows:
Board
Board in the
Capacity of
Audit & Risk
Management
Committee
Board in the
Capacity of
Nomination &
Remuneration
Committee
Number of Meetings Held
1
-
Number of Meetings Attended:
Peter Bird
1
Nicholas Ong
1
Daniel Smith
1
The Consolidated Entity does not have an Audit, Remuneration or Nomination Committee with
the full Board carrying out the functions that would otherwise be dealt with by such Committees.
All Directors were eligible to attend all Board Meetings held when they were in office.
SHARE OPTIONS
As at the date of this report, there were 2,152,539 options exercisable at $0.1125 expiring 18
November 2024 on issue.
SHARES ISSUED AS A RESULT OF THE EXERCISE OF OPTIONS
The were no shares issued as a result of the exercise of options during the year.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
14
REMUNERATION REPORT
Introduction
The Directors present the Remuneration Report for the Consolidated Entity for the year ended 30
June 2024. This Remuneration Report forms part of the Directors’ Report in accordance with the
requirements of the Corporations Act 2001 and its regulations. For the purposes of this report,
Key Management Personnel (“KMP”) of the Consolidated Entity are defined as those persons
having authority and responsibility for planning, directing and controlling the major activities of
the Company and the Consolidated Entity, directly or indirectly, including any director (whether
executive or otherwise) of the Parent Entity.
Remuneration Policy
The Company Constitution provides that the remuneration of non-executive Directors will not be
more than the aggregate fixed sum determined by a general meeting. The aggregate
remuneration for non-executive Directors has been set at an amount not to exceed $250,000 per
annum. The remuneration of executive Directors will be fixed by the Directors and may be paid
by way of fixed salary or consultancy fee.
Remuneration Report Approval at FY2024 AGM
The remuneration report for the period ended 30 June 2024 will be put to shareholders for
approval at the Company’s AGM which will be held during November 2024.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
15
Details of Remuneration
Details of the remuneration of the Directors, other key management personnel of the
Consolidated Entity and specified executives of the Consolidated Entity for the years ended 30
June 2024 and 30 June 2023 respectively are set out on the following tables:
Fixed
STI
LTI
Total
Proportion of
Remuneration
Year
Salary
fees
and
leave
$
Other
Fees
$
Ter-
mination
Payment
$
Super-
annuation
$
Incentive
Payments
$
FV
Securities
$
$
Fixed
%
STI
%
LTI
%
Non-
Executive
Directors
Peter Bird
2024
32,432
-
-
3,568
-
-
36,000
100%
-
-
2023
20,000
-
-
2,100
-
-
22,100
100%
-
-
Daniel
Smith
2024
36,000
-
-
-
-
-
36,000
100%
-
-
2023
35,586
-
-
-
-
-
35,586
100%
-
-
Nicholas
Ong
2024
36,000
-
-
-
-
-
36,000
100%
-
-
2023
22,000
-
-
-
-
-
22,000
100%
-
-
Jonathan
Shellabear
2024
-
-
-
-
-
-
-
-
-
-
2023
29,837
-
-
3,133
-
-
32,970
100%
-
-
Stephen
Brockhurst
2024
-
-
-
-
-
-
-
-
-
-
2023
19,520
-
-
-
-
-
19,520
100%
-
-
Total Non-
Executive
Directors
2024
104,432
-
-
3,568
-
-
108,000
100%
-
-
2023
126,943
-
-
5,233
-
-
132,176
100%
-
-
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
16
Consultancy Agreements
Pether Bird is appointed as a non-executive director pursuant to an appointment letter with the
Company. The appointment letter commenced on 20 November 2022 and will continue until it is
terminated in accordance with its terms. Under the Appointment Letter, Peter Bird is entitled to
receive a director fee of $36,000 per annum inclusive superannuation.
Daniel Smith is engaged as a non-executive director pursuant to a consultancy agreement with
the Company. The consultancy agreement commenced on 15 August 2022 and will continue until
it is terminated in accordance with its terms. For his role as a non-executive director, the
Company will pay Daniel Smith a fee of $52,560 per annum. The fee was reduced to $36,000 per
annum effective from 1 November 2022.
Nicholas Ong is engaged as a non-executive director pursuant to a consultancy agreement with
the Company. The consultancy agreement commenced on 20 November 2022 and will continue
until it is terminated in accordance with its terms. For his role as a non-executive director, the
Company will pay Nicholas Ong a fee of $36,000 per annum.
The Company engaged Minerva Corporate Pty Ltd (“Minerva Corporate”), of which Daniel Smith
and Nicholas Ong are directors, to provide company secretarial services for a monthly fee of
$2,000, and chief financial officer services for a monthly fee of $3,000.
Share Based Compensation
There were no share-based compensation during the year.
No ordinary shares in the Company were provided as a result of an exercise of remuneration
options to Directors and other key management personnel of the Consolidated Entity in this or
the previous reporting period.
Related Party Transactions
During the year the Company incurred $60,000 in company secretarial and chief financial officer
fees to Minerva Corporate Pty Ltd (“Minerva”), and additional consulting fee of $21,000 to
Minerva Corporate for the corporate consulting services provided by Daniel Smith and Nicholas
Ong.
As of 30 June 2024, the Company owed Minerva totalling $98,000 excl GST, including $21,000
unpaid directors fee each for Daniel Smith and Nicholas Ong, $14,000 for company secretarial
services, $21,000 for chief financial officer services, and $21,000 for corporate consulting services.
Directors’ Interests and Benefits
The movement during the reporting period in the number of fully paid ordinary shares of the
Company held directly, indirectly or beneficially, by each Director or key management personnel,
including their personally-related entities is as follows:
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
17
Director
No. Shares
Held at 30
June 2023
On-Market
Purchases
Conversion of
Performance
Rights
Other
Changes
No. Shares
Held at 30
June 2024
No. Shares
Held at Date
of this Report
Peter Bird
Directly
-
-
-
-
-
-
Indirectly
-
-
-
-
-
-
Daniel Smith
Directly
-
-
-
-
-
-
Indirectly
36,000,000
4,000,000
-
-
40,000,000 1
40,000,000
Nicholas Ong
Directly
-
-
-
-
-
-
Indirectly
35,902,301
4,097,699
-
-
40,000,000 2
40,000,000
The movement during the reporting period in the number of options over ordinary shares of the Company
held directly, indirectly or beneficially, by each Director or key management personnel, including their
personally-related entities is as follows:
Director
No. Options
Held at 30 June
2023
Grant of
Options
Expiry of
Options
Other
Changes
No. Options
Held at 30
June 2024
No. Options
Held at Date
of this
Report
Peter Bird
Directly
-
-
-
-
-
-
Indirectly
-
-
-
-
-
-
Daniel Smith
Directly
-
-
-
-
-
-
Indirectly
265,000
-
(265,000)
-
-
-
Nicholas Ong
Directly
-
-
-
-
-
-
Indirectly
265,000
-
(265,000)
-
-
-
End of Audited Remuneration Report.
1 Among shares held at 30 June 2024, 36,500,000 units were held by Bridge The Gap Trading Pty Ltd, a company of
which Daniel Smith and Nicholas Ong are directors and indirect shareholders, and 3,500,000 units were held by
Orwellian Investments Pty Ltd, a company of which Daniel Smith is director and indirect shareholder.
2 Among shares held at 30 June 2024, 36,500,000 units were held by Bridge The Gap Trading Pty Ltd, a company of
which Daniel Smith and Nicholas Ong are directors and indirect shareholders; 3,500,000 units were held through
Qupit Superannuation, of which Nicholas Ong is a beneficiary.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
18
ENVIRONMENTAL REGULATION
The Company is subject to significant environmental and monitoring requirements in respect of
its natural resources exploration activities. The Directors are not aware of any significant breaches
of these requirements during the year.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS
There is no likely development of which the Directors are aware of which could be expected to
significantly affect the results of the Company’s operations in subsequent financial periods not
otherwise disclosed in the ‘Principal activities’ and ‘Review of operations’ or the ‘Significant
events after the balance sheet date’ sections of the Directors’ report.
