White Cliff Minerals Limited
ABN 22 126 299 125
Annual report
for the year ended 30 June 2014
White Cliff Minerals Limited
ABN 22 126 299 125
Contents
Corporate information
Operations report
Directors’ report
Auditor’s independence declaration
Corporate governance report
Statement of comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Directors’ declaration
Independent auditor’s report to the members
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ASX additional information
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White Cliff Minerals Limited
ABN 22 126 299 125
Corporate Information
Michael Langoulant
Todd Hibberd
Rodd Boland
Michael Langoulant
Brooke White
Directors
Company secretaries
Registered office and
principal place of business
Suite 2, 47 Havelock Street
West Perth, Western Australia 6005
Share registry
Auditors
Solicitors
ASX code
Telephone:
Facsimile:
Website:
(08) 9321 2233
(08) 9324 2977
www.wcminerals.com.au
Computershare Investor Services Pty Ltd
Reserve Bank Building
Level 2, 45 St George’s Terrace
Perth, Western Australia 6000
(08) 9323 2000
Telephone:
HLB Mann Judd
Chartered Accountants
Level 4, 130 Stirling Street
Perth, Western Australia 6000
Jackson McDonald Lawyers
Level 25, 140 St Georges Terrace
Perth, WA 6000
White Cliff Minerals Limited is listed on the Australian
Securities Exchange (Shares: WCN, Options: WCNO &
WCNOA)
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White Cliff Minerals Limited
ABN 22 126 299 125
Review of Operations
Review of Operations
Highlights
• New Copper-Gold discovery at the Chanach project in the Kyrgyz Republic
o 7 metres at 3.83% copper and 30.1 g/t gold and;
o 10 metres at 1.73% copper including 1 metre at 106 g/t gold and;
o 9 metres at 6.03 g/t gold
•
Interest in the Kyrgyz Chanach Copper-Gold project increased to 88.7%
• Merolia Magmatic Nickel-Copper and Orogenic Gold region secured
o Multiple nickel anomalies identified by soil geochemistry
• Lake Johnston review upgrades Nickel potential
• $150,000 in Government funding secured for Nickel Sulphide exploration at Lake Johnston
Corporate
During the full year ending 30 June 2014 White Cliff Minerals Limited (Company or WCN) increased its
interest in the Chanach Copper-Gold project to 88.7% through the acquisition of an additional 32% interest in
the project from former joint venture partner T2 Gold Pty Ltd for consideration of 73,841,667 WCN shares
and $50,000 in cash.
Cash at the end of the financial year 30 June 2014 was $1 million. Due to challenging mining and exploration
industry market conditions the Company has continued to reduce corporate and operating expenses where
possible.
During the year the Company completed an oversubscribed placement to sophisticated and institutional
clients of Hartleys Limited, raising $1.2 million whilst a further $500,000 was raised via a share purchase
plan (SPP). Subsequent to year end, the Company received a $350,000 government research and
development tax refund.
Exploration Summary
The Company controls extensive tenement packages in Western Australia’s Yilgarn Craton and the Pilbara
region as well as a major gold-copper project in Central Asia.
Central Asia
During the year rock chip channel sampling at the Chanach copper-gold project in Kyrgyz Republic identified
three new zones of high grade copper and gold mineralisation including seven metres at 3.8% copper and
30.1 g/t gold, 10 metres at 1.7% copper including a one metre interval at 106 g/t gold and; nine metres at 6
g/t gold.
The mineralised zones occur on the outer edge of a +1km2 alteration system that displays extensive
alteration and quartz veining along faults and shear zones that extend over 7 kilometres. The new discovery
has been named Aucu and it will be the focus of an extensive exploration program in the second half of
2014.
Western Australia
In Western Australia the Company is exploring several projects with the primary focus on the Merolia and
Lake Johnston nickel projects (Map 1).
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White Cliff Minerals Limited
ABN 22 126 299 125
Multiple phases of soil geochemistry at the Merolia Nickel and Copper project have identified four major
nickel in soil anomalies. The Company is currently planned reverse air blast drilling programs and
electromagnetic surveys to better define nickel sulphide drilling targets.
During the year the Company completed a 220 sample infill and extension soil sampling program at the Lake
Percy prospect and completed 1100 metres of RC drilling program at the Mt Glasse prospect.
The Company has been granted $150,000 in government co-funding for drilling the Mt Glasse targets.
Laverton
Merolia
Lake Johnston
Map 1 White Cliff Minerals Limited Australian exploration projects
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White Cliff Minerals Limited
ABN 22 126 299 125
Map 2 Chanach project location with regional geology with major gold deposits illustrated.
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White Cliff Minerals Limited
ABN 22 126 299 125
The Chanach Copper – Gold Project, Central Asia (88.7%)
The Chanach gold-copper project is situated in the northwest region of the Kyrgyz Republic in Central Asia
and covers 83 km2. WCN currently has an 88.7% interest in the project after purchasing an additional 32%
interest from its former joint venture partner, T2 Gold Pty Limited for consideration of 73,841,667 shares and
$50,000 in cash.
During October and November 2013 the Company completed a trenching and rock chip channel sampling
program to comply with license retention conditions. The program collected 701 samples and focussed on
the western part of the license.
The trenching and rock chip channel sampling program identified three highly mineralised zones including:
• 7 metres at 3.83% copper and 30.1 g/t gold
• 10 metres at 1.73% copper including 1 metre at 106 g/t gold and;
• 9 metres at 6.03 g/t gold
The new discovery has been named Aucu and occurs two kilometres NNW of the Chanach copper deposit
(Figure 1). The mineralisation occurs as three zones interpreted to strike NNW and occurs in highly altered
limestone and felsic porphyry and consists of quartz veining and associated alteration that is heavily
impregnated with sulphides including pyrite and chalcopyrite (Figures 2 and 3).
The rock sampling was predominantly carried out over the western half of the Chanach lease to follow up
anomalous 2010 gold rock chip results and satellite ASTER alteration targets not previously explored. The
mineralisation occurs on the outer edge of a large phyllic (quartz-sericite-pyrite) alteration target identified in
the 2011 ASTER satellite alteration analysis (Figure 2). The exceptional gold and copper results (Table 1)
are associated with NNW trending faults and contacts between limestone units that have been modified by
mineralised fluids related to the underlying copper-gold porphyry intrusions to the east (Figure 2 and 3).
The initial geological interpretation indicates that the new results are part of a much larger mineralised
system (+1 km diameter) centred 500 metres to the west (Figure 2).
Separate rock samples contained visible gold occurring within quartz veining and chalcopyrite (copper-iron
sulphide) within weathered limestone and felsic porphyry units (Figure 4).
The new copper-gold discovery continues to expand the scale of the Chanach project and demonstrates that
the project has the potential to host multiple large scale copper-gold resources. The current high copper
price and forecast strength in the copper price is very encouraging and the Company believes there is
opportunity to extract significant value from the Chanach copper project.
Planned Exploration
The Company has developed an exploration plan for the 2014 field season that consists of an extensive
trenching program along strike from the Aucu discovery at 50 and 100 metre interval to be followed by a 3-
5000 metre reverse circulation drilling program the test the best targets (Figure 5). This program is currently
underway.
Table 1 Copper and gold rock chip channel sample assays from the three mineralised zones
Sample ID
Location
Zone
North
East
Copper %
Gold (g/t)
CHT13-1-008
CHT13-1-009
CHT13-1-010
CHT13-1-011
CHT13-1-012
CHT13-1-013
CHT13-1-014
Trench 1
Trench 1
Trench 1
Trench 1
Trench 1
Trench 1
Trench 1
1
1
1
1
1
1
1
4,627,256
695,835
4,627,255
695,835
4,627,254
695,835
4,627,253
695,834
4,627,252
695,834
4,627,252
695,834
4,627,251
695,833
2.47
0.83
2.51
4.75
5.63
2.78
7.81
0.17
160.26
21.18
1.34
16.71
15.32
0.35
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White Cliff Minerals Limited
ABN 22 126 299 125
CHT13-1-031
CHT13-1-032
CHT13-1-033
CHT13-1-034
CHT13-1-035
CHT13-1-036
CHT13-1-037
CHT13-1-038
CHT13-1-039
CHT13-1-040
CHT13-2-04
CHT13-2-05
CHT13-2-06
CHT13-2-07
CHT13-2-08
CHT13-2-09
CHT13-2-10
CHT13-2-11
CHT13-2-12
Trench 1
Trench 1
Trench 1
Trench 1
Trench 1
Trench 1
Trench 1
Trench 1
Trench 1
Trench 1
Trench_2
Trench_2
Trench_2
Trench_2
Trench_2
Trench_2
Trench_2
Trench_2
Trench_2
2
2
2
2
2
2
2
2
2
2
3
3
3
3
3
3
3
3
3
4,627,236
695,827
4,627,235
695,827
4,627,234
695,826
4,627,233
695,826
4,627,233
695,826
4,627,232
695,825
4,627,231
695,825
4,627,230
695,824
4,627,229
695,824
4,627,228
695,824
4,627,076
695,726
4,627,075
695,726
4,627,074
695,725
4,627,074
695,725
4,627,073
695,725
4,627,072
695,724
4,627,071
695,724
4,627,071
695,724
4,627,070
695,723
0.82
6.92
0.16
1.44
0.11
0.24
0.07
0.01
1.07
6.39
-0.005
0.017
-0.005
-0.005
-0.005
-0.005
-0.005
-0.005
-0.005
- 0.05
0.43
- 0.05
106.31
- 0.05
- 0.05
3.52
0.20
- 0.05
- 0.05
7.07
13.72
8.29
4.93
7.20
4.08
6.06
0.84
2.52
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White Cliff Minerals Limited
ABN 22 126 299 125
Figure 1 Geological map showing the location of the new copper-gold discovery 2km to the NNW of the existing
Chanach copper deposit.
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White Cliff Minerals Limited
ABN 22 126 299 125
Figure 2 Geological map showing location of new copper and gold discovery on the outer edge of a much larger
alteration zone (blue oval) and strong phyllic alteration (purple hatch) outcropping in the centre of the alteration.
Figure 3a Enlarged map showing details of the two high
grade mineralised copper and gold zones identified from
trench rock chip channel sampling
Figure 3b Enlarged map showing details of the high grade
gold zone identified from trench rock chip channel
sampling
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White Cliff Minerals Limited
ABN 22 126 299 125
Figure 4 Rock samples containing visible gold (left) and visible chalcopyrite (right) collected from mineralised
zones in the first trench. Photograph scale is approximate scale is 12cm.
See Figure 3a
for enlargement
See Figure 3b
for enlargement
Figure 5 Geological map showing planned exploration trenching (blue lines) and the location of new copper and gold
discovery on the outer edge of a much larger alteration zone (blue oval) with strong phyllic alteration (purple hatch)
outcropping in the centre of the alteration.
Merolia Nickel-Copper and Gold Project (100%)
Following the acquisition of the Merolia Nickel and Copper project at the beginning of the financial year the
Company has carried out three phases of soil geochemistry that have identified four major and several minor
anomalies nickel in soil at the McKenna and Rotorua prospects.
The major nickel anomalies at the McKenna prospect have nickel values up to 1,426ppm Nickel and 79ppm
Copper. The first McKenna anomaly (McKenna One) is interpreted to occur on the basal contact of the
mafic-ultramafic Diorite Hill intrusion and the adjacent ultramafic unit. Using a 250ppm Nickel contour the
anomaly extends 1,000 metres along strike and is around 500 metres wide (Figure 6).
