TIDMBGL
RNS Number : 0186B
Bullabulling Gold Limited
27 March 2013
Bullabulling Gold Limited
27 March 2013 ASX Code: BAB, AIM Code: BGL
Annual Report for the year ended 31 December 2012
Bullabulling Gold Limited confirms it has today published its
Annual Report for the year ended 31 December 2012.
The entire Annual Report is below, and may now be viewed on the
Company's website: www.bullabullinggold.com. The Annual report will
be posted to shareholders shortly.
For information, contact:
Brett Lambert Westhouse Securities Limited
Bullabulling Gold Limited (UK Nominated Adviser)
Level 2, 55 Carrington Street Martin Davison/Jonathan Haines
Nedlands, WA, 6009, Australia Tel: +44 20 7601 6100
Tel: +61 8 9386 4086
Neil Boom John Gardner / Rupert Dearden
Gresham PR Ltd (UK media) MAGNUS Investor Relations. Corporate
Tel: +44 7866 805 108 Communication. (Australian Media)
Tel: +61 8 9212 0101
jgardner@magnus.net.au rdearden@magnus.net.au
BULLABULLING GOLD LIMITED
ABN 50 153 234 532
ANNUAL REPORT
2012
CORPORATE DIRECTORY
DIRECTORS AND GROUP SECRETARY:
Peter Mansell Brett Lambert
Non-executive Chairman Managing Director
Ronnie Beevor Tim Netscher
Non-executive Director Non-executive Director
David McArthur
Company Secretary and Chief Financial
Officer
REGISTERED AND PRINCIPAL OFFICE: POSTAL ADDRESS:
Level 2, 55 Carrington PO Box 985
Street Nedlands WA 6909
Nedlands WA 6009
Telephone: +61 8
9386 4086
Facsimile: +61 8
9389 8327
SHARE REGISTRY: BANKERS:
Computershare Investor Services Pty ANZ Banking Group Limited
Ltd Level 6,
Level 2, Reserve Bank Building 77 St Georges Terrace
45 St George's Terrace Perth WA 6000
Perth WA 6000
Telephone: +61 8 9323 2000
Facsimile: +61 8 9323 2033
AUDITORS: SOLICITORS:
BDO Audit (WA) Pty Ltd Steinepreis Paganin
38 Station Street Level 4, The Read Building
Subiaco WA 6008 16 Milligan Street
Perth WA 6000
SECURITIES EXCHANGE: WEBSITE AND EMAIL:
Bullabulling Gold Limited shares www.bullabullinggold.com
are listed on the Australian info@bullabullinggold.com
Securities Exchange (ASX) under
the ticker symbol BAB; and on
the London AIM market under the
ticker symbol BGL
DOMICILE AND COUNTRY OF INCORPORATION:
Australia
REVIEW OF OPERATIONS
CORPORATE RESTRUCTURING
In January 2012, shareholders of GGG Resources plc approved the
acquisition of GGG by Bullabulling Gold Limited. The final approval
of the acquisition was granted by the UK Court on 15 March 2012 and
170,680,298 Bullabulling shares were distributed pro rata to GGG
shareholders as consideration for the acquisition. The shares of
Bullabulling Gold (in the form of CDI) were admitted for trading on
AIM (BGL: AIM) on 16 March 2012 and on 23 March 2012 the shares of
Bullabulling Gold were admitted for trading on the ASX (BAB:
ASX).
On 22 March 2012 the merger between Bullabulling Gold Limited
and Auzex Resources Limited was approved by Auzex shareholders and
on 27 March 2012 the final approval by the Australian Court was
granted. The merger by Scheme of Arrangement became effective on
28th March 2012.
In accordance to the Merger Implementation Agreement, Peter
Ruxton, Michael Short, Paul McGroary and Ciceron Angeles resigned
as directors of the Company. Chris Baker and John Lawton, formerly
directors of Auzex Resources Limited, were appointed to the board
as Non-Executive directors on 29 March 2012.
On 10 April 2012, Mr Peter Mansell was appointed to the Board as
a Non-Executive Director and Chairman of the Company and Mr Nigel
Clark resigned from the Board. Mr Brett Lambert was appointed to
the Board as Managing Director and CEO on 1 May 2012.
On 2 July Mr Ronnie Beevor was appointed to the Board as a
Non-Executive Director and Mr Jeff Malaihollo, Mr John Lawton, Mr
Chris Baker and Mr David McArthur resigned as directors, with Mr
McArthur remaining as Company Secretary and CFO.
Mr Tim Netscher was appointed to the Board as a Non-Executive
Director on 20 August 2012.
EXPLORATION and RESOURCE DEVELOPMENT
In January 2012 the Company received the final results for the
Phase Two infill drilling program of the Bullabulling Gold Project.
The Program comprised 425 RC drill holes for 74,452 metres, with
nearly all of the holes intersecting gold mineralisation.
In February 2012 the mineral resource estimate for the project
was updated to include results from the Phase Two drilling program,
increasing the total resource to 102.8 million tonnes at 0.96g/t
for 3.2 million ounces of contained gold. This represented a 34%
increase in contained gold compared to the previous estimate
prepared in August 2011. The updated estimate also increased the
proportion of resources classified as Indicated from 30% to
67%.
In July 2012 a 26 hole, 3,837 metre infill RC drilling program
was carried out at Bullabulling, principally targeting two areas
where additional information was sought to finalise open pit
designs for the pre-feasibility study. The results of this program
were used to further update the resource estimate leading to the
reporting in September 2012 of a new resource of 104.5 million
tonnes at 0.99g/t. Contained gold increased by 120,000 ounces to
over 3.3 million ounces.
At the Gibraltar Prospect, located approximately 6 kilometres
south east of the Bullabulling deposit, a 24 hole, 4,896 metre
infill and extensional drilling program was completed in April
2012. The program confirmed prior exploration results and
identified mineralisation beyond the limits of the resource model.
This lead to the resource estimate for Gibraltar increasing to 4.8
million tonnes at 1.15g/t for 177,500 ounces of contained gold, as
reported in July 2012.
The combined resource for Bullabulling and Gibraltar now stands
at 109.3 million tonnes grading 1.00g/t for 3.5 million ounces of
contained gold, as detailed in the table below.
Bullabulling Project Mineral Resource Estimate (Cut-off Grade
0.5g/t)
Bullabulling Mineral Tonnage Grade Contained Gold
Resources
---------------------------- -------- -------- ---------------
Indicated Resource 71.7Mt 0.96g/t 2,209,000 oz
---------------------------- -------- -------- ---------------
Inferred Resource 32.8Mt 1.06g/t 1,118,500 oz
---------------------------- -------- -------- ---------------
Total Resource 104.5Mt 0.99g/t 3,327,500 oz
---------------------------- -------- -------- ---------------
Gibraltar Mineral Resources Tonnage Grade Contained Gold
---------------------------- -------- -------- ---------------
Inferred Resource 4.8Mt 1.15g/t 177,500 oz
---------------------------- -------- -------- ---------------
Total Mineral Resources Tonnage Grade Contained Gold
---------------------------- -------- -------- ---------------
Indicated and Inferred 109.3Mt 1.00g/t 3,505,000 oz
Resource
---------------------------- -------- -------- ---------------
During the March quarter 2012, results were received from
geophysical surveys of the Company's Bullabulling tenure. The
results included data from three lines of two dimensional seismic
surveys and gravity surveys. This data was used with existing
magnetic data and known geological information to develop a three
dimensional geological model for the region which is designed to
aid the understanding of the controls on mineralisation and direct
future exploration programs. The geological model indicated that
existing mineralisation at Bullabulling occurs on the western limb
of an anticline and that there was evidence to suggest the
existence of a potentially mineralised eastern limb.
In September 2012, two diamond holes were drilled to gain
geological data at depth and assess the validity of the three
dimensional geological model that had been derived from the
geophysical data. The holes provided data that broadly supported
the geological model, although the interpreted depths of some
features varied from what had been interpreted. Of note was the
intersection at depth in hole BBDE001 of a geological sequence that
was consistent with the geological setting of the existing
Bullabulling deposit. The sequence was mineralised with gold values
of up to 0.4g/t.
Data from the diamond drill hole will be used to calibrate and
adjust the three dimensional geological model ahead of planning
future region exploration programs.
TENEMENT ACQUISITION
In January 2012 the Company secured an option to acquire 100% of
the Geko Gold Project, located approximately 17km north of the
Bullabulling Gold Project. Exploration drilling at Geko undertaken
during the 1990's by Newcrest and others successfully intersected
gold mineralisation that can be correlated with the same sequence
of lithologies which host the Bullabulling gold deposit.
Bullabulling Gold conducted limited exploration at Geko,
including five RC holes. However, the Company elected not to
exercise the option having concluded that acquisition of the
project under the terms of the option would be excessively dilutive
and therefore not in shareholders' best interests. The call option
expired on 6 July 2012.