INDEMNIFICATION AND INSURANCE OF OFFICERS
The Company has agreed to indemnify all of the Directors of the Company for any liabilities to
another person (other than the Company or related body corporate) that may arise from their
position as Directors of the Company and its controlled entities, except where the liability arises
out of conduct involving a lack of good faith. During the financial year the Company paid a
premium in respect of a contract insuring the Directors and officers of the Company and its
controlled entities against any liability incurred in the course of their duties to the extent
permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the
nature of the liability and the amount of the premium.
PROCEEDINGS ON BEHALF OF THE COMPANY
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. No proceedings have been brought or intervened in on behalf of the
Company with leave of the Court under section 237 of the Corporations Act 2001.
CORPORATE GOVERNANCE
The Board intends to set measurable objectives for achieving diversity, specifically including
gender diversity and will review and report on the effectiveness and relevance of these
measurable objectives. However, due to the current size of the Board and management, these
measurable objectives have not yet been set.
NON-AUDIT SERVICES
Criterion Audit Pty Ltd was appointed as the Company’s auditor on 24 October 2016 and has not
provided any non-audit services to the Company since its appointment.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
19
EVENTS SUBSEQUENT TO REPORTING DATE
There are no matters or circumstances have arisen since the end of the year which will
significantly affect, or may significantly affect, the state of affairs or operations of the reporting
entity in future financial periods other than the following:
On 27 September 2024, the Company issued 25,000,000 shares to Rock Mining Australia Pty Ltd
(“RMA”) pursuant to an agreement for the acquisition of RMA’s 6 granted prospecting licenses
and two mining license applications (the Tenements), which surround the Company’s Yarri gold
project. The anniversary consideration of $75,000 in fully paid ordinary shares in the Company is
based on the 5-day VWAP of the Company’s shares prior to 5 July 2024.
DIRECTORS’ REPORT continued
Nelson Resources Limited and Controlled Entities
20
AUDITOR’S DECLARATION OF INDEPENDENCE
The auditor’s independence declaration for the year ended 30 June 2024 has been received and
is included within the financial statements.
This report is made in accordance with a resolution of Directors, pursuant to section 306(3) of the
Corporation Act 2001.
Signed in accordance on behalf of the Directors.
____________________
Peter Bird
Non-Executive Chairman
29 September 2024
Liability limited by a scheme approved under Professional Standards Legislation
Criterion Audit Pty Ltd
ABN 85 165 181 822
PO Box 233 LEEDERVILLE WA 6902
Suite 2, 642 Newcastle Street
LEEDERVILLE WA 6007
Phone: 9466 9009
To The Board of Directors
Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001
As lead audit director for the audit of the financial statements of Nelson Resources Limited and Controlled Entities for the
year ended 30 June 2024, I declare that to the best of my knowledge and belief, there have been no contraventions of:
•
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
•
any applicable code of professional conduct in relation to the audit.
Yours faithfully
CHRIS WATTS CA
Director
CRITERION AUDIT PTY LTD
DATED at PERTH this 29th day of September 2024
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND
OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
22
Note
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
Revenue
3
12,505
45,266
Administration and other expenses
(84,081)
(147,004)
Accounting and audit fees
(44,706)
(40,699)
Consultancy fees
(109,955)
(85,073)
Depreciation: plant and equipment
9
(24,257)
(343,322)
Depreciation: right of use assets
10
-
(48,685)
Directors’ fees and superannuation
20
(95,432)
(223,184)
Employee expenses
(13,171)
(65,400)
Finance costs: lease liability
13
-
(8,244)
Impairment of plant and equipment
9
-
(37,847)
Legal fees
(387)
(43,240)
Marketing expenses
-
(4,349)
Occupancy expenses
(8,175)
(49,624)
Share based payments expense reversal :
options - Director
16
-
14,400
Travel and accommodation expenses
(2,076)
(7,719)
Gain on disposal of right of use assets
-
41,619
Loss on disposal of plant and equipment
(2,987)
(283,007)
Impairment for exploration assets
11
(4,500,748)
-
Write-off of capitalised exploration
expenditure
11
(1,490,681)
-
Exploration expenses
(35,924)
(20,958)
Loss before tax
(6,400,075)
(1,307,070)
Income tax expense
4
-
-
Net loss for the year from operations
(6,400,075)
(1,307,070)
Other comprehensive income
-
-
Total comprehensive loss for the year
(6,400,075)
(1,307,070)
Basic and diluted loss per share (cents)
5
(1.04)
(0.26)
The accompanying notes form part of these consolidated financial statements.
CONSOLIDATED STATEMENT OF BALANCE SHEET
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
23
Note
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
ASSETS
Current Assets
Cash and cash equivalents
7
100,967
896,796
Trade and other receivables
8
2,717
22,254
Prepaid expenses
28,466
45,841
Total Current Assets
132,150
964,891
Non-Current Assets
Plant and equipment
9
54,487
97,531
Exploration and evaluation assets
11
1,057,721
6,295,469
Total Non-Current Assets
1,112,208
6,393,000
Total Assets
1,244,358
7,357,891
LIABILITIES
Current Liabilities
Trade and other payables
12
208,487
50,406
Provisions
14
-
21,539
Total Current Liabilities
208,487
71,945
Total Liabilities
208,487
71,945
Net Assets
1,035,871
7,285,946
EQUITY
Contributed equity
15
46,578,784
46,428,784
Reserves
16
49,704
500,121
Accumulated losses
(45,592,617)
(39,642,959)
Total Equity
1,035,871
7,285,946
The accompanying notes form part of these consolidated financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
Nelson Resources Limited and Controlled Entities
24
Consolidated Entity
Note
Contributed
Equity
$
Reserves
$
Accumulated
Losses
$
Total
$
Balance at 1 July 2023
46,428,784
500,121
(39,642,959)
7,285,946
Equity issues
15
150,000
-
-
150,000
Options expired
-
(450,417)
450,417
-
Loss for the year
-
-
(6,400,075)
(6,400,075)
Other comprehensive income
-
-
-
-
Total comprehensive loss for
the year
-
-
(6,400,075)
(6,400,075)
Balance at 30 June 2024
46,578,784
49,704
(45,592,617)
1,035,871
Consolidated Entity
Contributed
Equity
$
Reserves
$
Accumulated
Losses
$
Total
$
Balance at 1 July 2022
45,044,487
610,244
(38,353,889)
7,300,842
Equity issues
15
1,471,486
-
-
1,471,486
Equity issue expenses
15
(87,189)
(77,723)
-
(164,912)
Share based payments
(expired securities)
16
-
(32,400)
18,000
(14,400)
Loss for the year
-
-
(1,307,070)
(1,307,070)
Other comprehensive income
-
-
-
-
Total comprehensive loss for
the year
-
-
(1,307,070)
(1,307,070)
Balance at 30 June 2023
46,428,784
500,121
(39,642,959)
7,285,946
The accompanying notes form part of these consolidated financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
25
Note
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
Cash flows from operating activities
Payments to suppliers and employees
(254,772)
(835,786)
Receipt from other income
27,111
39,536
Interest paid: lease liability
-
(8,244)
Interest received
4,931
8,266
Net cash used in operating activities
7
(222,730)
(796,228)
Cash flows from investing activities
Payment for plant and equipment
-
(1,500)
Payment for exploration and evaluation assets
(588,899)
(859,853)
Proceeds from disposal of plant and equipment
15,800
237,751
Net cash used in investing activities
(573,099)
(623,602)
Cash flows from financing activities
Proceeds from equity issues
-
1,393,763
Payment for costs of equity issues
-
(87,189)
Repayment of borrowings: lease liability
-
(46,601)
Net cash from financing activities
-
1,259,973
Net decrease in cash held
(795,829)
(159,857)
Cash and cash equivalents at beginning of the
year
896,796
1,056,653
Cash and cash equivalents at year end
7
100,967
896,796
The accompanying notes form part of these financial statements.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
26
1.
Corporate information
This annual report covers Nelson Resources Limited (the “Consolidated Entity”), a company
incorporated in Australia for the year ended 30 June 2024. The presentation currency of the
Consolidated Entity is Australian Dollars (“$”). A description of the Consolidated Entity’s
operations is included in the review and results of operations in the Directors’ Report. The
Directors’ Report is not part of the financial statements. The Consolidated Entity is a for-profit
entity and limited by shares incorporated in Australia whose shares are traded under the ASX code
“NES”. The financial statements were authorised for issue on 29 September 2024 by the Directors
of the Consolidated Entity. The Directors have the power to amend and reissue the financial
statements. The principal accounting policies adopted in the preparation of the financial
statements are set out below.