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White Cliff Minerals Limited
ABN 22 126 299 125
The second McKenna anomaly (McKenna Two) occurs one kilometre west of McKenna One and extends
1,000 metres along strike and is around 250 metres wide. The anomaly has nickel values up to 1,125ppm
and copper values up 52ppm. McKenna Two also reappears further north on the other side of a drainage
system which has eroded the soil and removed any surface expression of the nickel anomaly in between
(Figure 6).
The two Rotorua nickel anomalies have nickel values up to 743ppm Nickel and 68ppm Copper. The Rotorua
North Nickel anomaly extends 1,000 metres along strike and is 350 metres wide. The anomaly occurs within
a wedge of ultramafic rocks folded around the nose of a felsic intrusion (Figure 8).
The Rotorua South nickel anomaly extends over 800 metres along strike, is about 270 metres wide and
occurs along the interpreted basal contact of a wedge of ultramafic rocks adjacent to a felsic intrusion (Figure
8)
Detailed analysis of the sampling results has also revealed that a large proportion of the ultramafic rocks
within the survey area have virtually no geochemical response (Figure 8). Several test pits excavated across
this area indicate that transported Aeolian sands have filled in a shallow depression and covered a large
proportion of the ultramafic stratigraphy. The transported cover has limited the effectiveness of the sampling
method. The Company intends to test this area using low cost reverse air blast (RAB) or vacuum drilling to
penetrate the cover.
McKenna Prospect
Following the identification of the McKenna Nickel-Chrome-Bismuth-Copper anomaly (ASX Release 29th
April 2014) a combination of 378 infill and extension soil samples were collected and analysed by Portable
XRF. The McKenna One Nickel Anomaly is interpreted to occur on the basal contact of a layered mafic-
ultramafic intrusion called the Diorite Hill Complex and the adjacent ultramafic unit (Figure 6 & 7). Further
analysis of all geochemical data also identified the McKenna Two (and McKenna Two+) nickel anomaly that
appears to be bisected by recent east-west drainage affecting the continuity of the anomalies. The length of
the McKenna is interpreted to be >2,000m with nickel values up 1,125ppm and copper values up to 52ppm.
Table 2 Significant soil geochemistry results from the McKenna prospect (including recent infill sampling)
Sample_ID
Anomaly
Easting*
Northing*
Nickel
(ppm)
Chrome
(ppm)
Bismuth
(ppm)
Copper
(ppm)
MES1434
MES253
MES1435
MES245
MES242
MES247
MES1468
MES1500
MES1499
MES1513
MES322
MES323
MES1467
MES1582
*Coordinate grid is Geodetic Datum Australia 1994, Zone 51.
McKenna 1
McKenna 1
McKenna 1
McKenna 1
McKenna 1
McKenna 1
McKenna 2
McKenna 2
McKenna 2
McKenna 2
McKenna 2
McKenna 2
McKenna 2
McKenna 2+
6841800
6841300
6841800
6841600
6841300
6841800
6842200
6842400
6842400
6842600
6841700
6841800
6842200
6843400
458200
458300
458400
458500
458500
458500
457700
457600
457700
457600
457700
457700
457600
457700
1426
982
692
690
579
547
1125
1023
997
854
607
605
555
815
1180
2048
1280
895
1498
1858
1388
1286
987
1379
1028
1191
1701
856
41
25
-5
-5
23
33
38
31
-5
26
33
27
41
22
79
45
36
36
46
39
52
43
42
38
50
52
30
32
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White Cliff Minerals Limited
ABN 22 126 299 125
McKenna Two+
Nickel
McKenna Two
Nickel
McKenna One
Nickel
Figure 6 McKenna One and McKenna Two high tenor Nickel anomalies. Most anomalism outside the main
zones can be attributed to mechanical dispersion using recent drainage. (Diorite Hill Ultramafic Complex
basal contact in red. Pink contour is >250ppm Ni, Yellow contour is >50ppm Ni).
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White Cliff Minerals Limited
ABN 22 126 299 125
McKenna Two +
Nickel Anomaly
McKenna Two
Nickel Anomaly
McKenna One
Nickel
Figure 7 McKenna Nickel-chrome-Copper-Bismuth anomalism over Total Magnetic Intensity (Diorite Hill
Layered Ultramafic Complex basal contact in red, pink contour is >250ppm Ni, yellow contour is >50ppm Ni)
Rotorua North and Rotorua South Prospects
The infill soil geochemistry programme conducted in July 2014 (containing 105 samples) covered the original
Rotorua Nickel anomalies with 100m spaced samples on 200m spaced lines. The samples were assayed
using the same technique and portable XRF as was used on the original geochemistry programme. The
tighter sampling density has led to a strengthening of the anomalies and extended the Rotorua North and
Rotorua South anomalies out to 1,000m by 400m wide and 800m by 270m wide respectively.
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White Cliff Minerals Limited
ABN 22 126 299 125
Rotorua Ultramafic
Rotorua North
Nickel
Rotorua South
Nickel anomaly
Figure 8 Nickel anomalies (green outline) shown over the first vertical derivative magnetic image.
Table 3 Significant soil geochemistry results from the sampling completed over the Rotorua Prospect
Sample ID
MES1772
MES788
MES1781
MES789
MES1791
MES761
MES1792
MES1782
MES760
MES1783
MES1779
MES818
MES1789
MES1795
MES1822
MES1836
MES1849
MES1837
MES452
MES879
Anomaly
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua North
Rotorua South
Rotorua South
Rotorua South
Rotorua South
Rotorua South
Rotorua West
GDA North
6830800
6831200
6831000
6831200
6831200
6830800
6831200
6831000
6830800
6831000
6831000
6831600
6831200
6831400
6826200
6825800
6825600
6825800
6825600
6832400
GDA East
473900
473600
473800
473800
473700
474000
473500
473700
473800
473600
474000
473800
474100
474200
474700
474900
474900
474800
475000
465800
Cr ppm
1080
957
711
890
573
1111
605
632
564
587
550
543
381
468
691
625
593
593
549
1064
Ni ppm
743
644
591
519
473
441
381
353
338
331
207
178
162
151
219
153
153
152
125
157
Bi ppm
20
27
-5
-5
-5
-5
-5
30
-5
-5
-5
32
-5
-5
24
-5
-5
-5
-5
-5
Cu ppm
28
32
27
31
30
39
27
34
22
33
37
39
28
30
33
31
26
28
35
68
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White Cliff Minerals Limited
ABN 22 126 299 125
As noted previously the lack of geochemical response over the Rotorua Ultramafic unit (large NW-SE unit
shown in Figure 8 above) indicates transported cover is masking any bedrock geochemistry. As part of the
infill sampling programme, seven test pits, 100 metres apart were excavated by hand down to a depth of
approximately 1m across the Rotorua Ultramafic sequence in order to test the alluvial profile for depth and
any segregation. All 7 test pits encountered the same barren transported Aeolian sands from surface to the
bottom of the pit. Therefore a cost effective Rotary Air Blast (RAB) drilling program is planned to penetrate
the cover and reveal the bedrock geology across the Rotorua Ultramafic as well as testing across the soil
anomalies already identified.
Figure 9 Geological plan of the 771 km2 Merolia Project showing magmatic nickel-copper sulphide prospects and lode
gold prospects
Project Background
The Merolia project consists of 771 square kilometres of the Merolia Greenstone belt and contains extensive
ultramafic sequences including the Diorite Hill layered ultramafic complex, the Rotorua ultramafic complex,
the Coglia ultramafic complex and a 50 kilometre long zone of extrusive ultramafic lava’s (Figure 9). The
intrusive complexes are prospective for nickel-copper sulphide accumulations possibly with platinum group
elements, and the extrusive ultramafic rocks are prospective for nickel sulphide and nickel-cobalt
accumulations. The project also contains extensive basalt sequences that are prospective for gold
mineralisation including the Ironstone prospect where historical drilling has identified 24m at 8.6g/t gold.
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White Cliff Minerals Limited
ABN 22 126 299 125
Lake Johnston Project (100%)
During the year the Company completed a 1,100 metre reverse circulation (RC) drilling program at the Lake
Johnston nickel project in Western Australia.
Drilling intersected disseminated pyrrhotite (iron sulphide) and chalcopyrite (copper sulphide) zones with
associated quartz veining in hole GLRC008 explaining Conductor 2. The mineralisation occurs on the fault
contact between basalt and ultramafic rock. The fault contact has acted as a conduit for hydrothermal fluids
from volcanic activity that has generated quartz veining and wall rock alteration over 8 metres that contains
anomalous levels of copper and base metals. Results include 4m at 0.23% copper within 8 metres at 0.16%
copper.
Holes GLRC002 (conductors 7-9) and GLRC004 (Conductor 4) failed to intersect EM conductors at the
target depths. The Company is currently reviewing the geophysical data to establish if the modelled
conductors are deeper than interpreted. Further drilling may be required to fully test these targets.
Two holes (GLRC006 and GLRC009) were drilled to test a strong surface nickel-copper-platinum-palladium
soil anomaly. These holes intersected nickel-copper-zinc-bismuth mineralisation in the regolith profile.
Samples were sent to Bureau Veritas laboratories in Perth for analysis.
Results for GLRC009 included 12 metres at 1.0% Nickel, 300ppm copper, 0.16% zinc, 18ppm bismuth and
17ppb platinum + palladium including one metre at 2.0% nickel, 235 ppm copper, 0.15% zinc and 58ppm
bismuth.
Results for GLRC006 included 4 metres at 1.06% nickel, 0.9% chrome, 225 ppm copper, 0.21% zinc and
84ppm bismuth.
The drill hole intersections occur at the weathering front between the oxidised regolith and the transitional
regolith suggesting that weathering processes have contributed to the concentration of metals. However, the
level of anomalism of nickel, copper, bismuth, zinc and platinum/palladium suggests a primary magmatic
process generated the mineralisation. The Company is considering further drilling to test down dip of the
mineralisation.
The Company acknowledges the support of the Royalties for Regions Exploration Incentive Scheme (EIS)
administered by the Department of Mines and Petroleum (DMP). The DMP will fund 50% of the total direct
drilling costs up to a maximum of $150,000.
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White Cliff Minerals Limited
ABN 22 126 299 125
GLRC002 targeting
Conductors 7-9
GLRC006 and GLRC009
targeting Ni-Cu-Pt-Pd soil
anomaly
GLRC008 targeting
Conductor 2
GLRC004 targeting
Conductor 4
Figure 10 Mt Glasse location map showing detailed conductors (red hatched) and completed drill holes
Lake Percy Nickel Prospect (100%)1
The Company completed a 220 sample infill and extension soil sampling program in January 2014 covering
the western limb of the western ultramafic unit. The sampling was carried out to investigate a 2 kilometre
long zone where previous sparse sampling identified strongly elevated levels of coincident nickel and copper
(Figure 11). Recent drilling (2013) at the southern limit of this zone identified 32 metres at 0.83% nickel, 226
ppm copper and 176 ppm cobalt from 24 metres (LPRC007) mainly within the weathered ultramafic
regolith profile.
Several geochemical ratios were evaluated with the Kambalda ratio (Ni/Cr*Cu/Zn) identifying a strong
anomaly immediately north of the recent drilling (Figure 11). The Kambalda ratio identifies areas high in
nickel and copper but low in chrome and zinc. These areas can host massive nickel sulphides and warrant
further exploration. The Company has also identified three zones with highly anomalous nickel and copper
values along the basal contact that also require follow up work (Figure 12). In general the western ultramafic
unit has had little exploration and the drilling that has been completed has been widely spaced (lines 600m
apart) shallow RAB drilling that has not tested the ultramafic unit at depth.