In December 2012 the Company completed the acquisition of mining
lease M15/552 from Resolute Mining Limited. M15/552 is situated
immediately west of the Bullabulling gold deposit and is surrounded
on three sides by Bullabulling Gold's existing tenements. Control
of this tenement ensures that the main Phoenix pit can be mined to
optimal depth and enables the Company to fully evaluate depth
extensions to the Bullabulling gold deposit, which dips west
towards M15/552 and remains open down dip. In addition, the Company
now has greater flexibility in the positioning of waste rock dumps,
haulage roads and other infrastructure which may lead to improved
project economics, particularly where haulage distances can be
reduced.
The consideration for the acquisition of M15/552 was the issue
of 13.5 million ordinary Bullabulling Gold Limited shares.
BULLABULLING GOLD PROJECT PREFEASIBILITY STUDY
The Bullabulling Gold Project prefeasibility study (PFS)
progressed throughout the year and was completed just after year
end. The initial targeted completion date of 30 September 2012 was
pushed back to enable results from infill drilling conducted in
July 2012 to be incorporated into the study.
The PFS is based on the development of a 7.5 million tonne per
annum open pit mining operation with a conventional carbon in leach
processing facility. Gold production of 1.95 million ounces was
forecast over a mine life of 10.5 years.
The base case financial evaluation was carried out at the
average gold price over the three months to 31 January 2013 of
$1,622 per ounce. At this price the project was forecast to
generate an internal rate of return of 22% before tax and has a net
present value of $177 million, at an 8% discount rate. Forecast net
cash flow over the scheduled life of mine was $398 million. Key
project statistics are summarised in the table below.
Key PFS Statistics
-----------------------------------------------------------------------------
Mining Inventory Tonnage Grade Cont'd Gold
-------------------------------- --------------- ----------- -------------
Indicated Resource 67.5Mt 0.85g/t 1,838,000
oz
-------------------------------- --------------- ----------- -------------
Inferred Resource 11.6Mt 1.01g/t 377,000 oz
-------------------------------- --------------- ----------- -------------
Total Mining Inventory 79.1Mt 0.87g/t 2,215,000
oz
-------------------------------- --------------- ----------- -------------
Capital Costs Pre-production Sustaining Life of Mine
-------------------------------- --------------- ----------- -------------
Total Capital Expenditure $326.4M $57.5M $383.9M
-------------------------------- --------------- ----------- -------------
Production Summary Years 1-3 Life of Mine
-------------------------------- --------------- ----------- -------------
Project Life 3 years 10.5 years
-------------------------------- --------------- ----------- -------------
Strip Ratio 3.3:1 3.6:1
-------------------------------- --------------- ----------- -------------
Annual Processing Rate 7.5 Mtpa 7.5 Mtpa
-------------------------------- --------------- ----------- -------------
Processing Recovery 88.4% 88.0%
-------------------------------- --------------- ----------- -------------
Gold Production 651,000 oz 1,948,000
oz
-------------------------------- --------------- ----------- -------------
Total Operating Costs $25.83/t $28.20/t
-------------------------------- --------------- ----------- -------------
Project Economics Years 1-3 Life of Mine
-------------------------------- --------------- ----------- -------------
Base Case Gold Price $1,622/oz $1,622/oz
-------------------------------- --------------- ----------- -------------
C1 Cash Costs $891/oz $1,145/oz
-------------------------------- --------------- ----------- -------------
Average Annual EBITDA $141M $74M
-------------------------------- --------------- ----------- -------------
NPV at 8% discount (Pre-tax) $177M
-------------------------------- --------------- ----------- -------------
IRR (Pre-tax) 22%
-------------------------------- --------------- ----------- -------------
Cash flow after CAPEX Recovery
(Pre-tax) $96M $398M
-------------------------------- --------------- ----------- -------------
Pre-production capital costs are estimated at $326 million, with
a further $20 million of operating costs to be incurred before
production commences. Sustaining capital and closure costs amount
to $58 million over the life of the mine. Average life of mine cash
costs (C1) are $1,145 per ounce. However, in the first three years
of full production, 651,000 ounces are targeted for production at a
cost of $891 per ounce, delivering capital payback within that
period.
A range of specific opportunities to optimise the project and
enhance financial performance have been identified for evaluation
during the Definitive Feasibility Study (DFS). In-house estimates
of the potential impact on financial performance over the life of
mine have been made for key initiatives, indicating substantial
savings.
The Company has increased its technical capabilities enabling
the core mine planning component of the DFS to be carried out
in-house. It is expected that greater attention to detail in
relation to optimisation of the mine design will deliver
significant improvement in the operational and financial
performance of the project.
CORPORATE
In October 2012, Bullabulling Gold (UK) Limited lodged an
application for a Research and Development Grant with Aus Industry,
which, if approved, will result in a payment to the company of
approximately $2.1 million.
In March 2013, Bullabulling Gold Limited announced a 1:2
non-renounceable entitlements offer to raise up to $7.6 million
(before costs).
DIRECTORS' REPORT
The Directors present their report, together with the financial
statements of the Group, comprising Bullabulling Gold Limited ("the
Company"), and its subsidiaries, for the financial year ended 31
December 2012.
1. DIRECTORS
The directors of the Group at any time during or since the end
of the financial year are:
Name Period of Directorship
---------------- --------------------------------
Executive
Brett Lambert Director since 1 May 2012
Jeff Malaihollo Director from 15 September 2011
to 2 July 2012
David McArthur Director from 15 September 2011
to 2 July 2012
Non-executive
Peter Mansell Director since 10 April 2012
Ronnie Beevor Director since 2 July 2012
Tim Netscher Director since 20 August 2012
Nigel Clark Director from 15 September 2011
to 10 April 2012
Chris Baker Director from 29 March 2012 to
2 July 2012
John Lawton Director from 29 March 2012 to
2 July 2012
Peter Ruxton Director from 4 January 2012 to
29 March 2012
Paul McGroary Director from 4 January 2012 to
29 March 2012
Michael Short Director from 4 January 2012 to
29 March 2012
Ciceron Angeles Director from 4 January 2012 to
29 March 2012
Peter Mansell
Non-executive Chairman
Appointed: 10 April 2012
Experience and expertise
Peter Mansell was a corporate and resources lawyer with over 35
years of experience.
Mr Mansell holds a Bachelor of Commerce, Bachelor of Laws and
Higher Diploma in Tax law, all from the University of
Witwatersrand.
Other current listed company directorships
Non-executive director BWP Limited, as responsible entity for
BWP Trust Appointed 4 June 1998
Non-executive director Nyrstar NV (Belgium) Appointed 31 August
2007
Non-executive chairman Ampella Mining Limited Appointed 8
November 2010
Former listed company directorships in the past three years
Non-executive director OZ Minerals Limited 20 June 2008 to 13
April 2010
Non-executive director ThinkSmart Ltd 12 April 2007 to 21 May
2010
1. DIRECTORS (continued)
Peter Mansell (continued)
Special responsibilities
Member of the Audit and Risk Management Committee
Chairman of the Remuneration and Nomination Committee
Member of the Occupational Health and Safety Committee
Interest in shares and options
750,000 ordinary shares
Brett Lambert
Managing Director
Appointed: 1 May 2012
Experience and expertise
Brett Lambert is a mining engineer with 30 years' of Australian
and international resource industry experience encompassing mining
operations, project management, business development and corporate
administration. He has held senior management positions in several
gold and base metal mining companies and has been responsible for
taking a number of projects through feasibility study, construction
and into operation. Mr Lambert has served as a director of
companies listed on the Australian Securities Exchange, Toronto
Stock Exchange, London AIM Market and the Stock Exchange of
Thailand.
Other current listed company directorships
Nil
Former listed company directorships in the past three years
Managing Director and CEO Thundelarra Exploration Limited 28
September 2007 to 2 May 2012
Special responsibilities
Member of the Occupational Health and Safety Committee
Interest in shares and options
3,000,000 options
Ronnie Beevor
Non-executive Director
Appointed: 2 July 2012
Experience and expertise
Mr Beevor has more than 30 years' experience in investment
banking and was Head of Investment Banking at NM Rothschild &
Sons (Australia) Ltd between 1997 and 2002. During his career he
has had an extensive involvement with the natural resources
industry, both in Australia and internationally.
Formerly a Director of Oxiana Limited, which successfully
developed the Sepon gold-copper project in Laos, as well as the
Prominent Hill copper-gold project in South Australia, Mr Beevor is
a Senior Advisor to Standard Chartered Gryphon Partners and serves
on a number of listed resource company boards.
Mr Beevor has an Honours Degree in Philosophy, Politics and
Economics from Oxford University and qualified as a chartered
accountant in London in 1972.
