Building Opportunity and
Diversity in Copper and Nickel
Annual
Report
■ CORPORATE DIRECTORY
DIRECTORS
Mr Jeremy Kirkwood Non-Executive Chairman
Mr Daniel Madden
Mr Alan Senior
Mr Brian Dawes
Ms Karen Gadsby
Managing Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
COMPANY SECRETARY
Mr Shaun Vokes
Mr Alex Neuling
REGISTERED & PRINCIPAL OFFICE
Ground Floor, 6 Centro Avenue
Subiaco, Western Australia 6008
Telephone +61 8 9380 4230
Facsimile +61 8 9382 8200
Website: www.talismanmining.com.au
AUDITORS
HLB Mann Judd
Level 4, 130 Stirling Street
Perth, Western Australia 6000
Telephone +61 8 9227 7500
Facsimile +61 8 9227 7533
SHARE REGISTRY
Link Market Services
Level 4, Central Park
152 St Georges Terrace
Perth, Western Australia 6000
Telephone 1300 554 474
SECURITIES EXCHANGE LISTING
Australian Securities Exchange Limited
Level 8, Exchange Plaza
2 The Esplanade
Perth, Western Australia 6000
ASX Code: TLM
■ CONTENTS
Letter from the Chairman ......................................................................................................3
Review of Operations ............................................................................................................5
Tenement Schedule ............................................................................................................ 16
Corporate Governance Statement ...................................................................................... 17
Directors’ Report ................................................................................................................ 18
Remuneration Report ......................................................................................................... 25
Auditor’s Independence Declaration ....................................................................................33
Independent Auditor’s Report .............................................................................................34
Directors’ Declaration .......................................................................................................... 37
Consolidated Statement of Comprehensive Income ............................................................38
Consolidated Statement of Financial Position ......................................................................39
Consolidated Statement of Changes in Equity .....................................................................40
Consolidated Statement of Cash Flows ............................................................................... 41
Notes to the Consolidated Financial Statements .................................................................. 42
Additional Securities Exchange Information ......................................................................... 74
Page 1
Page 2
■ LETTER FROM THE CHAIRMAN
Dear Shareholder,
The 2016 financial year has been an active and progressive year for Talisman delivering a maiden copper-gold mineral resource
together with the continuation of focused exploration programs in a challenging global base metals price environment.
In April 2016 Talisman’s partner in the Springfield Joint Venture, Sandfire Resources NL, reported the maiden mineral resource
estimate for the high-grade Monty Copper Gold Deposit. The rapid delineation of this outstanding deposit containing almost
100,000 tonnes of copper and 55,000 ounces of gold within nine months of its discovery is an excellent result and marked a
significant milestone for the Springfield Joint Venture and an important breakthrough for the Doolgunna region.
With 99% of the Mineral Resource tonnage classified in the Indicated category, project development studies on the Monty
Deposit have progressed rapidly. The Joint Venture partners have commenced a feasibility study that aims to maximise the
value of the deposit through optimising the development pathway. This study is scheduled for completion early in calendar
2017, and depending on results, a subsequent decision to progress with development will be made in due course.
With an average resource grade of 9.4% Cu and 1.6g/t Au, the Monty deposit stands out as one of the highest grade
copper deposits discovered globally in decades and provides Talisman with confidence in the exceptional exploration
potential of the Doolgunna region. Exploration activities on the Springfield Joint Venture tenements have moved beyond the
immediate Monty Deposit to focus both along the 5km long Monty Trend and more broadly within the Homer and Southern
Volcanics prospects. Together with Sandfire, we look forward to advancing these work programs and achieving continued
exploration success.
Over the last twelve months we have also been progressing both on-ground and desktop exploration activities on our
Sinclair Nickel Project. Re-interpretation of historic data and geophysical surveys were completed which identified a number
of regional targets. In keeping with the subdued global nickel price outlook, Talisman undertook a focused, targeted
exploration drill campaign on several targets, successfully intersecting massive nickel sulphides at the Delphi prospect.
These encouraging results of our maiden campaign at Sinclair, support our belief that this region hosts a fertile mineralised
environment that has the potential to contain significant nickel mineralisation. On this basis, we have developed a
program of phased, results driven, on-ground exploration activities which builds on our previous success. These activities
commenced in August 2016 and in combination with continued interpretive work of historic data, will assist us to unlock
the value of Sinclair.
Whilst we continue to operate in a challenging base metals market for junior resource companies, it was pleasing to
see strong shareholder support for our March 2016 capital raising. We successfully raised $16.7 million in a heavily
oversubscribed placement that introduced a new substantial shareholder in Talisman. At financial year end, our cash
resources of $20.2 million have placed us in a strong position to fund both continued exploration at the Springfield Joint
Venture and potential near-term development of the Monty Deposit, progress our phased exploration programs at Sinclair
and continue to pursue quality opportunities.
We have also seen a number of Board and management changes during the year. Alan Senior served the Company
excellently as Chairman for eight years and stepped down from that role in April this year but remains a Non-Executive
Director. On behalf of shareholders, I thank him sincerely for his contribution as Chairman. Gary Lethridge resigned as
Managing Director on the 31 March after seven years in the role. Gary led the Company successfully through significant
changes and challenges and on behalf of the Company, I thank him for his service. I joined the Board on 1 April this year
and was elected Chairman and Daniel Madden, previously Talisman’s CFO and Company Secretary, was appointed as
Managing Director in July 2016. I welcome Dan to the Board and look forward to working with the Board as we continue
our next phase of growth.
On behalf of the Board, I would like to thank the Company’s dedicated team of staff and consultants for their efforts and
achievements during the year and we look forward to their continued hard work and enthusiasm in the new financial year.
Finally, I would also like to acknowledge the continued support of all our shareholders. Your Company is in a strong
financial position as we move forward to grow our business and extract value from our outstanding asset base.
Yours faithfully
Jeremy Kirkwood
Chairman
Page 3
TALISMAN MINING LTD Page 4
■ REVIEW OF OPERATIONS
■ REVIEW OF OPERATIONS
OVERVIEW
The past twelve months have seen significant advancement of the Company’s Doolgunna Cu-Au Projects including
the formalisation of a Joint Venture with Sandfire Resources NL, and the release of a maiden JORC 2012 Indicated and
Inferred mineral resource for the Monty Deposit in April 2016. The Monty Deposit maiden resource was 1.05 million
tonnes grading 9.4% copper and 1.6g/t gold1 for 99,000 tonnes of contained copper and 55,000 ounces of contained
gold. Talisman has also completed a detailed, comprehensive review and targeting process and an initial on-ground
exploration campaign at its 100% owned Sinclair Nickel Project (“Sinclair”) (Figure 1).
Talisman Mining Ltd and Sandfire Resources NL (“Sandfire”, ASX: SFR) formed a 30:70 Joint Venture over the Doolgunna
Cu-Au Projects (the “Joint Venture”) in December 2015, following Sandfire’s sole funded expenditure of $15 million on the
Doolgunna Cu-Au Projects.
Following the early discovery of high-grade copper mineralisation by Sandfire, in the third diamond hole completed as part
of the farm-in agreement in early 2015, the majority of the on-ground exploration work at the Springfield Project was aimed
at fast-tracking this exceptionally high grade copper-gold discovery towards a JORC 2012 Mineral Resource. Exploration
activities outside of the current resource envelope at the Monty Copper-Gold Deposit (“Monty”) have been limited to
regional first-pass air-core drilling aimed at identifying prospective stratigraphy, and a number of discrete isolated reverse
circulation (“RC”) drill holes to test geochemical anomalies and stratigraphic positions.
Following completion of a regional targeting review process early in the financial year, the Company undertook its maiden
on-ground exploration program at its 100% owned Sinclair Nickel Project. During the second half of the financial year
the Company undertook a review and remodelling of remnant and extension nickel mineralisation proximal to the Sinclair
Mine, along with a reassessment of historic drilling information from near mine and other regional targets. The outcome of
this work has led to a greater understanding of the geological controls and mineralising environment at Sinclair, and the
identification of a number of additional stratigraphic target horizons for future testing.
Figure 1: Talisman Project Locations
1 For details relating to the Monty JORC Mineral Resource see Sandfire Resources NL ASX announcement dated 13 April 2016, available on the Sandfire
and ASX websites.
Page 5
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
DOOLGUNNA CU-AU PROJECTS (JV WITH SANDFIRE RESOURCES NL)
The Doolgunna Cu-Au Projects Joint Venture is between the Company and Sandfire, with Sandfire acting as Joint
Venture Manager. The Joint Venture encompasses the Springfield and Halloween West Projects which are high quality
Volcanogenic Massive Sulphide (“VMS”) exploration projects in the emerging world class Bryah Basin region of Western
Australia (Figure 2).
Figure 2: Doolgunna Cu-Au Project Joint Venture – Springfield and Halloween West Project Locations
The discovery of exceptionally high grade copper-gold mineralisation and the subsequent maiden JORC 2012 Mineral
Resource estimate of 99,000 tonnes of contained copper at Monty, confirmed the significant exploration potential of the
Doolgunna Region.
In September 2015, Sandfire provided notice that it had sole-funded $10 million of exploration expenditure to earn an initial
51% interest in Talisman’s Doolgunna Cu-Au Projects. During the December 2015 quarter, Sandfire provided further notice
that it had sole-funded a further $5 million of exploration expenditure in order to earn an additional 19% interest in the
Doolgunna Cu-Au Projects. Under the terms of the Joint Venture, Sandfire and Talisman now contribute toward exploration
expenditure on a 70:30 pro-rata basis.
Page 6
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
SPRINGFIELD PROJECT
(30% Talisman Mining Ltd – Joint Venture with Sandfire Resources NL)
The Springfield Project comprises a 174km2 ground package located approximately 150km north-east of Meekatharra in
the northern Murchison Goldfields region of Western Australia.
Springfield is 4km directly along strike, to the east from Sandfire’s DeGrussa Copper-Gold mine and hosts the high-grade
Monty deposit, within one of four corridors that are prospective for VMS style mineralisation. These VMS corridors are
Monty Trend, Homer Trend, Central Corridor and Southern Volcanics (Figure 3).
Figure 3: Talisman Springfield Project
Field based exploration activities undertaken as part of the farm-in joint venture on the Springfield Project were dominated
by the resource definition drilling and associated works at Monty and included:
• air-core, RC and diamond drilling;
• down-hole and surface geophysical surveys; and
• geological studies.
Drilling across the Springfield Project area comprised:
Springfield Project Drilling Statistics
Hole Type
Number of Holes
Total Meters
Air-Core
RC
Diamond
Total:
1,447
54
140
1,641
120,745
15,498
45,392
181,635
Table 1: Springfield Project drilling statistics 1 July 2015 – 30 June 2016
Page 7
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
Monty
The Monty deposit, is located approximately 10km from Sandfire’s DeGrussa Copper-Gold Mine in what was originally
identified by Talisman as a prospective corridor of volcanic and sedimentary rock sequences with the potential to contain
DeGrussa style VMS mineralisation.
Key milestones achieved during the year were:
• Completion of resource definition drilling;
• Announcement of a maiden JORC Indicated and Inferred Mineral Resource;
• Completion of a high level mining study;
• Lodgement of a Mining Lease Application ("MLA") for the Monty Copper-Gold Project; and
• Commencement of a feasibility study by the Joint Venture.
Since the discovery of high grade copper-gold mineralisation in drill hole TLDD0004A in early 2015, the delineation of the
Monty deposit has been the main focus for the Joint Venture. Throughout resource definition drilling, Monty continued to
return exceptionally high grade copper/gold results, with some of the better intersections including:
• TLDD0005
• TLDD0010
• TLDD0026
• TLDD0061
9.2m @ 11.8% Cu & 2.9g/t Au from 417.0m down-hole;
10.5m @ 18.9% Cu & 3.1g/t Au from 359.7m down-hole; and
4.7m @ 12.8% Cu and 2.5g/t Au from 373.6m down-hole;
7.3 metres grading 6.2% Cu and 2.8g/t Au from 325.6m down-hole; and
21.6 metres grading 34.4% Cu and 0.4g/t Au from 339.4m down-hole;
25.8 metres grading 24.1% Cu and 0.5g/t Au from 299.0m down-hole including a bornite rich
zone of 8.5 metres grading 41.8% Cu and 0.5 g/t Au from 315.4m down-hole.
On the 13th of April 2016, Sandfire and Talisman jointly announced a JORC Indicated and Inferred Mineral Resource of
1.05 million tonnes grading 9.4% copper and 1.6g/t gold2. This includes a high-grade massive sulphide component
of 763,000t grading 12.1% Cu and 2.1g/t Au for 92,000t of contained copper and 52,000oz of contained gold2.
The Monty Mineral Resource estimate is set out in Table 2.
The mineralisation interpretation is supported by a total of 127 fully logged and validated diamond drill holes for some
42,351 meters, defining the current limit of the Monty Resource; 82 of which (on a nominal 40m x 30m spacing),
intersected massive sulphide mineralisation and have been used to inform the Mineral Resource estimate (Figure 4).
Drill spacing is such that 99% of the Mineral Resource (97,000t of contained Cu and 54,000oz of contained Au), has
been classified by Sandfire into the JORC 2012 Indicated category, and as such is available for conversion to mineral
reserve status.
Type
Mineral Resource
Category
Massive
Sulphide
Indicated
Inferred
Total
Indicated
Tonnes
754,000
9,000
763,000
287,000
Halo
Inferred
–
Total
Indicated
Total
Inferred
Total
287,000
1,041,000
9,000
1,050,000
Table 2: Monty Mineral Resource3 – 31 March 2016
Grade
Cu (%)
Contained
Grade
Contained
Cu (t)
Au (g/t)
Gold (oz)
12.0
20.7
12.1
2.2
–
2.2
9.3
20.7
9.4
91,000
2,000
92,000
6,000
–
6,000
97,000
2,000
99,000
2.1
2.7
2.1
0.3
–
0.3
1.6
2.7
1.6
51,000
1,000
52,000
3,000
–
3,000
54,000
1,000
55,000
2 For details relating to the Monty JORC Mineral Resource, see Sandfire Resources NL ASX announcement dated 13 April 2016, available on the Sandfire
and ASX websites.
3 Numbers as presented at a 1.0% Cu cut-off grade. Calculations have been rounded to the nearest 1000t, 0.1 % copper grade and 1000t copper metal,
0.1 g/t gold grade, 1000oz gold metal, differences may occur due to rounding.
Page 8
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
Figure 4: Diagrammatic Vertical Longitudinal Projection4 of the Monty resource wireframes and selected significant intersections.
Monty Deposit Geology
Copper and gold mineralisation at Monty is hosted in a sequence of sediments (siltstone, sandstones and conglomerates)
and basaltic rocks. Mineralisation occurs in a series of massive sulphide lenses that are interpreted to have been deposited
at different stratigraphic levels within the sedimentary package.
The modelled mineralisation at Monty is contained within seven stacked lenses of massive sulphide (Figure 4) that
encapsulate the massive sulphide mineralisation. Over 87% of the contained metal is within two main lenses.
Adjacent to these massive sulphide lenses, the host sequence shows moderate to strong chlorite alteration with
disseminated and/or blebby sulphides throughout. This zone of altered, sulphidic host rock is known as ‘halo
mineralisation’ which has been modelled both internal to the main massive sulphide lenses and as an external skin that sits
directly adjacent to the high-grade massive sulphides.
Two separate lenses of high-grade bornite mineralisation have been modelled by Sandfire within the two main massive
sulphide lenses. Mineralisation in these bornite-containing zones (Figure 5) is of significantly higher tenor than that in the
normal (i.e. non-bornite containing) massive sulphide zones. Based on drill-hole geometry and core observations, the
bornite zones are interpreted by Sandfire to be approximately orthogonal to lithological layering.
Figure 5: Large diameter (PQ) metallurgical drill core from Monty Copper-Gold deposit.
4 Vertical Longitudinal Projection and simplified interpretation, by Talisman, of the Monty discovery with drill-hole pierce points at the top of the interpreted
primary intercept. All intercepts are shown as down-hole widths.
Page 9
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
Monty Development Studies
A high-level study assessing potential for mining the Monty deposit was completed by the Joint Venture during the June
quarter of 2016. The purpose of the study was to identify any fatal flaws and to investigate optionality of various facets of
Monty development including surface infrastructure location, site access, applicable mining methods and permitting and
approval pathways.
Results of the preliminary study work were positive with no fatal flaws identified and the Joint Venture subsequently
approved and commenced the Monty feasibility study with a budget of A$3.9M (100% basis).The following feasibility study
work streams commenced in June 2016:
• Metallurgical test work with a specific focus on comminution and flotation;
• Geotechnical and structural geology studies;
• Mine design engineering including stoping, ore access and ventilation work; and
• Evaluation of a proposed haul road route between Sandfire’s DeGrussa Copper-Gold mine and Monty.
Subsequent to the end of the financial year, on 14 July 2016, the Joint Venture Manager submitted a MLA to the
Department of Mines and Petroleum of Western Australia, on behalf of the Joint Venture over the Monty Copper-Gold
Project (Figure 3), (see ASX release “Monty Mining Lease Application”).
The area of the MLA is 16.42km2 and covers the footprint of the known mineralisation of the Monty deposit as well as the
surrounding area which will be required for the box-cut and decline portal and other supporting mine infrastructure. The
MLA process will be progressed in parallel with consultations and negotiations with relevant stakeholders and preparations
for future mining activities.
Springfield Exploration
The exploration strategy employed by the Joint Venture at the Springfield Project in the search for new deposits leverages
off existing data sets from Talisman and Sandfire’s activities and follows a staged and systematic process aimed at
building geological, geochemical and structural understanding. This process involves the collection and integration of data
collected from the following:
• Air-Core drilling is used to build both geological and geochemical information, with infill drilling used to further refine
initial interpretations.
• Air-Core drill data is evaluated through a series of elemental ratios which aids in the identification of specific target
exhalative stratigraphic horizons.