The Companies geophysical consultants Newexco are currently reviewing the geophysics over the western
ultramafic unit to evaluate if more powerful EM is warranted. The Company will plan further work based on
the results of the review in conjunction with the highly favourable geochemistry.
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White Cliff Minerals Limited
ABN 22 126 299 125
High priority Nickel sulphide
drill targets (red circles)
Figure 11 Lake Percy soil sampling showing highly anomalous nickel/chrome*copper/zinc (Kambalda) ratios
>5 (pink dots) along the basal contact. White bullseyes are existing RAB drill holes at 600m spacing
Strong Nickel-Copper
anomalies on basal
contact (blue circles)
Figure 12 Lake Percy soil sampling showing high nickel and copper values along the basal contact
highlighting the prospectivity of the western contact of the western ultramafic unit north of LPRC007
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White Cliff Minerals Limited
ABN 22 126 299 125
Location Map showing tenement holdings, mine locations and the location of the Mt Glasse and Lake
Percy prospects.
Other Projects
The Company is undertaking an extensive review of the Company’s exploration projects and is currently
compiling historical data for several prospects. No field work was undertaken on the Company’s other
projects during the year.
The Information in this report that relates to exploration results, mineral resources or ore reserves is based on information compiled by
Mr Todd Hibberd, who is a member of the Australian Institute of Mining and Metallurgy. Mr Hibberd is a full time employee of the
company. Mr Hibberd has sufficient experience which is relevant to the style of mineralisation and type of deposits under consideration
and to the activity that he is undertaking to qualify as a Competent Person as defined in the 2012 edition of the `Australian Code for
Reporting Exploration Results, Mineral Resources and Ore Reserves (the JORC Code)`. Mr Hibberd consents to the inclusion of this
information in the form and context in which it appears in this report.
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White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ Report
Your directors present their annual financial report on the consolidated entity (referred to hereafter as the “Group”)
consisting of White Cliff Minerals Limited (the “Company” or “parent entity”) and the entities it controlled during the
financial year ended 30 June 2014. In order to comply with the provisions of the Corporations Act, the directors
report as follows:
Directors
The following persons were directors of the Company during the whole of the financial year and up to the date of
this report:
M Langoulant - Executive Chairman
T Hibberd - Managing Director
R Boland - Non-Executive Director
Principal activities
The principal activity of the Group during the financial year was mineral exploration.
Dividends
No dividend has been paid or declared since the start of the financial year and the directors do not recommend the
payment of a dividend in respect of the financial year.
Review of operations
Information on the operations of the Group is set out in the review of Operations Report on pages 4 to 21 of this
Annual Report.
Significant changes in the state of affairs
There have been no significant changes in the state of affairs of the Group to the date of this report.
Matters subsequent to the end of the financial year
There has not been any matter or circumstance that has arisen after balance date 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 periods.
Likely developments and expected results
Additional comments on expected results of certain operations of the Group are included in the review of
operations and activities.
Environmental legislation
The Group is subject to significant environmental legal regulations in respect to its exploration and evaluation
activities. There have been no known breaches of these regulations and principles.
Indemnification and insurance of directors and officers
During the financial year the Company has not paid premiums in respect of insuring directors and officers of the
Company against liabilities incurred as directors or officers. The Company has no insurance policy in place that
indemnifies the Company’s auditors.
21
White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ Report
Information on directors
Michael Langoulant; B Com, CA Executive Chairman and Company Secretary
Experience and expertise
Founding director with over 20 years’ experience in public company corporate administration and fundraising. After
10 years with large international accounting firms he has acted as finance director, CFO, company secretary and
non-executive director with a number of publicly listed companies.
Other current directorships
Nyota Minerals Limited and Luiri Gold Ltd
Former directorships in the last 3 years
None
Special responsibilities
Chairman and co-Company Secretary
Interests in shares and options at the date of this report
8,955,156 ordinary shares; 4,681,820 30 September 2014 options; 4,166,668 11 March 2017 options
Todd Jeffrey Hibberd; BSc, MSc, Dip Bus, MAusIMM, MAICD Managing Director
Experience and expertise
Appointed in December 2008 Mr Hibberd is a geologist with an extensive background in exploration, mining and
mineral economics with over 20 years in exploration, resource estimation, feasibility studies, mine development and
production management. Recent experience includes five years as Managing Director of White Cliff Minerals, two
years as Managing Director of ASX listed Stonehenge Metals Limited and 10 years working for Newmont Mining
Corporation in various senior exploration and production roles.
Other current directorships
None
Former directorships in the last 3 years
None
Special responsibilities
Managing Director
Interests in shares and options at the date of this report
15,497,736 ordinary shares; 5,000,000 30 September 2014 options; 4,666,668 11 March 2017 options
Rodd Boland; B Com, MBA Non-Executive Director
Experience and expertise
Mr. Boland has over 20 years of corporate and financial industry experience in investment banking, executive
management and the capital markets including advising and raising equity for corporations in the form of venture
capital, private equity, pre-initial public offerings and initial public offerings.
Other current directorships
None
Former directorships in the last 3 years
None.
Special responsibilities
Investor relations
Interests in shares and options at the date of this report
1,010,000 ordinary shares; 1,250,000 30 September 2014 options; 2,250,000 11 March 2017 options
Co-Company Secretary
Brooke White has been co-company secretary of White Cliff since February 2010. Ms White holds business
administration and financial services qualifications with over 12 years in corporate secretarial roles. She has been
either company secretary or assistant company secretary for numerous ASX and AIM listed mining and exploration
companies.
22
White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ Report
Meetings of directors
During the financial year there were 12 formal directors’ meetings. All other matters that required formal Board
resolutions were dealt with via written circular resolutions. In addition, the directors met on an informal basis at
regular intervals during the financial year to discuss the Group’s affairs.
The number of meetings of the Company’s board of directors attended by each director were:
M Langoulant
T Hibberd
R Boland
Shares under option
Directors’ meetings held
whilst in office
12
12
12
Directors’ meetings
attended
12
12
11
Outstanding share options at the date of this report are as follows:
Grant Date
Date of expiry
Exercise price
Number of options
September 2012 – March
2013
May 2014
30 September 2014
11 March 2017
$0.06
$0.03
116,227,300
102,050,017
No option holder has any right under the options to participate in any other share issue of the Company or any other
controlled entity.
Shares issued on the exercise of options
There have been no shares issued upon the exercise of options.
23
White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ Report
Remuneration Report
This report outlines the remuneration arrangements in place for the key management personnel of White Cliff
Minerals Limited (the “Company”) for the financial year ended 30 June 2014. The information provided in this
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 (“KMP”) 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, and includes all executives in the Parent and the Group receiving the highest
remuneration.
Key Management Personnel
(i) Directors
Michael Langoulant (Executive Chairman)
Todd Hibberd (Managing Director)
Rodd Boland (Non-executive Director)
(ii) Executive
There were no other executives of the Company as at 30 June 2014.
Details of directors’ and executives’ remuneration are set out under the following main headings:
A
B
C
D
Principles used to determine the nature and amount of remuneration
Details of remuneration
Employment contracts/Consultancy agreements
Share-based compensation
Principles used to determine the nature and amount of remuneration
A
The objective of the Company’s executive reward framework is to ensure reward for performance is competitive
and appropriate for the results delivered. The framework aims to align executive reward with the creation of value
for shareholders. The key criteria for good remuneration governance practices adopted by the Board are:
•
•
•
•
•
competitiveness and reasonableness
acceptability to shareholders
performance incentives
transparency
capital management
The framework provides a mix of fixed salary, consultancy agreement based remuneration and share based
incentives.
The broad remuneration policy for determining the nature and amount of emoluments of Board members and
senior executives of the Company is governed by the full board. Although there is no separate remuneration
committee the Board’s aim is to ensure the remuneration packages properly reflect directors’ and executives’
duties and responsibilities. The Board assesses the appropriateness of the nature and amount of emoluments of
such officers on a periodic basis by reference to relevant employment market conditions with the overall objective
of ensuring maximum stakeholder benefit from the retention and motivation of a high quality Board and executive
team.
The current remuneration policy adopted is that no element of any director or executive package is directly related
to the Company’s financial performance. Indeed there are no elements of any director or executive remuneration
that are dependent upon the satisfaction of any specific condition however the overall remuneration policy
framework is structured to advance and create shareholder wealth.
Non-executive directors
Fees and payments to non-executive directors reflect the demands which are made on, and the responsibilities of,
the directors. Non-executive directors’ fees and payments are reviewed annually by the Board and are intended to
be in line with the market.
24
White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ Report
Directors’ fees
Some of the directors perform at least some executive or consultancy services. As the Board considers it important to
distinguish between the executive and non-executive roles each of the directors receive a separate fixed fee for their
services as a director. As from 1 July 2012 the annual director fee has been reduced by 50% from $30,000 per annum
per director to $15,000 per annum per director.
Retirement allowances for directors
Apart from superannuation payments paid on salaries there are no retirement allowances for directors.
Executive pay
The executive pay and reward framework has the following components:
•
•
base pay and benefits such as superannuation
long-term incentives through participation in employee equity issues
Base pay
All executives are either full time employees or consultants who are paid on an agreed basis that has been
formalised in a consultancy agreement.
Benefits
Apart from superannuation paid on executive salaries there are no additional benefits paid to executives.
Short-term incentives
There are no current short term incentive remuneration arrangements.
Employee/Consultant options
To ensure that the Company has appropriate mechanisms in place to continue to attract and retain the services of
suitable directors and employees, the Company has issued options to key personnel.
During the year ended 30 June 2014, the Company issued 7,500,000 Options exercisable at $0.03 on or before 11
March 2017 to directors. During the year ended 30 June 2013, the Company issued 8,000,000 Options exercisable
at $0.06 on or before 30 September 2014 to directors.
B
Details of remuneration
Amounts of remuneration
Details of the remuneration of the directors and other key management personnel (as defined in AASB 124
Related Party Disclosures) of the Company and the Group for the year ended 30 June 2014 are set out in the
following tables. There are no elements of remuneration that are directly related to performance.
The key management personnel of the Group are the directors of the Company and those executives that have
authority and responsibility for planning, directing and controlling the activities of the Group.
25
White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ Report
Remuneration of directors
Year ended
30 June 2014
Name
Director
M Langoulant3
T Hibberd
R Boland
Primary benefits
Salary and/or
consulting
fees
$
Post-
employment
benefits
Super-
annuation
Directors’
Fees1
Share-based
payment
Option
Issues2
Total
$
$
$
$
105,000
160,749
21,000
286,749
15,000
15,000
15,000
45,0001
-
14,611
-
14,611
2,500
3,000
2,000
7,500
122,500
193,360
38,000
353,860
Other key management personnel
Nil
Year ended
30 June 2013
Director
M Langoulant3
T Hibberd
R Boland
Other key management personnel
Nil
150,000
229,360
30,000
409,360
30,000
30,000
30,000
90,0001
-
20,640
-
20,640
51,565
59,498
15,866
126,9292
231,565
339,498
75,866
646,929
1 The 2012 financial statements omitted the Director fees for the period January to June 2012 which were only to be paid
upon the Company receiving additional equity funding. These fees (although relating to the 2012 year) were paid in
September 2012 and are presented above as part of the 2013 year remuneration. Since 1 July 2012 director fees have
been set at $15,000 per annum.
2 The assessed fair value at grant date of options granted to directors is included in key management personnel
remuneration above and expensed in the statement of comprehensive income over the vesting period of the options.
Employee options exercisable in March 2017 issued to directors in May 2014 vested immediately such that the share
based expense relating to this issue of options has been accounted for in full during the 2014 year.