2.
Accounting policies
The principal accounting policies adopted in the preparation of these financial statements are set
out below. These policies have been consistently applied to all the periods presented, unless
otherwise stated.
a. Basis of preparation
This general purpose financial report has been prepared in accordance with Australian Accounting
Standards, including Australian Accounting Interpretations, other authoritative pronouncements
of the Australian Accounting Standards Board and the Corporations Act 2001. Nelson Resources
Limited is a for-profit entity for the purpose of preparing the financial statements. The financial
statements are presented in Australian dollars and have been prepared under the historical cost
convention.
b. Going concern
The annual financial report has been prepared on the going concern basis, which contemplates
continuity of normal business activities and the realisation of assets and settlement of liabilities
in the ordinary course of business. The Consolidated Entity incurred a loss from ordinary activities
of $6,400,475 for the year ended 30 June 2024 (2023: loss $1,307,070) and net cash outflows from
operating and investing activities of $795,829 (2023: $1,419,830). The net working capital
position of the Consolidated Entity at 30 June 2024 was deficit of $76,337 (2023: $892,946). The
financial statements have been prepared on the basis that the consolidated entity is a going
concern, which contemplates the continuity of normal business activity, realisation of assets and
settlement of liabilities in the normal course of business for the following reasons:
-
Letter of support from creditor amounting to $107,800 has been received, deferring
this payment of this amount for a period of at least 12 months from the date of this
financial report or when the company has available fund to pay such as completion of
a capital raising;
-
Confirmation from Minera Corporate Pty Ltd and Orwellian Investments Pty Ltd, two
entities associated with Nicholas Ong and Daniel Smith, confirming to provide financial
support to the company if required;
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
27
2.
Accounting policies (continued)
-
The company is currently evaluating the availability of equity funding options;
-
The Directors also anticipate the support of its existing shareholders and believe that
the company has the ability to raise an appropriate level of funding to execute its plans
and continue its activities; and
-
The ability to reduce planned exploration and administration expenditure including
deferment of future fees payable to Minerva Corporate
The Directors have prepared a cash flow forecast, which indicates that the Consolidated Entity
will have sufficient cash flows to meet all commitments and working capital requirements for the
12-month period from the date of signing this financial report.
Should this not occur, or not occur on a sufficiently timely basis, there is a material uncertainty
that may cast significant doubt about the Group’s ability to continue as a going concern and
therefore, the Group may be unable to realize its assets and discharge its liabilities in the normal
course of business. Should the Consolidated Entity be unable to continue as a going concern it
may be required to realise its assets and extinguish its liabilities other than in the normal course
of business and at amounts different to those stated in the financial statements.
The financial statements do not include any adjustments relating to the recoverability and
classification of asset carrying amounts or to the amount and classification of liabilities that might
result should the Consolidated Entity be unable to continue as a going concern and meet its debts
as and when they fall due.
c. Principles of consolidation
The financial statements incorporate the assets and liabilities of all subsidiaries of Nelson
Resources Limited and the results of all subsidiaries for the year then ended. Subsidiaries are all
entities (including structured entities) over which the Company has control. The Company
controls an entity when the Company is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power to direct
the activities of the entity. Subsidiaries are fully consolidated from the date on which control is
transferred to the Company. They are de-consolidated from the date that control ceases. The
acquisition method of accounting is used to account for business combinations by the Company.
The financial statements of the subsidiaries are prepared for the same reporting period as the
parent entity, using consistent accounting policies. In preparing the consolidated financial
statements, all intercompany transactions, balances and unrealised gains on transactions
between companies are eliminated. Unrealised losses are also eliminated unless the transaction
provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries
have been changed where necessary to ensure consistency with the policies adopted by the
Company. Non-controlling interests in the results and equity of subsidiaries are shown separately
in the statement of profit or loss, statement of financial position and statement of changes in
equity respectively.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
28
2.
Accounting policies (continued)
The Company treats transactions with non-controlling interests that do not result in a loss of
control as transactions with equity owners of the Company. A change in ownership interest results
in an adjustment between the carrying amounts of the controlling and non-controlling interests
to reflect their relative interests in the subsidiary. Any difference between the amount of the
adjustment to non-controlling interests and any consideration paid or received is recognised
within equity attributable to owners of Nelson Resources Limited. When the Company ceases to
have control, joint control or significant influence, any retained interest in the entity is remeasured
to its fair value with the change in carrying amount recognised in the profit or loss.
The fair value is the initial carrying amount for the purposes of subsequent accounting for the
retained interest as an associate, joint controlled entity or financial asset. In addition, any
amounts previously recognised in other comprehensive income in respect of that entity are
accounted for as if the Company had directly disposed of the related assets or liabilities. This may
mean that amounts previously recognised in other comprehensive income are reclassified to the
profit or loss.
d. Comparatives
When required by Australian Accounting Standards, comparative figures have been adjusted to
conform to changes in presentation for the current year.
e. Finance costs
Finance costs comprise interest expense on borrowings. Borrowing costs directly attributable to
the acquisition, construction or production of a qualifying asset are capitalised as part of the cost
of that asset. All other borrowing costs are recognised in the profit or loss using the effective
interest rate.
f. Critical accounting estimates and judgements
Estimates and judgements are continually evaluated and are based on historical experience and
other factors, including expectations of future events that may have a financial impact on the
Consolidated Entity and that are believed to be reasonable under the circumstances. The key
estimates and judgements that have a significant risk of causing a material adjustment to the
carrying amounts of assets and liabilities within the next financial year are discussed below.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
29
2.
Accounting policies (continued)
Exploration and evaluation expenditure
Determining the recoverability of exploration and evaluation expenditure capitalised, in
accordance with the Company’s accounting policy where a potential impairment is indicated,
requires estimates and assumptions as to whether successful development and commercial
exploitation, or alternatively sale, of the respective areas of interest will be achieved. This
assessment requires estimates and assumptions about the resources, the timing of expected cash
flows and future capital requirements. If, after having capitalised the expenditure under
accounting policy, a judgement is made that recovery of expenditure is unlikely, an impairment
loss is recognised in the profit or loss. Costs of site restoration are provided over the life of the
facility from when exploration commences and are included in the costs of that stage. Site
restoration costs include the dismantling and removal of mining plant, equipment and building
structure, waste removal, and rehabilitation of the site in accordance with clauses of the mining
permits. Such costs have been determined using estimates of future costs, current legal
requirements and technology and discounted by a pre-tax rate that reflects current market
assessments of the time value of money and the risks specific to the restoration works. Any
changes in the estimates for the costs are accounted for on a prospective basis. In determining
the costs of site restoration, there is uncertainty regarding the nature and extent of the
restoration due to community expectations and future legislation. Accordingly, the costs have
been determined on the basis that the restoration will be completed within one year of
abandoning the site.
Recoverability of deferred tax assets
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset
is realised or liability is settled. Deferred tax is credited in the income statement except where it
relates to items that may be credited directly to equity, in which case the deferred tax is adjusted
directly against equity. Deferred income tax assets are recognised to the extent that it is probable
that future tax profits will be available against which deductible temporary differences can be
utilised. The amount of benefits brought to account or which may be realised in the future is
based on the assumption that no adverse change will occur in income taxation legislation and the
anticipation that the economic entity will derive sufficient future assessable income to enable the
benefit to be realised and comply with the conditions of deductibility imposed by the law.
h. Accounting Standards that are mandatorily effective for the current reporting year
The Company has adopted all of the new and revised Standards and Interpretations issued by the
Australian Accounting Standards Board (AASB) that are relevant to its operations and effective for
an accounting period that begins on or after 1 July 2023. The Directors have determined that
there is no material impact of the new and revised Standards and Interpretations on the Company
and, therefore, no material change is necessary to Company accounting policies.
i. Standards and Interpretations in issue not yet adopted
At the date of authorisation of the financial statements, the Company has not applied the new
and revised Australian Accounting Standards, Interpretations and amendments that have been
issued but are not yet effective. Based on a preliminary review of the standards and amendments,
the Directors do not anticipate a material change to the Company’s accounting policies, however
further analysis will be performed when the relevant standards are effective.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
30
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
3.