• Defined horizons are then tested via a Down Hole Electro-Magnetic (DHEM) geophysical survey, which involves
drilling a deeper RC drill hole to act as a platform for the DHEM survey aimed at identifying conductive sulphide
mineralisation in the immediate vicinity of the surveyed drill hole.
• Following DHEM data collection and interpretation, a diamond drilling program may be developed to test discrete
DHEM anomalies identified in the survey.
Integration of the new information is undertaken to further develop and refine the geological interpretation.
•
This process is iterative, and commonly involves multiple phases of testing, interpretation and retesting as new information
is gathered through the process that challenges previous interpretations.
Drilling of regional stratigraphic target horizons during the financial year was restricted to first pass testing at Homer and to
the north-east of the Monty deposit which intersected the interpreted host stratigraphy along both trends.
Systematic air-core drilling across the Southern Volcanics and the wider regional Springfield Project area was also
undertaken to accurately delineate the interpreted VMS horizon along the prospective host horizon.
Future Activities
Consistent with the strategy employed by the Joint Venture, continued exploration activity will be focussed on identifying
and testing stratigraphic packages across Joint Venture tenements. Additionally, further testing in the near Monty
environment is expected including the potential for down-dip extensions to the Monty deposit.
Page 10
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
HALLOWEEN WEST
(18.8% Talisman Mining Ltd – Joint Venture with Sandfire Resources NL)
The Halloween West Joint Venture Project is located immediately to the west of the Halloween Project and approximately
20km west south-west of Sandfire’s DeGrussa Copper-Gold Mine.
The Halloween West Joint Venture was formed in 2012 when Talisman reached agreement with Chrysalis Resources
Limited (ASX: CYS) to farm into the Halloween West Copper-Gold Project.
In October 2014, Sandfire Resources acquired the interest held by Chrysalis Resources and the Joint Venture is now
between Talisman and Sandfire.
Exploration work by Sandfire (acting as the Joint Venture Manager) has been limited to desktop studies and a review of
historic work completed over the project. With the focus of on-ground exploration moving away from resource definition at
Monty to a more regional focus, it is anticipated that Sandfire will conduct on-ground exploration to test the various targets
that have been identified.
HALLOWEEN
(30% Talisman Mining Ltd – Joint Venture with Sandfire Resources NL)
The Halloween Project is located approximately 17km west south-west of Sandfire’s DeGrussa Copper-Gold Mine. The
Halloween Project covers the interpreted western extension of the Narracoota Volcanic Formation that locally hosts the
DeGrussa Deposit.
Tenement P52/1241 was surrendered by the Joint Venture during the reporting period.
SINCLAIR NICKEL PROJECT
(100% Talisman Mining Ltd)
Sinclair is located in the world-class Agnew-Wiluna Greenstone Belt in WA’s North-eastern Goldfields. The Sinclair Nickel
Project, developed and commissioned in 2008 and operated successfully before being placed on care and maintenance in
August 2013, produced approximately 38,500 tonnes of nickel at an average life-of-mine head grade of 2.44% Ni. Sinclair
has extensive infrastructure and includes a substantial 290km2 tenement package covering more than 80km strike of
prospective ultramafic contact within a 35km radius of the existing processing plant and infrastructure (Figure 6).
During the year Talisman undertook its maiden exploration program at Sinclair including surface geophysics and diamond
and RC drilling at selected regional locations across the project. Successful intersection of nickel sulphide mineralisation at
the Delphi Prospect (2.2m @ 1.9% Ni from 396.6m down hole) supports the prospectivity of Sinclair for the discovery of a
new nickel sulphide mineralisation.
Talisman continued to develop and advance its understanding of Sinclair throughout the year with a regional exploration
review and targeting process undertaken in the first half of the financial year. This review of the near mine environment
focused primarily on the Sinclair Trend, an 8km strike of ultramafic/basal contact running from the Sinclair deposit to the
Delphi Prospect. In the second half of the financial year, drilling activities included a limited program on high priority regional
targets. A follow-up program of DHEM surveys, RC and diamond drilling was commenced in August 2016.
Page 11
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
Figure 6: The Sinclair Nickel Project showing regional geology nickel production centres and reported contained nickel* of
the Agnew-Wiluna Belt (*MINDEX 2012)
Figure 7: Sinclair Project – Prospect Locations.
Page 12
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
Delphi Prospect
The Delphi Prospect is located between 4-10km south of the Sinclair mine (Figure 7), covering approximately 6km of
prospective ultramafic stratigraphy where drilling in the first half of the financial year returned 2.2m @ 1.9% Ni from 396.6m
down hole in one of two holes drilled as part of the Company’s maiden exploration program.
In August 2015, Talisman completed a surface Moving Loop Electro-Magnetic (MLEM) survey across approximately six
strike kilometres of prospective ultramafic stratigraphy at the Delphi Prospect that had not been subject to any modern
geophysics. Talisman employed modern surface geophysical techniques utilising a high-powered geophysical transmitter
and B-field SQUID sensor in a moving loop configuration to ensure the best possible EM coverage of the area.
Assessment of the results of the MLEM surveys identified five high priority EM anomalies, three anomalies at Delphi North
(constituting one target area) and two anomalies at Delphi (Figure 8).
Figure 8: Delphi prospect showing geophysical anomalies identified from
MLEM geophysics.
Historic drill intersections of nickel sulphides in the vicinity of the geophysical anomalies identified at Delphi North provided
a target that was drill tested with two diamond drill-holes as part of a broader campaign during the first half of the financial
year. Drill-hole SND001 (Figure 10), which targeted the interpreted MLEM anomaly, intersected a number of massive,
matrix and breccia sulphide horizons in a deformed sequence of host ultramafic and basaltic rock units.
Page 13
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
Assay results returned an overall intercept of:
• 2.2m at 1.9% Ni from 396.9m down-hole.
Narrow zones of massive nickel sulphides (Figure 9) within this overall intersection returned assay results including:
• 0.6m at 2.19% Ni from 396.9m down-hole; and
• 0.5m at 2.94% Ni from 398.6m down-hole.
Figure 9: Photograph of massive nickel sulphides intersected in diamond drill-hole
SND001 at the Delphi North Prospect.
The main sulphide intersection within the hole is represented by a total of 1.4 metres of massive, matrix and breccia
sulphides within a 2.2 metre interval, with narrow zones of strongly foliated basaltic rocks from 396.9m to 399.1m
down. The vertical depth of this intersection is approximately 348m below surface.
Figure 10: Interpretive longitudinal section of the Delphi – Delphi North Prospects (looking west) showing priority surface and down-
hole geophysical EM anomalies; historical drilling and significant mineralised intersections; and recent drilling by Talisman.
Drill-hole SND002, (Figure 10) which was completed approximately 100m south of SND001, intersected a narrow zone of
stringer sulphides within a highly deformed, complex sequence of ultramafic, basaltic and sedimentary rock units. While
the stringer sulphides intersected by this hole are not interpreted to host significant mineralisation, the hole demonstrates
the continuity of the fertile ultramafic horizon at Delphi North.
In conjunction with historical intersections at Delphi North, the recent drilling has now defined nickel sulphide mineralisation
over a strike length of 600m and follow up RC and diamond drilling commenced in September 2016 to test this potential.
Cody Well
The Cody Well Prospect is located approximately 3km north of the Sinclair mine (Figure 7).
As part of Talisman’s maiden drilling program in the first half of the year, one diamond drill-hole (SND003) was completed at
Cody Well to target a priority EM anomaly interpreted to lie in a favorable stratigraphic position along strike from the Sinclair
deposit and an associated coincident geochemical anomaly.
Page 14
TALISMAN MINING LTD ■ REVIEW OF OPERATIONS
This hole intersected narrow stringer sulphides in the stratigraphic hanging wall position and a narrow ultramafic unit which
is interpreted to represent the extension of the fertile Sinclair ultramafic unit. Visual inspection of the mineralisation identified
pyrrhotite as the dominant nickel-bearing sulphide mineral with accessory pyrite and chalcopyrite.
Although no significant assay results were returned from this drill-hole, Talisman considers the identification of the fertile
Sinclair ultramafic unit at Cody Well to represent a significant advance in early stage exploration of this area.
A DHEM survey will be completed at a later date and is expected to provide greater definition for the source of the
previously identified Fixed Loop Electro-Magnetic anomaly.
Sinclair Trend
Late in the financial year Talisman commenced a review of the near-mine geological environment, specifically assessing
lithological, geochemical and supporting geophysical data to better understand the controls on mineralisation within the
Sinclair Trend and refine the targeting model for Sinclair-style deposits.
Figure 11: Oblique projection of the Sinclair Ultramafic trend.
The remodelling of the ultramafic/basal contact in the near mine environment identified multiple mineralised positions,
reaffirming the high prospectivity of the Sinclair Trend including the Delphi North Prospect (Figure 11).
A campaign of on-ground exploration at Delphi North commenced in early September 2016 to follow up these results.
Future Activities
The start of planned on-ground exploration in September 2016 signals the commencement of an efficient, staged and
ongoing exploration focus at Sinclair. As a result of the extensive regional exploration review undertaken in 2015 and the
recent re-modelling of the ultramafic contact along the Sinclair Trend, multiple targets have been identified that remain to
be tested. These targets will be subject to further review and prioritisation during the financial year ending 30 June 2017 as
on-ground exploration activities at Sinclair progress.
The current program of exploration activities represents the first stage of on-ground work at Sinclair. Subsequent work
within the Sinclair Trend will be focused on further defining potential targets for proposed future on-ground exploration
testing, with work to potentially include:
• Re-modelling of the Stirling and Skye mineralised positions;
• Review of newly identified parallel structures to east & west of Sinclair;
• Re-modelling of the Sinclair mine extensions;
• Re-modelling of Sinclair mine remnants;
• Re-conditioning and DHEM of historic drill holes adjacent to the existing Sinclair mine;
• Re-logging of historic drill core;
• Detailed geology sectional interpretations;
• Geological mapping;
• Surface SQUID EM surveys; and
• RC/diamond and Air-Core drilling campaigns.
Competent Person’s Statement
Information in this report that relates to Exploration Results and Exploration Targets is based on information completed by
Mr Anthony Greenaway, who is a member of the Australasian Institute of Mining and Metallurgy. Mr Greenaway is a full time
employee of Talisman Mining Ltd and has sufficient experience which is relevant to the style of mineralisation and types
of deposits under consideration and to the activities undertaken to qualify as a Competent Person as defined in the 2012
Edition of the “Australian Code for Reporting of Mineral Resources and Ore Reserves”. Mr Greenaway consents to the
inclusion in this report of the matters based on information in the form and context in which it appears.
Page 15
TALISMAN MINING LTD ■ TENEMENT SCHEDULE
As at date of report
Project
Tenement
Blocks
(Area)
Talisman
Equity (%)
JV Partner
Expiry
Annual
Commit-
ment
Comments
Halloween
West /
Doolgunna
West
Springfield
Sinclair
E52/2275
6.0
18.8%
Sandfire Resources NL
8/02/19
$ 50,000
E52/2282
E52/2313
E52/2466
E52/3424*
E52/3425*
E36/0650
E37/1231
E37/0903
L36/0198
L37/0175
M36/0444
M36/0445
M36/0446
M37/1063
M37/1089
M37/1090
M37/1126
M37/1127
M37/1136
M37/1137
M37/1148
M37/1168
M37/1223
M37/1275
M37/0362
M37/0383
M37/0384
M37/0385
M37/0386
M37/0424
M37/0426
M37/0427
M37/0590
M37/0692
M37/0735
M37/0816
M37/0818
M37/0819
P37/7228
P37/7233
70.0
14.0
14.0
1.0
6.0
16.0
3.0
13.0
103.1 HA
83.9 HA
568.0 HA
973.0 HA
843.0 HA
604.0 HA
574.0 HA
478.0 HA
603.0 HA
603.0 HA
986.0 HA
850.0 HA
44.7 HA
190.0 HA
675.0 HA
1961.0 HA
981.5 HA
841.7 HA
536.7 HA
926.8 HA
983.8 HA
891.0 HA
505.0 HA
821.0 HA
120.0 HA
136.0 HA
959.0 HA
818.4 HA
806.5 HA
380.1 HA
61.5 HA
116.0 HA
30.0%
30.0%
30.0%
Sandfire Resources NL
Sandfire Resources NL
Sandfire Resources NL
24/11/19 $ 140,000
$ 50,000
24/11/19
$ 50,000
5/04/20
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
Application
Application
Application
15/10/18
$ 50,000
$ 50,000
21/09/18
$ –
19/04/28
$ –
19/04/28
$ 56,800
27/03/29
$ 97,300
27/03/29
$ 84,300
27/03/29
$ 60,400
27/03/29
$ 57,400
22/04/29
$ 47,800
22/04/29
$ 60,300
27/03/29
$ 60,300
27/03/29
$ 98,600
27/03/29
$ 85,000
27/03/29
$ 10,000
27/03/29
$ 19,000
27/03/29
27/03/29
$ 67,500
29/07/28 $ 196,100
$ 98,200
20/05/34
$ 84,200
28/01/35
$ 53,700
28/01/35
28/01/35
$ 92,700
$ 98,400
28/01/35
3/02/36
$ 89,100
$ 50,500
3/02/36
$ 82,100
3/02/36
$ 12,100
27/03/29
$ 13,600
27/03/29
$ 95,900
27/03/29
$ 81,900
27/03/29
$ 80,700
27/03/29
$ 38,100
28/08/29
$ 2,480
21/09/16
$ 4,680
21/09/16
* These tenements have been applied for jointly as part of the Company’s Doolgunna Cu-Au Projects Joint Venture with Sandfire Resources NL.
Page 16
TALISMAN MINING LTD ■ CORPORATE GOVERNANCE STATEMENT
The Company’s Corporate Governance Statement can be found on the Company’s website at www.talismanmining.com.au/
about-us/corporate-governance.html under the heading marked “Corporate Governance Statement”.
The following governance-related documents can also be found on the Company’s website:
Charters
• Board
• Audit Committee
• Nomination Committee
• Remuneration Committee
• Risk Committee
Constitution
• Constitution of Talisman Mining Limited
Board
• Code of Conduct – summary
• Policy and Procedure for the Selection and (Re)Appointment of Directors
• Process for Performance Evaluation
Compliance, Controls and Policies
• Risk Management Policy – summary
• Continuous Disclosure Policy – summary
• Securities Trading Policy
• Diversity Policy
• Remuneration Policy
Shareholder Communication
• Shareholder Communication and Investor Relations Policy
Page 17
TALISMAN MINING LTD ■ DIRECTORS’ REPORT
Your Directors submit herewith the annual financial report of the consolidated entity (referred to hereafter as the Group)
consisting of Talisman Mining Ltd and the entities it controlled during the financial year ended 30 June 2016. In order to
comply with the provisions of the Corporations Act 2001, the Directors report as follows:
Information about directors
The names and particulars of the directors who held office during or since the end of the financial year are:
Name
Particulars
Jeremy Kirkwood
BCom ANU
Non-Executive Chairman
1 April 2016 – current
Daniel Madden
BComACC, ACA, Governance
Institute of Australia
Managing Director
1 July 2016 – current
Alan Senior
Asscshp Mech Eng, FIEAUST,
FAusIMM
Non-Executive Director
7 November 2007 – current
Non-Executive Chairman
7 November 2007 – 31 March
2016
Chairman (Non-Executive/Independent)
Jeremy Kirkwood joined Talisman in April 2016 and has extensive experience in
corporate strategy, investment banking and global capital market and provides invaluable
strategic input and guidance to the Company’s board and management team.
Mr Kirkwood is a principal of Pilot Advisory Group and was previously a Managing
Director at Credit Suisse, Morgan Stanley and Austock. He has primarily worked in
public markets, undertaking merger and acquisitions and capital raisings for companies
principally in the metals and mining, energy and infrastructure sectors.
He is a Director of BGD Corporation, Chair of Geelong Grammar School and a Director
of Independent Schools Victoria.
Jeremy serves on the Company’s Audit, Nomination and Remuneration Committees.
With extensive industry experience and being financially literate, Jeremy is considered
qualified to hold these responsibilities.
Managing Director (Executive/Non-Independent)
Dan Madden was appointed as acting CEO in April 2016 and has been with Talisman
since 2009 in his previous role as Chief Financial Officer and Company Secretary. Dan
has more than 15 years’ experience in the resource sector, including as General Manager
– Finance for Xstrata Nickel Australasia and Financial Controller for Jubilee Mines NL.
He graduated from the University of Birmingham with a degree in Commerce and
Accounting before joining Deloitte in the UK and Australia. He is an Associate Member
of the Institute of Chartered Accountants of England and Wales and a member of the
Governance Institute of Australia.
On the 1st of July 2016, Mr Madden was appointed as the Managing Director of Talisman
Mining Ltd.
Non-Executive Director (Independent)
Alan graduated from the West Australian Institute of Technology (Curtin University) with
an Associateship in Mechanical Engineering in 1968. He is an engineer with extensive
experience in design and project development, mainly associated with the mining and
mineral processing industry in Australia.
Prior to joining Talisman, Alan operated as an independent consultant servicing the
mineral processing industry. Before joining the board of Jubilee in 2003 he led the team
which completed the feasibility study for the Cosmos Nickel project and its successful
implementation, followed three years later by the transition from open cut to underground
mining. Alan was a non-executive Director of Jubilee Mines NL up until its purchase by
Xstrata.
Alan was the Chairman of Talisman for over eight years. He serves on the Company’s
Audit, Nomination and Remuneration Committees. With extensive industry experience
and being financially literate, Alan is considered qualified to hold these responsibilities.
Page 18
TALISMAN MINING LTD ■ DIRECTORS’ REPORT
Name
Particulars
Brian Dawes
B. Sc. Mining, MAusIMM
Non-Executive Director
17 June 2009 – current
Karen Gadsby
B Comm, FCA, MAICD
Non-Executive Director
3 April 2008 – current
Gary Lethridge
B. Comm, CA, FCIS, FGIA,
MAICD
Managing Director
2 February 2009 – 31 March
2016
Non-Executive Director (Independent)
Brian is a mining engineer with extensive international mining industry experience.