Employee options exercisable in September 2014 issued to Directors in November 2012 were issued with continuity of
employment vesting conditions. In March 2013 however shareholders voted to vary the conditions of all September 2014
options on issue (including those issued to Directors) such that these options could become listed on ASX. As a result
the vesting conditions were removed and the share based expense relating to the issue of options to Directors has been
accounted for in full during the 2013 year instead of being amortised over three financial years as was originally
intended.
3 Includes fees for accounting and corporate administration services to a company of which he is a director and
shareholder.
26
White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ Report
Employee share option plan
Options granted, exercised or lapsed during the year in relation to key management personnel as part of
their remuneration
2014
Name
Director
Balance at the
beginning of the
financial period
Granted
during the
financial
period
Expired
during the
financial
period
Balance at the
end of the
financial
period
Vested and
exercisable at the
end of the
financial period
M Langoulant
4,250,000
2,500,000
(1,000,000)
5,750,000
5,750,000
T Hibberd
R Boland
5,250,000
1,750,000
Other key management personnel
3,000,000
(1,500,000)
6,750,000
6,750,000
2,000,000
(750,000)
3,000,000
3,000,000
Nil
-
-
-
-
-
Key management personnel equity holdings
Fully paid ordinary shares
2014
Director
Ordinary shares
M Langoulant
T Hibberd
R Boland
Options
M Langoulant
T Hibberd
R Boland
2013
Director
Ordinary shares
M Langoulant
T Hibberd
R Boland
Options
M Langoulant
T Hibberd
R Boland
Balance at
beginning of
year
Net movement
during the year
Balance at the end of
year
5,621,822
6,047,964
510,000
3,333,334
9,449,772
500,000
5,681,820
3,166,668
6,500,000
3,166,668
2,000,000
1,250,000
3,400,002
3,705,714
10,000
2,221,820
2,342,250
500,000
1,000,000
4,681,820
1,500,000
5,000,000
750,000
1,250,000
8,955,156
15,497,736
1,010,000
8,848,488
9,666,668
3,250,000
5,621,822
6,047,964
510,000
5,681,820
6,500,000
2,000,000
Fair values at grant date are determined using market value for listed options or a Black and Scholes option
pricing model that takes into account various assumptions as detailed in Note 12.
27
White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ Report
C
Employment contracts/Consultancy agreements
On appointment to the Board, all Non-Executive Directors enter into a service agreement with the Company in the
form of a letter of appointment. Formal services contracts have been made with the Executive Chairman and the
Managing Director.
For the majority of the financial year the Board accepted that their contractual remuneration was reduced by a
factor of 40%. Upon completing a capital raising in May 2014 remuneration rates were reinstated to normal
amounts. Further annual director fees have been reduced by 50% effective from 1 July 2012.
The Company has entered into a consultancy agreement with Lanza Holdings Pty Ltd, an entity associated with
Mike Langoulant, for services including accounting and corporate administration. Annual fees payable to Lanza are
$150,000 plus GST. The Company may terminate the consultancy agreement on 3 months’ notice by paying 12
months of consultancy fees. Lanza may terminate the consultancy agreement due to breach or upon 3 months’
notice.
Share-based compensation
D
Options
Options are granted to employees and consultants as determined by the board. The terms and conditions of each
grant of options affecting remuneration in this or future reporting periods are as follows:
Grant date
Expiry date
Exercise price
Value per option
at grant date
Date exercisable
2 November 2012
30 September 2014
19 May 2014
11 March 2017
$0.06
$0.03
$0.016
$0.001
30 September 2014
11 March 2017
There have been no options granted to employees or consultants that have been exercised or have lapsed during
the reporting period other than 5,750,000 options exercisable at $0.25 which lapsed on 30 June 2014.
Options granted carry no dividend or voting rights. When exercisable, each option is convertible into one ordinary
share. Further information on the options is set out in notes 12 and 15 to the financial statements.
Details of share-based compensation options issue to directors and key management personnel during the current
financial year are set out below.
Name
Option series
Number
granted
Number vested % of compensation
for year consisting
of options
M Langoulant
T Hibberd
R Boland
End of remuneration report.
19/5/14
19/5/14
19/5/14
2,500,000
3,000,000
2,000,000
2,500,000
3,000,000
2,000,000
2
2
5
28
White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ Report
Auditor independence and non-audit services
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 29 and forms part of this directors’ report for the year ended 30 June 2014.
Non-audit services
The Company may decide to employ the auditors on assignments additional to their statutory audit duties where the
auditor’s expertise and experience with the Company and/or the consolidated entity are important. The Company
has considered the position and is satisfied that the provision of the non-audit services is compatible with the
general standard of independence for auditors imposed by the Corporations Act 2001. The auditors have not
provided any material non-audit services during the reporting year and therefore the auditors’ independence was not
compromised.
Proceedings on behalf of Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings
on behalf of the Company, or to intervene in any proceedings to which the Company is a party, for the purpose of
taking responsibility on behalf of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section
237 of the Corporations Act 2001.
This report is made in accordance with a resolution of the directors.
M Langoulant
Chairman
Perth, Western Australia
22 September 2014
29
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the consolidated financial report of White Cliff Minerals Limited for the year
ended 30 June 2014, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
a)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
b) any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
22 September 2014
N G Neill
Partner, HLB Mann Judd
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.
30
White Cliff Minerals Limited
ABN 22 126 299 125
Corporate governance statement
Introduction
White Cliff Minerals Limited (the “Company”) considers the adoption of appropriate systems of control and
accountability as the basis for the administration of corporate governance. Some of these policies and
procedures are summarised in this report. Commensurate with the spirit of the ASX Corporate Governance
Council's Corporate Governance Principles and Recommendations 2nd edition (Recommendations) the
Company has followed each Recommendation where the Board has considered the recommendation to be
an appropriate benchmark for corporate governance practices, taking into account factors such as the size of
the Company and the Board, resources available and activities of the Company. Where, after due
consideration, the Company's corporate governance practices depart from the Recommendations, the Board
has offered full disclosure of the nature of, and reason for, the adoption of its own practice.
Further information about the Company's corporate governance practices, polices and Charters are set out
on the Company's website at www.wcminerals.com.au. In accordance with the Recommendations,
information published on the Company's website includes charters (for the Board and its sub-committees),
codes of conduct and other policies and procedures relating to the Board and its responsibilities.
Disclosure – Principles & recommendations
The Company reports below on how it has followed (or otherwise departed) from each of the
Recommendations during the 2013/2014 financial year ("Reporting Period").
Board
Roles and responsibilities of the Board and Senior Executives
(Recommendations: 1.1, 1.3)
The Company has established the functions reserved to the Board, and those delegated to senior executives
and has set out these functions in its Board Charter.
The Board is collectively responsible for promoting the success of the Company through its key functions of
overseeing the management of the Company, providing overall corporate governance of the Company,
monitoring the financial performance of the Company, engaging appropriate management commensurate
with the Company's structure and objectives, involvement in the development of corporate strategy and
performance objectives, and reviewing, ratifying and monitoring systems of risk management and internal
control, codes of conduct and legal compliance.
Senior executives are responsible for supporting the Managing Director and assisting the Managing Director
in implementing the running of the general operations and financial business of the Company in accordance
with the delegated authority of the Board. Senior executives are responsible for reporting all matters which
fall within the Company's materiality thresholds at first instance to the Managing Director or, if the matter
concerns the Managing Director, directly to the Chair or the lead independent director, as appropriate.
Skills, experience, expertise and period of office of each Director
(Recommendation: 2.6)
A profile of each Director setting out their skills, experience, expertise and period of office is set out in the
Directors' Report.
The mix of skills and diversity for which the Board is looking to achieve in membership of the Board are:
ability to provide guidance on the development of the Company’s assets; independence; understanding of
exploration; capital markets; geological; accounting and finance; and mining experience.
Director independence
(Recommendations: 2.1, 2.2, 2.3, 2.6)
For the Reporting Period the Board did not have a majority of directors who were independent.
31
White Cliff Minerals Limited
ABN 22 126 299 125
The Company has not complied with this Recommendation. The Board has two non-independent directors
and one independent director. Given the size and scope of the Company's operations, the Board considers
that it has the relevant experience in the exploration and mining industry and is appropriately structured to
discharge its duties in a manner that is in the best interests of the Company and its Shareholders from both a
long-term strategic and operational perspective.
The Board considers the independence of directors having regard to its Policy on Assessing the
Independence of Directors, which provides that when determining the independent status of a director the
Board should consider whether the director:
is a substantial shareholder of the Company or an officer, of, or otherwise associated directly with, a
substantial shareholder of the Company;
is employed, or has previously been employed in an executive capacity by a Group company and
there has not been a period of at least 3 years between ceasing such employment and serving on the
Board;
has within the last 3 years been a principal of a material professional adviser or a material consultant
to the Group;
has a material contractual relationship with the Company or other group member other than as a
director;
is a material supplier or customer of the Group, or an officer of or otherwise associated directly or
indirectly with a material supplier or customer.
The Board has agreed on the following guidelines for assessing the materiality of matters:
Statement of Financial Position items are material if they have a value of more than 5% of pro-forma
net asset.
Statement of Comprehensive Income items are material if they will have an impact on the current year
operating result of 5% or more.
Items are also material if they impact on the reputation of the Company, involve a breach of legislation,
are outside the ordinary course of business, could affect the Company’s rights to its assets, if
accumulated would trigger the quantitative tests, involve a contingent liability that would have a
probable effect of 5% or more on asset, liability, income or expense items, or will have an effect on
operations which is likely to result in an increase or decrease in net income or dividend distribution of
more than 5%.
The independent director of the Company is Mr Boland, who is not the Chair. Whilst the Company
recognises the benefit of having an independent director as Chair, the Board was of the view that Mr
Langoulant continues to be the most appropriate person for the position of Chair.
The Chief Executive Officer is Mr Hibberd who is not also Chair of the Board.
Independent professional advice
(Recommendation: 2.6)
To assist directors with independent judgement, it is the Board's policy that if a director considers it
necessary to obtain independent professional advice to properly discharge the responsibility of their office as
a director then, provided the director first obtains approval from the Chair for incurring such expense, the
Company will pay the reasonable expenses associated with obtaining such advice.
Selection and (Re) Appointment of Directors
(Recommendation: 2.6)
In determining candidates for the Board, the Nomination Committee (or equivalent) follows a prescribed
process whereby it evaluates the mix of skills, experience and expertise of the existing Board. In particular,
the Nomination Committee (or equivalent) is to identify the particular skills that will best increase the Board's
effectiveness. Consideration is also given to the balance of independent directors. Potential candidates are
identified and, if relevant, the Nomination Committee (or equivalent) recommends an appropriate candidate
for appointment to the Board. Any appointment made by the Board is subject to ratification by shareholders
at the next general meeting.
32
White Cliff Minerals Limited
ABN 22 126 299 125
Each director other than the Managing Director, must not hold office (without re-election) past the third
annual general meeting of the Company following the director's appointment or three years following that
director's last election or appointment (whichever is the longer).
However, a director appointed to fill a casual vacancy or as an addition to the Board must not hold office
(without re-election) past the next annual general meeting of the Company. At each annual general meeting
a minimum of one director or one third of the total number of directors must resign. A director who retires at
an annual general meeting is eligible for re-election at that meeting. Re-appointment of directors is not
automatic.
Board committees
Nomination Committee
(Recommendations: 2.4, 2.6)
The Board has not established a separate Nomination Committee. The Board believes that there would be
no efficiencies gained by establishing a separate Nomination Committee. Accordingly, the Board performs
the role of the Nomination Committee. Items that are usually required to be discussed by a Nomination
Committee are marked as separate agenda items at Board meetings when required. When the Board
convenes as the Nomination Committee it carries out those functions which are delegated to it in the
Company’s Nomination Committee Charter. The Board deals with any conflicts of interest that may occur
when convening in the capacity of the Nomination Committee by ensuring that the director with conflicting
interests is not party to the relevant discussions.