1. DIRECTORS (continued)
Ronnie Beevor (continued)
Other current listed company directorships
Non-executive director Unity Mining Limited Appointed 1 November
2002
Non-executive chairman EMED Mining Public Limited Appointed 15
November 2004
Non-executive chairman Bannerman Resources Limited Appointed 27 July 2009
Non-executive director Ampella Mining Limited Appointed 5 July
2011
Former listed company directorships in the past three years
Non-executive director Rey Resources Limited 2 August 2010 to 28
November 2012
Non-executive director Talison Lithium Limited 4 August 2010 to
26 March 2013
Special responsibilities
Chairman of the Audit and Risk Management Committee
Member of the Remuneration and Nomination Committee
Member of the Occupational Health and Safety Committee
Interest in shares and options
None
Tim Netscher
Non-executive Director
Appointed: 20 August 2012
Experience and expertise
Mr Netscher is a Chemical Engineer, and holds a commerce degree
and a MBA. He has worked in a number of countries, in roles
spanning marketing, operations management, project management (from
concept studies through to large scale project implementation) and
business development. Mr Netscher has held senior positions with
Impala Platinum Holdings Ltd, QNI Limited, PT Inco, Vale and
Newmont. Mr Netscher has significant open pit mine development
experience, and whilst at Newmont held overall responsibility for
ramping up the Boddington Gold Mine, a large tonnage, low grade
project similar to the Bullabulling Gold Project.
Other current listed company directorships
Managing Director and CEO Gindalbie Metals Limited Appointed 13
September 2010
Non-executive director Deep Yellow Ltd Appointed 1 January
2013
Former listed company directorships in the past three years
Non-executive director Industrea Limited 19 February 2009 to 30
November 2012
Special responsibilities
Member of the Audit and Risk Management Committee
Member of the Remuneration and Nomination Committee
Chair of the Occupational Health and Safety Committee
Interest in shares and options
None
2. COMPANY SECRETARY
David McArthur
David McArthur is a Chartered Accountant and was appointed to
the position of Company Secretary on 15 September 2011. Mr McArthur
has 30 years' experience in the corporate management of public
listed companies.
3. DIRECTORS' MEETINGS
The number of meetings of the Company's Board of Directors and
of each Board Committee held during the year ended 31 December
2012, and the numbers of meetings attended by each director
were:
Director Full meetings of Meetings of Audit Meetings of Remuneration Meetings of Occupational
directors and and Nomination Health and Safety
Risk Management Committee Committee
Committee
No. of No. of No. of No. of No. of No. of No. of No. of
meetings meetings meetings meetings Meetings Meetings meetings meetings
attended held whilst attended attended held whilst held whilst attended held whilst
a director a director a director a director
------------ -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
Peter
Mansell 7 7 1 1 1 1 1 1
Brett
Lambert 7 7 - - - - 1 1
Ronnie
Beevor 6 6 1 1 1 1 1 1
Tim
Netscher 5 5 1 1 1 1 1 1
David
McArthur 2 2 - - - - - -
Jeff
Malaihollo 2 2 - - - - - -
Nigel Clark 1 1 - - - - - -
Chris Baker 1 1 - - - - - -
John Lawton 1 1 - - - - - -
Peter - - - - - - - -
Ruxton
Paul - - - - - - - -
McGroary
Michael - - - - - - - -
Short
Ciceron - - - - - - - -
Angeles
------------ -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
4. REMUNERATION REPORT - AUDITED
This remuneration report sets out the current remuneration
arrangements for Non-Executive Directors, Executive and other Key
Management Personnel (KMP) of Bullabulling Gold Limited. For the
purposes of this report, key management personnel is defined as
those persons having authority and responsibility for planning,
directing and controlling major activities of the Group, and
includes the executives in the Group receiving the highest
remuneration.
Overall the Group believes its remuneration policy and framework
is designed to deliver strong alignment of interests between
Executives and shareholders.
The remuneration report is set out under the following main
headings:
(a) Principles of compensation
(b) Directors' and executive officers' remuneration
(c) Analysis of bonuses included in remuneration
(d) Equity instruments
(a) Principles of compensation - audited
Remuneration is referred to as compensation throughout this
report.
Compensation levels for Directors and Executives of the Group
are competitively set to attract and retain appropriately qualified
and experienced Directors and Executives. As the Group's principal
activities during the year were mineral exploration and evaluation,
measurement of remuneration policies against financial performance
is not considered relevant until such time as mining operations
commence. The measurement of remuneration policies considered a
range of factors including budget performance, delivery of results
and timely completion of development programmes.
The objective of the Group's reward framework is to ensure
reward for performance is competitive and appropriate. The Board
ensures that remuneration satisfies the following criteria for
reward:
competitiveness and reasonableness;
transparency;
attracts and retains high calibre executives; and
rewards capability and experience.
Remuneration of Directors and Executives for the year ended 31
December 2012 has been determined by the Remuneration and
Nomination Committee. In this respect consideration is given to
normal commercial rates of remuneration for similar levels of
responsibility.
Fixed compensation
Fixed compensation consists of base compensation (which is
calculated on a total cost basis and includes any FBT charges
related to employee benefits including motor vehicles), as well as
employer contributions to superannuation funds. Compensation levels
are reviewed annually by the Remuneration and Nomination Committee
through a process that considers individual and overall performance
of the Group, and compares compensation to ensure it is comparable
and competitive within the market in which the Group operates.
Performance-linked compensation
Performance-linked compensation consists of both short-term and
longer-term remuneration. Performance-linked remuneration is not
based on specific financial indicators such as earnings or
dividends as the Group is at the exploration and development stage.
Vesting of long term incentives is based on the share price
performance of the Group, which is considered an appropriate
measure of the outcome of overall performance. There is no separate
profit-share plan.
4. REMUNERATION REPORT - AUDITED (continued)
(a) Principles of compensation - audited (continued)
Short-term incentives
Short term incentives (STI) reward employees for their
individual achievements and contributions to business success and
organisation outcomes during the financial year. STI's are a
variable reward and are not guaranteed.
Each year, the Remuneration and Nomination Committee considers
the appropriate targets and Key Performance Indicators (KPI's) to
link the STI and the level of payout if targets are met. This
includes capping the maximum payout under the STI scheme and
determining the minimum levels of performance to trigger payment of
the STI's. Depending upon the level of management, KPI's include
the following:
-- satisfactory completion of development programs, on time and on budget;
-- securing funding to support planned work programs;
-- investor relations; and
-- consideration of safety performance, corporate governance,
external relations and general management.
In the 2012 financial year, the maximum incentive available to
the Managing Director was 50% of base salary, and for other key
executives was 30% of base salary. Each executive has a target STI
opportunity depending on the accountabilities of the role and
impact on organisational performance.
Principles used to determine the nature and amount of STI for
financial year 2012
For the year ended 31 December 2012, the KPI's linked to the STI
scheme were based on Group and individual objectives. Performance
is based on a scorecard of metrics which the Group believes are the
best measures that link both the individuals' performance with the
Group's performance.
The Remuneration and Nomination Committee is responsible for
assessing whether the KPI's are met. To help make this assessment,
the Committee receives detailed reports on performance from
management.
The Remuneration and Nomination Committee has the discretion to
adjust STI's downwards in light of unexpected or unintended
circumstances.
Long-term incentive
Long-term incentives are comprised of share options, which are
granted from time to time to encourage sustained performance in the
realisation of strategic outcomes and growth in shareholder wealth.
Options are granted for no consideration and do not carry voting or
dividend entitlements. The exercise price of the options is
determined after taking into account the underlying share price
performance during the period leading up to the date of the grant.
Subject to specific vesting conditions, each option is convertible
into one ordinary share. See details of options issued under
section (d) of the remuneration report.
Consequences of performance on shareholder wealth
The overall level of key management personnel compensation takes
into account the performance of the Group over a number of
years.
Performance in respect of the current financial year and the
previous financial year is detailed in the table below:
Shareholder returns 31 Dec 31 Dec
2012 2011
Restated
$ $
------------------------------- ---------------- --------------
(Loss) / profit attributable
to equity holders (39,615,033) (10,828,222)
Basic profit (loss) per share (15.51) (15.36)
Closing share price (cents) 8 20
------------------------------- ---------------- --------------
4. REMUNERATION REPORT - AUDITED (continued)
(a) Principles of compensation - audited (continued)
Consequences of performance on shareholder wealth
(continued)
$38,555,913 of the loss reported above, follows a board
resolution on 12 September 2012 to change the exploration and
development accounting policy such that current and future
exploration is expensed through profit and loss. This includes
acquisition costs which would have been capitalised under the
previous accounting policy.
During the financial years noted above, there were no dividends
paid or other returns of capital made by the Group to shareholders.
The Group's performance is impacted by a number of factors
including employee performance.
As the Group is still in the exploration and development phase
of its operations, and as such does not generate revenue, other
than the share price, the financial performance set out in the
table above is not a good indicator for determining appropriate
levels of remuneration.