He holds a BSc in Mining from the University of Leeds UK, and is Member of the
Australasian Institute of Mining and Metallurgy.
He has worked in the UK, Africa, the Middle East and across Australia and holds several
First Class Mine Managers’ Certificates of Competency. Brian’s diverse expertise
covers all key industry aspects from exploration through the discovery, feasibility,
funding, approvals, project construction, commissioning, operations, optimisation,
logistics, marketing, and closure phases. This includes site management and corporate
responsibilities in a diversity of challenging and successful underground and open
pit operations across many commodities and geographies; mainly in copper, nickel,
gold, zinc, lead, iron ore, graphite. and coal. Prior to joining Talisman, Brian held senior
positions with Jubilee Mines NL, Western Areas, LionOre Australia, WMC, Normandy
Mining, and Aberfoyle.
Brian serves on the Company’s Audit, Nomination and Remuneration Committees. With
extensive industry experience and being financially literate, Brian is considered qualified
to hold these responsibilities.
Non-Executive Director (Independent)
Karen is a professional Non-Executive Director with over 30 years’ finance and
commercial experience across several sectors.
She worked as an Executive for North Ltd throughout Australia for 13 years including at
Robe River Iron Associates and Energy Resources of Australia Ltd.
She has held a number of directorships in Western Australia and is currently the Chair of
Strategen Environmental Consulting Pty Ltd.
Karen is the Chair of the Audit Committee and a member of the Nomination and
Remuneration Committees. With her extensive experience in finance and having chaired a
number of Audit Committees, Karen is considered qualified to hold these responsibilities.
Former Managing Director (Executive/Non-Independent)
Gary is an experienced executive whose industry involvement has included exposure
to all phases of mineral resources projects; from exploration, discovery, feasibility,
development and through to operations.
Prior to joining Talisman in early 2009, Gary held the position of Executive General
Manager-Corporate and Chief Financial Officer at Jubilee Mines NL, where he was part
of the senior executive management team from 2003 until that company’s acquisition
by Xstrata in early 2008. Before that, Gary held senior executive positions with LionOre
Mining International Limited in Australia (now Norilsk Nickel) and has also previously
acted as a Non-Executive Director of two Australian listed resources companies.
The above named directors held office for the entire period unless otherwise noted.
Page 19
TALISMAN MINING LTD ■ DIRECTORS’ REPORT
Directorships of other listed companies
Directorships of other listed companies held by directors in the three years immediately before the end of the financial year
are as follows:
Name
Company
Appointed
Resigned
Alan Senior
Amex Resources Limited
Jul-12
May-15
Directors’ shareholdings
The following table sets out each Director’s relevant interest in shares, and rights or options in shares of the Company or a
related body corporate as at the date of this report:
Directors
Fully paid ordinary shares
Number
Share Options
Number
Jeremy Kirkwood
Daniel Madden
Alan Senior
Brian Dawes
Karen Gadsby
119,000
–
116,666
353,333
311,334
–
1,000,000
750,000
500,000
500,000
Remuneration of key management personnel
Information about the remuneration of Directors and senior management is set out in the Remuneration Report of this
Directors’ Report.
Share options granted to key management personnel
During and since the end of the financial year, an aggregate of 500,000 share options were granted to the following
directors and senior management as part of their remuneration:
Directors and senior
management
Number of
options granted
Issuing Entity
Number of ordinary
shares under option
Anthony Greenaway (i)
500,000
Talisman Mining Ltd
500,000
(i) 125,000 vest on 30 September 2016; 125,000 options vest 31 March 2017; 125,000 options vest 30 September
2017; and 125,000 vest 31 March 2018.
Page 20
TALISMAN MINING LTD ■ DIRECTORS’ REPORT
Company Secretaries
Shaun Vokes, BBus, CPA
Appointed 1 May 2016
Shaun joined Talisman in February 2016. He is a finance professional with over 25 years’ experience in the metalliferous
resources industry gained predominantly in senior operational and management roles within Australia and Africa.
Prior to joining Talisman, Shaun spent five years as Manager, Business Services/CFO for Kabanga Nickel Company Ltd
in Tanzania. Shaun’s experience includes project evaluation and financing, business development, contract negotiation,
metals marketing, risk management and corporate and financial governance for both private and ASX-listed entities across
a range of base and precious metals.
Shaun is a graduate of Curtin University and holds a Bachelor of Business degree and is a member of the Australian
Society of Certified Practicing Accountants.
Alex Neuling, BSc, FCA (ICAEW), ACIS
Appointed 1 May 2016
Alex Neuling is a Chartered Accountant and Chartered Secretary with extensive corporate and financial experience
including as Director, Chief Financial Officer and/or Company Secretary of various ASX-listed companies in the mining,
mineral exploration, oil & gas and other sectors.
Prior to those roles, Alex worked at Deloitte in London and Perth. Alex also holds an honours degree in Chemistry from the
University of Leeds in the United Kingdom and is principal of Erasmus Consulting which provides company secretarial and
financial management consultancy services to a variety of ASX-listed and other companies.
Principal activities
The principal activity of Talisman Mining Limited during the course of the financial year was exploration for, and
development of, base metals and other minerals, including copper, copper-gold, gold and nickel.
Review of operations and future developments
A detailed review of operations during the financial year and commentary on future developments is set out in the section
titled “Review of Operations” in this Annual Report.
Financial performance and financial position
Financial performance
During the financial year the Group reported an operating loss after tax of $8,010,457 (2015: loss after tax $3,769,482).
Revenue for the year of $348,355 (2015: $367,760) consisted primarily of bank interest earned on the Group’s short-term
deposits held during the year.
During the year, the Group adopted a voluntary change in accounting policy whereby exploration and evaluation
expenditure (other than expenditure related to the acquisition of exploration rights or expenditure incurred to determine
the technical feasibility and commercial viability of extraction of a mineral deposit) is expensed as incurred rather than
capitalised. This change in accounting policy has been adopted retrospectively, and hence prior year’s reported figures in
this financial report may differ from figures reported in last years’ financial report.
Financial position
As at 30 June 2016 the Group had net assets of $29,265,537 (2015: $13,568,709) including $20,243,616 of cash and cash
equivalents (2015: $4,865,632).
Changes in state of affairs
There was no significant change in the state of affairs of the Group during the financial year other than as set out in this
report.
Page 21
TALISMAN MINING LTD ■ DIRECTORS’ REPORT
Subsequent events
The following management changes were effective 1 July 2016:
• Mr Daniel Madden was appointed as Managing Director
• Mr Shaun Vokes was appointed as Chief Financial Officer
There has not been any other matter or circumstance occurring subsequent to end of the financial year that has
significantly affected, or may significantly affect the operations of the Group, the results of those operations, or the state of
affairs of the Group in future financial years.
Environmental regulations
The Group’s environmental obligations are regulated under both State and Federal legislation. Performance with respect
to environmental obligations is monitored by the Board of Directors and subjected from time to time to government agency
audits and site inspections. No significant or material environmental breaches have been notified by any government
agency during the year ended 30 June 2016.
Dividends
No dividends have been paid or declared since the start of the financial year. No recommendation for the payment of a
dividend has been made.
Share options
Shares under option or issued on exercise of options
Details of unissued shares or interests under option as at the date of this report are:
Issuing entity
Number of shares
under option
Class of shares
Exercise price
of options
Expiry date of
options
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
150,000
175,000
175,000
562,500
562,500
562,500
562,500
150,000
750,000
750,000
125,000
125,000
125,000
125,000
125,000
125,000
125,000
125,000
125,000
125,000
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
$0.40
$0.50
$0.60
$0.43
$0.51
$0.60
$0.69
$0.90
$0.41
$0.49
$0.56
$0.64
$0.40
$0.50
$0.60
$0.70
$0.80
$0.90
$0.95
$1.00
30-Sep-16
30-Sep-16
30-Sep-16
31-Oct-16
31-Oct-16
31-Oct-16
31-Oct-16
30-Jun-17
31-Oct-17
31-Oct-17
31-Oct-17
31-Oct-17
1-Mar-18
1-Mar-18
1-Mar-18
1-Mar-18
31-Mar-19
31-Mar-19
31-Mar-19
31-Mar-19
The holders of these options do not have the right, by virtue of the option, to participate in any share issue or interest issue
of any other body corporate or registered scheme.
Page 22
TALISMAN MINING LTD ■ DIRECTORS’ REPORT
Shares issued on exercise of options
There were no shares or interests issued during or since the end of the financial year as a result of the exercise of options.
Options that expired/lapsed
Details of employee options that expired or lapsed during or since the end of the financial year are:
Issuing entity
Number of options
expired/lapsed
Class of shares
Exercise price
of options
Expiry date of
options
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
Talisman Mining Limited
(250,000)
(250,000)
(250,000)
(250,000)
(25,000)
(25,000)
(25,000)
(25,000)
(25,000)
(25,000)
(25,000)
(25,000)
(625,000)
(625,000)
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
$1.02
$1.13
$1.41
$1.53
$0.44
$0.47
$0.49
$0.52
$0.44
$0.47
$0.49
$0.52
$0.56
$0.64
31-Jul-15
31-Jul-15
31-Jul-15
31-Jul-15
31-Aug-15
31-Aug-15
31-Aug-15
31-Aug-15
31-Oct-15
31-Oct-15
31-Oct-15
31-Oct-15
31-Mar-16
31-Mar-16
Indemnification of officers and auditors
During the financial year, the Company entered into a contract insuring the Directors and executive officers of the Company
and of any related body corporate against a liability incurred as a Director or executive officer 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.
The Company has not otherwise, during or since the end of the financial year, except to the extent permitted by law,
indemnified or agreed to indemnify an officer or auditor of the Company or related body corporate against a liability
incurred as an officer or auditor.
Page 23
TALISMAN MINING LTD ■ DIRECTORS’ REPORT
Directors’ meetings
The following table sets out the number of Directors’ meetings (including meetings of committees of directors) held
during the financial year and the number of meetings attended by each Director (while they were a director or committee
member). During the financial year, 11 board meetings, 2 audit committee meetings, 1 remuneration committee meeting
and 2 nomination committee meeting were held.
Directors
Jeremy Kirkwood
Alan Senior
Gary Lethridge
Brian Dawes
Karen Gadsby
Board of directors
Audit committee
Remuneration
committee
Nomination
committee
Eligible
to attend
Attended
Eligible
to attend
Attended
Eligible
to attend
Attended
Eligible
to attend
Attended
4
11
6
11
11
4
11
6
11
10
–
2
1
2
2
–
1
1
2
2
1
1
–
1
1
1
1
–
1
1
2
2
–
2
2
2
2
–
2
2
Note: Executive Directors attending committee meetings during the year attended all or part of the meeting by invitation of
the relevant Committee.
Proceedings on behalf of the Company
No persons have applied for leave pursuant to s.237 of the Corporation Act 2001 to bring, or intervene in, proceedings on
behalf of Talisman Mining Limited.
Non-Audit Services
Details of amounts paid or payable to the auditor for non-audit services provided during the year by the auditor are outlined
in Note 29 to the financial statements. The Directors are satisfied that the provision of non-audit services is compatible with
the general standard of independence for auditors imposed by the Corporations Act 2001.
The Directors are of the opinion that the services do not compromise the auditor’s independence as all non-audit services
have been reviewed to ensure that they do not impact the impartiality and objectivity of the auditor and none of the
services undermine the general principles relating to auditor independence as set out in Code of Conduct APES 110: Code
of Ethics for Professional Accountants issued by the Accounting Professional & Ethical Standards Board.
Auditor Independence declaration
Section 307C of the Corporations Act 2001 requires our auditors, HLB Mann Judd, to provide the Directors of the
Company with an Independence Declaration in relation to the audit of the annual report. This Independence Declaration is
set out on page 33 and forms part of this Directors’ report for the year ended 30 June 2016.
Page 24
TALISMAN MINING LTD ■ REMUNERATION REPORT
This Remuneration Report, which forms part of the Directors’ report, sets out information about the remuneration of the
key management personnel of Talisman Mining Limited (the “Company”) for the financial year ended 30 June 2016. The
information in the remuneration report has been audited as required by Section 308(3C) of the Corporations Act 2001.
The remuneration report details the remuneration arrangements for key management personnel who are defined as those
persons having authority and responsibility for planning, directing and controlling the major activities of the Company and
the Group, directly or indirectly, including any director (whether executive or otherwise) of the parent company.
The prescribed details for each person covered by this report are detailed below under the following headings:
(a) key management personnel details;
(b) remuneration policy and relationship between the remuneration policy and Company performance;
(c) key terms of employment contracts; and
(d) remuneration of key management personnel.
(a) Key management personnel details
The key management personnel of Talisman Mining Limited during the year were:
Non-Executive Chairman
Jeremy Kirkwood
Non-Executive Director
Alan Senior
Non-Executive Director
Brian Dawes
Non-Executive Director
Karen Gadsby
Managing Director
Gary Lethridge
Chief Financial Officer to Acting Chief Executive Officer
Daniel Madden
Commercial Manager/ Company Secretary
Shaun Vokes
General Manager – Geology
Anthony Greenaway
General Manager – Project Development
Ben Wilson
(Appointed 1 April 2016)
(Resigned 31 March 2016)
(Appointed 1 April 2016)
(Appointed 29 February 2016)
(Appointed 15 March 2016)
(b) Remuneration policy and relationship between the remuneration policy and
Company performance
Key management personnel (excluding Non-Executive Directors)
The Board is responsible for determining the remuneration policies for the Group, including those affecting Executive
Directors and other key management personnel. The Board may seek appropriate external advice to assist in its decision
making.
The Company’s remuneration policy for executive directors and key management personnel is designed to promote
superior performance and long term commitment to the Company. The main principles of the policy when considering
remuneration are as follows:
• executive directors and key management personnel are motivated to pursue long term growth and success of the
Company within an appropriate control framework;
interests of key leadership are aligned with the long-term interests of the Company’s shareholders; and
there is a clear correlation between performance and remuneration.
•
•
The remuneration policy for executive directors and other key management personnel has three main components, fixed
remuneration, long term incentive and a potential discretionary bonus.
Fixed remuneration
Executive Directors and other key management personnel receive fixed remuneration in the form of a base salary (plus
statutory superannuation) which is reviewed annually by the Remuneration Committee. The review process includes
a review of companywide and individual performance, comparative compensation in the market and internally, and, if
appropriate, external advice to assist in its decision making.
Page 25
TALISMAN MINING LTD ■ REMUNERATION REPORT
Long term incentives
To align the interests of key management personnel with the long term objectives of the Group and its shareholders, the
Group’s policy, having regard to the stage of development of its assets, is to issue share options under the shareholder
approved ‘Executive and Employee Option Plan’ (EEOP) and at the discretion of the Board, subject to shareholder approval
for directors. The issue of share options as remuneration represents cost effective consideration to Directors and key
management personnel for their commitment and contribution to the Group and are used as a strategic tool to recruit and
retain high calibre personnel. Options issued during the year vest at various periods during the life of the options and value
is only realised by directors and key management personnel upon growth at various premiums to the Company’s 5-day
volume weighted share price from the date of grant and subsequent vesting of the options.
Vesting conditions relating to the performance of the Group are not considered appropriate having regard to the stage of
development of the Group’s assets.
Potential discretionary bonus
A potential discretionary bonus may be paid to executive directors and other key management personnel. Any potential
bonus paid is at the discretion of the Remuneration Committee and will typically be made in recognition of contribution to
the Company’s performance and other significant efforts of Executive Directors and other key management personnel in
applicable and appropriate circumstances. There were no discretionary bonuses paid during or with regard to the financial
years ended 30 June 2015 or 30 June 2016.
Non-Executive Directors
The Group’s Non-Executive Directors receive fees (including statutory superannuation) for their services and the
reimbursement of reasonable expenses. The fees paid to the Group’s Non-Executive Directors reflect the demands on, and
responsibilities of, the directors. They do not receive any retirement benefits (other than compulsory superannuation). The
Board decides annually the level of fees to be paid to Non-Executive Directors with reference to market standards.
Non-Executive Directors may also receive share options where this is considered appropriate by the Board as a whole
and with regard to the stage of the Group’s development. Such options vest across the life of the option and are primarily
designed to provide an incentive to Non-Executive Directors to remain with the Group. Options issued to Non-Executive
Directors are subject to shareholder approval.
A Non-Executive Directors’ fee pool limit of $300,000 per annum was approved by the shareholders at the General
Meeting on 19 May 2008 and was utilised to a level of $178,000 (inclusive of superannuation) for the financial year ended
30 June 2016. The fee paid for the 2016 financial year to the Chairman was $74,506 per annum and $45,900 per annum
for the Non-Executive Directors (excluding statutory superannuation).
(c) Key terms of employment contracts
Remuneration and other terms of employment for executive directors are formalised in a letter agreement. The Acting CEO,
Daniel Madden’s remuneration and other terms are formalised by way of a letter agreement that is ongoing. The notice
period for Mr. Madden is three months and payment of a termination benefit on early termination by the Group (other than
for gross misconduct) at the end of the notice period, is three months’ base salary. Where the Group elects to dispense
with the notice period and terminate employment, six months’ base salary applies.
Remuneration and other terms of employment for Mr Vokes, Mr Wilson, and Mr Greenaway are formalised by way of letter
agreements which are ongoing. The notice period for Mr Vokes is three months and a termination benefit payable on early
termination by the Group (other than for gross misconduct) is equal to three months’ base salary and the notice period for
Mr Wilson and Mr Greenaway is four weeks and a termination benefit payable on early termination by the Group (other than
for gross misconduct) is equal to four weeks’ base salary.
Remuneration for executive directors and key management personnel consists of a base salary, superannuation and
performance incentives. Long term performance incentives may include options granted at the discretion of the Board
subject to obtaining the relevant approvals. The remuneration of the Managing Director is recommended to the Board
by the Remuneration Committee. Remuneration of key management personnel (excluding Non-Executive Directors) is
recommended annually by the Remuneration Committee in consultation with the Managing Director or equivalent.