The full Board officially convened as a Nomination Committee once during the Reporting Period. In addition
informal nomination-related discussions occurred from time to time during the year as required.
Audit Committee
(Recommendations: 4.1, 4.2, 4.3, 4.4)
The Board has not established an Audit Committee.
The role of the audit committee is undertaken by the full Board, which comprises two executive directors and
one independent non-executive director. The Board considers that given its current size no efficiencies or
other benefits would be gained by establishing a separate audit committee. The Board has stated its audit
and compliance responsibilities in the Board Charter.
Remuneration Committee
(Recommendations: 8.1, 8.2, 8.3, 8.4)
The Board has not established a Remuneration Committee.
The Board considers that no efficiencies or other benefits would be gained by establishing a separate
Remuneration Committee. The Company’s constitution provides that the remuneration of Non-Executive
Directors will not be more than the aggregate fixed sum determined by general meeting. Time is set aside at
one Board meeting each year specifically to address the matters usually considered by a Remuneration
Committee. Remuneration matters, usually considered by a Remuneration Committee, were considered at
during a number of Board meetings during the year.
Details of remuneration, including the Company’s policy on remuneration, are contained in the
“Remuneration Report” which forms of part of the Directors’ Report. The Company’s policy is to remunerate
non-executive directors at market rates (for comparable companies)
time, commitment and
responsibilities. Fees for non-executive directors are not linked to the performance of the Company. Given
the Company’s stage of development and the financial restriction placed on it, the Company may consider it
appropriate to issue unlisted options to non-executive directors, subject to obtaining the relevant approvals.
The grant of options is designed to attract and retain suitability qualified non-executive directors.
for
There are no termination or retirement benefits for non-executive directors (other than for superannuation).
33
White Cliff Minerals Limited
ABN 22 126 299 125
Performance evaluation
Senior executives
(Recommendations: 1.2, 1.3)
The Managing Director is responsible for evaluating the performance of senior executives. The performance
evaluation of senior executives is undertaken by meetings held with each senior executive and the Managing
Director on an informal basis at least once a year.
During the Reporting Period an evaluation of senior executives took place in accordance with the process
disclosed above.
Board, its committees and individual directors
(Recommendations: 2.5, 2.6)
The Chair is responsible for evaluating the performance of the Board and, when deemed appropriate, Board
committees and individual directors. Evaluations of the Board and its committees are undertaken by way of
round-table discussions and individual directors by one on one interview.
During the Reporting Period an evaluation of the Board and individual directors took place in accordance
with the process disclosed above.
Ethical and responsible decision making
Code of Conduct
(Recommendations: 3.1, 3.5)
The Company has established a Code of Conduct as to the practices necessary to maintain confidence in
the Company's integrity, the practices necessary to take into account its legal obligations and the reasonable
expectations of its stakeholders and the responsibility and accountability of individuals for reporting and
investigating reports of unethical practices.
Diversity
(Recommendations: 3.2, 3.3, 3.4, 3.5)
The Company has established a Diversity Policy, which includes requirements for the Board to establish
measurable objectives for achieving gender diversity and for the Board to assess annually both the
objectives and progress towards achieving them.
Given the small size of the Company, the Board has not set measurable objectives for achieving gender
diversity. However, the Company's Board does take into account the gender, age, ethnicity and cultural
background of potential Board members, executives and employees.
At the date of this report the Company had only 2 male employees and no female Board members but a
contract female co-company secretary.
A summary of the Company’s Diversity Policy is disclosed on the Company’s website.
Continuous Disclosure
(Recommendations: 5.1, 5.2)
The Company has established written policies and procedures designed to ensure compliance with ASX
Listing Rule disclosure requirements and accountability at a senior executive level for that compliance.
Shareholder Communication
(Recommendations: 6.1, 6.2)
The Company has designed a communications policy for promoting effective communication with
shareholders and encouraging shareholder participation at general meetings.
34
White Cliff Minerals Limited
ABN 22 126 299 125
Risk Management
Recommendations: 7.1, 7.2, 7.3, 7.4)
The Board has adopted a Risk Management Policy, which sets out the Company's risk profile. Under the
policy, the Board is responsible for approving the Company's policies on risk oversight and management and
satisfying itself that management has developed and implemented a sound system of risk management and
internal control.
Under the policy, the Board delegates day-to-day management of risk to the Managing Director, who is
responsible for identifying, assessing, monitoring and managing risks. The Managing Director is also
responsible for updating the Company's material business risks to reflect any material changes, with the
approval of the Board.
In fulfilling the duties of risk management, the Managing Director has unrestricted access to Company
employees, contractors and records and may obtain independent expert advice on any matter they believe
appropriate, with the prior approval of the Board.
In addition, the following risk management measures have been adopted by the Board to manage the
Company's material business risks:
•
•
the Board has established authority limits for management, which, if proposed to be exceeded,
requires prior Board approval; and
the Board has adopted a compliance procedure for the purpose of ensuring compliance with the
Company's continuous disclosure obligations.
During the previous Reporting Period, the Company formalised its approach to risk management by
documenting all material business risks in a risk register and allocation of ownership for material business
risks to the Managing Director and management of individual material business risks to senior management
and individuals within the organisation. The risk register is regularly reviewed by the Board and
management. All risks identified in the risk register will be reviewed and assessed by management and the
Board at least annually. Risk is a standing discussion item at scheduled Board meetings.
The key categories of risk of the Company, as reported on by management, include:
cash management and the ability to raise fresh equity capital;
financial reporting;
•
•
• ASX reporting compliance;
• project ownership retention;
• executive travel safety;
• maintaining joint venture partnerships;
• employee health and safety;
•
retention of key employees;
• environmental compliance;
•
foreign exchange risk; and
•
sovereign risk.
The Board has required management to design, implement and maintain risk management and internal
control systems to manage the Company's material business risks. The Board also requires management to
report to it confirming that those risks are being managed effectively. The Board has received a report from
management as to the effectiveness of the Company's management of its material business risks for the
Reporting Period.
The Managing Director and the CFO equivalent have provided a declaration to the Board in accordance with
section 295A of the Corporations Act and have assured the Board that such declaration is founded on a
sound system of risk management and internal control and that the system is operating effectively in all
material respects in relation to financial reporting risks.
35
White Cliff Minerals Limited
ABN 22 126 299 125
Statement of Comprehensive Income
For the year ended 30 June 2014
Other income
Depreciation
Exploration expenditure incurred
Impairment of other financial assets
Project acquisition costs written off
Share based payment expense
Other expenses
Loss before income tax expense
Note
2
8
Consolidated
2014
$
2013
$
25,347
260,705
-
921,067
-
249,679
7,500
824,681
2,670
1,345,261
101,609
439,568
158,660
1,068,200
2,002,927
3,115,968
(1,977,580)
(2,855,263)
Income tax benefit
3
351,513
-
Loss after income tax benefit
Net loss for the year
Other comprehensive loss/(income)
Items that will not be subsequently reclassified to
profit and loss:
Reclassification of fair value adjustments on
investments in other companies to profit and loss
Other comprehensive loss/(income), net of tax
(1,626,067)
(2,855,263)
(1,626,067)
(2,855,263)
-
-
53,849
53,849
Total comprehensive loss for the year
(1,626,067)
(2,801,414)
Basic loss per share
(cents per share)
4
(0.7)
(2.3)
The above statement of comprehensive income should be read in conjunction with the accompanying notes.
36
White Cliff Minerals Limited
ABN 22 126 299 125
Statement of Financial Position
As at 30 June 2014
Current Assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total Current Assets
Non-Current Assets
Exploration project acquisition costs
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and other payables
Total Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
Note
Consolidated
2014
$
2013
$
6
7
8
9
1,002,094
396,498
28,758
1,190,649
39,109
-
1,427,350
1,229,758
1,393,350
814,612
1,393,350
814,612
2,820,700
2,044,370
219,390
182,827
219,390
182,827
219,390
182,827
2,601,310
1,861,543
10
11
16,822,494
882,399
(15,103,583)
14,464,160
874,899
(13,477,516)
2,601,310
1,861,543
The above statement of financial position should be read in conjunction with the accompanying notes.
37
White Cliff Minerals Limited
ABN 22 126 299 125
Statement of Changes in Equity
For the year ended 30 June 2014
Consolidated
Issued
capital
$
Accumulated
losses
$
Reserves
Total equity
$
$
Balance at 1 July 2012
11,801,936
(10,622,253)
503,730
1,683,413
Loss for the period
Other comprehensive
income
Total comprehensive loss for
the year
Shares issued during the
period
Capital raising costs (note
10(b))
Share based compensation
-
-
-
2,972,001
(309,777)
-
2,662,224
(2,855,263)
-
(2,855,263)
-
53,849
53,849
(2,855,263)
53,849
(2,801,414)
-
-
-
-
-
2,972,001
-
317,320
(309,777)
317,320
317,320
2,979,544
Balance at 30 June 2013
14,464,160
(13,477,516)
874,899
1,861,543
Loss for the period
Other comprehensive
income
Total comprehensive loss for
the year
Shares issued during the
period
Capital raising costs (note
10(b))
Share based compensation
-
-
-
(1,626,067)
-
(1,626,067)
2,440,316
(81,982)
-
2,358,334
-
-
-
-
-
-
-
-
(1,626,067)
-
(1,626,067)
2,440,316
-
7,500
(81,982)
7,500
7,500
2,365,834
Balance at 30 June 2014
16,822,494
(15,103,583)
882,399
2,601,310
The above statement of changes in equity should be read in conjunction with the accompanying notes.
38
White Cliff Minerals Limited
ABN 22 126 299 125
Statement of Cash Flows
For the year ended 30 June 2014
Cash flows from operating activities
Government drilling grants
Payments to suppliers and employees
Interest received
Consolidated
Inflows/
(Outflows)
2014
$
Inflows/
(Outflows)
2013
$
Note
-
(554,437)
22,823
106,221
(1,003,794)
28,484
Net cash outflow from operating activities
17(a)
(531,614)
(869,088)
Cash flows from investing activities
Loans (to)/from others
Payments for other assets
Payments for project acquisitions
Payments for exploration and evaluation
Proceeds from sale of tenements
-
(26,234)
(90,000)
(1,160,625)
-
110,606
-
-
(1,633,062)
126,000
Net cash outflow from investing activities
(1,276,859)
(1,396,456)
Cash flows from financing activities
Proceeds from the issue of shares
Capital raising costs
Net cash inflow from financing activities
Net increase/(decrease) in cash held
Cash at the beginning of the year
1,701,900
(81,982)
2,972,001
(151,117)
1,619,918
2,820,884
(188,555)
555,340
1,190,649
635,309
Cash at the end of the year
6
1,002,094
1,190,649
The above statement of cash flows should be read in conjunction with the accompanying notes.
39
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 1: Statement of significant accounting policies
(a)
Basis of preparation
The 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 complies
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 report has also been
prepared on a historical cost basis. The Company is a listed public company registered and domiciled in
Australia. The financial report is presented in Australian dollars.
Going Concern
The Company and its controlled entities as at 30 June (the “Group”) do not generate sufficient cash flows
from their operating activities to finance these activities. Thus the continuing viability of the Group and its
ability to continue as a going concern and meet its debts and commitments as they fall due are dependent
upon the Group being successful in completing a capital raising and/or asset sale/joint venture agreement
in the next 12 months. The directors have mitigated this risk by reducing the Group’s corporate overheads
and postponing expenditure on the Group’s projects where possible.