Non-executive compensation
Total compensation for all non-executive directors, as voted by
shareholders, is not to exceed $500,000 per annum in total, and is
set based on the demands which are made on, and the responsibility
of the Directors, and a comparison of fees paid to other directors
of comparable companies. Non-Executive Directors' fees are reviewed
annually. The Chairman's fees are determined independently to the
fees paid to the Non-Executive Directors, based on comparative
roles in the external market.
Directors' base fees are currently $65,000 (plus superannuation)
per annum per non-executive director and non-executive Chairman's
fees are $120,000 (plus superannuation) per annum. Directors' fees
cover all main board activities and memberships of applicable
sub-committees.
Role of the Remuneration and Nomination Committee
The Remuneration and Nomination Committee is a committee of the
Board. It is primarily responsible for making recommendations to
the Board on:
-- The overarching Executive remuneration framework and incentive plan policies;
-- Executive remuneration (Directors and other Executives); and
-- Non-Executive Director fees
The objective of the Remuneration and Nomination Committee is to
ensure that remuneration policies and structures are fair and
competitive, and aligned with the long-term interests of the Group.
In doing this, the Remuneration and Nomination Committee at times
seeks advice from independent remuneration consultants.
Service contracts
Remuneration and other terms of employment for Executive and key
management personnel are formalised in service agreements. The
service agreements outline the components of compensation paid to
the Executive and key management personnel but do not prescribe how
compensation levels are modified year-to-year. Compensation levels
are reviewed each year to take into account cost-of-living changes,
any change in the scope of the role performed by the senior
executive and any changes required to meet the principles of the
compensation policy. The major provisions of the agreement relating
to remuneration are set out below.
4. REMUNERATION REPORT - AUDITED (continued)
(a) Principles of compensation - audited (continued)
Service contracts (continued)
On 1 May 2012 an employment agreement was entered into with Mr
Brett Lambert, Managing Director whereby Mr Lambert is paid
$350,000 per annum, plus superannuation. The agreement specifies
the duties and obligations to be fulfilled by him. The contract is
open ended, and can be terminated with 12 months' notice.
On 15 September 2011 an employment agreement was entered into
with Mr McArthur whereby Mr McArthur is paid $165,000 per annum,
plus superannuation in recognition of his role as Chief Financial
Officer and Company Secretary. The contract is open ended and can
be terminated with 6 months' notice.
On 8 March 2012 an employment agreement was entered into with Mr
Trevor Pilcher whereby Mr Pilcher is paid a total package of
$175,000 per annum, in recognition of his role as Chief Project
Geologist. The contract is open ended and can be terminated with 6
weeks' notice.
On 19 November 2012 an employment agreement was entered into
with Mr Mark Braghieri, General Manager - Development whereby Mr
Braghieri is paid $320,000 per annum, plus superannuation. The
agreement specified the duties and obligations to be fulfilled by
him. The contract is open ended, and can be terminated with 6
months' notice.
Services from remuneration consultants
In order to meet the obligations of the Corporations Law
Amendments the Remuneration and Nomination Committee engaged PJ
Kinder Consulting (PJ Kinder) as remuneration consultant to review
the amount and elements of the remuneration paid to the Managing
Director.
PJ Kinder was paid $5,000 for the review.
The engagement of PJ Kinder by the Remuneration and Nomination
Committee was based on a documented set of protocols that would be
followed by PJ Kinder, members of the Remuneration and Nomination
Committee and the Managing Director for the way in which
remuneration recommendations would be developed by PJ Kinder and
provided to the Remuneration and Nomination Committee.
The protocols included the prohibition of PJ Kinder providing
advice or recommendations to the Managing Director before the
advice or recommendations were given to members of the Remuneration
and Nomination Committee and not unless PJ Kinder had approval to
do so from members of the Remuneration and Nomination
committee.
These arrangements were implemented to ensure that PJ Kinder
would be able to carry out its work, including information capture
and the formation of recommendations, free from undue influence by
the Managing Director about whom the recommendation relates.
The Board is satisfied that the remuneration recommendations
were made by PJ Kinder free from undue influence.
The Board undertook its own inquiries and review of the
processes and procedures followed by PJ Kinder during the course of
its assignment and is satisfied that its remuneration
recommendations were made free from undue influence.
PJ Kinder was required to provide the Remuneration and
Nomination Committee with a summary of the way in which it carried
out its work, details of its interaction with the Managing Director
in relation to the assignment, and to respond to questioning by
members of the committee after the completion of the
assignment.
4. REMUNERATION REPORT - AUDITED (continued)
(b) Directors' and executive officers' remuneration - audited
Details of the nature and amount of each major element of the
compensation of each of the directors and key management personnel
of the Company and the Group are shown below:
Short-term employee benefits Post Share
employment based
benefits payments
% of Value of
Name Cash salary Non- Total Super- Options Total remuneration options
and fees Monetary annuation performance as
benefits based % of
remuneration
$ $ $ $ $ $ % %
----------------------- ----------------- --------------- ------------------ -------------- -------------- -------------- -------------- --------------
Non-executive
directors
Peter Mansell
(1) 2012 86,923 1,982 88,905 7,823 - 96,728 - -
2011 - - - - - - - -
Ronnie Beevor
(2) 2012 35,425 1,364 36,789 - - 36,789 - -
2011 - - - - - - - -
Tim Netscher
(3) 2012 25,902 999 26,901 - - 26,901 - -
2011 - - - - - - - -
Sub-total
non-executive 2012 148,250 4,345 152,595 7,823 - 160,418 - -
directors 2011 - - - - - - - -
remuneration
====== ================= =============== ================== ============== ============== ============== ============== ==============
Executive
directors
Brett Lambert
(4) 2012 262,880 1,825 264,705 21,969 108,870 395,544 - 28%
2011 - - - - - - - -
====== ================= =============== ================== ============== ============== ============== ============== ==============
Total current
directors 2012 411,130 6,170 417,300 29,792 108,870 555,962 -
remuneration 2011 - - - - - - -
4. REMUNERATION REPORT - AUDITED (continued)
(b) Directors' and executive officers' remuneration - audited (continued)
Short-term employee benefits Post Share
employment based
benefits payments
% of Value of
Name Cash salary Non- Total Super- Options Total remuneration options
and fees Monetary annuation performance as
benefits based % of
remuneration
$ $ $ $ $ $ % %
---------------------- ----------------- --------------- ------------------ -------------- -------------- -------------- -------------- --------------
Former
Directors
Jeff
Malaihollo
(5) 2012 123,592 4,439 128,031 - - 128,031 - -
2011 201,890 - 201,890 - - 201,890 - -
David
McArthur
(6) 2012 32,096 1,356 33,452 3,053 - 36,505 - -
2011 132,890 - 132,890 9,090 - 141,980 - -
Nigel Clark
(7) 2012 70,783 1,247 72,030 - - 72,030 - -
2011 205,913 - 205,913 - - 205,913 - -
Chris Baker
(8) 2012 12,500 4,439 16,939 - - 16,939 - -
2011 - - - - - - - -
John Lawton
(8) 2012 13,077 4,439 17,516 - - 17,516 - -
2011 - - - - - - - -
Peter Ruxton
(9) 2012 6,371 3,732 10,103 - - 10,103 - -
2011 102,498 - 102,498 - - 102,498 - -
Paul McGroary
(9) 2012 8,058 3,732 11,790 - - 11,790 - -
2011 76,874 - 76,874 - - 76,874 - -
Michael Short
(9) 2012 3,058 3,732 6,790 - - 6,790 - -
2011 34,166 - 34,166 - - 34,166 - -
Ciceron
Angeles
(9) 2012 - 3,732 3,732 - - 3,732 - -
2011 53,423 - 53,423 53,423 - -
Sub-total
former 2012 269,535 30,848 300,383 3,053 - 303,436 - -
directors
remuneration 2011 807,654 - 807,654 9,090 - 816,744 - -
====== ================= =============== ================== ============== ============== ============== ============== ==============
4. REMUNERATION REPORT - AUDITED (continued)
(b) Directors' and executive officers' remuneration - audited (continued)
Short-term employee benefits Post Share
employment based
benefits payments
% of Value of
Name Cash salary Non- Total Super- Options Total remuneration options
and fees Monetary annuation performance as
benefits based % of
remuneration
$ $ $ $ $ %
---------------------- ----------------- --------------- ------------------ -------------- -------------- -------------- -------------- --------------
Total
directors 2012 680,665 37,018 717,683 32,845 108,870 859,398 -
remuneration 2011 807,654 - 807,654 9,090 - 816,744 -
====== ================= =============== ================== ============== ============== ============== ============== ==============
Other key management
personnel
David
McArthur
(6) 2012 148,000 4,439 152,439 11,888 - 164,327 - -
2011 - - - - -
Mark
Braghieri
(10) 2012 35,286 268 35,554 2,083 3,742 41,379 - 9%
2011 - - - - - - - -
Trevor
Pilcher 2012 122,280 1,930 124,210 10,235 - 134,445 - -
2011 - - - - - - - -
Sub-total
other
key
management
personnel 2012 305,566 6,637 312,203 24,206 3,742 340,151 - -
remuneration 2011 - - - - - - - -
Total
directors
and other 2012 986,231 43,655 1,029,886 57,051 112,612 1,199,549 -
key
management 2011 807,654 - 807,654 9,090 - 816,744 -
personnel
remuneration
(1) Appointed 10 April 2012 (5) Appointed 15 September 2011 and
resigned 2 July 2012 (9) Appointed 4 January 2012 and resigned 29
March 2012
(2) Appointed 2 July 2012 (6) Appointed 15 September
2011 and resigned as a director 2 July 2012 (10) Appointed 26 November 2012
(3) Appointed 20 August 2012 (7) Appointed15 September 2011 and
resigned 10 April 2012 (11) Appointed 16 April 2012 as per
acquisition of subsidiary
(4) Appointed 1 May 2012 (8) Appointed 29 March 2012 and
resigned 2 July 2012
4. REMUNERATION REPORT - AUDITED (continued)
(b) Directors' and executive officers' remuneration - audited (continued)
Notes in relation to the table of directors' remuneration -
audited
-- Non-monetary benefits relates to Directors and Officers Liability Insurance;
-- Directors who invoice the Company receive total remuneration
including the superannuation component.