Page 26
TALISMAN MINING LTD ■ REMUNERATION REPORT
(d) Remuneration of key management personnel
Details of the nature and amount of each element of the remuneration for key management personnel during the year are
set out in the following tables:
Short-term employee benefits
employment benefits
Post-
employ-
ment
benefits
Salary
& fees
$
Bonus
$
Non-
monetary
$
Other
$
Super-
annuation
$
Other
long-term
employee
benefits
$
Share-
based
payment
Options
(ix)
$
Total
$
% of
compen-
sation
linked to
perfor-
mance
%
–
–
–
–
–
–
–
–
–
–
–
–
–
–
2016
Directors
Jeremy
Kirkwood (i)
Alan Senior (ii)
Gary Lethridge
(iii)
Brian Dawes
Karen Gadsby
20,000
65,981
281,242
45,900
45,900
Executives
Daniel Madden
(iv)
252,962
Shaun Vokes (v)
58,513
Ben Wilson
180,000
Anthony
Greenaway (vi)
54,000
1,004,498
2015
Directors
Alan Senior
72,675
Gary Lethridge
281,138
Brian Dawes
Karen Gadsby
Graeme
Cameron (vii)
45,900
45,900
202,053
Executives
Daniel Madden
216,000
Graham Leaver
75,096
Peter Cash (viii)
152,017
1,090,779
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
13,327
–
–
4,330
–
–
–
17,657
–
14,729
–
–
–
–
–
–
14,729
0.00%
1.77%
6.56%
1.69%
1,900
6,268
–
–
–
21,900
1,299
73,548
30,688
41,792
25,748
392,797
4,361
4,361
24,031
5,559
17,100
–
–
–
–
–
866
51,127
18,721
68,982
27.14%
1,732
283,055
–
64,072
16,407
213,507
0.61%
0.00%
7.68%
5,130
–
18,674
77,804
24.00%
99,398
41,792
83,447 1,246,792
6,904
26,708
4,361
4,361
–
22,697
–
–
–
–
20,520
7,134
12,207
104,892
–
–
–
–
–
–
–
–
–
10,339
89,918
11.50%
147,292
469,867
31.35%
6,893
57,154
12.06%
29,458
79,719
36.95%
–
224,750
0.00%
13,785
250,305
5.51%
17,734
99,964
17.74%
–
164,224
0.00%
225,501 1,435,901
(i) Jeremy Kirkwood was appointed 1 April 2016 as Non-Executive Chairman.
(ii) Alan Senior was Non-Executive Chairman from 1 July 2015 to 31 March 2016 and Non-Executive Director 31 March
2016 to 30 June 2016.
Page 27
TALISMAN MINING LTD ■ REMUNERATION REPORT
(iii) Gary Lethridge resigned on 31 March 2016 and salaries and fees detailed above include long service leave and annual
leave entitlements paid on termination.
(iv) Daniel Madden was appointed Acting Chief Executive Officer from 1 April 2016.
(v) Shaun Vokes was appointed from 29 February 2016.
(vi) Anthony Greenaway was appointed from 15 March 2016.
(vii) Graeme Cameron resigned on 15 January 2015 and salaries and fees detailed above include annual leave entitlements
paid on termination.
(viii) Peter Cash was made redundant on the 5 November 2015.
(ix) The value of share based payments shown in the table are non-cash values based on an accounting valuation
calculated under the Black Scholes option pricing method.
Incentive share based payment arrangements in existence during the financial year
During the financial year the following incentive share based payment arrangements for key management personnel were in
existence:
Options
Series
Number
Grant date
Expiry date
Vesting date
Exercise
price
$
Fair value per
option at grant
date (i)
$
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
250,000
250,000
250,000
250,000
562,500
562,500
562,500
562,500
750,000
750,000
750,000
750,000
125,000
125,000
125,000
125,000
150,000
175,000
175,000
150,000
125,000
125,000
125,000
125,000
15-Mar-12
15-Mar-12
15-Mar-12
15-Mar-12
25-Nov-13
25-Nov-13
25-Nov-13
25-Nov-13
5-Dec-14
5-Dec-14
5-Dec-14
5-Dec-14
4-Mar-15
4-Mar-15
4-Mar-15
4-Mar-15
5-Mar-15
5-Mar-15
5-Mar-15
11-Aug-15
4-Apr-16
4-Apr-16
4-Apr-16
4-Apr-16
31-Jul-15
31-Jul-15
31-Jul-15
31-Jul-15
31-Oct-16
31-Oct-16
31-Oct-16
31-Oct-16
31-Oct-17
31-Oct-17
31-Oct-17
31-Oct-17
1-Mar-18
1-Mar-18
1-Mar-18
1-Mar-18
30-Sep-16
30-Sep-16
30-Sep-16
30-Jun-17
31-Mar-19
31-Mar-19
31-Mar-19
31-Mar-19
13-Sep-12
15-Mar-13
13-Sep-13
15-Mar-14
26-May-14
25-Nov-14
26-May-15
25-Nov-15
25-May-15
24-Nov-15
24-May-16
24-Nov-16
1-Sep-15
1-Mar-16
1-Sep-16
1-Mar-17
11-Jul-15
12-Oct-15
12-Jun-16
31-Dec-15
30-Sep-16
31-Mar-17
30-Sep-17
31-Mar-18
$1.02
$1.13
$1.41
$1.53
$0.43
$0.51
$0.60
$0.69
$0.41
$0.49
$0.56
$0.64
$0.40
$0.50
$0.60
$0.70
$0.40
$0.50
$0.60
$0.90
$0.80
$0.90
$0.95
$1.00
$0.18
$0.18
$0.16
$0.16
$0.04
$0.04
$0.04
$0.03
$0.11
$0.10
$0.10
$0.10
$0.11
$0.10
$0.10
$0.09
$0.07
$0.06
$0.06
$0.37
$0.02
$0.14
$0.13
$0.13
(i) The fair value per option at grant date is not the exercise price but the non-cash inferred value based upon the Black
Scholes option pricing model.
Page 28
TALISMAN MINING LTD ■ REMUNERATION REPORT
Potential value at the vesting date of options currently granted to directors and key management personnel is only
realised by those optionholders upon increases in the Company’s share price at a certain premium to the 5-day volume
weighted share price at the date of grant of the options and the optionholder subsequently exercising those options. This
represents a performance criterion directly related to substantial share price increases prior to realisation of potential value.
Optionholders must also be either a director or employee at the time of vesting for granted options to vest. Other than the
above, there are no other performance criteria that need to be met in relation to options granted under series 1 to 24 before
the beneficial interest vests in the recipient.
The following grants of share based payment compensation were made to key management personnel during the current
financial year.
Directors and senior
management
Number of options
granted
Issuing Entity
Number of ordinary
shares under option
Anthony Greenaway
500,000
Talisman Mining Ltd
500,000
The primary purpose of the grant of share based payment compensation to key management personnel is to provide cost
effective consideration for their ongoing retention, commitment and contribution to the Company. The determined fair
values of share based payments contained within this Remuneration Report are non-cash, inferred values and realisation
of any value from the options requires significant growth in the share price between the date of grant of the options and the
vesting date of the options in addition to the options then being exercised. The vesting dates of options granted as share
based payments are structured to encourage and potentially reward longevity of service to the Company and realisation of
value to shareholders.
Options granted to Executive and Non-Executive Directors are approved by shareholders at general meetings of the
Company.
The assessed fair value at the grant date of options granted to individuals is allocated equally over the period from the grant
date to the vesting date, and the amount is included in the remuneration tables in this remuneration report. Fair values at
grant date are determined using a Black Scholes option pricing model that takes into account the exercise price, the term
of the option, the share price at grant date, the expected price volatility of the underlying share and the risk free rate for the
term of the option.
Inputs into model
20
Exercise price
Grant date share price
(5 day VWAP)
Expected volatility
Risk-free interest rate
Dividend yield (%)
Expected life of options (years)
$ 0.90
$ 0.590
150%
1.95%
Nil
1.64
21
$ 0.80
$ 0.465
68%
1.95%
Nil
3.30
22
23
24
$ 0.90
$ 0.95
$ 1.00
$ 0.465
$ 0.465
$ 0.465
68%
1.95%
Nil
3.30
68%
1.95%
Nil
3.30
68%
1.95%
Nil
3.30
During the year, no key management personnel exercised options that were granted to them as part of their compensation
in that year.
Page 29
TALISMAN MINING LTD ■ REMUNERATION REPORT
Value of options issued to directors and executives
The following table summarises the value of options granted, exercised or lapsed during the annual reporting period to the
identified directors or executives.
Value of options
granted at the
grant date (i)
$
Value of options
exercised at the
exercise date
$
Value of options
lapsed at the date
of lapse (ii)
$
Name
Directors
Jeremy Kirkwood
Alan Senior
Gary Lethridge
Brian Dawes
Karen Gadsby
Executives
Daniel Madden
Shaun Vokes
Ben Wilson
–
–
–
–
–
–
–
–
Total
$
–
–
–
–
(121,938)
(121,938)
–
–
–
–
–
–
–
–
–
–
–
68,293
–
–
–
–
–
–
–
–
–
Anthony Greenaway
68,293
(i) The value of options granted during the period is recognised in compensation over the vesting period of the grant, in
accordance with Australian accounting standards.
(ii) The value of options lapsing during the period reflects the total fair value determined at issue date.
(e) Other transactions with key management personnel
During the year ended 30 June 2016 the Group paid $13,628 to Ailie Services Pty Ltd, a related party of Mr Brian Dawes,
for consultancy services provided over a nine day period which were deemed to be provided outside the ordinary
requirements of Non-Executive Director duties. This transaction was made on the Company’s normal commercial terms
and conditions.
The Group also paid $2,325 to Natalie Madden, a related party of Mr Daniel Madden, for financial consultancy services
provided over a 2 month period January to February 2016. This transaction was made on the Company’s normal
commercial terms and conditions.
There were no other transactions with key management personnel of the Group during the 2016 and 2015 financial years.
Page 30
TALISMAN MINING LTD ■ REMUNERATION REPORT
(f) Shareholdings of key management personnel
Opening
bal at
1 July
Balance
at date
appointment
Shares
received on
exercise of
options
Net other
change
Balance on
resignation
Balance at
30 June
Number
Number
Number
Number
Number
Number
2016
Directors
Jeremy Kirkwood
N/A
119,000
Alan Senior
Gary Lethridge
Brian Dawes
Karen Gadsby
Executives
Daniel Madden
Shaun Vokes
Ben Wilson
Anthony Greenaway
2015
Directors
Alan Senior
Gary Lethridge
Brian Dawes
Karen Gadsby
Graeme Cameron
Executives
Daniel Madden
Graham Leaver
Peter Cash
116,666
1,666,667
353,333
311,334
–
–
–
–
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
2,448,000
119,000
116,666
1,666,667
353,333
311,334
–
–
–
495,000
2,943,000
N/A
N/A
N/A
N/A
N/A
N/A
–
N/A
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
8,000
–
N/A
N/A
1,666,667
N/A
N/A
N/A
N/A
N/A
N/A
119,000
116,666
–
353,333
311,334
–
–
8,000
–
8,000
1,666,667
908,333
–
–
–
–
–
–
–
–
–
N/A
N/A
N/A
N/A
–
N/A
N/A
495,000
116,666
1,666,667
353,333
311,334
N/A
–
–
–
495,000
2,448,000
Page 31
TALISMAN MINING LTD ■ REMUNERATION REPORT
(g) Option holdings of key management personnel
Opening
balance
at
1 July
Granted
as
remun-
eration
Options
Exerc-
ised
Net other
change
Balance
on resig-
nation
Closing
balance
at 30
June
Vested
but not
exerc-
isable
Vested
during
the year
Vested
and
exerc-
isable at
30 June
Number Number Number Number Number Number Number Number Number
2016
Directors
Jeremy Kirkwood
Alan Senior
N/A
750,000
Gary Lethridge
2,500,000
Brian Dawes
Karen Gadsby
500,000
500,000
Executives
Daniel Madden
1,000,000
Shaun Vokes
Ben Wilson
N/A
500,000
–
–
–
–
–
–
–
–
Anthony Greenaway
N/A 500,000
–
–
–
–
N/A
–
N/A 750,000
– (1,250,000) 1,250,000 1,250,000
–
–
–
–
–
–
–
–
–
–
–
–
N/A 500,000
N/A 500,000
N/A 1,000,000
N/A
–
N/A 500,000
N/A 500,000
–
–
–
–
–
–
–
–
–
–
–
187,500
750,000
625,000 1,250,000
125,000
500,000
250,000
375,000
250,000 1,000,000
–
–
500,000
500,000
–
–
5,750,000
500,000
– (1,250,000) 1,250,000 5,000,000
– 1,937,500 4,375,000
2015
Directors
Alan Senior
750,000
–
–
–
N/A 750,000
Gary Lethridge
3,000,000 2,500,000
– (3,000,000)
N/A 2,500,000
Brian Dawes
500,000
–
Karen Gadsby
500,000
500,000
Graeme Cameron
2,000,000
Executives
Daniel Madden
1,000,000
–
–
Graham Leaver
–
500,000
–
–
–
N/A 500,000
(500,000)
N/A 500,000
– (1,000,000) 1,000,000
N/A
–
–
–
–
N/A 1,000,000
N/A 500,000
Peter Cash
1,000,000
–
– (1,000,000)
–
N/A
–
–
–
–
–
–
–
–
375,000
562,500
625,000
625,000
250,000
375,000
125,000
125,000
–
N/A
500,000
750,000
–
–
–
–
8,750,000 3,500,000
– (5,500,000) 1,000,000 5,750,000
– 1,875,000 2,437,500
This directors’ report is signed in accordance with a resolution of directors made pursuant to s.298(2) of the Corporations
Act 2001.
On behalf of the Directors
Daniel Madden
Managing Director
Perth, 30 September 2016
Page 32
TALISMAN MINING LTD ■ AUDITOR’S INDEPENDENCE DECLARATION
AUDITOR’S INDEPENDENCE DECLARATION
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the consolidated financial report of Talisman Mining Limited for the
year ended 30 June 2016, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
As lead auditor for the audit of the consolidated financial report of Talisman Mining Limited for the
year ended 30 June 2016, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
a)
a)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit;
and
the auditor independence requirements of the Corporations Act 2001 in relation to the audit;
and
b)
b)
any applicable code of professional conduct in relation to the audit.
any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
30 September 2016
Perth, Western Australia
30 September 2016
M R W Ohm
Partner
M R W Ohm
Partner
HLB Mann Judd (WA Partnership) ABN 22 193 232 714
Level 4, 130 Stirling Street Perth WA 6000. PO Box 8124 Perth BC 6849 Telephone +61 (08) 9227 7500. Fax +61 (08) 9227 7533.
Email: hlb@hlbwa.com.au. Website: http://www.hlb.com.au
Liability limited by a scheme approved under Professional Standards Legislation
HLB Mann Judd (WA Partnership) ABN 22 193 232 714
Level 4, 130 Stirling Street Perth WA 6000. PO Box 8124 Perth BC 6849 Telephone +61 (08) 9227 7500. Fax +61 (08) 9227 7533.
Email: hlb@hlbwa.com.au. Website: http://www.hlb.com.au
Liability limited by a scheme approved under Professional Standards Legislation
HLB Mann Judd (WA Partnership) is a member of
HLB Mann Judd (WA Partnership) is a member of
International, a worldwide organisation of accounting firms and business advisers.
International, a worldwide organisation of accounting firms and business advisers.
Page 33
TALISMAN MINING LTD
■ INDEPENDENT AUDITOR’S REPORT
INDEPENDENT AUDITOR’S REPORT
To the members of Talisman Mining Limited
Report on the Financial Report
We have audited the accompanying financial report of Talisman Mining Limited (“the company”), which
comprises the consolidated statement of financial position as at 30 June 2016, the consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated statement of
cash flows for the year then ended, notes comprising a summary of significant accounting policies and other
explanatory information, and the directors’ declaration of the Group comprising the company and the entities
it controlled at the year’s end or from time to time during the financial year.
Directors’ responsibility for the financial report
The directors of the company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error.
In Note 2(a), the directors also state that, in accordance with Accounting Standard AASB 101: Presentation of
Financial Statements, the consolidated financial statements comply with International Financial Reporting
Standards.
Auditor’s responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit
in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical
requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance
about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the
risks of material misstatement of the financial report, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the Group’s preparation of the financial report
that gives a true and fair view 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 company’s and its controlled
entities’ internal control. An audit also includes evaluating the appropriateness of accounting policies used and
the reasonableness of accounting estimates made by the directors, as well as evaluating the overall
presentation of the financial report.
Our audit did not involve an analysis of the prudence of business decisions made by directors or management.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.
HLB Mann Judd (WA Partnership) ABN 22 193 232 714
Level 4, 130 Stirling Street Perth WA 6000. PO Box 8124 Perth BC 6849 Telephone +61 (08) 9227 7500. Fax +61 (08) 9227 7533.
Email: hlb@hlbwa.com.au. Website: http://www.hlb.com.au
Liability limited by a scheme approved under Professional Standards Legislation
HLB Mann Judd (WA Partnership) is a member of
International, a worldwide organisation of accounting firms and business advisers.
Page 34
TALISMAN MINING LTD
■ INDEPENDENT AUDITOR’S REPORT
Auditor’s opinion
In our opinion:
(a)
the financial report of Talisman Mining Limited is in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Group’s financial position as at 30 June 2016 and its performance
for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b)
the financial report also complies with International Financial Reporting Standards as disclosed in Note
2(a).
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2016.
The directors of the company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on
the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
Auditor’s opinion
In our opinion, the Remuneration Report of Talisman Mining Limited for the year ended 30 June 2016 complies
with section 300A of the Corporations Act 2001.