Revenue
Income from sub-lease office
7,574
37,000
Interest revenue
4,931
8,266
12,505
45,266
Accounting policy
Interest revenue is recognised as interest accrues using the effective interest method. This is a
method of calculating the amortised cost of a financial asset and allocating the interest income
over the relevant period using the effective interest rate, which is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial asset to the net carrying
amount of the financial asset. Other revenue (including rent revenue) is recognised when it is
received or when the right to receive payment is established.
Revenue is recognised at an amount that reflects the consideration to which the Consolidated
Entity is expected to be entitled in exchange for transferring goods or services to a customer. For
each contract with a customer, the Consolidated Entity: identifies the contract with a customer;
identifies the performance obligations in the contract; determines the transaction price which
takes into account estimates of variable consideration and the time value of money; allocates the
transaction price to the separate performance obligations on the basis of the relative stand-alone
selling price of each distinct good or service to be delivered; and recognises revenue when or as
each performance obligation is satisfied in a manner that depicts the transfer to the customer of
the goods or services promised.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
31
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
4.
Income tax
Income tax benefit
Current income tax
-
-
Reconciliation of income tax benefit to prima facie tax
Loss before income tax benefit
(6,400,075)
(1,307,070)
Tax at the Australian tax rate of 30% (2023: 30%)
(1,920,022)
(392,121)
Movements in timing differences not recognised
149,355
(380,949)
Non-assessable income
-
(16,806)
Non-deductible expenses
1,350,224
227
Current year losses for which no deferred tax asset was
recognised
420,443
789,649
Income tax expense
-
-
Deferred tax balances not recognised
Tax losses
5,478,495
5,118,204
Exploration
(1,461,265)
(1,328,287)
Business related costs
99,090
161,088
Other
220,089
(3,348)
4,336,409
3,947,657
Tax losses
The tax benefit at 30% of estimated unused tax losses is currently under review and it has not
been recognised as a deferred tax asset. The benefit of deferred tax assets will only be brought
to account if future assessable income is derived of a nature and of an amount sufficient to
enable the benefit to be realised and the conditions for deductibility imposed by the relevant tax
legislation continue to be complied with and no changes in tax legislation adversely affect the
Company in realising the benefit.
Accounting policy
Income tax
Income tax comprises current and deferred tax. Income tax is recognised in the profit or loss
except to the extent that it relates to items recognised directly in equity, in which case it is
recognised in equity. Current tax is the expected tax payable on the taxable income for the year,
using tax rates enacted or substantially enacted at the reporting date, and any adjustment to tax
payable in respect of previous years. Deferred tax is provided using the balance sheet method
on temporary differences arising between the tax bases of assets and liabilities and their carrying
amounts for financial reporting purposes at the reporting date.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
32
4.
Income tax (continued)
Deferred tax assets are recognised for all deductible temporary differences and unused tax losses
only if it is probable that future taxable amounts will be available to utilise those temporary
differences and losses. Deferred tax liabilities and assets are not recognised for temporary
differences between the carrying amount and tax bases of investments in foreign operations
where the company is able to control the timing of the reversal of the temporary differences and
it is probable that the differences will not reverse in the foreseeable future. Deferred tax assets
and liabilities are offset when there is a legally enforceable right to offset current tax assets and
liabilities and when the deferred tax balances relate to the same taxation authority. Current tax
assets and tax liabilities are offset where the entity has a legally enforceable right to offset and
intends either to settle on a net basis, or to realise the asset and settle the liability
simultaneously. The carrying amount of deferred tax assets is reviewed at the end of each
reporting period and reduced to the extent that it is no longer probable that sufficient taxable
profit will be available to allow all or part of the deferred income tax asset to be utilised.
Unrecognised deferred tax assets are reassessed at the end of each reporting period and are
recognised to the extent that it has become probable that future taxable profit will be available
to allow the deferred tax asset to be recovered. The amount of deferred tax provided is based
on the expected manner of realisation or settlement of the carrying amount of assets and
liabilities, using tax rates (and tax laws) enacted or substantively enacted by the end of the
reporting period. Deferred tax relating to items recognised in other comprehensive income or
equity is recognised in other comprehensive income or equity and not in the profit or loss.
GST
Revenues, expenses and assets are recognised net of the amount of GST, except where the
amount of GST incurred is not recoverable from the Australian Taxation Office ("ATO").
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 ATO 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 ATO are presented as operating cash flows included in receipts from
customers or payments to suppliers. Commitments and contingencies are disclosed net of
amount of GST recoverable from, or payable to, the ATO.
Tax Consolidation
Nelson Resources Limited and its 100% owned Australian resident subsidiaries, have
implemented the tax consolidation legislation. Nelson Resources Limited is the head entity within
the tax consolidated group.
5.
Earnings per share
Loss used for basic and diluted loss per share are loss after tax of $6,400,078 (2023: loss after tax
of $1,307,070). The weighted average number of ordinary shares used as the denominator in
calculating basic and diluted earnings per share is 615,001,436 ordinary shares (2023:
500,728,326 ordinary shares). There were no potential ordinary shares that are considered
dilutive in the current reporting year.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
33
5.
Earnings per share (continued)
Accounting policy
Basic earnings per share is calculated by dividing the profit or loss attributable to equity holders
of the Company, excluding any costs of servicing equity other than ordinary shares, by the
weighted average number of ordinary shares outstanding during the period, adjusted for
bonus elements in ordinary shares issued during the period. 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.
6.
Segment reporting
Operating segments are determined based on the reports reviewed by the Board of Directors,
which are used to make strategic decisions. The Company does not have any operating
segments with discrete financial information. All of the Company’s assets and liabilities are
located within Australia. The Company does not have any customers at this stage. Internal
management reports for the Board of Directors’ review are consistent with the information
provided in the statement of profit or loss and other comprehensive income, statement of
financial position and statement of cash flows. As a result, no reconciliation is required
because the information as presented is what is used by the Board to make strategic decisions.
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
7.
Cash and cash equivalents
Cash in hand and at bank
100,967
896,796
100,967
896,796
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
34
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
7.
Cash and cash equivalents (continued)
Reconciliation of loss for the year to net cash flows from
operating activities
Loss for the year
(6,400,075)
(1,307,070)
Adjustments for:
4,500,748
-
Impairment provision
Depreciation
24,257
392,009
Disposal of plant and equipment
2,987
287,486
Gain on disposal of right of use assets
-
(41,619)
Impairment of plant and equipment
-
37,847
Written-off of capitalised exploration expenditure
1,490,681
-
Share based payments
-
(14,400)
Change in operating assets and liabilities:
(Increase)/decrease in receivables
36,912
(1,911)
Increase/(decrease) in trade payables and accruals
143,299
(163,128)
Increase/(decrease) in provisions
(21,539)
14,558
Net cash used in operating activities
(222,730)
(796,228)
Accounting policy
Cash and cash equivalents include cash at bank and on hand and term deposits held at call with
financial institutions with original maturities of three months or less but exclude any restricted
cash. Restricted cash is not available for use by the Company and therefore is not considered
highly liquid.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
35
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
8.
Trade and other receivables
Accrued interest revenue
-
417
Mongolian projects receivable 3
555,304
555,304
Impairment of Mongolian projects receivable22
(555,304)
(555,304)
Other receivables
2,717
21,837
2,717
22,254
The ageing of the receivables and allowance for expected credit losses provided for above are as
follows:
Expected
Credit Loss
Rate
%
Carrying
Amount
$
Allowance
for Expected
Credit Losses
$
Not overdue
0%
2,717
-
0-3 months overdue
0%
-
-
3-6 months overdue
0%
-
-
>6 months overdue
100%
555,304
(555,304)
558,021
(555,304)
Accounting policy
Trade receivables are initially recognised at fair value and subsequently measured at amortised
cost using the effective interest method, less any allowance for expected credit losses. Trade
receivables are generally due for settlement within 30 days. The Consolidated Entity has applied
the simplified approach to measuring expected credit losses, which uses a lifetime expected loss
allowance. To measure the expected credit losses, trade receivables have been grouped based
on days overdue. Other receivables are recognised at amortised cost, less any allowance for
expected credit losses. The allowance for expected credit losses assessment requires a degree of
estimation and judgement. It is based on the lifetime expected credit loss, grouped based on days
overdue, and makes assumptions to allocate an overall expected credit loss rate for each group.