(c) Analysis of bonuses included in remuneration - audited
No short-term incentive cash bonuses were awarded as
remuneration to Directors of the Group or to key management
personnel as at 31 December 2012.
Subsequent to the year end, the Remuneration and Nominations
Committee resolved that the Managing Director would receive a bonus
of $66,500 in relation to the year ended 31 December 2012.
(d) Equity instruments - audited
All options refer to options over ordinary shares of
Bullabulling Gold Limited, which are exercisable on a one-for-one
basis.
Options and rights over equity instruments granted as
compensation - audited
Details on options over ordinary shares in the Company that were
granted as compensation to each key management person during the
reporting period is as follows:
Tranche Vesting Conditions
-------- -----------------------------------------------------------
1 The 10 day VWAP share price equals or exceeds the exercise
price during the 12 month period commencing 1 May 2013
2 The 10 day VWAP share price equals or exceeds the exercise
price during the 12 month period commencing 1 May 2014
3 The 10 day VWAP share price equals or exceeds the exercise
price during the 12 month period commencing 1 May 2015
4 Exercisable at a price equal to 130% of the 5 day VWAP
immediately prior to the contract commencement date of
26 November 2012. The options vest after 12 months and
expire after 24 months
5 Exercisable at a price equal to 160% of the 5 day VWAP
immediately prior to the contract commencement date of
26 November 2012. The options vest after 24 months and
expire after 36 months
6 Exercisable at a price equal to 190% of the 5 day VWAP
immediately prior to the contract commencement date of
26 November 2012. The options vest after 36 months and
expire after 48 months
-------- -----------------------------------------------------------
4. REMUNERATION REPORT - AUDITED (continued)
(d) Equity instruments - audited (continued)
Options and rights over equity instruments granted as
compensation - audited (continued)
Number Grant Fair value Exercise Number
of Date per option % vested % forfeited Financial price of options
options at grant in year in year years per option vested
granted date in which during
Tranche during cents (A) (B) grant cents Expiry 2012
2012 vests date
----------- --------- ---------- ----------- ------------ -------------- -------------- ----------- ------------ ----------- --------------
Executive directors
Brett
Lambert 1 1,000,000 13-Jun-12 8.81 - - 01-Jan-13 28.4 1-May-14 -
2 1,000,000 13-Jun-12 10.66 - - 01-Jan-14 31.6 1-May-15 -
3 1,000,000 13-Jun-12 11.89 - - 01-Jan-15 36.8 1-May-16 -
Other key management personnel
Mark
Braghieri 4 500,000 29-Nov-12 4.31 - - 01-Jan-13 10.2 26-Nov-14 -
5 500,000 29-Nov-12 4.82 - - 01-Jan-14 12.6 26-Nov-15 -
6 500,000 29-Nov-12 5.28 - - 01-Jan-15 14.9 26-Nov-16 -
(A) The amount vested in the year represents the number of
options that becomes unconditional due to recipient satisfying
specified vesting condition;
(B) The percentage forfeited in the year represents the
reduction from the maximum number of options available to vest due
to performance criteria not being achieved.
4. REMUNERATION REPORT - AUDITED (continued)
(d) Equity instruments - audited (continued)
Exercise of options granted as compensation - audited
During the reporting period, no shares were issued on the
exercise of options previously granted as compensation.
Analysis of movements in options - audited
The movement during the reporting period, by value, of options
over ordinary shares in the Company, held by each key management
person is detailed below:
Granted in year Value of options Lapsed in year
exercised in
year
$ $ (B)
(A) $ (C)
-------------------- ---------------- ----------------- ---------------
Executive directors
Brett Lambert 313,525 - -
Senior executives
Mark Braghieri 72,092 - -
Analysis of movements in options - audited (continued)
Notes in relation to the table on analysis of movements in
options - audited
(A) The value of options granted in the year is the fair value
of the options calculated at grant date using the Black Scholes
option-pricing model.
(B) The value of options exercised during the year is calculated
as the market price of shares of the Company as at close of trading
on the date the options were exercised after deducting the price
paid to exercise the option.
(C) The value of the options that lapsed during the year
represents the benefit foregone and is calculated at the date the
option lapsed using the Black Scholes option-pricing model assuming
the performance criteria had been achieved;
Payments to persons before taking office - audited
Brett Lambert provided consulting services prior to taking
office as Managing Director and CEO. Included in total remuneration
paid to Brett Lambert, consideration for the consulting service
totalling $10,769 was paid on 15 May 2012.
This is the end of the Remuneration Report - Audited.
5. PRINCIPAL ACTIVITIES
The principal activity of the Group during the course of the
financial year was gold exploration and project development.
There was no significant change in the nature of the activity of
the Group during the year.
6. OPERATING AND FINANCIAL REVIEW
Overview
Bullabulling Gold Limited is listed on the Australian Securities
Exchange (ASX: BAB) and London's AIM Market (AIM: BGL) and has
approximately 302.5 million shares on issue. The Group's primary
asset is the wholly owned Bullabulling Gold Project, located near
Coolgardie in Western Australia.
The Bullabulling Gold Project hosts JORC compliant Mineral
Resources of 3.5 million ounces comprising Indicated Resources of
71.7 million tonnes at 0.96 g/t gold (2.2 million ounces) and
Inferred Resources of 32.8 million tonnes at 1.06 g/t gold (1.1
million ounces) at Bullabulling and Inferred Resources of 4.8
million tonnes at 1.15 g/t gold (0.2 million ounces) at Gibraltar.
Exploration has demonstrated strong potential for further expansion
of the resource base.
The Bullabulling deposit is amenable to bulk tonnage open pit
mining and conventional CIL processing has delivered high gold
recoveries. The deposit is situated on granted Mining Leases in
close proximity to infrastructure. The Group has recently completed
a prefeasibility study into the development of a large scale, low
cost mining operation at Bullabulling and is now moving into
definitive feasibility study. First production is targeted for Q4
2015.
Other than exploration and development activities as detailed in
the quarterly reports released to the market, there have been no
other significant operations by the Group during year ended 31
December 2012.
Financial Results
The loss for the financial year ended 31 December 2012
attributable to members of Bullabulling Gold Limited after income
tax was $39,615,033 (2011: loss of $10,828,222).
$38,555,913 of the loss follows a board resolution on 12
September 2012 to change the exploration and development accounting
policy such that current and future exploration is expensed through
profit and loss. In the current year exploration expensed through
profit and loss includes the gain on acquisition of the investment
in Auzex Resources Limited. Comparative figures have been
represented to reflect the change in accounting policy (see note 9
of the notes to the consolidated financial statements).
In October 2012, Bullabulling Gold (UK) Limited lodged an
application for a Research and Development Grant with Aus Industry,
which, if approved, will result in a payment to the company of
approximately $2.1 million.
In March 2013, Bullabulling Gold Limited announced a 1:2
non-renounceable entitlements offer to raise up to $7.6 million
(before costs).
No dividends were paid during the financial year ended 31
December 2012 and no dividend is recommended for the current
year.
Review of Financial Condition
During the year the net assets of the Group reduced by
$10,004,598 from $14,345,468 (restated) at 31 December 2011 to
$4,340,870 at 31 December 2012. This resulted from the change in
accounting policy to expense exploration and development
expenditure as incurred and also the administrative costs of the
organisation.
6. OPERATING AND FINANCIAL REVIEW (continued)
Significant changes in the state of affairs
On 29 March 2012 Bullabulling Gold Limited acquired 100% of the
issued shares of GGG Resources plc, now known as Bullabulling Gold
(UK) Ltd, by way of merger by scheme of arrangement.
On 16 April 2012 Bullabulling Gold Limited acquired 100% of the
issued shares of Auzex Resources Limited, now known as Bullabulling
Operations Pty Ltd, by way of scheme of arrangement.