As a result of these matters, there is a material uncertainty that may cast significant doubt on whether
the Group will continue as a going concern and, therefore, whether it will realise its assets and settle its
liabilities and commitments in the normal course of business and at the amounts stated in the financial
report. However, the directors believe that the Group will be successful in the above matters and,
accordingly, have prepared the financial report on a going concern basis.
(b)
(c)
(d)
Adoption of new and revised standards
Changes in accounting policies on initial application of Accounting Standards
In the year ended 30 June 2014, the Directors have reviewed all of the new and revised Standards and
Interpretations issued by the AASB that are relevant to the Group’s operations and effective for the
current annual reporting period. It has been determined by the Directors that there is no impact, material
or otherwise, of the new and revised Standards and Interpretations on the Group and, therefore, no
change is necessary to Group accounting policies.
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 2014. As a result of this review the Directors have
determined that there is no impact, material or otherwise, of the new and revised Standards and
Interpretations on the Group and, therefore, no change necessary to Group accounting policies.
Statement of compliance
The financial report was authorised by the Board of directors for issue on 22 September 2014.
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).
Basis of consolidation
The consolidated financial statements comprise the financial statements of White Cliff Minerals Limited
(“Company” or “parent entity”) and its controlled entities as at 30 June 2014 (the “Group”).
The financial statements of the controlled entities are prepared for the same reporting period as the
parent entity, using consistent accounting policies.
In preparing the consolidated financial statements, all intercompany balances and transactions, income
and expenses and profit and losses resulting from intra-group transactions have been eliminated in full.
Controlled entities are fully consolidated from the date on which control is transferred to the Group and
cease to be consolidated from the date on which control is transferred out of the Group. Control exists
where the Company has the power to govern the financial and operating policies of an entity so as to
obtain benefits from its activities.
40
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 1: Statement of significant accounting policies (continued)
(e)
Significant accounting judgements estimates and assumptions
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.
Exploration and evaluation costs carried forward
The Group’s main activity is exploration and evaluation for minerals. The nature of exploration activities
are such that it requires interpretation of complex and difficult geological models in order to make an
assessment of the size, shape, depth and quality of resources and their anticipated recoveries. The
economic, geological and technical factors used to estimate mining viability may change from period to
period. In addition, exploration activities by their nature are inherently uncertain. Changes in all these
factors can impact exploration asset carrying values.
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
either market value or using a Black and Scholes model using the assumptions contained in Note 12.
Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group
and the revenue can be reliably measured. The following specific recognition criteria must also be met
before revenue is recognised:
(i) Interest income
Interest revenue is recognised on a time proportionate basis that takes into account the effective yield
on the financial asset.
(ii) Government assistance - drilling grants
Government grants are recognised at fair value where there is reasonable assurance that the grant will
be received and all grant conditions will be met. Grants relating to expense items are recognised as
income over the periods necessary to match the grant to the costs they are compensating.
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. Temporary bank overdrafts are included in cash at bank and in hand. Permanent
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.
Income tax
The income tax expense or benefit for the year is the tax payable on the current year’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 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.
41
(f)
(g)
(h)
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 1: Statement of significant accounting policies (continued)
(h)
Income tax (cont)
Deferred income tax liabilities are recognised for all taxable temporary differences except:
•
•
when the deferred income tax liability arises from the initial recognition of goodwill or of an asset
or liability in a transaction that is not a business combination and that, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss; or
when the taxable temporary difference is associated with investments in controlled entities,
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 controlled entities,
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.
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
financial 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.
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 both 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.
(i)
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.
42
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 1: Statement of significant accounting policies (continued)
(j)
(k)
(l)
Impairment of assets
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 re-
valued amount (in which case the impairment loss is treated as a revaluation decrease).
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 financial
periods. 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.
Trade and other payables
Trade payables and other payables are carried at amortised costs and represent liabilities for goods and
services provided to the Group prior to the end of the financial year that are unpaid and arise when the
Group becomes obliged to make future payments in respect of the purchase of these goods and
services. Trade and other payables are presented as current liabilities unless payment is not due within
12 months.
Provisions
Where applicable, 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 made 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 net present value of management’s
best estimate of the expenditure required to settle the present obligation at the end of the reporting year.
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 a
borrowing cost.
43
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 1: Statement of significant accounting policies (continued)
(m)
(o)
(p)
Share-based payment transactions
Equity settled transactions:
The Group provides benefits to employees and consultants 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 and consultants 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 by using either market value or the Black and Scholes model, further details of which are
given in Note 14.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity,
over the period in which any performance and/or service conditions are fulfilled, ending on the date on
which the relevant employees become fully entitled to the award (the vesting period).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting
date reflects the extent to which the vesting period has expired, and the Group’s best estimate of the
number of equity instruments that will ultimately vest.
The statement of comprehensive income charge or credit for a year represents the movement in
cumulative expense recognised as at the beginning and end of that year.
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 (see Note 4).
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 costs of acquisition as part of purchase consideration.
Earnings per share
Basic earnings per share is calculated as net profit or loss 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.
Diluted earnings per share is calculated as net profit or loss 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.
44
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 1: Statement of significant accounting policies (continued)
(q)
Exploration and evaluation expenditure
Exploration costs are expensed as incurred. Acquisition costs are accumulated in respect of each
separate area of interest. Acquisition costs are carried forward where right of tenure of the area of
interest is current and they are expected to be recouped through the sale or successful development and
exploitation of the area of interest or, where exploration and evaluation activities in the area of interest
have not yet reached a stage that permits reasonable assessment of the existence of economically
recoverable reserves. When an area of interest is abandoned or the Directors decide that it is not
commercial, any accumulated acquisition costs in respect of that area are written off in the financial year
and accumulated acquisition costs written off to the extent that they will not be recovered in the future.
Amortisation is not charged on acquisition costs carried forward in respect of areas of interest in the
development phase until production commences.
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest
that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The
recoverable amount of the exploration and evaluation asset (for the cash generating unit(s) to which it
has been allocated being no larger than the relevant area of interest) is estimated to determine the
extent of the impairment loss (if any). Where an impairment loss subsequently reverses, the carrying
amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent
that the increased carrying amount does not exceed the carrying amount that would have been
determined had no impairment loss been recognised for the asset in previous years.
Where a decision has been made to proceed with development in respect of a particular area of interest,
the relevant exploration and evaluation asset is tested for impairment and the balance is then
reclassified to development.
(r)
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 White Cliff Minerals Limited.
(s)
Parent entity financial statements
The financial information for the parent entity, White Cliff Minerals, disclosed in Note 18, has been
prepared on the same basis as the consolidated financial statements.
45
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 2: Revenue and expenses
(a) Revenue from continuing operations
Other revenue
Tribute production share of gold
Interest received
Profit on sale of tenements
Government drilling grants
(b) Expenses
Loss from ordinary activities before income tax
expense includes the following specific
expenses:
Auditor’s remuneration
Employee costs*
* Includes all direct exploration employee costs
Consolidated
2014
$
2013
$
2,524
22,823
-
-
-
28,484
126,000
106,221
30,050
348,539
29,550
490,870
46
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 3: Income tax
(a) Income tax benefit
The prima facie income tax expense on pre-tax accounting result
from operations reconciles to the income tax benefit in the
financial statements as follows
Accounting loss before tax from continuing
operations
Tax expense/(benefit) calculated at 30%
Research and development tax refund
Non-deductible expenses
Other deferred tax assets and tax liabilities not
recognised
Adjustments in respect of current income tax of
previous years
Deferred tax assets and tax liabilities not
recognised in relation to foreign expenses
Income tax expense/(benefit) reported in the
statement of comprehensive income
(b) Unrecognised deferred tax balances
The following deferred tax assets have not been brought to
account
Deferred tax assets comprise:
Accruals
Fair value of investments
Share issue costs
Losses available for offset against future income – revenue
Losses available for offset against future income – capital
Deferred tax liabilities comprise:
Exploration expenses capitalised
Net unrecognised deferred tax assets
(c) Income tax benefit not recognised directly in
equity during the year
Consolidated
2014
$
2013
$
(1,977,580)
(2,855,263)
(593,274)
(856,579)
(351,513)
1,954
-
36,566
99,288
508,762
202,174
597
289,858
310,654
(351,513)
-
6,072
30,483
61,220
3,244,898
38,159
3,380,832
10,613
30,483
53,495
3,195,884
38,159
3,328,634
(31,480)
(94,384)
3,349,352
3,234,250
Share issue costs
32,486
45,335
47
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 4: Loss per share
Total basic loss per share (cents)
The loss and weighted average number of ordinary
shares used in the calculation of basic loss per share is
as follows:
Net loss for the period
The weighted average number of ordinary shares
The diluted loss per share is not reflected as the result is anti-dilutive.
Consolidated
2014
$
2013
$
(0.7)
(2.3)
(1,626,067)
(2,855,263)
222,517,148 122,080,092
Note 5: Segment information
For management purposes, the Board of Directors of the Company has been defined as the Chief Operating
Decision Maker. Segment information is presented in respect of the Group’s business segments based on the
Group’s management and internal reporting structure.
During the year the group operated predominantly in one business segment that consisted of mineral exploration.
Geographically, the group explores in both Australia and the Kyrgyz Republic. Segment results are classified in
accordance with their use within geographic segments.
Segment results and assets include items directly attributable to a segment as well as those that can be allocated
on a reasonable basis.
The following table presents the financial information regarding these segments provided to the Board of Directors
for the year ended 30 June 2014.
2014
Revenue
Gold produced
Interest income
Segment revenue
Segment net operating loss
after tax
Segment assets
Other segment information
Segment liabilities
Depreciation and amortisation
of segment assets
Australia
$
2,524
22,823
25,347
Kyrgyz
$
-
-
-
Total
$
2,524
22,823
25,347
(870,883)
(755,184)
(1,626,067)
1,532,283
1,288,417
2,820,700
(195,542)
(23,848)
(219,390)
-
-
-
48
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 5: Segment information (cont)
2013
Revenue
Government drilling grants
Sale of tenements
Interest income
Segment revenue
Segment net operating
after tax
loss
Segment assets
Segment liabilities
Depreciation and amortisation
of segment assets
Note 6: Cash and cash equivalents
Cash at bank and on hand
Short term deposits
Australia
$
106,221
126,000
28,484
260,705
Kyrgyz
$
-
-
-
-
Total
$
106,221
126,000
28,484
260,705
(2,109,115)
(746,148)
(2,855,263)
1,544,370
500,000
2,044,370
168,827
14,000
182,827
2,670
-
2,670
Consolidated
2014
$
2013
$
-
1,002,094
42,891
1,147,758
1,002,094
1,190,649
(a) Reconciliation to Statement of Cash Flows
The above figures agree to cash at the end of the financial year as shown in the Statement of Cash Flows.
(b) Cash at bank and on hand
These are non-interest bearing accounts.
(c) Deposits at call
The deposits are bearing floating interest rates between 0.3% and 2.35%. These deposits have a maturity of no
more than 90 days.
49
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 7: Trade and other receivables
Goods and services tax receivable
Other receivables – Research and
development tax refund
Interest receivable
Note 8: Exploration project acquisition costs
Opening balance
Project acquisition costs
Project acquisition costs written off
Acquisition costs in respect of areas of
interest in the exploration phase
Consolidated
2014
$
2013
$
43,536
39,109
351,513
1,449
-
-
396,498
39,109
Consolidated
2014
$
2013
$
814,612
828,417
(249,679)
570,644
683,536
(439,568)
1,393,350
814,612
The recoupment of exploration project acquisition costs carried forward is dependent upon the recoupment of
costs through successful development and commercial exploitation, or alternatively by sale of the respective
areas.