These assumptions include recent sales experience and historical collection rates.
3 On 9 June 2017, the Company entered into an agreement with an independent third party buyer to sell its interest in
assets and projects in Mongolia for a cash consideration of USD500,000. During the 30 June 2021 financial year the
Company received an initial sum of USD40,000 or equivalent of AUD56,490 as a good faith payment, for the sale. The
Directors are of the view that the full amount of the receivable is likely to be not recoverable and, therefore, a full
provision for impairment has been made. Ownership of the shares has already been transferred.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
36
9.
Plant and equipment
Computer
Equipment
$
Office
Equipment
$
Motor
Vehicles
$
Exploration
Equipment
$
Total
$
2024
Written down value at
beginning of year
754
5,246
31,070
60,461
97,531
Additions
-
-
-
-
-
Depreciation
-
-
(7,368)
(16,889)
(24,257)
Disposals
(754)
(5,246)
(12,787)
-
(18,787)
Written down value at
end of year
-
-
10,915
43,572
54,487
Computer
Equipment
$
Office
Equipment
$
Motor
Vehicles
$
Exploration
Equipment
$
Total
$
2023
Written down value at
beginning of year
3,905
72,136
133,397
529,250
738,688
Additions
-
-
263,749
1,500
265,249
Depreciation
(2,065)
(28,395)
(145,414)
(167,448)
(343,322)
Impairment
-
(37,847)
-
-
(37,847)
Disposals
(1,086)
(648)
(220,662)
(302,841)
(525,237)
Written down value at
end of year
754
5,246
31,070
60,461
97,531
Accounting policy
Plant and equipment is stated at historical cost less accumulated depreciation and any
accumulated impairment in value. The residual values, useful lives and depreciation methods are
reviewed, and adjusted if appropriate, at each reporting date. An item of property, plant and
equipment is derecognised upon disposal or when there is no future economic benefit to the
consolidated entity. Gains and losses between the carrying amount and the disposal proceeds are
taken to profit or loss. Any revaluation surplus reserve relating to the item disposed of is
transferred directly to retained profits. Depreciation is calculated on a diminishing value basis
over the estimated useful life of the asset as follows:
Computer equipment – 2.5 years Office equipment – 2.5 years
Motor vehicles – 4 years Exploration equipment – 2.5 years
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
37
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
10.
Right of use assets
Balance at beginning of year
-
210,149
Depreciation
-
(48,685)
Disposals4
-
(161,464)
Balance at end of year
-
-
Accounting policy
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is
measured at cost, which comprises the initial amount of the lease liability, adjusted for, as
applicable, any lease payments made at or before the commencement date net of any lease
incentives received, any initial direct costs incurred, and, except where included in the cost of
inventories, an estimate of costs expected to be incurred for dismantling and removing the
underlying asset, and restoring the site or asset. Right-of-use assets are depreciated on a straight-
line basis over the unexpired period of the lease or the estimated useful life of the asset,
whichever is the shorter. Where the Consolidated Entity expects to obtain ownership of the
leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-
of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
11.
Exploration and evaluation assets
Balance at beginning of year
6,295,469
5,435,616
Exploration and evaluation expenditure incurred during
the year
603,681
859,853
Acquisition of tenements paid by shares (refer to Note 15)
150,000
-
Impairment provision 5
(4,500,748)
Written-off 6
(1,490,681)
-
Balance at end of year
1,057,721
6,295,469
4 On 25 June 2023 the Company assigned its lease agreement to Heavy Minerals Limited.
5 In accordance with the requirements of AASB 6, the Company performed an impairment review on its exploration
and evaluation assets. An impairment provision of $4.5 million is provided against several tenements that have been
considered non-prospective, with no significant exploration expenditure or work programs planned for these
tenements. Full impairment provisions are provided against these area of interests. In addition, available information
received by the Company has indicated that the carrying value of certain projects exceeds their indicative fair value.
The difference between the fair value and the carrying amount is recognised as an impairment expense and charged
to profit or loss accounts..
6 After a portfolio review, the Company surrendered a number of non-prospective tenements during the year. The
carrying amounts of these tenements were fully written off accordingly.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
38
11.
Exploration and evaluation assets (continued)
Accounting policy
Exploration and evaluation expenditure in relation to each separate area of interest are recognised
as an exploration and evaluation asset in the year in which they are incurred where the following
conditions are satisfied:
(i) the rights to tenure of the area of interest are current; and
(ii) at least one of the following conditions is also met:
•
the exploration and evaluation expenditure are expected to be recouped through
successful development and exploration of the area of interest, or alternatively, by its
sale; or
•
exploration and evaluation activities in the area of interest have not, at the reporting
date, reached a stage which permits a reasonable assessment of the existence or
otherwise of economically recoverable reserves, and active and significant operations
in, or in relation to, the area of interest are continuing.
Exploration and evaluation assets are initially measured at cost and include acquisition of rights to
explore, studies, exploratory drilling, trenching and sampling and associated activities and an
allocation of depreciation and amortisation of assets used in exploration and evaluation activities.
General and administrative costs are only included in the measurement of exploration and
evaluation costs where they are related directly to operational activities in a particular area of
interest. Indirect costs that are included in the cost of an exploration and evaluation asset include,
among other things, charges for depreciation of equipment used in exploration and evaluation
activities. If an area of interest is abandoned or is considered to be of no further commercial
interest, the accumulated exploration costs relating to the area are written off against income in
the year of abandonment. Exploration and evaluation assets are assessed for impairment when
facts and circumstances suggest that the carrying amount of an exploration and evaluation asset
may exceed its recoverable amount. The recoverable amount of the exploration and evaluation
asset (or the cash-generating unit(s) to which it has been allocated, being no larger than the
relevant area of interest) is estimated to determine the extent of the impairment loss (if any).
Where a decision has been made to proceed with development in respect of a particular area of
interest, the relevant exploration and evaluation asset is tested for impairment and the balance is
then reclassified to development.
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
12.
Trade and other payables
Accrued expenses
102,382
12,000
Trade creditors
-
23,468
Other payables
106,105
14,938
208,487
50,406
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
39
12.
Trade and other payables (continued)
Accounting policy
These amounts represent liabilities for goods and services provided to the Company prior to the
end of the reporting period that are unpaid. They are unsecured and are usually paid within 30
days of recognition. Trade and other payables are presented as current liabilities unless payment
is not due within 12 months from the reporting date. They are recognised initially at their fair
value and subsequently measured at amortised cost using the effective interest method.
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
13.
Lease liability
Current
Balance at beginning of year
-
58,710
Repayments
-
(46,601)
Write off during the year
-
(12,109)
Balance at end of year
-
-
Non-Current
Balance at beginning of year
-
190,974
Write off during the year
-
(190,974)
Balance at end of year
-
-
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
40
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
14.
Provisions
Annual leave provision
-
21,539
-
21,539
Accounting policy
Provision is made for the Consolidated Entity's liability for employee benefits arising from services
rendered by employees to the end of the reporting period. Employee benefits that are expected
to be wholly settled within one year have been measured at the amounts expected to be paid
when the liability is settled. Employee benefits expected to be settled more than one year after
the end of the reporting period have been measured at the present value of the estimated future
cash outflows to be made for those benefits.
Consolidated Entity
30 June 2024
Consolidated Entity
30 June 2023
No.
$
No.
$
15.
Contributed equity
Balance at beginning of year
588,594,328
46,428,784
294,297,164
45,044,487
Share issue: 18 October 2022
-
-
294,297,164
1,471,486
Share issue: 5 July 20237
25,000,000
150,000
-
-
Share issue costs
-
-
-
(87,189)
Balance at end of year
613,594,328
46,578,784
588,594,328
46,428,784
7 The shares were issued as part of the consideration for the acquisition of six granted prospecting licenses and two
mining license applications surrounding the Yarri Project from Rock Mining Australia Pty Ltd.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
41
Consolidated
Entity
30 June 2024
No.
Consolidated
Entity
30 June 2023
No.
15.