The merger with GGG Resources plc was deemed a reverse
acquisition for accounting purposes, as Bullabulling Gold Limited
had no assets at the date of the merger. GGG Resources plc is
deemed the acquirer in the merger, and accordingly for accounting
purposes the accounts presented are an extension of the GGG
Resources plc financial statements.
The functional currency of GGG Resources plc changed to
Australian dollars to reflect the primary economic environment in
which the entity operates.
On 7 December 2012 Bullabulling Gold Limited issued 13,500,000
ordinary shares at 9 cents each for the acquisition of the Resolute
tenement.
7. EVENTS SUBSEQUENT TO REPORTING DATE
On 14(th) March 2013, the Group announced a 1 for 2
non-renounceable entitlement offer to raise $7.6 million.
Other than the matters discussed above, there have been no
matters of circumstance that have arisen since the end of the
financial year that have significantly affected, or may
significantly affect, the operations of the Group, the results of
these operations, or the state of affairs of the Group in future
financial years.
8. LIKELY DEVELOPMENTS
The Group will continue to pursue its policy of quality
exploration, evaluation of resources, and development of the
Bullabulling gold project.
9. ENVIRONMENTAL REGULATION
The Group is subject to significant environmental regulation in
relation to its exploration activities and aims to ensure that the
highest standard of environmental care is achieved, and that it
complies with all relevant environmental legislation. The Directors
are not aware of any significant breaches during the period covered
by this report.
10. INSURANCE PREMIUMS
During the financial year, Bullabulling Gold Limited paid a
premium of $15,528 (2011: $nil) to insure the Directors and the
Company Secretary of the Group.
The liabilities insured are legal costs that may be incurred in
defending civil or criminal proceedings that may be brought against
the officers in their capacity as officers of the Group, and any
other payments arising from liabilities incurred by the officers in
connection with such proceedings. This does not include such
liabilities that arise from conduct involving a wilful breach of
duty by the officers or the improper use by the officers of their
position or of information to gain advantage for themselves or
someone else or to cause detriment to the Group. It is not possible
to apportion the premium between amounts relating to the insurance
against legal costs and those relating to other liabilities.
11. DIRECTORS' INTERESTS
The relevant interest of each director in the shares,
debentures, interests in registered schemes and rights or options
over such instruments issued by the Group, as notified by the
directors to the ASX in accordance with S205G(1) of the
Corporations Act 2001, at the date of this report is as
follows:
Ordinary Options over
Director Shares ordinary shares
--------------- -------------------- -------------------
Peter Mansell 750,000 -
Brett Lambert - 3,000,000
Ronnie Beevor - -
Tim Netscher - -
--------------- -------------------- -------------------
12. SHARE OPTIONS
Options granted to directors and executives of the Group
During or since the end of the financial year, the Group granted
options for no consideration over unissued ordinary shares in the
Group to the following directors and executives as part of their
remuneration:
Directors Number of Exercise price Expiry
options per option date
granted cents
---------------- ------------ ------------------------ ----------
Brett Lambert 1,000,000 28.4 01-May-14
Brett Lambert 1,000,000 31.6 01-May-15
Brett Lambert 1,000,000 36.8 01-May-16
Executives
Mark Braghieri 500,000 10.2 26-Nov-14
Mark Braghieri 500,000 12.6 26-Nov-15
Mark Braghieri 500,000 14.9 26-Nov-16
---------------- ------------ ------------------------ ----------
The options tabled above were provided at no cost to the
recipients. All options expire on the earlier of their expiry date
or termination of the individual's employment in accordance with
the Group's Employee Share Option Plan rules.
All options were granted during the financial year. No options
have been granted since the end of the financial year.
12. SHARE OPTIONS
Unissued shares under options
At the date of this report unissued ordinary shares of the Group
under option are:
Expiry date Exercise Number of
price Shares
cents
---------------------- ----------- ------------
20-Nov-15 59.22 3,630,000
30-Jun-15 14.80 1,150,000
23-Apr-15 11.84 3,425,000
06-Oct-14 10.36 500,000
21-Oct-13 11.00 1,766,621
28-Oct-14 20.90 387,621
01-May-14 28.40 1,000,000
01-May-15 31.60 1,000,000
01-May-16 36.80 1,000,000
26-Nov-14 10.20 500,000
26-Nov-15 12.60 500,000
26-Nov-16 14.90 500,000
---------------------- ----------- ------------
Total 15,359,242
---------------------- ----------- ------------
No option holder has any right under the options to participate
in any other share issue of the Group.
Shares issued on exercise of options
During or since the end of the financial year, no directors or
key executives exercised their options.
13. PROCEEDINGS ON BEHALF OF THE GROUP
No person has applied to the Court under Section 237 of the
Corporations Act 2001 for leave to bring proceedings on behalf of
the Group, or to intervene in any proceedings to which the Group is
a party, for the purpose of taking responsibility on behalf of the
Group for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of
the Group with leave of the Court under section 237 of the
Corporations Act 2001.
14. NON-AUDIT SERVICES
The Group may decide to employ the auditor on assignments
additional to their statutory audit duties where the auditor's
expertise and experience with the Group are important.
Details of the amounts paid or payable to the auditor (BDO) for
audit and non-audit services provided during the year are set out
below.
The Board of Directors has considered the position and, in
accordance with advice received from the Audit and Risk Management
Committee, 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 Directors
are satisfied that the provision of non-audit services by the
auditor, as set out below, did not compromise the auditor
independence requirements of the Corporations Act 2001 for the
following reasons:
-- all non-audit services have been reviewed by the Board acting
as the Audit and Risk Management Committee to ensure they do not
impact the impartiality and objectivity of the auditor
-- none of the services undermine the general principles
relating to auditor independence as set out in APES 110 Code of
Ethics for Professional Accountants.
During the year the following fees were paid or payable for
non-audit services provided by the auditor of the parent entity,
its related practices and non-related audit firms:
2012 2011
$ $
-------------------------------------------- ------------------------ --------------------------
Other assurance services
BDO Australia
Admission to AIM UK Stock Exchange 5,292 -
5,292 -
------------------------ --------------------------
Taxation services
BDO Australia
Tax compliance services 885 -
Tax advice on substitute accounting and 31,556 -
acquisition
Tax advice on employee share schemes and 30,992 -
R&D
63,433 -
------------------------ --------------------------
Total remuneration for non-audit services 68,725 -
======================== ==========================
The consolidated financial statements represent a continuation
of the financial statements of GGG Resources plc, a company
incorporated in the UK. As GGG Resources plc is not governed by the
Corporations Act 2001, comparative figures for audit and non-audit
services are not required.
15. LEAD AUDITOR'S INDEPENDENCE DECLARATION
A copy of the auditors' independence declaration as required
under section 307C of the Corporations Act 2001 is included in the
Directors' Report.
Signed in accordance with a resolution of Directors.
Brett Lambert
Managing Director
Dated at Perth, Western Australia this 27(th) day of March
2013.
AUDITOR'S INDEPENDENCE DECLARATION
CORPORATE GOVERNANCE STATEMENT
The Board of Directors of Bullabulling Gold Limited (the Board)
is responsible for the corporate governance of the Group. The Board
guides and monitors the business and affairs of the Group on behalf
of the shareholders by whom they are elected and to whom they are
accountable. This statement outlines the main corporate governance
practices in place throughout the financial year, which comply with
the Australian Securities Exchange (ASX) Corporate Governance
Council June 2010 amendments to the August 2007 "Corporate
Governance Principles and Recommendations (Second Edition)" ("the
Recommendations"), unless otherwise stated.
As required under ASX Listing Rule 4.10.3, the Group makes the
following disclosures in relation to each of the Recommendations. A
checklist, cross referencing the ASX Principles to the relevant
section of this Statement, the Remuneration Report or Financial
Report, follows these disclosures.
BOARD OF DIRECTORS
Role of the Board
The primary role of the Board is to oversee and approve the
Group's strategic direction, to oversee the Group's management and
business activities and to report to shareholders. The roles and
responsibilities of the Board are formalised in written policies.
All documents can be accessed on the Group's website at
www.bullabullinggold.com under the Corporate Governance
section.
The Board evaluates these policies on an ongoing basis.