As a result of exploration activities during the year, the directors re-assessed the carrying value of the acquisition
costs relating to certain project areas and, as a result, have written off those acquisition costs that are not expected
to be re-couped in the future, notwithstanding that title to these areas remains valid and further exploration is
planned.
Note 9: Trade and other payables
Trade payables and accruals*
Provisions
* Trade payables are non-interest bearing and are normally paid on 30 day terms.
153,834
65,556
145,774
37,053
219,390
182,827
50
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 10: Issued capital
(a) Ordinary shares issued
449,049,614 (2013: 186,107,947) ordinary
shares
Consolidated
$
2014
$
2013
16,822,494
14,464,160
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote
per share at shareholders’ meetings. In the event of winding up of the parent entity, ordinary shareholders rank after all
creditors and are fully entitled to any proceeds on liquidation.
(b) Movements in ordinary share capital:
Details
Placement
Share Purchase Plan
Placement
Placement
Placement
Placement
Placement
Share Purchase Plan
Project acquisition
Date
Opening balance
7 September 2012
1 October 2012
11 October 2012
13 February 2013
21 March 2013
Capital raising costs
30 June 2013
24 March 2014
8 May 2014
8 May 2014
8 May 2014
Capital raising costs
30 June 2014
(c) Share options
Listed options exercisable at $0.03 on or before 11 March 2017
Listed options exercisable at $0.06 on or before 30 September 2014
Employee Options exercisable at $0.25 on or before 30 June 2014
(d) Movements in share options
Listed Options to acquire ordinary fully paid shares at $0.06 on or before
30 September 2014:
Beginning of the financial year
Issued during year
Balance at end of financial year
Number of
shares
67,380,647
6,660,000
20,000,000
18,340,000
8,400,000
65,327,300
-
186,107,947
18,610,000
114,690,000
55,800,000
73,841,667
-
Issue Price
$
$
11,801,936
199,800
600,000
550,200
184,800
1,437,201
(309,777)
0.03
0.03
0.03
0.022
0.022
14,464,160
167,490
1,032,210
502,200
738,417
(81,982)
0.009
0.009
0.009
0.01
449,049,614
16,822,494
Number of options
2014
2013
102,050,017
116,227,300
-
218,277,317
-
116,227,300
5,750,000
121,977,300
116,227,300
-
-
116,227,300
116,227,300
116,227,300
51
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 10: Issued capital (cont)
Listed Options to acquire ordinary fully paid shares at $0.03 on or before
11 March 2017:
Beginning of the financial year
Issued during year
Balance at end of financial year
Employee Options exercisable at $0.25 on or before 30 June 2014
Beginning of the financial year
Expired during year
Balance at end of financial year
Note 11: Reserves
Option issue reserve (a)
Share compensation reserve (b)
Number of options
2014
2013
-
102,050,017
102,050,017
-
-
-
5,750,000 5,750,000
-
(5,750,000)
- 5,750,000
Consolidated
2014
$
125,391
757,008
2013
$
125,391
749,508
882,399
874,899
(a)
(b)
Option issue reserve
The option issue reserve represents amounts paid upon subscribing for options issued by the Company.
Share compensation reserve
The share compensation reserve is used to record the value of equity benefits provided to consultants and
directors as part of their remuneration. Refer Note 12.
52
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 12: Share based payments
Share based payments consists of listed and unlisted options issued to directors and consultants. The expense
is recognised in the Statement of Comprehensive Income and Statement of Changes in Equity over the vesting
periods of the options. The following share-based payment arrangements were in place during the current and
prior years:
Number
Grant date
Expiry Date Exercise price $
Fair value
5,750,000
1/4/2011
30/6/2014
10,000,000
2/11/2012
30/9/2014
7,500,000
19/5/2014
11/3/2017
0.25
0.06
0.03
$310,500*
$158,660*
$7,500**
Fair value of options granted
* The fair value of the equity-settled share options was estimated using the Black and Scholes model taking into
account the terms and conditions upon which the options were granted. The holders of these options did not
realise any value/profit from these options which have now lapsed.
** The fair value of the equity-settled share options was estimated using the initial bid price for these options on
the first day these options were quoted for trading upon ASX. This method provides the most accurate estimate
of the value of these options.
The actual value of these options may be materially different to this accounting estimation.
The following table lists the inputs to the Black and Scholes model used:
Dividend yield %
Expected
volatility %
Risk-free
interest rate %
Life of option
Exercise price
Grant date share
price
Discount for lack
of marketability
April 2011
November
2012
-
100%
-
90%
4.95%
2.55%
39 months
23 months
$0.25
$0.06
$0.145
$0.053
33%
33%
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. The fair value of unlisted options was discounted
to account for the existence of continuity of employment vesting conditions, non-transferability and the un-listed
aspect of the employee options. No other features of options granted were incorporated into the measurement
of fair value.
53
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 13: Financial instruments
(a) Capital risk management
Prudent capital risk management implies maintaining sufficient cash and marketable securities to ensure
continuity of tenure to exploration assets and to be able to conduct the Group’s business in an orderly and
professional manner. The Board monitors its future capital requirements on a regular basis and will when
appropriate consider the need for raising additional equity capital or to farm-out exploration projects as a means
of preserving capital. The Board currently has a policy of not entering into any debt arrangements.
(b) Categories of financial instruments
The Group’s principal financial instruments comprise of cash and short-term deposits. The main purpose of
these financial instruments is to raise finance for the Group’s operations. The Group has various other financial
assets and liabilities such as receivables and trade payables, which arise directly from its operations. It is, and
has been throughout the year, the Group’s policy that no trading in financial instruments shall be undertaken
during the year.
(c) Financial risk management objectives
The Group is exposed to market risk (including interest rate risk and equity price risk), credit risk and liquidity
risk.
The main risks arising from the Group’s financial instruments are interest rate risk and credit risk. The Board
reviews and agrees policies for managing each of these risks and they are summarised below.
(d) Market risk
Equity price risk sensitivity analysis
There has been no change to the Group’s exposure to market risks or the manner in which it manages and
measures the risk from the previous period.
(i) Interest rate risk management
All cash balances attract a floating rate of interest. Excess funds that are not required in the short term are placed
on deposit for a period of no more than 3 months. The Group’s exposure to interest rate risk and the effective
interest rate by maturity periods is set out below.
Interest rate sensitivity analysis
As the Group has no interest bearing borrowings its exposure to interest rate movements is limited to the amount
of interest income it can potentially earn on surplus cash deposits.
At 30 June 2014, if interest rates had changed by +/- 50 basis points and all other variables were held constant,
the Group’s after tax loss would have been $4,840 (2013: $4,130) lower/higher as a result of higher/lower interest
income on cash and cash equivalents.
54
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 13: Financial instruments (cont)
(e) Credit risk management
Credit risk relates to the risk that counterparties will default on their contractual obligations resulting in financial
loss to the Group. The Group has adopted a policy of only dealing with credit worthy counterparties and
obtaining sufficient collateral or other security where appropriate, as a means of mitigating the risk of financial
loss from any defaults.
(f) Liquidity risk management
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities to ensure
continuity of tenure to exploration assets and to be able to conduct the Group’s business in an orderly and
professional manner. Cash deposits are only held with major financial institutions.
2014
Financial assets
Cash and cash equivalents – non - interest
bearing
Cash and cash equivalents – interest bearing
Trade and other receivables
Financial liabilities
Trade and other payables
Provisions
2013
Financial assets
Cash and cash equivalents – non - interest
bearing
Cash and cash equivalents – interest bearing
Trade and other receivables
Financial liabilities
Trade and other payables
Provisions
Weighted
Average
Interest
Rate
Less than
1 month
1-3
months
3 months
– 1 year
5 + years
n/a
2.35%
n/a
-
1,002,094
396,498
1,398,592
-
-
-
-
-
-
-
-
n/a
n/a
-
-
-
153,834
-
153,834
-
65,556
65,556
n/a
41,751
-
3.45%
n/a
348,021
39,109
428,881
n/a
n/a
-
-
-
800,877
-
800,877
145,774
-
145,774
-
-
-
-
-
37,053
37,053
-
-
-
-
-
-
-
-
-
-
-
-
-
The directors consider that the carrying value of the financial assets and financial liabilities are recognised in
the consolidated financial statements approximate their fair values.
55
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 14: Commitments and contingencies
Exploration expenditure commitments
In order to maintain rights of tenure to its Australian located mineral tenements, the Company is required to
outlay certain amounts in respect of rent and minimum expenditure requirements set by the Western Australian
State Government Mines Department. The Group’s commitments to meet this minimum level of expenditure are
approximately $707,000 (2013: $580,000) annually.
Exemption from incurring this annual level of expenditure may be granted where access to the tenement area is
restricted for reasons beyond the Company’s control such as where native title issues restrict the Company’s
ability to explore in the project area. The Company is not aware of any such restrictions to exploration in the
coming year and it does not anticipate seeking any exemption to reduce this annual expenditure requirement.
In order to maintain rights of tenure to its Kyrgyz Republic located mineral tenement, the Company is required
to complete an annual works program as agreed with the Kyrgyz government. If this program is not
completed in the calendar year then continued tenure to the project could be in jeopardy.
Other contingencies
The Company is a co-guarantor to an office lease under which its remaining exposure through to the end of the
lease in October 2015 is approximately $56,450.
Note 15: Key management personnel disclosures
(a) Directors
At the date of this report the directors of the Company are:
M Langoulant – Executive chairman
T Hibberd – Managing director
R Boland – Non executive director
There were no changes of the key management personnel after the reporting date and the date the financial
report was authorised for issue.
(b) Key management personnel
During the reporting periods the Company had no other key management personnel.
(c) Key management personnel compensation
Short-Term
Post-employment
Share-based payments
Consolidated
2014
$
331,749
14,611
7,500
353,860
2013
$
499,360
20,640
126,929
646,929
Detailed remuneration disclosures of directors and key management personnel are in pages 24 to 29 of this
report.
56
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 16: Related party disclosure
The ultimate parent entity in the wholly-owned group and the ultimate Australian parent entity is White Cliff
Minerals Limited. The consolidated financial statements include the financial statements of White Cliff Minerals
Limited and the controlled entities listed in the following table:
Name of entity
Country of
incorporation
Class of shares
Equity holding
Northern Drilling Pty Ltd
Petrus Resources Pty Ltd
Venture Exploration Pty Ltd
PBP Malaysia Limited
Chanach LLC
Australia
Australia
Australia
Malaysia
Kyrgyz Republic
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
2014
%
100
100
100
98.5
88.7
2013
%
100
100
100
62.7
57.1
There were no transactions between White Cliff Minerals Limited and its controlled entities during the financial year
other than loan funds advanced to the Chanach LLC re the Chanach copper-gold project (2013: nil).
The Company has entered into a consultancy agreement with Lanza Holdings Pty Ltd, an entity associated with
Mike Langoulant, for services including accounting and corporate administration. Annual fees payable to Lanza are
$150,000 plus GST. The Company may terminate the agreement on 3 months’ notice by paying 12 months of
consultancy fees. Lanza may terminate the agreement due to breach or upon 3 months’ notice.