Contributed equity (continued)
Listed options
Balance at beginning of year
79,198,858
112,498,753
Options expired
(79,198,858)
(33,299,895)
Balance at end of year
-
79,198,858
Unlisted options
Balance at beginning of year
10,152,539
10,152,539
Options expired
(8,000,000)
-
Balance at end of year
2,152,539
10,152,539
Capital management
The Company’s objectives when managing capital are to safeguard its ability to continue as a
going concern, so that it may continue to provide returns for shareholders and benefits for other
stakeholders. Due to the nature of the Company’s activities, being mineral exploration, it does
not have ready access to credit facilities and therefore is not subject to any externally imposed
capital requirements, with the primary source of Company funding being equity raisings.
Accordingly, the objective of the Company’s capital risk management is to balance the current
working capital position against the requirements to meet exploration programmes and
corporate overheads. This is achieved by maintaining appropriate liquidity to meet anticipated
operating requirements, with a view to initiating appropriate capital raisings as required. Refer
to Note 2(b).
Accounting policy
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.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
42
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
16.
Reserves
Options reserve
Balance at beginning of year
500,121
577,844
Reversal of expired options 8
(450,417)
(77,723)
Balance at end of year
49,704
500,121
Accounting policy
The Company measures the cost of equity-settled transactions with employees by reference to
the fair value of the equity instruments at the date at which they are granted. The fair value is
determined by using the Black-Scholes model taking into account the terms and conditions
upon which the instruments were granted.
17.
Financial instruments
Financial risk management objectives, policies and processes
The Company has exposure to the following risks from their use of financial instruments:
credit risk,
liquidity risk, and
market risk (including gold price risk, interest rate and currency risk).
This note presents information about the Company’ exposure to each of the above risks, their
objectives, policies and processes for measuring and managing risk. The Board has overall
responsibility for the establishment and oversight of the risk management framework. The
Board reviews and agrees policies for managing each of these risks and they are summarised
below. The Company’s principal financial instruments comprise cash. The main purpose of the
financial instruments is to earn the maximum amount of interest at a low risk to the Company.
The Company also has other financial instruments such as receivables and payables which arise
directly from its operations. For the year under review, it has been the Company’s policy not
to trade in financial instruments.
8 8 million options at exercisable price $0.097, which were issued to directors as share-based payments in September
2020, expired on 14 September 2023.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
43
Consolidated
Entity
30 June 2024
$
Consolidate
d Entity
30 June
2023
$
17.
Financial instruments (continued)
Financial instruments
Financial assets
Cash and cash equivalents
100,967
896,796
Trade and other receivables
2,717
22,254
103,684
919,050
Financial liabilities
Trade and other payables
208,487
50,406
208,487
50,406
Credit risk
Credit risk refers to the risk that counterparty will default on its contractual obligations resulting
in financial loss to the Company. The Company has adopted a policy of only dealing with
creditworthy counterparties and obtaining sufficient collateral where appropriate, as a means
of mitigating the risk of financial loss from defaults. The Company only transacts with entities
that are rated the equivalent of investment grade and above. The Company’s exposure and the
credit ratings of its counterparties are continuously monitored. Credit exposure is controlled
by counterparty limits that are reviewed and approved by the Board annually. The Company
does not have any significant credit risk exposure to the National Australia Bank. The credit risk
on liquid funds is reduced because the counterparty is a bank with high credit rating assigned
by international credit rating agencies.
Liquidity risk
Ultimate responsibility for liquidity risk management rests with the Board of Directors, who
have built an appropriate liquidity risk management framework for the management of the
Company’s short, medium and long-term funding and liquidity management requirements. The
Company manages liquidity risk by maintaining adequate reserves and banking facilities and by
continuously monitoring forecast and actual cash flows and matching the maturity profiles of
financial assets and liabilities. The Company did not have any undrawn facilities at its disposal
as at reporting date. The table below analyses the Company’s financial liabilities into relevant
maturity groupings based on their contractual maturities. The amounts disclosed in the table
are the contractual undiscounted cash flows. Balances due within 12 months equal their
carrying balances as the impact of discounting is not significant. Refer Note 2(b).
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
44
17.
Financial instruments (continued)
Contractual maturities of financial liabilities
Details
<1 Year
$
1-2
Years
$
2-5
Years
$
>5
Years
$
Total
$
Carrying
Amount
$
30 June 2024
Trade and other payables
208,487
-
-
-
208,487
208,487
Total
208,487
-
-
-
208,487
208,487
30 June 2023
Trade and other payables
50,406
-
-
-
50,406
50,406
Total
50,406
-
-
-
50,406
50,406
Market risk is the risk that changes in market prices such as foreign exchange rates, interest rates
and equity prices will affect the Company’s income or the value of its holdings of financial
instruments. The Company does not have short or long-term debt and therefore the risk is
minimal. The Company limits its exposure to credit risk by only investing in liquid securities and
only with counterparties that have acceptable credit ratings.
Interest rate risk
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will
fluctuate due to changes in market interest rates. Current financial assets and financial liabilities
are generally not exposed to interest rate risk because of their short-term nature. The Company’s
cash and cash equivalents at 30 June 2022 are fixed interest rate financial instruments. Therefore,
they are not subject to interest rate risk.
Fair value measurements
The fair values of cash, receivables, trade and other payables approximate their carrying amounts
as a result of their short maturity. When an asset or liability, financial or non-financial, is measured
at fair value for recognition or disclosure purposes, the fair value is based on the price that would
be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date; and assumes that the transaction will take place either: in
the principal market; or in the absence of a principal market, in the most advantageous market.
Fair value is measured using the assumptions that market participants would use when pricing the
asset or liability, assuming they act in their economic best interests. For non-financial assets, the
fair value measurement is based on its highest and best use.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
45
17.
Financial instruments (continued)
Valuation techniques that are appropriate in the circumstances and for which sufficient data are
available to measure fair value, are used, maximising the use of relevant observable inputs and
minimising the use of unobservable inputs. Assets and liabilities measured at fair value are
classified into three levels, using a fair value hierarchy that reflects the significance of the inputs
used in making the measurements. Classifications are reviewed at each reporting date and
transfers between levels are determined based on a reassessment of the lowest level of input that
is significant to the fair value measurement. For recurring and non-recurring fair value
measurements, external valuers may be used when internal expertise is either not available or
when the valuation is deemed to be significant. External valuers are selected based on market
knowledge and reputation. Where there is a significant change in fair value of an asset or liability
from one period to another, an analysis is undertaken, which includes a verification of the major
inputs applied in the latest valuation and a comparison, where applicable, with external sources
of data.
Accounting policy
Investments and other financial assets
Investments and other financial assets are initially measured at fair value. Transaction costs are
included as part of the initial measurement, except for financial assets at fair value through profit
or loss. Such assets are subsequently measured at either amortised cost or fair value depending
on their classification. Classification is determined based on both the business model within which
such assets are held and the contractual cash flow characteristics of the financial asset unless, an
accounting mismatch is being avoided. Financial assets are derecognised when the rights to
receive cash flows have expired or have been transferred and the Consolidated Entity has
transferred substantially all the risks and rewards of ownership. When there is no reasonable
expectation of recovering part or all of a financial asset, its carrying value is written off.
Financial assets at fair value through profit or loss
Financial assets not measured at amortised cost or at fair value through other comprehensive
income are classified as financial assets at fair value through profit or loss. Typically, such financial
assets will be either: (i) held for trading, where they are acquired for the purpose of selling in the
short-term with an intention of making a profit, or a derivative; or (ii) designated as such upon
initial recognition where permitted. Fair value movements are recognised in profit or loss.
Financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income include equity investments
which the Consolidated Entity intends to hold for the foreseeable future and has irrevocably
elected to classify them as such upon initial recognition.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
46
17.
Financial instruments (continued)
Impairment of financial assets
The Consolidated Entity recognises a loss allowance for expected credit losses on financial assets
which are either measured at amortised cost or fair value through other comprehensive income.