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
30 September 2016
M R W Ohm
Partner
Page 35
TALISMAN MINING LTD ■ INDEX TO THE FINANCIAL REPORT
Directors’ Declaration
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
37
38
39
40
41
Notes to the Consolidated Financial Statements
42
42
General Information
42
Significant Accounting Policies
51
Voluntary Change in Accounting Policy
54
Other Income
54
Expenses
54
Exploration Expenditure Expensed as Incurred
55
Income Tax
56
Cash and Cash Equivalents
57
Trade and Other Receivables
57
Other Financial Assets
Property, Plant and Equipment
58
Exploration, Evaluation and Development Expenditure 59
59
Trade and Other Payables
59
Employee Benefits
60
Provisions
60
Issued Capital
61
Accumulated Losses
61
Earnings Per Share
62
Commitments and Contingencies
62
Financial Instruments
65
Share-Based Payments
68
Directors’ and Executives’ Disclosures
69
Joint Operation
70
Segment Reporting
70
Contingent Liabilities and Contingent Assets
71
Parent Entity Disclosures
72
Related Party Disclosure
72
Acquisition of Assets
73
Remuneration of Auditors
73
Events Subsequent to Reporting Date
Additional Securities Exchange Information
74
Page 36
■ DIRECTORS’ DECLARATION
The directors declare that:
(a) in the directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable.
(b) in the directors’ opinion, the attached financial statements, notes and additional disclosures of the consolidated entity
are in accordance with the Corporations Act 2001, including:
ii. complying with Australian Accounting Standards and the Corporations Regulations 2001; and
iii. giving a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and performance for the
year then ended.
(c) in the directors’ opinion the attached financial statements and notes thereto are in accordance with International
Financial Reporting Standards issued by the International Accounting Standards Board.
(d) the directors have been given the declarations required by s.295A of the Corporations Act 2001.
Signed in accordance with a resolution of the directors made pursuant to s.295(5) of the Corporations Act 2001.
On behalf of the Directors
Daniel Madden,
Managing Director
Perth, 30 September 2016
Page 37
TALISMAN MINING LTD ■ CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2016
Continuing operations
Other income
Employee benefits expense
Exploration expenditure expensed as incurred
Care and Maintenance expense
Occupancy expenses
Administrative expenses
Unwinding of discount on provisions
Depreciation and amortisation expense
Disposal of fixed assets
Impairment of available-for-sale financial assets
Loss before income tax expense
Income tax benefit
Loss after tax from continuing operations
Note
30 Jun 16
$
Restated*
30 Jun 15
$
4
5
6
5
15
10
7
348,355
367,760
(813,267)
(876,454)
(5,809,259)
(1,975,597)
(431,236)
(170,355)
(830,568)
(241,375)
(59,752)
–
(104,232)
(169,386)
(496,768)
–
(90,623)
1,818
(3,000)
(426,000)
(8,010,457)
(3,769,482)
–
–
(8,010,457)
(3,769,482)
Net loss for the period
(8,010,457)
(3,769,482)
Other comprehensive income for the period, net of tax
Items that may be reclassified to profit or loss
Net change in the fair value of available-for-sale financial assets
10
Other comprehensive income for the period, net of tax
Total comprehensive loss for the period
(7,000)
(7,000)
(156,300)
(156,300)
(8,017,457)
(3,925,782)
Loss per share:
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
18
18
(5.06)
n/a
(2.87)
n/a
The accompanying notes form part of these financial statements.
* Refer to Note 3 for details about restatements for the voluntary change in accounting policy.
Page 38
TALISMAN MINING LTD ■ CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2016
Assets
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
Non-Current Assets
Receivables
Other financial assets
Property, plant and equipment
Deferred exploration and evaluation expenditure
Total Non-Current Assets
Total Assets
Liabilities
Current Liabilities
Trade and other payables
Employee benefits
Total Current Liabilities
Non-Current Liabilities
Deferred tax liabilities
Provisions
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
Note
30 Jun 16
$
Restated*
30 Jun 15
$
Restated*
1 Jul 14
$
8
9
9
10
11
12
13
14
7
15
16
17
17
20,243,616
4,865,632
16,083,171
257,490
200,627
370,086
20,501,106
5,066,259
16,453,257
60,184
120,700
60,184
130,700
2,788,756
2,810,786
70,184
713,000
261,096
14,544,635
14,000,000
–
17,514,275
17,001,670
1,044,280
38,015,381
22,067,929
17,497,537
362,219
100,416
462,635
380,886
72,500
453,386
213,850
33,428
247,278
–
–
8,287,209
8,045,834
8,287,209
8,045,834
–
–
–
8,749,844
8,499,220
247,278
29,265,537
13,568,709
17,250,259
60,881,617
37,404,278
37,404,278
409,589
469,832
1,923,900
(32,025,669)
(24,305,401)
(22,077,919)
29,265,537
13,568,709
17,250,259
The accompanying notes form part of these financial statements.
* Refer to Note 3 for details about restatements for the voluntary change in accounting policy.
Page 39
TALISMAN MINING LTD ■ CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2016
Issued
Capital
$
Accumulated
Losses
$
Asset
Revaluation
Reserve
$
Share-based
Payments
Reserve
$
Total Equity
$
Balance at 1 July 2014
37,404,278
7,103,801
177,500
1,746,400
46,431,979
Change in accounting policy
(note 3(b))
Restated Total Equity at
1 July 2014
Loss for the period
Net change in fair value of
available-for-sale financial assets
Total comprehensive
income/(loss) for the period
Recognition of share-based
payments
Unlisted options lapsing
–
(29,181,720)
–
–
(29,181,720)
37,404,278
(22,077,919)
177,500
1,746,400
17,250,259
–
–
–
–
–
(3,769,482)
–
–
(156,300)
(3,769,482)
(156,300)
–
–
–
(3,769,482)
(156,300)
(3,925,782)
–
1,542,000
–
–
244,232
244,232
(1,542,000)
–
Balance at 30 June 2015
37,404,278
(24,305,401)
21,200
448,632
13,568,709
Balance at 1 July 2015
37,404,278
(24,305,401)
21,200
448,632
13,568,709
Loss for the period
Net change in fair value of
available-for-sale financial assets
Total comprehensive
income/(loss) for the period
–
–
–
(8,010,457)
–
–
(7,000)
(8,010,457)
(7,000)
Shares issued during the year
23,477,339
Recognition of share-based
payments
Unlisted options lapsing
–
–
–
–
290,189
–
–
–
–
–
–
–
(8,010,457)
(7,000)
(8,017,457)
23,477,339
236,946
(290,189)
236,946
–
Balance at 30 June 2016
60,881,617
(32,025,669)
14,200
395,389
29,265,537
The accompanying notes form part of these financial statements.
* Refer to Note 3 for details about restatements for the voluntary change in accounting policy.
Page 40
TALISMAN MINING LTD ■ CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2016
Cash flows from operating activities
Payments to suppliers and employees
Payments for exploration and evaluation
Interest received
Interest paid
Note
30 Jun 16
$
Restated
30 Jun 15
$
inflows/(outflows)
(1,584,750)
(1,264,360)
(6,172,670)
(1,784,376)
242,132
440,982
–
(225)
Net cash used in operating activities
8
(7,515,288)
(2,607,979)
Cash flows from investing activities
Payments for exploration and evaluation expenditure
Payments for property, plant and equipment
Proceeds from sale of plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Payments for share issue costs
Net cash provided by financing activities
Net increase /(decrease) in cash held
Cash and cash equivalents at the beginning of the period
(544,634)
(5,954,165)
(39,433)
(2,657,213)
–
1,818
(584,067)
(8,609,560)
24,712,989
(1,235,650)
23,477,339
–
–
–
15,377,984
(11,217,539)
4,865,632
16,083,171
Cash and cash equivalents at the end of the period
8
20,243,616
4,865,632
The accompanying notes form part of these financial statements.
* Refer to Note 3 for details about restatements for the voluntary change in accounting policy.
Page 41
TALISMAN MINING LTD ■ NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL INFORMATION
Talisman Mining Limited (the Company) is a public company listed on the Australian Securities Exchange (trading under the
symbol “TLM”) and operating in Australia.
Talisman Mining Limited’s Registered Office and its principal place of business are as follows:
Registered Office
6 Centro Avenue
Subiaco
Western Australia 6008
Principal place of business
6 Centro Avenue
Subiaco
Western Australia 6008
The nature of the operations and principal activities of the Company are described in the Directors’ Report.
2. SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of preparation
This financial report is a general purpose financial report, which has been prepared in accordance with the requirements of
the Corporations Act 2001, Accounting Standards and Interpretations and to comply with other requirements of the law.
The accounting policies detailed below have been consistently applied to all of the years presented unless otherwise
stated. The financial statements are for the Group consisting of Talisman Mining Limited and its subsidiaries. The financial
report comprises the consolidated financial statements for the Group for the year ended 30 June 2016. The Company is a
for-profit entity for the purposes of preparing the consolidated financial statements.
The financial statements have been prepared on a historical cost basis, except for available-for-sale investments which
have been measured at fair value. Historical cost is based on the fair values of the consideration given in exchange for
goods and services.
The financial report is presented in Australian dollars.
(i) Adoption of new and revised standards
Standards and Interpretations applicable to 30 June 2016
In the year ended 30 June 2016, the Directors have reviewed all of the new and revised Standards and Interpretations
issued by the AASB that are relevant to the Company and effective for the current annual reporting period.
As a result of this review, 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 Group accounting policies.
Standards and Interpretations in issue not yet adopted
The Directors have also reviewed all new Standards and Interpretations that have been issued but are not yet effective
for the year ended 30 June 2016. As a result of this review the Directors have determined that there is no material impact,
of the new and revised Standards and Interpretations on the Group and, therefore, no change is necessary to Group
accounting policies.
(ii) Statement of compliance
The financial report was authorised for issue on 30 September 2016.
The financial report complies with Australian Accounting Standards, which include Australian equivalents to International
Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report, comprising the financial
statements and notes thereto, complies with International Financial Reporting Standards (IFRS).
(iii) Significant accounting estimates and judgements
The application of accounting policies requires the use of judgements, estimates and assumptions about carrying values
of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are
based on historical experience and other factors that are considered to be relevant. Actual results may differ from these
estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are recognised in the period in
which the estimate is revised if it affects only that period, or in the period of the revision and future periods if the revision
affects both current and future periods.
Page 42
TALISMAN MINING LTD 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Share-based payment transactions:
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by utilising a Black and Scholes model,
using the assumptions detailed in Note 21.
Exploration and evaluation expenditure carried forward
The recoverability of the carrying amount of exploration and evaluation expenditure carried forward has been reviewed
by the Directors. The recoverability of the carrying amount of the exploration and evaluation assets is dependent on the
successful development and commercial exploitation, or alternatively, sale of the respective area of interest.
The Group reviews the carrying value of exploration and evaluation expenditure on a regular basis to determine whether
economic quantities of reserves have been found or whether further exploration and evaluation work is underway or
planned to support continued carry forward of capitalised costs. This assessment requires judgement as to the status of
the individual projects and their estimated recoverable amount.
Impairment of available-for-sale financial assets
The Group follows the guidance of AASB 139 Financial Instruments: Recognition and Measurement to determine when an
available-for-sale financial asset is impaired. This determination requires significant judgement. In making this judgement,
the Group evaluates, among other factors, the duration and extent to which the fair value of an investment is less than its
cost and the financial health of and short-term business outlook for the investee, including factors such as industry and
sector performance, changes in technology and operational and financing cash flows.
Provision for mine closure
The provision for mine closure is based on the present value of the estimated cost of restoring the environmental
disturbance that has occurred up to the reporting date. Significant estimates and assumptions are made in determining
the provision for rehabilitation of the mine as there are numerous factors that will affect the ultimate liability payable. These
factors include estimates of the extent and costs of rehabilitation activities, technological changes, regulatory changes,
cost increases as compared to inflation rates and changes in discount rates. These uncertainties may result in future actual
expenditure differing from the amounts currently provided. The provision at reporting date represents management’s best
estimate of the present value of the future rehabilitation costs required.
(b) Basis of Consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the
Company and its subsidiaries. Control is achieved when the Company:
• has power over the investee;
•
• has the ability to use its power over the investee to affect its returns.
is exposed, or has rights, to variable returns from its involvement with the investee; and
The Company reassess whether or not it controls an investee if facts and circumstances indicate that there are changes to
one or more of the three elements listed above.
When the Company has less than a majority of the voting rights if an investee, it has the power over the investee when
the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The
Company considers all relevant facts and circumstances in assessing whether or not the Company’s voting rights are
sufficient to give it power, including,
•
the size of the Company’s holding of voting rights relative to the size and dispersion of holdings of the other vote
holders;
• potential voting rights held by the Company, other vote holders or other parties; rights arising from other contractual
arrangements; and
• any additional facts and circumstances that indicate that the Company has, or does not have, the current ability
to direct the relevant activities at the time that decisions need to be made, including voting patterns at previous
shareholder meetings.
Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the
Company loses control of the subsidiary. Specifically income and expenses of a subsidiary acquired or disposed of during
the year are included in the consolidated statement of comprehensive income from the date the Company gains control
until the date when the Company ceases to control the subsidiary.
Page 43
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(c) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the
operating segments, has been identified as the Board of Directors of the Company.
(d) Revenue recognition
Revenue is measured at fair value of the consideration received or receivable. Amounts disclosed as revenue are net of
returns, trade allowances, rebates and amounts collected on behalf of third parties.
Interest income
Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Group
and the amount of revenue can be reliably measured. Interest income is accrued on a time basis, by reference to the
principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future
cash receipts through the expected life of the financial asset to that assets’ net carrying amount on initial recognition.
(e) Income tax
The income tax expense or benefit for the period is the tax payable on the current period’s taxable income based on the
applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary difference and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of
the reporting period in the countries where the Company’s subsidiaries and associates operate and generate taxable
income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax
regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be
paid to the tax authorities.
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted
or substantively enacted by the balance date.
Deferred income tax is provided on all temporary differences at the balance date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
• when the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is
not a business combination and that, at the time of the transaction, affects neither the accounting profit nor taxable
profit or loss; or
• when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint
ventures, and the timing of the reversal of the temporary difference can be controlled and it is probable that the
temporary difference will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets
and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences and the carry-forward of unused tax credits and unused tax losses can be utilised, except:
• when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition
of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss; or
• when the deductible temporary difference is associated with investments in subsidiaries, associates or interests
in joint ventures, in which case a deferred tax asset is only recognised to the extent that it is probable that the
temporary difference will reverse in the foreseeable future and taxable profit will be available against which the
temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance date and reduced to the extent that it is
no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be
utilised.
Page 44
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Unrecognised deferred income tax assets are reassessed at each balance date and are recognised to the extent that it has
become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the
asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted
at the balance date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same
taxation authority.
Tax consolidation legislation
The Company and its 100% owned Australian resident subsidiaries have implemented the tax consolidation legislation.
Current and deferred tax amounts are accounted for in each individual entity as if each entity continued to act as a
taxpayer on its own.
The Company recognises its own current and deferred tax amounts and those current tax liabilities, current tax assets and
deferred tax assets arising from unused tax credits and unused tax losses which it has assumed from its controlled entities
within the tax consolidated Group.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts
payable or receivable from or payable to other entities in the Group. Any difference between the amounts receivable or
payable under the tax funding agreement are recognised as a contribution to (or distribution from) controlled entities in the
tax consolidated Group.
(f) Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in
which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as
applicable; and
receivables and payables, which are stated with the amount of GST included.
•
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or
payables in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows arising from
investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating
cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation
authority.
(g) Impairment of tangible and intangible assets other than goodwill
The Group assesses at each balance date whether there is an indication that an asset may be impaired. If any such
indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset’s
recoverable amount. An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and
is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those
from other assets or groups of assets and the asset’s value in use cannot be estimated to be close to its fair value. In such
cases the asset is tested for impairment as part of the cash-generating unit to which it belongs. When the carrying amount
of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-generating unit is considered
impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the asset. Impairment
losses relating to continuing operations are recognised in those expense categories consistent with the function of the
impaired asset unless the asset is carried at revalued amount (in which case the impairment loss is treated as a revaluation
decrease).
Page 45
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
An assessment is also made at each balance date as to whether there is any indication that previously recognised
impairment losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is
estimated. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to
determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case the carrying
amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount
that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years.
Such reversal is recognised in profit or loss unless the asset is carried at revalued amount, in which case the reversal is
treated as a revaluation increase. After such a reversal the depreciation charge is adjusted in future periods to allocate the
asset’s revised carrying amount, less any residual value, on a systematic basis over its remaining useful life.
(h) Cash and cash equivalents
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Bank overdrafts
are shown within borrowings in current liabilities in the statement of financial position.
For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as
defined above, net of outstanding bank overdrafts.
(i) Financial assets
Financial assets in the scope of AASB 139 Financial Instruments: Recognition and Measurement are classified as either
financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, or available-for-
sale investments, as appropriate. When financial assets are recognised initially, they are measured at fair value plus, in the
case of investments not at fair value through profit or loss, directly attributable transaction costs. The Group determines
the classification of its financial assets after initial recognition and, when allowed and appropriate, re-evaluates this
designation at each financial year-end. All regular way purchases and sales of financial assets are recognised on the trade
date i.e. the date that the Group commits to purchase the asset. Regular way purchases or sales are purchases or sales of
financial assets under contracts that require delivery of the assets within the period established generally by regulation or
convention in the marketplace.
Available-for-sale investments
Available-for-sale investments are those non-derivative financial assets that are designated as available-for-sale or are not
classified as any other category. After initial recognition available-for sale investments are measured at fair value with gains
or losses being recognised as a separate component of equity until the investment is derecognised or until the investment
is determined to be impaired, at which time the cumulative gain or loss previously reported in equity is recognised in profit
or loss.