Note 17: Reconciliation of loss after income tax to net cash outflow from operating activities
a) Reconciliation of loss from ordinary activities after income tax
to net cash outflow from operating activities
Net loss for the year after income tax
(1,626,067)
(2,855,263)
Consolidated
2014
$
2013
$
Depreciation
Share based payment expense
Impairment of financial assets
Profit on sale of tenements classified as
investing activity
Exploration expenditure and employee costs
treated as investment activity
Mining tenement acquisition costs written off
(Increase) / decrease in trade and other
receivables
Increase / (decrease) in trade and other
payables
Increase / (decrease) in provisions
-
7,500
-
2,670
158,660
101,609
-
(126,000)
1,160,625
249,679
(359,914)
8,060
28,503
1,784,831
-
1,642
25,710
37,053
Net cash outflow from operating activities
(531,614)
(869,088)
b) Non-cash financing and investing activities
During the year the Company issued 73,481,667 ordinary shares to acquire an additional interest in the
Chanach project. Refer note 10.
57
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 18: Parent Entity Disclosures
Financial position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Total liabilities
Net assets
Equity
Issued capital
Retained earnings
Reserves
Option issue reserve
Share-based payments
Total equity
Financial performance
Loss for the year
Other comprehensive income
Total comprehensive loss
Note 19: Events after the balance date
30 June 2014
$
30 June 2013
$
1,427,350
1,393,350
2,820,700
1,229,758
814,612
2,044,370
219,390
219,390
182,827
182,827
2,601,310
1,861,543
16,822,4940
(15,103,583)
14,464,160
(13,477,516)
125,391
757,008
125,391
749,508
2,601,310
1,861,543
(1,626,067)
-
(2,855,263)
53,849
(1,626,067)
(2,801,414)
There has not been any matter or circumstance that has arisen after balance date 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 periods.
58
White Cliff Minerals Limited
ABN 22 126 299 125
Notes to the financial statements
For the year ended 30 June 2014
Note 20: Auditor’s remuneration
The auditors of the Group are HLB Mann Judd.
Assurance services
HLB Mann Judd:
Audit and review of financial statements
Total remuneration for audit services
Other services
HLB Mann Judd - taxation services
Total auditor’s remuneration
Consolidated
2014
$
2013
$
24,800
24,800
22,800
22,800
5,250
6,750
30,050
29,550
Note 21: Interest in jointly controlled operation
During the Reporting Period the Company increased its interest in Chanach LLC from 57% to 88.7%.
Chanach LLC is the Chanach joint venture company that holds the copper and gold exploration tenement in
Kyrgyz Republic.
Apart from owning this mineral tenement Chanach LLC does not hold any other material assets. All known
Chanach LLC liabilities are accrued as liabilities of the parent company. As a result it is not considered
necessary to consolidate Chanach LLC into the Group’s accounts as it will not show a position that is
materially different.
The Group has no capital commitments or guarantees in relation to funding Chanach LLC. The Company
increased in interest in this project from 57.1% to 88.7% during the financial year by the payment of $50,000
cash and the issue of 73,841,667 ordinary shares. During the year ended 30 June 2013 the Group impaired
its exploration property acquisition costs for this project by $314,568.
59
White Cliff Minerals Limited
ABN 22 126 299 125
Directors’ declaration
1.
In the opinion of the directors of White Cliff Minerals Limited (the “Company”):
a.
the accompanying financial statements and notes are 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 2014 and of its
performance for the financial year then ended; and
ii. complying with Accounting Standards, Corporations Regulations 2001, professional reporting
b.
c.
requirements and other mandatory requirements.
there are reasonable grounds to believe that the Company will be able to pay its debts as and when
they become due and payable.
the financial statements and notes thereto are in accordance with International Financial Reporting
Standards issued by the International Accounting Standards Board.
2. This declaration has been made after receiving the declarations required to be made to the directors in
accordance with Section 295A of the Corporations Act 2001 for the year ended 30 June 2014.
This declaration is signed in accordance with a resolution of the Board of Directors.
MJ Langoulant
Chairman
Perth, Western Australia
22 September 2014
60
INDEPENDENT AUDITOR’S REPORT
To the members of
WHITE CLIFF MINERALS LIMITED
Report on the Financial Report
We have audited the accompanying financial report of White Cliff Minerals Limited (“the
company”), which comprises the consolidated statement of financial position as at 30 June
2014, 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 for the consolidated entity. The consolidated entity
comprises 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 is free from material misstatement, whether
due to fraud or error.
In Note 1(c), the directors also state, in accordance with Accounting Standard AASB 101:
Presentation of Financial Statements that the financial report complies with International
Financial Reporting Standards.
Auditor’s responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We
conducted our audit in accordance with Australian Auditing Standards. Those standards
require that we comply with relevant ethical requirements relating to audit engagements and
plan and perform the audit to obtain reasonable assurance whether the financial report is free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial report. The procedures selected depend on the auditor’s
judgement, including the assessment of the risks of material misstatement of the financial
report, whether due to fraud or error. In making those risk assessments, the auditor considers
internal control relevant to the company’s preparation and fair presentation of the financial
report in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of 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.
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.
61
Independence
In conducting our audit, we have complied with the independence requirements of the
Corporations Act 2001.
Auditor’s opinion
In our opinion:
(a) the financial report of White Cliff Minerals Limited is in accordance with the
Corporations Act 2001, including:
(i) giving a true and fair view of the consolidated entity’s financial position as at 30
June 2014 and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and
the Corporations
Regulations 2001; and
the financial report also complies with International Financial Reporting Standards as
disclosed in Note 1(c).
Emphasis of Matter
Without modifying our opinion, we draw attention to Note 1(a) to the financial report which
indicates that the continuing viability of the Group and its ability to continue as a going
concern and meet its debts and commitments as they fall due are dependent upon the Group
being successful in completing a capital raising and/or asset sale/joint venture agreement in
the next 12 months. The directors have mitigated this risk by reducing the Group’s corporate
overheads and postponing expenditure on the Group’s projects where possible.
These conditions indicate the existence of a material uncertainty that may cast significant
doubt about the company’s ability to continue as a going concern and therefore, the company
may be unable to realise its assets and discharge its liabilities in the normal course of
business.
Report on the Remuneration Report
We have audited the remuneration report included in the directors’ report for the year ended
30 June 2014. 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 White Cliff Minerals Limited for the year ended 30
June 2014 complies with section 300A of the Corporations Act 2001.
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
22 September 2014
N G Neill
Partner
62
The shareholder information set out below was applicable as at 31 August 2014.
Additional information
A. Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
1 −
1,000
1,001 −
5,000
5,001 − 10,000
10,001 − 100,000
100,001 and over
There were 280 holders of less than a marketable parcel of ordinary shares.
B. Equity security holders
Twenty largest quoted equity security holders – ordinary shares
Name
Mr Andy Igo
T2 Gold Pty Ltd
Mr Mark Tkocz
Southern Terrain Pty Ltd < Southern Terrain ac>
Terra Aqua Pty Ltd (Terra Verde A/C)
Terra Aqua Pty Ltd (Terra Rosso A/C)
Woodlands Asset Management Pty Ltd
Lanza Holdings Pty Ltd
Tenbagger Resources Pty Ltd < Tenbagger Family ac>
Ms Nerida White
Jamber Investments Pty Ltd (Amber Schwartz Family A/C)
Technica Pty Ltd
Mr Jamie Lai
Perth Select Seafoods Pty Ltd
JB Toro Pty Ltd
Henconnor Pty Ltd
Mr Richard Simpson
Mr Paul Barrett
BT Portfolio Services Pty Ltd
Tindindi Cellars Pty Ltd
Class of equity security
Ordinary shares
22
27
78
384
326
837
Ordinary
shares held
% of
issued
shares
80,000,000
73,841,667
20,700,000
10,000,000
7,545,349
7,352,387
6,818,185
5,466,669
5,416,667
3,833,335
3,750,000
2,950,000
3,488, 030
3,450,000
3,300,000
3, 044,397
3,007,810
3,000,000
3,000,000
3,000,000
253,746,163
17.82
16.44
4.61
2.23
1.68
1.64
1.52
1.22
1.21
0.85
0.84
0.83
0.78
0.77
0.73
0.68
0.67
0.67
0.67
0.67
56.51
63
Additional information
Twenty largest quoted equity security holders – 30 September 2014 options
Name
Zenix Nominees Pty Ltd
Woodlands Asset Management Pty Ltd
Southern Terrain Pty Ltd (Southern Terrain A/C)
Mr Todd Hibberd
Mr Michael Langoulant
Gandria Capital Pty Ltd (The Tedblahnki Family A/C)
Technica Pty Ltd
Florin Mining Investment Company Limited (Trading A/C)
Scintilla Strategic Investments Limited
Lawrence Crowe Consulting Pty Ltd (L C C Super Fund
A/C)
Mr Guy Lance Jones (BOQ Loan A/C)
Octifil Pty Ltd
Perth Select Seafoods Pty Ltd
Miss Allison Armstrong
Invictus Capital Pty Ltd (Mail Family A/C)
Mr Alexander Lonel
Mr Mark Nasarczyk & Mr Atilla Belik
O’Connor Funds Pty Ltd (The O’Connor Super Fund A/C)
AMB Ambro Clearing Sydney Nominees Pty Ltd <
Custodian a/c>
Twenty largest quoted equity security holders – 11 March 2017 options
Name
Mr Mark Tkocz
BT Portfolio Services Pty Ltd
Southern Terrain Pty Ltd < Southern Terrain ac>
Australia Global Capital Pty Ltd
Terra Aqua Pty Ltd (Terra Verde A/C)
Lanza Holdings Pty Ltd < Langoulant Family SF>
Mr Bin Lui
Jomot Pty Ltd
Mr Rodd Boland
Adgemis Holdings Pty Ltd
IQ Global Asset Partners Pty Ltd
A & P White Pty Ltd
Ms Nerida White
Mr Kah How Chan
Chingam Pty Ltd
Mr Richard Simpson
Blu Bone Pty Ltd
Mr M Bahen & Mrs M Bahen
Mr Alan Bender
Mr Michael Mazelevskis
Options held
% of
issued
options
10,000,000
6,818,185
3,922,730
3,750,000
3,250,000
3,045,455
2,500,000
2,425,000
2,400,000
2,362,549
2,272,730
2,272,727
2,075,000
2,000,000
2,000,000
2,000,000
2,000,000
1,921,682
1,575,000
8.60
5.87
3.38
3.23
2.80
2.62
2.15
2.09
2.06
2.03
1.96
1.96
1.79
1.72
1.72
1.72
1.72
1.65
1.36
61,091,058
52.56
Options held
% of
issued
options
6,284,500
5,000,000
5,000,000
4,750,000
3,833,334
3,333,334
2,668,059
2,500,000
2,250,000
2,000,000
1,933,000
1,800,000
1,666,668
1,600,000
1,544,445
1,503,905
1,500,001
1,500,000
1,500,000
1,500,000
6.16
4.90
4.90
4.65
3.76
3.27
2.61
2.45
2.20
1.96
1.89
1.76
1.63
1.57
1.51
1.47
1.47
1.47
1.47
1.47
53,667,246
52.59
64
C. Substantial shareholders
There are no substantial shareholders in the Company other than:
• Mr A Igo . 17.82%
• T2 Gold Pty Ltd 16.44%
D. Voting rights
The voting rights attaching to each class of equity securities are set out below:
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and
upon a poll each share shall have one vote.
E. Tenement schedule
Project Area
Tenement details
% Held
Laverton
Merolia
EL38/2484; EL38/2702
100
EL38/2690; EL38/2693; EL38/2727
100
Mt Remarkable
EL31/1015
Ghan Well
E39/1479; EL39/1585-6; EL39/5262-63
Ironstone Range
EL38/2552; EL38/2583; EL38/2847-49;
Lake Johnson
EL63/1222, EL63/1264;
Oakover
EL45/3250
Chanach, Kyrgyz Republic
EL 590 A Π
100
100
100
100
100
88.7
65