In addition to matters required by law to be approved by the
Board, the responsibilities include, but are not limited to:
-- supervising the Group's framework of control and
accountability systems to enable risk to be assessed and
managed;
-- ensuring the Group is properly managed, for example by:
- appointing and, where appropriate, removing any Managing
Director, Chief Executive Officer (or equivalent) of the Group;
- ratifying the appointment and, where appropriate, the removal
of any Chief Financial Officer and the Group Secretary;
- formulating short term and long term strategies to enable the
Group to achieve its objectives and ensuring that the Group has the
resources to meet its strategic objectives;
- input into and final approval of management's development of
corporate strategy and performance objectives;
- reviewing and ratifying systems of risk management and
internal compliance and control, codes of conduct and legal
compliance;
- monitoring senior management's performance and implementation
of strategy and ensuring appropriate resources are available;
and
- establishing, monitoring and determining the powers and duties
of any and all of the Group's committee's;
-- approving and monitoring the progress of major capital
expenditure, capital management, and acquisitions and
divestments;
-- approving the annual budget;
-- monitoring the financial performance of the Group;
-- approving and monitoring financial and other reporting;
-- providing overall corporate governance of the Group,
including conducting regular reviews of the balance of
responsibilities within the Group to ensure division of functions
remain appropriate to the needs of the Group;
BOARD OF DIRECTORS (continued)
Role of the Board (continued)
-- appointing the external auditor and the appointment of a new
external auditor when any vacancy arises, provided that any
appointment made by the Board must be ratified by shareholders at
the next AGM of the Group;
-- liaising with the Group's external auditors;
-- monitoring and ensuring compliance with all of the Group's
legal obligations, in particular those obligations relating to the
environment, native title, cultural heritage; and
-- occupationalhealth and safety.
Responsibility for management of Bullabulling Gold Limited's day
to day business activities is delegated to the Managing Director
who is accountable to the Board.
The Managing Director (CEO) is responsible for:
-- managing all exploration and development activities;
-- ensuring that tenements are maintained in good standing with
applicable State Authorities;
-- reporting to the Board on exploration and development activities;
-- reporting to the Board on financial activities;
-- preparation of the exploration and development budgets;
-- periodical high-level review of key controls to ensure that
they are operating as required / designed, and
-- managing investor relations and fund raising initiatives.
Board composition and expertise
The composition of the Board is determined in accordance with
the following principles and guidelines:
-- The Board shall comprise at least three Directors, increasing
where additional expertise is considered desirable in certain
areas;
-- Where possible, the Board is to comprise a majority of
non-executive directors who are considered by the Board to be
independent;
-- Directors may bring characteristics which allow a mix of
qualifications, skill and experience;
-- At any point in time, its membership represents an
appropriate balance between directors with experience and knowledge
of the Group, and directors with an external or fresh perspective;
and
-- The size of the Board is conducive to effective discussion
and efficient decision-making.
The Board reviews its composition on an annual basis to ensure
that it has the appropriate mix of expertise and experience to
adequately discharge its responsibilities and duties. Where a
vacancy exists, for whatever reason, or where it is considered that
the Board would benefit from the services of a new director with
particular skills, the Board will select appropriate candidates
with relevant qualifications, skills and experience.
Details of members of the Board, their experience, expertise,
qualifications, term of office and independent status are set out
in the Directors' Report under the heading "Information on
Directors". There are three non-executive Directors who are deemed
independent under the principles set out below, at the date of
signing the Directors' Report.
Retirement and re-election of directors
The Group's Constitution specifies that any Director other than
the Managing Director (CEO) must retire from office no later than
the third Annual General Meeting (AGM) following their last
election.
BOARD OF DIRECTORS (continued)
Chairman
The Chairman is responsible for leading the Board, ensuring
Directors are properly briefed in all matters relevant to their
role and responsibilities, facilitating Board discussions and
managing the Board's relationship with the Group's senior
executives.
The Chairman's responsibilities are set out in the Board
Charter, which is available from the Group's website at
www.bullabullinggold.com under the Corporate Governance
section.
Independence of directors
The Board has adopted the specific principles in relation to
Directors' independence. These state that to be deemed independent,
a director must be a non-executive and:
-- not be a substantial shareholder of the Group or an officer
of, or otherwise associated directly with, a substantial
shareholder of the Group;
-- within the last three years, not have been employed in an
executive capacity by the Group or been a director after ceasing to
hold any such employment;
-- within the last three years not have been a principal of a
material professional advisor or a material consultant to the Group
or an employee materially associated with the service provided;
-- not be a material supplier or customer of the Group, or an
officer of or otherwise associated, directly or indirectly, with a
material supplier or customer;
-- must have no material contractual relationship with the
Group, other than as a director of the Group;
-- be free from any interest and any business or other
relationship which could, or could reasonably be perceived to,
materially interfere with the director's ability to act in the best
interests of the Group; and
-- not have been on the Board for a period which could, or could
reasonably be perceived to, materially interfere with the
director's ability to act in the best interests of the Group.
Materiality for these purposes is determined on both
quantitative and qualitative bases. An amount of over 10% of the
current year operating result of the Group or 10% of the pro forma
net assets is considered material for these purposes. In addition,
the Group applies materiality based on qualitative assessments
including if matters impact on the reputation of the Group and if
they involve a related party.
As outlined in the Directors' Report under the heading
"Information on Directors", there are three independent,
non-executive directors, one of whom is the Chairman of the Board,
at the date of signing the Directors' Report.
Director education
The non-executive directors are given every opportunity to gain
a better understanding of the business, the industry, and the
environment within which the Group operates, and are given access
to continuing education opportunities to update and enhance their
skills and knowledge.
Independent professional advice
Each director has the right of access to all relevant Group
information and to the Group's executives and, subject to prior
approval of the Chairperson which will not be unreasonably
withheld, each director has the right to seek independent legal and
other professional advice at the Group's expense concerning any
aspect of the Group's operations or undertakings in order to fulfil
their duties and responsibilities as directors.
BOARD OF DIRECTORS (continued)
Board Performance Review
There is no formal appraisal system in place for Board
performance on a director by director basis. The performance of all
directors is assessed through review by the Board as a whole of a
director's attendance at, and involvement in, Board meetings, his
performance and other matters identified by the Board or other
directors. Significant issues are actioned by the Board. Due to the
Board's assessment of the effectiveness of these processes, the
Board has not otherwise formalised measures of a director's
performance.
The Group has not conducted a performance evaluation of the
members of the Board during the reporting period. However, the
Board conducts a review of the performance of the Group against
budgeted targets on an ongoing basis.
Conflict of Interest
Directors must keep the Board advised of any interest that could
potentially conflict with those of the Group.
Directors' remuneration
Details of the Group's remuneration policies are included in the
"Remuneration Report" section of the Directors' Report.
BOARD COMMITTEES
Board committees and membership
The Board currently has three standing committees to assist in
the discharge of its responsibilities. These are the:
-- Audit and Risk Management Committee;
-- Remuneration and Nomination Committee; and
-- Occupational Health and Safety Committee.
To facilitate the execution of its responsibilities, the Board's
Committees provide a forum for a more detailed analysis of key
issues. Each Committee is entitled to the resources and information
it requires to carry out its duties, including direct access to
advisors and employees. Current membership of the committees' of
the Bullabulling Gold Limited Board, are set out below:
Audit and Risk Management Committee
The audit and risk management committee consists of all
non-executive directors. The role of the audit and risk management
committee is documented in a Charter which is approved by the Board
of Directors. The Chairman may not be the Chairman of the Board.
The role of the committee is to advise on the establishment and
maintenance of a framework of internal control and appropriate
ethical standards for the management of the Group.
It also gives the Board of Directors additional assurance
regarding the quality and reliability of financial information
prepared for use by the Board in determining policies or for
inclusion in the financial report.
The members of the audit and risk management committee for the
Group at the date of this report were:
-- Mr Ronnie Beevor - non-executive Director (Committee chair);
-- Mr Peter Mansell - non-executive Chairman
-- Mr Tim Netscher - non-executive Director
BOARD COMMITTEES (continued)
Audit and Risk Management Committee (continued)
The external auditors, managing director and CFO are invited to
audit and risk management committee meetings at the discretion of
the committee. The committee met once during the year and committee
members' attendance record is disclosed in the table of directors'
meetings.
The external auditor met with the Audit and Risk Management
Committee and the Board of directors once during the year.
The responsibilities of the audit and risk management committee
include:
-- to review the financial report and other financial information distributed externally;
-- to monitor corporate risk assessment processes;
-- to review any new accounting policies ensuring compliance
with Australian Accounting Standards and generally accepted
accounting principles;
-- to review audit reports ensuring that where major
deficiencies or breakdowns in controls or procedures have been
identified, appropriate and prompt remedial action is taken by
management;
-- to review the nomination and performance of the auditor;
-- to liaise with the external auditors ensuring that the annual
and half-year statutory audits are conducted in an effective
manner;
-- to monitor the establishment of an appropriate internal control framework and consider enhancements;
-- to monitor the establishment of appropriate ethical standards;
-- to monitor the procedures in place ensuring compliance with
the Corporations Act 2001, the Australian Securities Exchange
Listing Rules and all other regulatory requirements;
-- to address any matters outstanding with auditors, the
Australian Taxation Office, the Australian Securities and
Investments Commission, the Australian Securities Exchange and
other financial institutions; and
-- to improve the quality of the accounting function.
The audit and risk management committee reviews the performance
of the external auditors on an annual basis and meets with them
during the year.