The fair value of investments that are actively traded in organised financial markets is determined by reference to quoted
market bid prices at the close of business on the balance date. For investments with no active market, fair value is
determined using valuation techniques. Such techniques include using recent arm’s length market transactions, reference
to the current market value of another instrument that is substantially the same, discounted cash flow analysis and option
pricing models.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an
active market. Such assets are carried at amortised cost using the effective interest method.
Impairment of financial assets
(j)
The Group assesses at each balance date whether a financial asset or Group of financial assets is impaired.
Available-for-sale investments
If there is objective evidence that an available-for-sale investment is impaired, an amount comprising the difference
between its cost (net of any principal repayment and amortisation) and its current fair value, less any impairment loss
previously recognised in profit or loss, is transferred from equity to the statement of comprehensive income. Reversals
of impairment losses for equity instruments classified as available-for-sale are not recognised in profit. Reversals of
impairment losses for debt instruments are reversed through profit or loss if the increase in an instrument’s fair value can
be objectively related to an event occurring after the impairment loss was recognised in profit or loss.
Loans and receivables
Trade receivables, loans, and other receivables are recorded at amortised cost less impairment.
Page 46
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(k) Interests in joint operations
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the
assets, and obligations for the liabilities, relating to the arrangement. Joint control is the contractually agreed sharing of
control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the
parties sharing control.
When a group entity undertakes its activities under joint operations, the Group as a joint operator recognises in relation to
its interests in a joint operation:
•
•
•
•
•
its assets, including its share of any assets held jointly;
its liabilities, including its share of any liabilities incurred jointly;
its revenue from the sale of its share of the output arising from the joint operation;
its share of the revenue from the sale of the output by the joint operation; and
its expenses, including its share of any expenses incurred jointly.
The Group accounts for the assets, liabilities, revenues and expenses relating to its interest in a joint operation in
accordance with the relevant standards and interpretations applicable to the particular assets, liabilities, revenues and
expenses.
When a group entity transacts with a joint operation in which a group entity is a joint operator (such as a sale or
contribution of assets), the Group is considered to be conducting the transaction with the other parties to the joint
operation, and gains and losses resulting from the transactions are recognised in the Group’s consolidated financial
statements only to the extent of the other parties’ interests in the joint operation.
When a group entity transacts with a joint operation in which a group entity is a joint operator (such as a purchase of
assets), the Group does not recognise its share of the gains and losses until it resells those assets to a third party.
(l) Property, plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses. Such cost
includes the cost of replacing parts that are eligible for capitalisation when the cost of replacing the parts is incurred.
Similarly, when each major inspection is performed, its cost is recognised in the carrying amount of the plant and
equipment as a replacement only if it is eligible for capitalisation.
Land and buildings are measured at fair value less accumulated depreciation on buildings and less any impairment losses
recognised after the date of the revaluation.
Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows:
Mine site plant and equipment
Office furniture and equipment
Motor vehicles
Leasehold improvements
Units of Production
2-6 years
8-10 years
10 years
The assets’ residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each
financial year end.
Impairment
The carrying values of plant and equipment are reviewed for impairment at each balance date, with recoverable amount
being estimated when events or changes in circumstances indicate that the carrying value may be impaired.
The recoverable amount of plant and equipment is the higher of fair value less costs to sell and value in use. In assessing
value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset.
For an asset that does not generate largely independent cash inflows, recoverable amount is determined for the cash-
generating unit to which the asset belongs, unless the asset’s value in use can be estimated to approximate fair value.
Page 47
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
An impairment exists when the carrying value of an asset or cash-generating unit exceeds its estimated recoverable
amount. The asset or cash-generating unit is then written down to its recoverable amount.
For plant and equipment, impairment losses are recognised in the statement of comprehensive income. However, because
land and buildings are measured at revalued amounts, impairment losses on land and buildings are treated as a revaluation
decrement.
Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are
expected from its use or disposal.
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and
the carrying amount of the asset) is included in profit or loss in the year the asset is derecognised.
(m) Exploration and evaluation expenditure
Exploration for and evaluation of mineral resources is the search for mineral resources after the entity has obtained legal
rights to explore in a specific area, as well as the determination of the technical feasibility and commercial viability of
extracting the mineral resource.
Exploration and evaluation expenditure is expensed to the profit or loss as incurred except in the following circumstances in
which case the expenditure may be capitalised:
• The existence of a mineral deposit has been established however additional expenditure is required to determine
the technical feasibility and commercial viability of extraction and it is anticipated that future economic benefits are
more likely than not to be generated as a result of the expenditure; and
• The exploration and evaluation activity is within an area of interest which was acquired as an asset acquisition or in
a business combination and measured at fair value on acquisition.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward
costs in relation to that area of interest. An impairment exists when the carrying value of expenditure exceeds its estimated
recoverable amount. The area of interest is then written down to its recoverable amount and the impairment losses are
recognised in the statement of comprehensive income.
Upon approval for the commercial development of an area of interest, exploration and evaluation assets are tested for impairment
and transferred to ‘Mine properties in development’. No amortisation is charged during the exploration and evaluation phase.
(n) Trade and other payables
Trade payables and other payables are carried at amortised cost and represent liabilities for goods and services provided
to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make
future payments in respect of the purchase of these goods and services. Trade and other payables are presented as
current liabilities unless payment is not due within 12 months.
(o) Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of
ownership to the lessee. All other leases are classified as operating leases.
Assets held under finance leases are initially recognised at their fair value or, if lower, the present value of the minimum
lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is included in the
statement of financial position as a finance lease obligation.
Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a
constant rate of interest on the remaining balance of the liability. Finance charges are charged directly against income,
unless they are directly attributable to qualifying assets, in which case they are capitalised.
Finance lease assets are depreciated on a straight line basis over the estimated useful life of the asset.
Operating lease payments are recognised as an expense on a straight line basis over the lease term, except where
another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are
consumed. In the event that lease incentives are received to enter into operating leases, such incentives are recognised as
a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except
where another systematic basis is more representative of the time pattern in which economic benefits from the leased
asset are consumed.
Page 48
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(p) Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation. Provisions are not recognised for future operating losses.
When the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense
relating to any provision is presented in the statement of comprehensive income net of any reimbursement.
Provisions are measured at the present value or management’s best estimate of the expenditure required to settle the
present obligation at the end of the reporting period.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the
risks specific to the liability.
When discounting is used, the increase in the provision due to the passage of time is recognised as an interest expense.
(q) Provision for mine closure
A provision for mine closure is recognised when there is a present obligation as a result of development activities
undertaken, it is probable that an outflow of economic benefits will be required to settle the obligation, and the amount of
the provision can be measured reliably. The estimated future obligations include the costs of abandoning sites, removing
facilities and restoring the affected areas.
The provision for mine closure costs is the best estimate of the present value of the expenditure required to settle the
restoration obligation at the balance date. Future restoration costs are reviewed annually and any changes in the estimate
are reflected in the present value of the restoration provision at each balance date.
The initial estimate of the mine closure provision is capitalised into the cost of the related asset and amortised on the same
basis as the related asset, unless the present obligation arises from the production of inventory in the period, in which case
the amount is included in the cost of production for the period. Changes in the estimate of the provision for restoration
and rehabilitation are treated in the same manner, except that the unwinding of the effect of discounting on the provision is
recognised as a finance cost rather than being capitalised into the cost of the related asset.
(r) Employee leave benefits
Wages, salaries, annual leave and sick leave
Liabilities accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave expected
to be settled within 12 months of the balance date are recognised in other payables in respect of employees’ services up to
the balance date. They are measured at the amounts expected to be paid when the liabilities are settled. Liabilities for non-
accumulating sick leave are recognised when the leave is taken and are measured at the rates paid or payable.
Liabilities accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave not
expected to be settled within 12 months of the balance date are recognised in non-current other payables in respect of
employees’ services up to the balance date. They are measured as the present value of the estimated future outflows to be
made by the Group.
(s) Share-based payment transactions
Equity settled transactions
The Group provides benefits to employees (including senior executives) of the Group in the form of share-based payments,
whereby employees render services in exchange for shares or rights over shares (equity-settled transactions).
The cost of these equity-settled transactions with employees is measured by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined using a Black-Scholes model, further details
of which are given in Note 21.
In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to
the price of the shares of the Company (market conditions) if applicable.
Page 49
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in
which the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become
fully entitled to the award (the vesting period).
The cumulative expense recognised for equity-settled transactions at each balance date until vesting date reflects:
(i)
(ii) the Group’s best estimate of the number of equity instruments that will ultimately vest. No adjustment is made for the
the extent to which the vesting period has expired; and
likelihood of market performance conditions being met as the effect of these conditions is included in the determination
of fair value at grant date. The statement of comprehensive income charge or credit for a period represents the
movement in cumulative expense recognised as at the beginning and end of that period.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is only conditional upon
a market condition.
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not been
modified. In addition, an expense is recognised for any modification that increases the total fair value of the share-based
payment arrangement, or is otherwise beneficial to the employee, as measured at the date of modification.
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet
recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award and
designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they were
a modification of the original award, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per
share, refer Note 18.
Equity-settled share-based payments are measured at fair value at the date of grant by use of the Black Scholes model.
The expected life used in the model has been adjusted, based on management’s best estimate, for the effects of non-
transferability, exercise restrictions, and behavioral considerations.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis
over the vesting period, based on the entity’s estimate of shares that will eventually vest.
(t) Issued capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new
shares or options for the acquisition of a new business are not included in the cost of acquisition as part of the purchase
consideration.
(u) Earnings per share
Basic earnings per share is calculated as net profit attributable to members of the parent, adjusted to exclude any costs
of servicing equity (other than dividends) and preference share dividends, divided by the weighted average number of
ordinary shares, adjusted for any bonus element.
Diluted earnings per share is calculated as net profit attributable to members of the parent, adjusted for:
• costs of servicing equity (other than dividends) and preference share dividends;
•
the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been
recognised as expenses; and
• other non-discretionary changes in revenues or expenses during the period that would result from the dilution of
potential ordinary shares; divided by the weighted average number of ordinary shares and dilutive potential ordinary
shares, adjusted for any bonus element.
The Group does not report diluted earnings per share on incurring an operating loss for the financial year.
(v) Parent entity financial information
The financial information for the parent entity, Talisman Mining Limited, disclosed in Note 26 has been prepared on the
same basis as the consolidated financial statements, except as set out below.
Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, and joint venture entities are accounted for at cost in the parent entity’s financial statements.
Page 50
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3. VOLUNTARY CHANGE IN ACCOUNTING POLICY
(a) Exploration and Evaluation Accounting Policy
The financial report has been prepared on the basis of a retrospectively applied voluntary change in accounting policy
related to exploration and evaluation expenditure.
The new accounting policy is to expense exploration and evaluation expenditure to the profit or loss as incurred except in
the following circumstances in which case the expenditure may be capitalised:
• The existence of a mineral deposit has been established however additional expenditure is required to determine
the technical feasibility and commercial viability of extraction and it is anticipated that future economic benefits are
more likely than not to be generated as a result of the expenditure; and
• The exploration and evaluation activity is within an area of interest which was acquired as an asset acquisition or in
a business combination and measured at fair value on acquisition.
The previous accounting policy was to capitalise exploration and evaluation expenditure incurred and carry forward as
an asset when rights to tenure of the area of interest were current and costs were expected to be recouped through
the successful development of the area of interest (or alternatively by its sale), or where activities in the area had not yet
reached a stage which permitted a reasonable assessment of the existence or otherwise of economically recoverable
reserves and active operations were continuing.
Management believes that this change in policy will result in more relevant and reliable information in the financial report.
Recognition criteria of exploration and evaluation assets are inherently uncertain and expensing as incurred results in
a more transparent balance sheet and profit or loss. Furthermore, the change in policy aids in accountability of line
management’s expenditures and the newly adopted policy is consistent with those of many other exploration and
mining companies.
Page 51
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3. VOLUNTARY CHANGE IN ACCOUNTING POLICY (CONTINUED)
(b) Impact on Financial Statements
As a result of the change in the accounting policy for exploration and evaluation expenditure, prior year financial statements
had to be restated. The amounts disclosed for the 2015 reporting period and in the balance sheets as at 1 July 2014 and
30 June 2015 are after the change in accounting policy for exploration and evaluation expenditure.
Consolidated statement of profit or loss and other comprehensive income
Continuing operations
Other income
Employee benefits expense
Prior year restatement
Previously
stated
30 Jun 15
$
Profit
Increase/
(Decrease)
$
Restated*
30 Jun 15
$
367,760
(876,454)
–
–
367,760
(876,454)
Exploration expenditure expensed as incurred
(506,716)
(1,468,881)
(1,975,597)
Impairment of exploration expenditure
Care and Maintenance expense
Occupancy expenses
Administrative expenses
Depreciation and amortisation expense
Disposal of fixed assets
Impairment of available-for-sale financial assets
Loss before income tax expense
Income tax benefit
(7,314,675)
7,314,675
(104,232)
(169,386)
(496,768)
(90,623)
1,818
(426,000)
–
–
–
–
–
–
–
(104,232)
(169,386)
(496,768)
(90,623)
1,818
(426,000)
(9,615,276)
5,845,794
(3,769,482)
2,678,373
(2,678,373)
–
Loss after tax from continuing operations
(6,936,903)
3,167,421
(3,769,482)
Net loss for the period
(6,936,903)
3,167,421
(3,769,482)
Other comprehensive income for the period, net of tax
Items that may be reclassified to profit or loss
Net change in the fair value of available-for-sale financial assets
Other comprehensive income for the period, net of tax
(156,300)
(156,300)
–
–
(156,300)
(156,300)
Total comprehensive loss for the period
(7,093,203)
3,167,421
(3,925,782)
Loss per share:
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
(5.27)
n/a
(2.87)
n/a
Page 52
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3. VOLUNTARY CHANGE IN ACCOUNTING POLICY (CONTINUED)
Balance sheet
Previously
stated
30 Jun 15
$
Increase/
(Decrease)
$
Restated
30 Jun 15
$
Previously
stated
1 Jul 14
$
Increase/
(Decrease)
$
Restated
1 Jul 14
$
Assets
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
4,865,632
200,627
5,066,259
Non-Current Assets
Receivables
Other financial assets
60,184
130,700
Property, plant and equipment
2,810,786
–
–
–
–
–
–
4,865,632 16,083,171
200,627
370,086
5,066,259 16,453,257
–
16,083,171
–
370,086
–
16,453,257
60,184
70,184
130,700
713,000
2,810,786
261,096
–
–
–
70,184
713,000
261,096
Deferred exploration and evaluation
expenditure
40,084,747 (26,084,747)
14,000,000 31,930,540 (31,930,540)
–
Total Non-Current Assets
43,086,417 (26,084,747)
17,001,670 32,974,820 (31,930,540)
1,044,280
Total Assets
48,152,676 (26,084,747) 22,067,929 49,428,077 (31,930,540)
17,497,537
Liabilities
Current Liabilities
Trade and other payables
Employee benefits
Total Current Liabilities
Non-Current Liabilities
380,886
72,500
453,386
–
–
–
380,886
213,850
72,500
33,428
453,386
247,278
–
–
–
213,850
33,428
247,278
Deferred tax liabilities
70,449
(70,449)
–
2,748,820
(2,748,820)
Provisions
8,045,834
–
8,045,834
–
–
Total Non-Current Liabilities
8,116,283
(70,449)
8,045,834
2,748,820
(2,748,820)
–
–
–
Total Liabilities
8,569,669
(70,449)
8,499,220
2,996,098
(2,748,820)
247,278
Net Assets
39,583,007 (26,014,298) 13,568,709 46,431,979 (29,181,720)
17,250,259
Equity
Issued capital
Reserves
Retained earnings
Total Equity
37,404,278
469,831
–
37,404,278 37,404,278
–
469,832
1,923,900
–
37,404,278
–
1,923,900
1,708,898 (26,014,299) (24,305,401)
7,103,801 (29,181,720) (22,077,919)
39,583,007 (26,014,299) 13,568,709 46,431,979 (29,181,720)
17,250,259
Page 53
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3. VOLUNTARY CHANGE IN ACCOUNTING POLICY (CONTINUED)
Consolidated statement of cash flows
Exploration and evaluation expenditure that is expensed is included as part of cash flows from operating activities whereas
exploration and evaluation expenditure that is capitalised is included as part of cash flows from investing activities. This has
resulted in additional cash outflows from operating activities of $1,784,376 for the year ended 30 June 2015. This has also
resulted in a corresponding reduction of $1,784,376 being reflected in the net cash outflows from investing activities for the
same reporting period
4. OTHER INCOME
Bank interest received and receivable
Other income
5. EXPENSES
Loss for the year includes the following expenses:
Non-cash share based payment expense
Other employee benefits
Operating lease rental expense
30 Jun 16
$
30 Jun 15
$
348,355
359,760
–
8,000
348,355
367,760
30 Jun 16
$
30 Jun 15
$
236,946
576,321
170,355
244,231
632,223
169,386
6. EXPLORATION EXPENDITURE EXPENSED AS INCURRED
Project
Expenditure
expensed in
the period
Life to date
project
expenditure
previously
expensed
Project
Expenditure
expensed in
the period
Restated*
Life to date
project
expenditure
previously
expensed
30 Jun 16
$
30 Jun 15
$
2,424,580
1,351,071
1,351,071
–
3,376,499
21,159,727
3,817
586,983
3,248,716
1,862
5,046
511
21,157,865
581,937
3,248,205
–
–
617,107
6,942,534
–
–
–
–
4,363
Sinclair
Springfield
Halloween West JV
Halloween(i)
Murchison Exploration Projects(ii)
Other Exploration Expenses
5,809,259
26,346,497
1,975,597
31,930,541
(i) The Halloween Project was surrendered during the reporting period.
(ii) The Murchison Exploration Projects were relinquished during the financial year ended 30 June 2015.
Page 54
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 7.
INCOME TAX
30 Jun 16
$
Restated
30 Jun 15
$
The prima facie income tax expense on pre-tax accounting loss from operations
reconciles to the income tax benefit in the financial statements as follows:
Accounting loss before income tax
(8,010,457)
(3,769,482)
Income tax benefit calculated at 30% (2015: 30%)
Non-deductible expenses
Tax losses and deferred tax balances not recognised.