The measurement of the loss allowance depends upon the Consolidated Entity's assessment at the
end of each reporting period as to whether the financial instrument's credit risk has increased
significantly since initial recognition, based on reasonable and supportable information that is
available, without undue cost or effort to obtain. Where there has not been a significant increase
in exposure to credit risk since initial recognition, a 12-month expected credit loss allowance is
estimated. This represents a portion of the asset's lifetime expected credit losses that is
attributable to a default event that is possible within the next 12 months. Where a financial asset
has become credit impaired or where it is determined that credit risk has increased significantly,
the loss allowance is based on the asset's lifetime expected credit losses. The amount of expected
credit loss recognised is measured on the basis of the probability weighted present value of
anticipated cash shortfalls over the life of the instrument discounted at the original effective
interest rate. For financial assets measured at fair value through other comprehensive income,
the loss allowance is recognised within other comprehensive income. In all other cases, the loss
allowance is recognised in profit or loss.
18.
Commitments and contingencies
The Company the following expenditure contracted at the reporting date. The Company has
certain statutory requirements to undertake a minimum level of exploration activity in order to
maintain rights of tenure to its various exploration tenements. These requirements may vary from
time to time, subject to approval of the relevant government departments and are expected to be
fulfilled in the normal course of operations of the Company to avoid forfeiture of any tenement.
The Company has a 100% share of tenements rental and expenditure commitments. These
exploration commitments are not provided for in the financial statements and are payable:
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
Not longer than 1 year
493,220
910,986
More than 1 year but not longer than 5 years
380,000
1,398,817
More than 5 years
-
-
873,220
2,309,803
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
47
18.
Commitments and contingencies (continued)
a. Contingent assets
There are no contingent assets as at 30 June 2024.
b. Contingent liabilities
There were no contingent liabilities at 30 June 2024. The Directors are not aware of any significant
breaches of environmental legislation and requirements during the year.
Consolidated
Entity
30 June 2024
$
Consolidated
Entity
30 June 2023
$
19.
Auditor’s remuneration
Criterion Audit Pty Ltd: Audit and review of financial
reports
31,500
30,000
Total auditor’s remuneration
31,500
30,000
20.
Key management personnel compensation
Salary, fees and leave
104,432
170,287
Termination payments
-
52,013
Superannuation
3,568
5,233
Total key management personnel compensation
108,000
227,533
21. Related party transactions
During the year the Company incurred $60,000 in company secretarial and chief financial officer
fees to Minerva Corporate Pty Ltd (“Minerva”), and an additional $21,000 consulting fee
corporate consulting services provided by Daniel Smith and Nicholas Ong.
As of 30 June 2024, the Company owed Minerva totalling $98,000 excl GST, including $21,000
unpaid directors fee each for Daniel Smith and Nicholas Ong, $14,000 for company secretarial
services, $21,000 for chief financial officer services, and $21,000 for corporate consulting services.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
48
22.
Interests in controlled entities
Company Name
Place of
Incorporation
30 June 2024
% Ownership
30 June 2023
% Ownership
79 Exploration Pty Ltd
Australia
100%
100%
Nelson Exploration Services Pty Ltd
Australia
100%
100%
Nelson Resources Limited is the ultimate parent entity of the Company. The parent entity’s
financial performance and financial position are as follows:
Company
30 June 2024
$
Company
30 June 2023
$
ASSETS
Current Assets
Cash and cash equivalents
100,957
896,786
Trade and other receivables
2,652
22,254
Prepaid expenses
28,466
45,841
Total Current Assets
132,075
964,881
Non-Current Assets
Plant and equipment
-
6,000
Investments
1,057,721
1,100,001
Total Non-Current Assets
1,057,721
1,106,001
Total Assets
1,189,796
2,070,882
LIABILITIES
Current Liabilities
Trade and other payables
194,558
39,407
Provisions
-
21,539
Total Current Liabilities
194,558
60,946
Total Liabilities
194,558
60,946
Net Assets
995,238
2,009,936
EQUITY
Contributed equity
46,578,784
46,428,784
Reserves
49,704
500,121
Accumulated losses
(45,633,250)
(44,918,969)
Total Equity
995,238
2,009,936
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
49
24.
Events after the end of the reporting year
There are no matters or circumstances have arisen since the end of the year which will significantly
affect, or may significantly affect, the state of affairs or operations of the reporting entity in future
financial periods other than the following:
On 27 September 2024, the Company issued 25,000,000 shares to Rock Mining Australia Pty Ltd
(“RMA”) pursuant to an agreement for the acquisition of RMA’s 6 granted prospecting licenses and
two mining license applications (the Tenements), which surround the Company’s Yarri gold
project. The anniversary consideration of $75,000 in fully paid ordinary shares in the Company is
based on the 5-day VWAP of the Company’s shares prior to 5 July 2024.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE YEAR ENDED 30 JUNE 2024
Nelson Resources Limited and Controlled Entities
50
Consolidated Entity Disclosure Statement
Entity name
Body Corporate,
partnership or
trust
Place of
incorporation
% of share capital held
directly by the Company in the
body corporate
Australian or
Foreign resident
Principal activities
2024
2023
79 Exploration
Pty Ltd
Body corporate
Australia
100%
100%
Australian
Exploration
Nelson
Exploration
Services Pty Ltd
Body corporate
Australia
100%
100%
Australian
Provision
DIRECTORS’ DECLARATION
Nelson Resources Limited and Controlled Entities
51
The Directors of the Consolidated Entity declare that:
(a)
the consolidated financial statements and notes, set out on pages 22 to 49, are in
accordance with the Corporations Act 2001, including:
(i)
giving a true and fair view of the Consolidated Entity’s financial position as at 30 June
2024 and its performance for the financial year ended on that date; and
(ii) complying with Accounting Standards, the Corporations Regulations 2001 and other
mandatory professional reporting requirements; and
(b)
the financial report also complies with International Financial Reporting Standards as
issued by the International Accounting Standards Board; and
(c)
the consolidated entity disclosure statement on page 50 is true and correct. And
(d)
there are reasonable grounds to believe that the Company will be able to pay its debts as
and when they become due and payable; and
This declaration has been made after receiving the declarations from the by the chief executive
officer and chief financial officer required by section 295A of the Corporations Act 2001 for the
year ended 30 June 2024.
On behalf of the directors
____________________
Peter Bird
Non-Executive Chairman
29 September 2024
Liability limited by a scheme approved under Professional Standards Legislation
Criterion Audit Pty Ltd
ABN 85 165 181 822
PO Box 233 LEEDERVILLE WA 6902
Suite 2, 642 Newcastle Street
LEEDERVILLE WA 6007
Phone: 9466 9009
Independent Auditor’s Report
To the Members of Nelson Resources Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Nelson Resources Limited (“the Company”) and Controlled Entities (“the
Consolidated Entity”), which comprises the consolidated statement of financial position as at 30 June 2024, the
consolidated statement of profit and loss and other comprehensive income, the consolidated statement of changes in
equity and the consolidated statement of cash flows for the year then ended, notes to the financial statements, including a
summary of material accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Consolidated Entity is in accordance with the Corporations Act
2001, including:
a)
giving a true and fair view of the Consolidated Entity’s financial position as at 30 June 2024 and of its financial
performance for the year then ended; and
b)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Material Uncertainty Regarding Continuation as a Going Concern
Without modifying our opinion above, we draw attention to Note 2(b) to the annual report, which indicates that the
Consolidated Entity produced a net loss for the year of $6,400,475 with net cash outflows from operating and investing
activities of $795,829. The net working asset position of the Consolidated Entity at 30 June 2024 was a deficit of $76,337.
These conditions, along with other matters as set forth in Note 2(b), indicate the existence of a material uncertainty that
may cast significant doubt about the ability of the Consolidated Entity to continue as a going concern and whether it will
realise its assets and extinguish its liabilities in the normal course of business and at the amounts stated in the financial
report.
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 Consolidated Entity in accordance with the auditor independence requirements of 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.
Key audit matter
How our audit addressed the key audit
matter
Exploration and Evaluation Expenditure – $1,057,721
(Refer to Note 11)
Exploration and evaluation is a key audit matter due to:
•
The significance of the balance to the Consolidated
Entity’s consolidated financial position.
•
The level of judgement required in evaluating
management’s application of the requirements of
AASB 6 Exploration for and Evaluation of Mineral
Resources. AASB 6 is an industry specific accounting
standard requiring the application of significant
judgements, estimates and industry knowledge. This
includes specific requirements for expenditure to be
capitalised as an asset and subsequent requirements
which must be complied with for capitalised
expenditure to continue to be carried as an asset.
•
The assessment of impairment of exploration and
evaluation expenditure being inherently difficult.
Our procedures included, amongst others:
•
We assessed management’s determination of its
areas of interest for consistency with the definition in
AASB 6. This involved analysing the tenements in
which the Consolidated Entity holds an interest and
the exploration programmes planned for those
tenements.
•
For each area of interest, we assessed the
Consolidated Entity’s rights to tenure by corroborating
to government registries and evaluating agreements
in place with other parties as applicable;
•
We tested the additions to capitalised expenditure for
the year by evaluating a sample of recorded
expenditure for consistency to underlying records, the
capitalisation requirements of the Consolidated
Entity’s accounting policy and the requirements of
AASB 6;
•
We considered the activities in each area of interest
to date and assessed the planned future activities for
each area of interest by evaluating budgets for each
area of interest.
•
We assessed each area of interest for one or more of
the following circumstances that may indicate
impairment of the capitalised expenditure:
•
the licenses for the right to explore expiring in the
near future or are not expected to be renewed;
•
substantive expenditure for further exploration in
the specific area is neither budgeted or planned
•
decision or intent by the Consolidated Entity to
discontinue activities in the specific area of
interest due to lack of commercially viable
quantities of resources; and
•
data indicating that, although a development in
the specific area is likely to proceed, the carrying
amount of the exploration asset is unlikely to be
recovered in full from successful development or
sale.
•
We assessed the appropriateness of the related
disclosures in the notes to the financial statements.
Other Information
The directors are responsible for the other information. The other information comprises the information included in the
Consolidated Entity’s annual report for the year ended 30 June 2024, but does not include the financial report and our
auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information 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, 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.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of:
a.
the financial report (other than the consolidated entity disclosure statement) that gives a true and fair view in
accordance with Australian Accounting Standards and the Corporations Act 2001; and
b.
the consolidated entity disclosure statement that is true and correct in accordance with the Corporations Act 2001,
and
for such internal control as the directors determine is necessary to enable the preparation of:
i.
the financial report (other than the consolidated entity disclosure statement) that gives a true and fair view and is
free from material misstatement, whether due to fraud or error; and
ii.
the consolidated entity disclosure statement that is true and correct and is free of misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Consolidated Entity 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 Consolidated Entity 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
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and maintain
professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
•
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Consolidated Entity’s internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the directors.
•
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Consolidated Entity’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial
report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the
Consolidated Entity to cease to continue as a going concern.
•
Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and
whether the financial report represents the underlying transactions and events in a manner that achieves fair
presentation.
•
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
within the Consolidated Entity to express an opinion on the financial report. We are responsible for the direction,
supervision and performance of the Consolidated Entity’s audit. We remain solely responsible for our audit
opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear
on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance in the audit
of the financial report of the current period and are therefore the key audit matters. We describe these matters in our
auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare
circumstances, we determine that a matter should not be communicated in our report because the adverse consequences
of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2024.
In our opinion, the Remuneration Report of Nelson Resources Limited, for the year ended 30 June 2024, 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 s 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.
CRITERION AUDIT PTY LTD
CHRIS WATTS CA
Director
DATED at PERTH this 29th day of September 2024
ADDITIONAL INFORMATION FOR PUBLIC LISTED COMPANIES (continued)
Nelson Resources Limited and Controlled Entities
57
As at 20 September 2024
Issued Securities
Listed on ASX
Unlisted
Total
Fully paid ordinary shares
613,594,328
-
613,594,328
$0.1125 unlisted options expiring
18-Nov-24
-
2,152,539
2,152,539
Total
613,594,328
2,152,539
383,648,561
Distribution of Listed Ordinary Fully Paid Shares
Spread of holdings
Number of Holders
Number of Units
% of Total Issued
Capital
1 – 1,000
48
7,593
0.00%
1,001 – 5,000
38
151,898
0.02%
5,001 – 10,000
137
1,185,205
0.19%
10,001 – 100,000
481
20,513,950
3.34%
100,001 – and over
368
591,735,682
96.44%
Total
1,072
613,594,328
100.00%
Top 20 Listed Ordinary Fully Paid Shareholders
Rank
Shareholder
Shares Held
% Issued
Capital
1.
BRIDGE THE GAP TRADING PTY LTD
36,500,000
5.95%
2.
CROESUS MINING PTY LTD
29,000,000
4.73%
3.
N & J MITCHELL HOLDINGS PTY LTD
19,377,096
3.16%
4.
MR GAVIN JEREMY DUNHILL
19,000,000
3.10%
5.
SANCOAST PTY LTD
18,000,000
2.93%
6.
ROCK MINING AUSTRALIA PTY LTD
15,300,000
2.49%
7.
ESM LIMITED
15,020,000
2.45%
8.
SCINTILLA STRATEGIC INVESTMENTS LIMITED
15,000,000
2.44%
9.
PLATINA RESOURCES LIMITED
12,135,516
1.98%
10.
CAMPBELL KITCHENER HUME & ASSOCIATES PTY LTD
11,500,000
1.87%
11.
RUBITON PTY LTD
10,399,996
1.69%
12.
TETRAMIN PTY LTD
10,000,000
1.63%
13.
RALLOU PTY LTD
9,159,999
1.49%
14.
CROESUS MINING PTY LTD
9,000,000
1.47%
15.
KESLI CHEMICALS PTY LTD
8,500,000
1.39%
16.
DR LEON EUGENE PRETORIUS
8,100,000
1.32%
17.
CHALEYER HOLDINGS PTY LTD
8,000,000
1.30%
18.
ARIS NOMINEES PTY LTD
7,137,744
1.16%
ADDITIONAL INFORMATION FOR PUBLIC LISTED COMPANIES (continued)
Nelson Resources Limited and Controlled Entities
58
19.
MSB CONTENT PTY LTD
7,000,000
1.14%
20.
JARASAURUS PTY LTD
7,000,000
1.14%
Total
275,130,351
44.84%
At $0.003 per share, the number of shareholdings held in less than marketable parcels is 773.
Substantial shareholders listed in its register as at 20 September 2024 is Bridge The Gap Trading
Pty Ltd with 5.95%. Croesus Mining Pty Ltd , N & J Mitchell
Holdings Pty Ltd , Croesus Mining Pty Ltd , Carly McGowan, Elizabeth Sterinepreis and Judith Steinepreis collectively own 10.23%.
There are no holders of more than 20% of this class of securities.
There is no on-market buy-back as at the date of this report.
Ordinary Shares Voting Rights - Subject to any rights or restrictions for the time being attached
to any class or classes of Shares, at general meetings of Shareholders or classes of Shareholders:
each Shareholder entitled to vote may vote in person or by proxy, attorney or
representative;
on a show of hands, every person present who is a Shareholder or a proxy, attorney or
representative of a Shareholder has one vote; and
on a poll, every person present who is a Shareholder or a proxy, attorney or
representative of a Shareholder shall, in respect of each fully paid Share held by him, or
in respect of which he is appointed a proxy, attorney or representative, have one vote
for the Share, but in respect of partly paid Shares shall have such number of votes as
bears the same proportion to the total of such Shares registered in the Shareholder’s
name as the amount paid (not credited) bears to the total amounts paid and payable
(excluding amounts credited).
ADDITIONAL INFORMATION FOR PUBLIC LISTED COMPANIES (continued)
Nelson Resources Limited and Controlled Entities
59
Schedule of Exploration Tenements
TenementID
Name
Status
Interest:
Current
Period
E28/2923
Woodline
Live
100%
E28/2874
Woodline
Live
100%
E28/2633
Woodline
Live
100%
E28/2769
Woodline
Live
100%
E28/2679
Woodline
Live
100%
E28/3210
Woodline
Live
100%
E28/3342
Tempest
Live
100%
P31/2085
Tempest
Live
100%
P31/2090
Yarri
Live
100%
P31/2088
Yarri
Live
100%
P31/2087
Yarri
Live
100%
P31/2086
Yarri
Live
100%
P31/2091
Yarri
Live
100%
P31/2089
Yarri
Live
100%
E28/2805
Yarri
Live
100%
P31/2093
Yarri
Live
100%
P31/2096
Yarri
Live
100%
M31/490
Yarri
Pending
100%
M31/489
Yarri
Pending
100%
E52/3695
Fortnum
Live
100%
E52/4133
Fortnum
Live
100%