(2,403,137)
(1,130,845)
72,541
73,270
2,330,596
1,057,575
Income tax benefit reported in the statement of comprehensive income
–
–
Unrecognised deferred tax balances
Deferred tax assets compromise of:
Tax losses carried forward
Impairment of financial assets
Other deferred tax balances
Deferred tax liabilities comprise of:
Exploration expenditure capitalised
Other deferred tax balances
30 Jun 16
$
Restated
30 Jun 15
$
11,284,733
9,927,377
2,150,550
2,149,650
405,345
26,953
13,840,628
12,103,980
1,366,250
36,711
1,402,961
177,050
4,686
181,736
Income tax expense not recognised directly in equity during the year
370,695
–
Deferred tax assets have not been recognised in respect of these items because it is not probable that future profits will be
available against which the Group can utilize the benefits thereof.
Deferred tax liabilities have not been recognised in respect of these taxable temporary differences as the entity is able to
control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse
in the foreseeable future.
Page 55
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 8. CASH AND CASH EQUIVALENTS
(a) Reconciliation of cash and cash equivalents
Cash at bank and on hand
Short-term deposits
30 Jun 16
$
30 Jun 15
$
1,235,325
348,229
19,008,291
4,517,403
20,243,616
4,865,632
(b) Reconciliation of loss for the year to net cash flow from operating activities
30 Jun 16
$
Restated
30 Jun 15
$
Loss for the year after tax
(8,010,457)
(3,769,482)
Impairment of available-for-sale financial assets
Depreciation and amortisation
Disposal of fixed assets
Unwinding discount rate on mine closure provision
Equity settled share-based payments
Changes in net assets and liabilties
(Increase)/decrease in assets:
Trade and other receivables
Increase/(decrease) in liabilities:
Trade and other payables
Provisions
Net cash used in operating activities
3,000
59,752
–
241,375
236,946
426,000
90,623
(1,818)
–
244,231
(56,255)
179,160
(17,565)
27,916
184,235
39,072
(7,515,288)
(2,607,979)
(c) Non-cash financing and investing activities
There were no non-cash financing and investing activities during the current or prior year.
Page 56
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 9. TRADE AND OTHER RECEIVABLES
Current
Goods and services tax recoverable
Other debtors
Other debtors – security bonds
Prepayments and accrued income
Non-Current
Other debtors – security bonds
Due to the nature of the Group’s receivables, no ageing is presented.
10. OTHER FINANCIAL ASSETS
30 Jun 16
$
30 Jun 15
$
65,043
969
–
191,478
257,490
22,970
35,598
–
142,059
200,627
60,184
60,184
30 Jun 16
$
30 Jun 15
$
Non-Current
Available-for-sale listed investments carried at fair value
120,700
130,700
Available-for-sale investments consist of investments in ordinary shares, and therefore have no fixed maturity date or
coupon rate. The carrying amount of financial assets recorded in the financial statements represents their net fair values,
determined in accordance with the accounting policies disclosed in Note 2.
At year end, an assessment of the fair value of all available for sale investments resulted in an impairment charge of $3,000
(2015: $426,000) and a loss of $7,000 (2015: loss of $156,300) being recognised in the statement of comprehensive
income in the line item “Net change in the fair value of available-for-sale financial assets”. The Group’s assessment of the
fair value was made in accordance with AASB 139 and was based on the share price of the investment below cost as
quoted by the Australian Securities Exchange.
The Directors consider that the carrying amounts of financial assets and financial liabilities recorded in the financial
statements approximate their fair value.
Page 57
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 11. PROPERTY, PLANT AND EQUIPMENT
Office
furniture and
equipment
$
Leasehold
improvements
$
Plant and
equipment
$
Motor
vehicles
$
Total
$
Year ended 30 June 2016
At 1 July 2015, net of
accumulated depreciation
Additions
Disposals
Depreciation charge for the year
Year ended 30 June 2015
At 1 July 2014, net of
accumulated depreciation
Additions
Disposals
Depreciation charge for the year
At 30 June 2016
Cost or fair value
Accumulated depreciation
Net carrying amount
At 30 June 2015
Cost or fair value
Accumulated depreciation
Net carrying amount
53,466
37,722
–
(27,046)
64,142
102,600
4,311
–
(53,445)
53,466
599,899
(535,757)
64,142
562,177
(508,711)
53,466
6,314
2,636,002
115,004
2,810,786
–
–
(4,758)
1,556
–
–
–
–
–
37,722
–
(27,948)
(59,752)
2,636,002
87,056
2,788,756
11,177
–
147,319
261,096
–
–
(4,863)
6,314
2,636,002
–
–
–
–
2,640,313
–
(32,315)
(90,623)
2,636,002
115,004
2,810,786
25,438
2,636,002
276,426
3,537,765
(23,882)
–
(189,370)
(749,009)
1,556
2,636,002
87,056
2,788,756
25,438
2,636,002
276,426
3,500,043
(19,124)
–
(161,422)
(689,257)
6,314
2,636,002
115,004
2,810,786
The carrying value of plant and equipment held under finance lease and hire purchase contracts as at 30 June 2016 is nil
(2015: nil).
Plant and equipment at a value of $2,636,002 was acquired during last year as part of the acquisition of the Sinclair Nickel
Project.
Page 58
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 12. EXPLORATION, EVALUATION AND DEVELOPMENT EXPENDITURE
Costs carried forward in respect of areas of interest in the following phases:
Exploration and evaluation phase – at cost
Balance at beginning of period
Expenditure capitalised
Acquisition of projects
30 Jun 16
$
Restated
30 Jun 15
$
14,000,000
544,635
–
–
–
14,000,000
14,544,635
14,000,000
The recoupment of costs carried forward in relation to areas of interest in the exploration and evaluation phases is
dependent upon the successful development and commercial exploitation or sale of the respective areas.
13. TRADE AND OTHER PAYABLES
Current
Trade payables
Accruals
Other payables
Trade payables are non-interest bearing and are normally settled on 30 day terms.
14. EMPLOYEE BENEFITS
Current
Employee benefits
30 Jun 16
$
30 Jun 15
$
308,279
5,871
48,069
362,219
73,056
273,142
34,688
380,886
30 Jun 16
$
30 Jun 15
$
100,416
72,500
Employee benefits relate to annual leave and long service leave entitlements accrued to employees.
Page 59
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 15. PROVISIONS
Non-Current
Provision for mine closure
Balance at the beginning of the year
Acquisition of Project
Unwinding of discount rate adjustment
Balance at the end of year
30 Jun 16
$
30 Jun 15
$
8,287,209
8,045,834
8,045,834
–
–
8,045,834
241,375
–
8,287,209
8,045,834
Provision for mine closure is the estimated present value of the mine closure and rehabilitation costs of the Sinclair mine.
The provision represents the best estimate of the present value of the expenditure required to settle the restoration
obligations at the reporting date. Future restoration costs are reviewed annually and any changes in the estimate are
reflected in the present value of the provision for mine closure at each reporting date.
16. ISSUED CAPITAL
Ordinary shares
Issued and fully paid
30 Jun 16
$
30 Jun 15
$
60,881,617
37,404,278
Movements in ordinary shares on issue
At 1 July
Share placement at 47c cents
Share placement at 45c cents
Share issue costs
At 30 June
30 Jun 16
30 Jun 15
Number
$
Number
$
131,538,627
37,404,278
131,538,627
37,404,278
17,021,277
8,000,000
37,139,975
16,712,989
–
1,235,650
–
–
–
–
185,699,879
60,881,617
131,538,627
37,404,278
Fully paid ordinary shares carry one vote per share and carry the right to dividend.
30 Jun 16
30 Jun 15
Number
$
Number
$
Movements in options over ordinary shares
on issue
At 1 July
Directors’ remuneration
Employees’ remuneration
Transfer on exercise of unlisted options
7,250,000
448,632
8,750,000
1,746,400
–
650,000
–
116,221
120,725
3,000,000
1,000,000
193,982
50,250
–
–
–
Unlisted Options Lapsing
(2,250,000)
(290,189)
(5,500,000)
(1,542,000)
At 30 June
5,650,000
395,389
7,250,000
448,632
Share options are exercisable on a 1:1 basis at various exercise prices. The options expire between 30 September 2016
to 31 March 2019. Further details of options granted to directors and employees are contained in Note 21 to the financial
statements.
Page 60
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 17. ACCUMULATED LOSSES
Accumulated Losses
Balance at beginning financial year
Net loss for the year
Transfer on expiry of unexercised options
Balance at end of financial year
Reserves
Asset revaluation reserve
Share based payment reserve
Balance at end of financial year
Asset revaluation reserve
30 Jun 16
$
Restated
30 Jun 15
$
(24,305,401)
(22,077,919)
(8,010,457)
(3,769,482)
290,189
1,542,000
(32,025,669)
(24,305,401)
14,200
395,389
409,589
21,200
448,632
469,832
The asset revaluation reserve is used to record temporary fluctuations between the market value of available-for-sale
investments and the acquisition price.
Share based payment reserve
The share based payment reserve is used to record the value of equity benefits provided to employees and Directors as
part of their remuneration. Refer to Note 21 for further details.
18. EARNINGS PER SHARE
Basic loss per share
Basic loss per share
Net loss for the period
30 Jun 16
cents
Restated
30 Jun 15
cents
(5.06)
(2.87)
$
$
(8,010,457)
(3,769,482)
Number
Number
Weighted average number of ordinary shares for the purpose of basic loss per share
158,424,209
131,538,627
Diluted loss per share
Diluted loss per share was not calculated for the years ended 30 June 2016 and 30 June 2015 as the Company was in a
loss making situation which did not increase the loss per share.
Page 61
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 19. COMMITMENTS AND CONTINGENCIES
In order to maintain current rights of tenure to exploration tenements, the Group is required to perform exploration work to
meet the minimum expenditure requirements specified by various State governments. These obligations are not provided
for in the financial report and are payable as follows:
Exploration expenditure
Within one year
After one year but not more than five years
Greater than five years
30 Jun 16
$
30 Jun 15
$
2,367,628
2,374,865
8,637,277
9,080,766
19,116,976
21,088,976
30,121,881
32,544,607
If the Group decides to relinquish certain exploration leases and/or does not meet these obligations, assets recognised
in the statement of financial position may require review to determine the appropriateness of carrying values. The sale,
transfer or farm-out of exploration rights to third parties will reduce or extinguish these obligations.
Operating leases
Operating lease arrangements comprise an agreement for the rental of office space with a lease term of 2 years; storage
facilities with a lease term of 1 year and a motor vehicle operating lease with a term of 2 years. Future minimum rentals
payable under non-cancellable operating leases are as follows:
30 Jun 16
$
30 Jun 15
$
131,263
23,269
139,914
23,269
–
–
154,532
163,183
Non-cancellable operating lease commitments
Within one year
After one year but not more than five years
Greater than five years
20. FINANCIAL INSTRUMENTS
(a) Introduction
The Group has exposure to the following risks arising from financial instruments:
• Credit risk
• Liquidity risk
•
• Capital risk
Interest rate risk
This note presents information about the Group’s exposure to each of the above risks, their objectives, policies and
processes for measuring and managing risk and the management of capital. Further quantitative disclosures are included
throughout this note and the financial report.
The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework.
Risk management policies are established to identify and analyse risks faced by the Group, to set appropriate risk limits
and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly
to reflect changes in market conditions and the Group‘s activities. The Group’s aim is to develop a disciplined and
constructive control environment in which all employees understand their roles and obligations.
Page 62
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 20. FINANCIAL INSTRUMENTS (CONTINUED)
(b) Categories of financial instruments
Financial assets
Cash and cash equivalents
Receivables
Available-for-sale investments
Financial liabilities
Trade and other payables
Other financial liabilities
30 Jun 16
$
30 Jun 15
$
20,243,616
4,865,632
317,674
120,700
260,811
130,700
20,681,990
5,257,143
362,218
100,416
462,634
380,886
72,500
453,386
Fair value of financial assets and liabilities
The carrying amount of financial assets and financial liabilities recorded in the financial statements represents their
respective net fair values, determined in accordance with the accounting policies disclosed in Note 2.
During the year, an assessment of the fair value of available-for-sale investments resulted in a loss of $7,000 (2015: loss of
$156,300) recognised in the statement of comprehensive income in the line item “Net change in the fair value of available-
for-sale financial assets” and an impairment of $3,000 (2015: $426,000) in the statement of comprehensive income.
The Directors consider that the carrying amounts of financial assets and financial liabilities recorded in the financial
statements approximate their fair value.
(c) Credit Risk Management
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral
where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group only transacts with entities
that are rated the equivalent of investment grade and above. This information is supplied by independent rating agencies
where available and, if not available, the Group uses publicly available financial information and its own trading record to
rate its major customers. The Group’s exposure and the credit ratings of its counterparties are continuously monitored and
the aggregate value of transactions concluded is spread amongst approved counterparties. Credit exposure is controlled
by counterparty limits that are reviewed and approved by the Risk Management Committee annually.
The Group does not have any significant credit risk exposure to any single counterparty or any Group of counterparties
having similar characteristics. The credit risk on liquid funds and derivative financial instruments is limited because the
counterparties are banks with high credit ratings assigned by international credit rating agencies.
The carrying amount of financial assets recorded in the financial statements, net of any allowance for losses, represents the
Group’s maximum exposure to credit risk without taking account of the value of any collateral obtained.
Page 63
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 20. FINANCIAL INSTRUMENTS (CONTINUED)
(d) Liquidity Risk Management
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 Group’s short, medium and long-term funding and liquidity
management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve
borrowing facilities by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial
assets and liabilities. The following table details the Company’s and the Group’s expected contractual maturity for its non-
derivative financial liabilities. These have been drawn up based on undiscounted contractual maturities of the financial liabilities
based on the earliest date the Group can be required to repay. The tables include both interest and principal cash flows.
Less than
1 month
$
1 to 3
months
$
3 months
to 1 year
$
1 to 5
years
$
5+ years
$
No fixed
term
$
Total
$
2016
Financial Assets
Non-interest bearing
66,025
Variable interest rate 1,235,310
–
–
Fixed interest rate
18,360,217
585,706
19,661,552
585,706
–
–
–
–
–
–
163,550
163,550
Financial Liabilities
Non-interest bearing
362,219
Fixed interest rate
–
362,219
2015
Financial Assets
Non-interest bearing
22,995
Variable interest rate
348,204
–
–
–
–
–
Fixed interest rate
1,001,907
3,379,254
1,373,106
3,379,254
100,416
–
100,416
–
–
–
–
–
–
–
–
–
162,000
162,000
Financial Liabilities
Non-interest bearing
380,886
Fixed interest rate
–
380,886
–
–
–
72,500
–
72,500
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
66,025
1,235,310
19,109,473
20,410,808
462,635
–
462,635
22,995
348,204
4,543,161
4,914,360
453,386
–
453,386
(e) Interest rate risk
The Group is not exposed to interest rate risk as it has not borrowed funds at fixed/variable interest rates.
Some of the Group’s assets are subject to interest rate risk but the Group is not dependent on this income.
Interest rate sensitivity analysis
The sensitivity analysis of the Group’s exposure to interest rate risk at the reporting date has been determined based on a
change of 50 basis points in interest rates taking place at the beginning of the financial year and held constant throughout
the year.
At reporting date, if interest rates had been 50 basis points higher and all other variables were constant, the Group’s net
loss would have reduced by $6,177 (2014: net loss reduced by $1,741).
Page 64
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 20. FINANCIAL INSTRUMENTS (CONTINUED)
(f) Capital risk management
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to
sustain future development of the business. The capital structure of the Group consists of equity only, comprising issued
capital and reserves, net of accumulated losses. The Group’s policy is to use capital market issues to meet the funding
requirements of the Group.
There were no changes in the Group’s approach to capital management during the year.
The Group is not subject to externally imposed capital requirements.
(g) Fair value of financial instruments
AASB 7 Financial Instruments: Disclosures which require disclosure of fair value measurements by level of the following fair
value measurement hierarchy:
• Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1);
•
Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (as
prices) or indirectly (derived from prices) (level 2); and
Inputs for the asset or liability that are not based on observable market data (unobservable inputs) (level 3).
•
The following table presents the Group’s assets and liabilities measured and recognised at fair value at 30 June 2016 and
30 June 2015.
Level 1
$
Level 2
$
Level 3
$
Total
$
2016
Assets
Available-for-sale financial assets
120,700
2015
Assets
Available-for-sale financial assets
130,700
–
–
–
120,700
–
130,700
21. SHARE-BASED PAYMENTS
The Group has an Employee Share Option Plan (“ESOP”) for executives and employees of the Group. In accordance with
the provisions of the ESOP, as approved by shareholders at a previous annual general meeting, executives and employees
may be granted options at the discretion of the Directors.
Each employee share option converts into one ordinary share of Talisman Mining Limited on exercise. No amounts are paid
or payable by the recipient on receipt of the option. The options carry neither rights to dividends nor voting rights. Options
may be exercised at any time from the date of vesting to the date of their expiry.
The number of options granted is at the sole discretion of the Directors subject to the total number of outstanding options
being issued under the ESOP not exceeding 5% of the Company’s issued capital at any one time.
Options issued to Directors are not issued under the ESOP but are subject to approval by shareholders and attach vesting
conditions as appropriate.
There are no cash settlement alternatives.
Page 65
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 21. SHARE-BASED PAYMENTS (CONTINUED)
The following share-based payment arrangements were in place during the current and prior periods:
Options
Series
Number
Grant date
Expiry date
Vesting date
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
250,000
250,000
250,000
250,000
562,500
562,500
562,500
562,500
750,000
750,000
750,000
750,000
125,000
125,000
125,000
125,000
150,000
175,000
175,000
150,000
125,000
125,000
125,000
125,000
15-Mar-12
15-Mar-12
15-Mar-12
15-Mar-12
31-Jul-15
31-Jul-15
31-Jul-15
31-Jul-15
13-Sep-12
15-Mar-13
13-Sep-13
15-Mar-14
25-Nov-13
31-Oct-16
26-May-14
25-Nov-13
31-Oct-16
25-Nov-14
25-Nov-13
31-Oct-16
26-May-15
25-Nov-13
31-Oct-16
25-Nov-15
5-Dec-14
5-Dec-14
5-Dec-14
5-Dec-14
4-Mar-15
4-Mar-15
4-Mar-15
4-Mar-15
5-Mar-15
5-Mar-15
5-Mar-15
31-Oct-17
25-May-15
31-Oct-17
24-Nov-15
31-Oct-17
24-May-16
31-Oct-17
24-Nov-16
1-Mar-18
1-Mar-18
1-Mar-18
1-Mar-18
1-Sep-15
1-Mar-16
1-Sep-16
1-Mar-17
30-Sep-16
11-Jul-15
30-Sep-16
12-Oct-15
30-Sep-16
12-Jun-16
11-Aug-15
30-Jun-17
31-Dec-15
4-Apr-16
4-Apr-16
4-Apr-16
4-Apr-16
31-Mar-19
30-Sep-16
31-Mar-19
31-Mar-17
31-Mar-19
30-Sep-17
31-Mar-19
31-Mar-18
Exercise
price
Fair value per
option at
grant date
$
$1.02
$1.13
$1.41
$1.53
$0.43
$0.51
$0.60
$0.69
$0.41
$0.49
$0.56
$0.64
$0.40
$0.50
$0.60
$0.70
$0.40
$0.50
$0.60
$0.90
$0.80
$0.90
$0.95
$1.00
$
$0.18
$0.18
$0.16
$0.16
$0.04
$0.04
$0.04
$0.03
$0.11
$0.10
$0.10
$0.10
$0.11
$0.10
$0.10
$0.09
$0.07
$0.06
$0.06
$0.37
$0.02
$0.14
$0.13
$0.13
There has been no alteration of the terms and conditions of the above share-based payment arrangement since grant date.
Page 66
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 21. SHARE-BASED PAYMENTS (CONTINUED)
The following table illustrates the number (No.) and weighted average exercise prices of and movements in share options
issued during the year:
Outstanding at the beginning of year
Granted during the year
Exercised during the year
Expired during the year
Outstanding at the end of year
Exercisable at the end of year
2016
2015
Number of
options
Weighted
average
exercise price
Number of
options
Weighted
average
exercise price
$
$
7,250,000
650,000
–
(2,250,000)
5,650,000
4,775,000
0.64
0.91
0.90
0.57
0.52
8,750,000
4,000,000
–
(5,500,000)
7,250,000
3,437,500
0.84
0.53
–
0.87
0.64
0.71
No share options were exercised during the period.
The share options outstanding at the end of the year had an exercise price of $0.57 (2015: $0.64) and a weighted average
remaining contractual life of 361 days (2015: 610 days). The range of exercise price of option outstanding range from $0.40
to $1.00 (2015:$ 0.40 to $1.53)
The weighted average fair value of options granted during the year was $123,987 (2015: $383,969)
The fair value of the equity-settled share options granted under the option plans is estimated as at the date of grant using
the Black Scholes model taking into account the terms and conditions upon which the options were granted.
Inputs into model
20
21
22
23
24
Exercise price
$ 0.90
$ 0.80
$ 0.90
$ 0.95
$ 1.00
Grant date share price (5 day
VWAP)
Expected volatility
Risk-free interest rate
Dividend yield (%)
Expected life of options (years)
$ 0.590
$ 0.465
$ 0.465
$ 0.465
$ 0.465
150%
1.95%
Nil
1.64
68%
1.95%
Nil
3.30
68%
1.95%
Nil
3.30
68%
1.95%
Nil
3.30
68%
1.95%
Nil
3.30
The fair value of the equity-settled share options granted under the option plans is estimated as at the date of grant using
the Black Scholes model taking into account the terms and conditions upon which the options were granted.
The expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that may
occur. The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may
also not necessarily be the actual outcome. No other features of options granted were incorporated into the measurement
of fair value.
The carrying amount of the liability relating to the cash-settled share-based payment at 30 June 2016 is $395,388
(2015: $448,631).
Page 67
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 22. DIRECTORS’ AND EXECUTIVES’ DISCLOSURES
Details of key management personnel
The key management personnel of Talisman Mining Limited during the year were:
Directors
Jeremy Kirkwood
Alan Senior
Brian Dawes
Karen Gadsby
Gary Lethridge
Executives
Daniel Madden
Shaun Vokes
Anthony Greenaway
Ben Wilson
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Managing Director
(Appointed 1 April 2016)
(Resigned 31 March 2016)
Chief Financial Officer to Acting Chief Executive Officer
Commercial Manager/ Company Secretary
General Manager – Geology
General Manager – Project Development
(Appointed 1 April 2016)
(Appointed 29 February 2016)
(Appointed 15 March 2016)
Key management personnel compensation is disclosed in the Remuneration Report which forms part of the Directors’
Report and has been audited.
The total remuneration paid to key management personnel of the Company and the Group during the year was as follows:
Short-term employee benefits
Post-employment benefits
Other long-term benefits
Share-based payments (i)
Total key management personnel compensation
30 Jun 16
$
30 Jun 15
$
1,022,155
1,105,508
99,398
41,792
83,447
104,892
–
225,501
1,246,792
1,435,901
(i) The value of share-based payments shown in the table are non-cash values based on an accounting valuation
calculated under the Black Scholes option pricing method.
Other transactions with key management personnel
During the year ended 30 June 2016 the Group paid $13,628 to Ailie Services Pty Ltd, a related party of Mr. Brian
Dawes, for consultancy services provided over a 9 day period which were deemed to be provided outside the ordinary
requirements of Non-Executive Director duties. This transaction was made on normal terms and conditions.
The Group also paid $2,325 to Natalie Madden, a related party of Mr. Daniel Madden, for consultancy services provided
over a month. This transaction was made on normal terms and conditions.
There were no other transactions with key management personnel of the Group during the 2016 financial year.
Page 68
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 23. JOINT OPERATION
In December 2013, the Company entered into a $15 million exploration Farm-In and Joint Venture Agreement (“Agreement”)
with Sandfire Resources NL (ASX: SFR, “Sandfire”) over its Doolgunna Cu-Au Projects located approximately 150km
north-east of Meekatharra in the northern Murchinson Goldfields region of Western Australia. These projects comprise the
Springfield, Halloween and Halloween West Projects which abut Sandfire’s DeGrussa-Doolgunna tenements. During the year
Sandfire reached the $15 million farm-in expenditure threshold (project-to-date), which marked the end of its sole-funding
stage and the formation of an unincorporated joint venture with Sandfire acting as Joint Venture Manager. Joint venture
expenditure is now funded jointly by the Group and Sandfire on a 30:70 basis in accordance with the Agreement.
As a result of the above Agreement, the Group’s interest in the Halloween West Joint Venture was reduced to 18.8% (2015:
62.9%). The Halloween West Joint Venture was originally formed in 2012 when the Company reached agreement with
Chrysalis Resources Ltd (“Chrysalis”) to farm into the Halloween West Copper-Gold Project. In October 2014 Sandfire
acquired the interest held by Chrysalis and agreed with the Company to farm-into the Halloween West Project under the
terms of the Doolgunna Cu-Au Projects Agreement. Sandfire acts as the Joint Venture Manager of the Halloween West
Joint Venture.
The Group is entitled to a proportionate share of the income received and bears a proportionate share of the joint
operation’s expenses.
The joint operation accounts, which are proportionately consolidated based on the above equity percentages in the
consolidated financial statements, are disclosed as follows:
Joint Operation
Operator
Doolgunna
Sandfire Resources
Halloween West
Sandfire Resources
Jun 2016
Jun 2015
Benefical
Interest
Benefical
Interest
30%
19%
100%
63%
The Group’s interests in the assets/liabilities and income/expenditure employed in the above joint venture operations are
detailed below. The amounts are included in the financial statements under their respective asset categories.
Assets
Cash and cash equivalents
Receivables
Exploration and Evaluation
Total assets
Liabilities
Trade and other payables
Total liabilities
Net assets
30 Jun 16
$
30 Jun 15
$
414,740
19,535
544,634
978,909
31,826
502
588,940
621,268
234,411
234,411
39,438
39,438
744,498
581,830
Carrying amount of interest in joint venture
744,498
581,830
Page 69
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 23. JOINT OPERATION (CONTINUED)
The joint venture has no contingent liabilities and capital commitments with the exception that in order to maintain current
rights of tenure to exploration tenements, the joint venture is required to perform exploration work to meet the minimum
expenditure requirements specified by various State governments. These obligations are not provided for in the financial
report and are payable as follows:
Commitments for expenditure
Exploration expenditure
Within one year
After one year but not more than five years
Greater than five years
30 Jun 16
$
30 Jun 15
$
70,000
112,767
50,000
130,548
–
–
182,767
180,548
24. SEGMENT REPORTING
The Group continues to operate in one geographical segment, being Western Australia and in one operating category,
being mineral exploration and evaluation.
The chief operating decision-maker has been identified as the Board of Talisman Mining Limited and information reported
to the Board for the purpose of resource allocation and assessment of performance is focused on mineral exploration and
evaluation within Western Australia. Consequently the Group reports within one segment.
25. CONTINGENT LIABILITIES AND CONTINGENT ASSETS
A contingent liability exists for a deferred consideration payment of $2 million for the Sinclair Nickel Project, to be paid six
months following the receipt of the first payment for the sale of nickel product should production recommence within six
years of transaction completion. This contingent consideration is dependent on a number of factors that are unknown at
the date of this financial report which include amongst others, material future exploration success and future nickel prices.
In the opinion of the Directors there are no other contingent liabilities or assets as at 30 June 2016 and no contingent
liabilities or assets were incurred in the interval between the period end and the date of this financial report.
Page 70
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 26. PARENT ENTITY DISCLOSURES
Disclosures as at 30 June 2016 and for the year then ended in relation to Talisman Mining Limited as a single entity are
noted below.
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Asset revaluation reserve
Share based payment reserve
Retained earnings
Total equity
Loss for the year
Net change in the fair value of available for sale financial assets
Total comprehensive loss
Exploration expenditure
Within one year
After one year but not more than five years
Greater than five years
30 Jun 16
$
Restated
30 Jun 15
$
20,066,820
5,034,421
331,037
356,667
20,397,857
5,391,088
228,225
189,658
–
–
228,225
189,658
20,169,632
5,201,430
60,881,617
37,404,278
14,200
395,388
21,200
448,631
(41,121,573)
(32,663,679)
20,169,632
5,210,430
Year ended
30 Jun 16
$
Restated
30 Jun 15
$
(8,748,083)
(2,421,342)
(7,000)
(156,300)
(8,755,083)
(2,577,642)
30 Jun 16
$
30 Jun 15
$
184,000
460,071
–
644,071
–
–
–
–
Page 71
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 27. RELATED PARTY DISCLOSURE
The consolidated financial statements include the financial statements of Talisman Mining Limited and the subsidiaries
listed in the following table:
Name
Country of
Incorporation
Equity Interest
Investment
2016
%
2015
%
2016
$
2015
$
Talisman A Pty Ltd
Talisman Nickel Pty Ltd
Haverford Holdings Pty Ltd
Australia
Australia
Australia
100
100
100
100
100
100
10
1
10
1
68,000
68,000
Talisman Mining Limited is the ultimate parent entity and ultimate parent of the Group.
28. ACQUISITION OF ASSETS
On 18 October 2014 Talisman Nickel Pty Ltd, a wholly owned subsidiary of Talisman Mining Limited, entered into an
agreement with Xstrata Nickel Australasia Operations Pty Ltd. (XNAO), a subsidiary of Glencore plc to acquire 100% of the
wholly owned Sinclair Nickel Project from XNAO.
On acquisition at 5 February 2015 Talisman Nickel Pty Ltd assumed all environmental liabilities and obligations, and made
the following payments for the acquisition;
• a cash payment of $7,950,000;
• $130,996 of transaction costs;
• $509,173 relating to stamp duty; and
• a contingent deferred payment of $2 million dependent on production being recommenced within six years of
transaction completion.1
The fair value of the identifiable assets and liabilities of the Sinclair Project Nickel Project as at the date of acquisition are:
$
Deferred exploration and evaluation expenditure (Note 12)
Property, plant and equipment (Note 11)
Provision for mine closure (Note 15)
Fair value of identifiable net assets
Cost of the acquisition
Cash payment
Transaction costs
Stamp duty
Total cost of the acquisition
Cash payments associated with acquisition
Payments for exploration projects
Payments for property, plant and equipment
Recognised
on acquisition
14,000,000
2,636,002
(8,045,834)
8,590,168
7,950,000
130,996
509,172
8,590,168
5,954,166
2,636,002
8,590,168
1The contingent consideration is dependent on a number of factors that were unknown at the time of acquisition and
remain unknown at this time, which include amongst others, material future exploration success and future nickel prices.
Accordingly given the inherent uncertainty of the contingent payment being realised it does not form part of the recognised
purchase consideration for valuation purposes.
Page 72
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 29. REMUNERATION OF AUDITORS
The auditor of Talisman Mining Limited is HLB Mann Judd.
Agreed upon procedures and reporting thereon in relation to Sandfire Resource NL
farm in spend on Springfield JV.
Audit or review of the financial report
Total Remuneration of Auditors
30. EVENTS SUBSEQUENT TO REPORTING DATE
The following management changes were effective 1 July 2016:
• Mr Daniel Madden was appointed as Managing Director
• Mr Shaun Vokes was appointed as Chief Financial Officer
30 Jun 16
$
30 Jun 15
$
15,500
34,500
50,000
–
34,500
34,500
There has not been any other matter or circumstance occurring subsequent to end of the financial year that has
significantly affected, or may significantly affect the operations of the Group, the results of those operations, or the state of
affairs of the Group in future financial years.
Page 73
TALISMAN MINING LTD ■NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ■ ADDITIONAL SECURITIES EXCHANGE INFORMATION
AS AT 21 SEPTEMBER 2016
1. NUMBER OF HOLDERS OF EQUITY SECURITIES
(a) Distribution of holders of equity securities
Range
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Fully paid
ordinary
shares
165
605
462
894
215
Number of
holders
88,671
1,877,913
4,029,477
33,303,222
146,400,596
2,341
185,699,879
(b) Voting rights
Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or by proxy
has one vote on a show of hands.
(c) Less than marketable parcel of shares
The number of shareholders holding less than a marketable parcel is 224 (holding a total of 158,006 shares) given a share
value of $0.365 cents per share.
(d) Substantial Shareholdings:
Ordinary Shareholders
Mr Kerry Kyriakos Harmanis
Hunter Hall Investment Mgt
Fully paid ordinary shares
Number
%
29,689,138
19,779,949
15.99%
10.65%
Set out above is an extract from the Company’s register of last substantial shareholder notices as received by the
Company and/or lodged at the ASX. Shareholdings and percentages reported in the table are as reported in the most
recent notifications received, however these may differ from current holdings as substantial holders are required to notify
the Company only in respect of changes which act to increase or decrease their percentage holding by at least 1% of total
voting rights.
2. COMPANY SECRETARY
The name of the company secretaries are Shaun Vokes and Alexander Neuling.
3. REGISTERED OFFICE AND PRINCIPAL ADMINISTRATIVE OFFICE
Registered and principal administrative office:
Ground Level, 6 Centro Avenue
Subiaco Western Australia 6008
Telephone +61 8 9380 4230
Registered securities are held at the following address:
Link Market Services Limited
Level 4, Central Park
152 St Georges Terrace
Perth Western Australia 6000
Page 74
TALISMAN MINING LTD ■ ADDITIONAL SECURITIES EXCHANGE INFORMATION
AS AT 21 SEPTEMBER 2016
4. SECURITIES EXCHANGE LISTING
Quotation has been granted for all the ordinary shares of the Company on all Member Exchanges of the Australian
Securities Exchange Limited
5. RESTRICTED SECURITIES
There are no restricted securities or securities in voluntary escrow at the date of this report.
6. TWENTY LARGEST HOLDERS OF ORDINARY SHARES
Ordinary Shareholders
1 Mr Kerry K Harmanis & Ms Pauline Hind
2 Hunter Hall Investment Mgt
3 Grosvenor Pirie Mgt
4 Westoz Funds Mgt
5 Mr & Mrs Phillip W Averill
6 Acorn Capital
7 Private Portfolio Managers PPM
8 3rd Wave Investors
9 Ms. Lorna J Kelly
10 Mr & Mrs Anthony Beris
11 Mr Angus D Paradice & Ms Claire V Pfister
12 Mr Nicholas TJ Paspaley
13 Mrs Jasmine Kallis
14 Mr Iain S Gray
15 Independent Asset Mgt
16 Katana Capital
17 Interactive Brokers
18 Mr Lafras Luitingh
19 Mr Hubert A East
20 Mr Christopher M Michael
7. ON-MARKET BUY BACK
At the date of this report the Company is not involved in an on-market buy-back.
Number
%
29,689,138
19,779,949
15.99%
10.65%
4,112,795
4,000,000
3,972,151
3,939,911
3,806,641
3,410,892
2,500,000
2,404,464
2,125,000
1,754,064
1,520,000
1,500,000
1,444,445
1,290,000
1,198,765
1,000,000
975,000
920,000
2.21%
2.15%
2.14%
2.12%
2.05%
1.84%
1.35%
1.29%
1.14%
0.94%
0.82%
0.81%
0.78%
0.69%
0.65%
0.54%
0.53%
0.50%
91,343,215
49.19%
Page 75
TALISMAN MINING LTD ■ NOTES
Page 76
TALISMAN MINING LTD Ground Floor
6 Centro Avenue, Subiaco
Western Australia 6008
T: + 61 8 9380 4230
F: + 61 8 9382 8200
www.talismanmining.com.au