Remuneration and Nomination Committee
The members of the remuneration and nomination committee for the
Group at the date of this report were:
-- Mr Peter Mansell - non-executive Chairman (Committee chair);
-- Mr Ronnie Beevor - non-executive Director;
-- Mr Tim Netscher - non-executive Director
The committee met twice during the year.
BOARD COMMITTEES
Remuneration and Nomination Committee (continued)
The remuneration and nomination committee operates in accordance
with its Charter. The main responsibilities of the committee
are:
-- to review the size and composition of the Board;
-- to review and advise the Board on the range of skills
available on the Board and appropriate balance of skills for future
Board membership;
-- to review and consider succession planning for the managing
director, the chairman and other directors;
-- to develop criteria and procedures for the identification of
candidates for appointment as directors and apply the criteria and
procedures to identify prospective candidates for appointment as a
director and make recommendations to the Board;
-- to make recommendations to the Board regarding any directors
who should not continue in office;
-- to nominate for approval by the Board external experts;
-- to determine remuneration policies and remuneration of directors and executives;
-- to determine the Group recruitment, retention and termination
policies and procedures for senior management;
-- to determine and review incentive schemes;
-- to determine and review superannuation arrangements of the Group; and
-- to determine and review professional indemnity and liability insurance for directors.
Further details of remuneration arrangements in place for the
directors and executives are set out in the Directors' Report.
Occupational Health and Safety Committee
The role of the Occupational Health and Safety Committee is to
ensure that, as a minimum requirement, the Group ensures the
ongoing compliance with relevant legislation and industry specific
standards, so that a safe and healthy workplace is maintained and
continually improved. This will be achieved by:
-- continually demonstrating commitment to health and safety at
a corporate level and down through the organisation structure;
-- establishing measurable health and safety objectives and
targets to ensure continual improvement in health and safety
management;
-- ongoing identification of hazards and control risk through best practicable means;
-- ongoing review of the Group's safety management systems to
ensure ongoing compliance and continual improvements in safety
management and performance; and
-- maintaining adequate facilities for the immediate care of employees.
The members of the Occupational Health and Safety Committee
are:
-- Mr Tim Netscher - non-executive Director (Committee chair);
-- Mr Peter Mansell - non-executive Chairman;
-- Mr Ronnie Beevor - non-executive Director;
-- Mr Brett Lambert - Managing Director
The committee met once during the year.
MANAGING BUSINESS RISK
The Board believes that risk management and compliance are
fundamental to sound management and that oversight of such matters
is an important responsibility of the Board. The Group maintains
policies and practices designed to identify and manage significant
business risks, including:
-- regular budgeting and financial reporting;
-- procedures and controls to manage financial exposures and operational risks;
-- the Group's business plan;
-- corporate strategy guidelines and procedures to review and
approve the Group's strategic plans; and
-- insurance and risk management programmes.
The Board reviews these systems and the effectiveness of their
implementation annually and considers the management of risk at its
meetings. The Group's risk profile is reviewed annually. The Board
may consult with the Group's external auditors on external risk
matters or other appropriately qualified external consultants on
risk generally, as required.
Internal controls
Procedures have been established at the Board and executive
management levels that are designed to safeguard the assets and
interests of the Group, and to ensure the integrity of reporting.
These include accounting, financial reporting and internal control
policies and procedures. To achieve this, the executive directors
perform the following procedures:
-- ensure appropriate follow-up of significant audit findings and risk areas identified;
-- review the scope of the external audit to align it with Board requirements; and
-- conduct a detailed review of published accounts.
CEO and CFO assurance on corporate reporting
The Board receives monthly management reports about the
financial condition and operational results of the Group. The Chief
Executive Officer (or equivalent) and Chief Financial Officer (or
equivalent) annually provide a formal statement, in accordance with
section 295A of the Corporations Act, to the Board that in all
material respects and to the best of their knowledge and
belief:
-- the Group's financial reports present a true and fair view of
the Group's financial condition and operational results and are in
accordance with relevant accounting standards; and
-- the Group's risk management and internal control systems are
sound, appropriate and operating efficiently and effectively.
Environmental regulation
The Group has a policy of at least complying, but in most cases
exceeding, its environmental performance obligations. No
environmental breaches have been notified by any Government agency
during the year ended 31 December 2012.
ETHICAL STANDARDS
All directors and executives are expected to act with the utmost
integrity and objectivity, striving at all times to enhance the
performance and reputation of the Group and its controlled
entities.
Code of Conduct
In pursuit of the highest ethical standards, the Group has
adopted a Code of Conduct which establishes the standards of
behaviour required of directors and employees in the conduct of the
Group's affairs. This Code is provided to all directors and
employees. The Board monitors implementation of this Code.
Unethical behaviour is to be reported to the Chairman as soon as
practicable.
The Code of Conduct is based on respect for the law, and acting
accordingly, dealing with conflicts of interest appropriately,
using the consolidated entity's assets responsibly and in the best
interests of the Group, acting with integrity, being fair and
honest in dealings, treating other people with dignity and being
responsible for actions and accountable for the consequences.
The Group has advised each director, executive and employee that
they must comply with the Group's Ethical Standards.
Diversity Policy
The Group has established a Diversity Policy which provides the
written framework and objectives for achieving a work environment
that values and utilises the contributions of employees'
backgrounds, experiences, and perspectives, irrespective of gender,
age, ethnicity and cultural background. The Board is responsible
for developing, where possible, measurable objectives and
strategies to support the framework and objectives of the Diversity
Policy. The Remuneration and Nomination Committee is responsible
for monitoring the progress of the measurable objectives through
various monitoring, evaluation and reporting mechanisms.
The key elements of the diversity policy are as follows:
-- increased diversity throughout the Group when a position becomes available
-- annual assessment of the board diversity objectives and
performance against objectives by the board and nomination
committee
Due to the size of the Group and there being a limited need to
increase staff levels at this stage, there has been limited
opportunity to implement the diversity policy. As a result, the
Group has not yet met its objectives. However, the Group outsources
its corporate and accounting services to Broadway Management (WA)
Pty Ltd where 78% of its employees are represented by female
members.
Pursuant to Recommendation 3.4 of the Recommendations, the Group
discloses the following information as at the date of this
report:
2012 2011
Gender representation Women Men Women Men
Group representation 10% 90% 0% 100%
Senior management representation 0% 100% 0% 100%
Board representation 0% 100% 0% 100%
Corporate services provider representation 78% 22% 75% 25%
The Diversity Policy can be accessed on the Group's website at
www.bullabullinggold.com under the Corporate Governance
section.
ETHICAL STANDARDS (continued)
Trading in company securities by directors and employees
The Board has adopted a policy in relation to dealings in the
securities of the Group which applies to all directors and
employees. Under the policy, directors are prohibited from short
term or "active" trading in the Group's securities and directors
and employees are prohibited from dealing in the Group's securities
whilst in possession of price sensitive information. The Chairman
(or in his place the Managing Director) must also be notified of
any proposed transaction. The Chairman must notify the chair of the
Audit and Risk Management Committee.
This policy is provided to all directors and employees.
Compliance with it is reviewed on an ongoing basis in accordance
with the Group's risk management systems.
COMMUNICATION WITH SHAREHOLDERS
The Board aims to ensure that shareholders are kept informed of
all major developments affecting the Group. Information is
communicated to shareholders as follows:
-- as the Group is a disclosing entity, regular announcements
are made to the Australian Securities Exchange in accordance with
the Group's continuous disclosure policy, including quarterly cash
flow reports, half-year reviewed accounts, year-end audited
accounts and an annual report;
-- the Board ensures the annual report includes relevant
information about the operations of the Group during the year,
changes in the state of affairs and details of future
developments;
-- shareholders are advised in writing of key issues affecting the Group;
-- any proposed major changes in the Group's affairs are
submitted to a vote of shareholders, as required by the
Corporations Act 2001;
-- the Board encourages full participation of shareholders at
the Annual General Meeting to ensure a high level of accountability
and identification of the Group's strategies and goals. All
shareholders who are unable to attend these meetings are encouraged
to communicate or ask questions by writing to the Group; and
-- the external auditor is required to attend the annual general
meetings to answer any questions concerning the audit and the
content of the auditor's report.
The Board reviews this policy and compliance with it on an
ongoing basis.
Continuous Disclosure
The Group has in place a continuous disclosure policy, a copy of
which is provided to all Group officers and employees who may from
time to time be in the possession of undisclosed information that
may be material to the price or value of the Group's
securities.
The continuous disclosure policy aims to ensure timely
compliance with the Group's continuous disclosure obligations under
the Corporations Act 2001 (Cth) and ASX Listing Rules and ensures
officers and employees of the Group understand these
obligations.
The procedure adopted by the Group is essentially that any
information which may need to be disclosed must be brought to the
attention of the Chairman, who in consultation with the Board
(where practicable) and any other appropriate personnel, will
consider the information and whether disclosure is required and
prepare an appropriate announcement.
At least once in every 12 month period, the Board will review
the Group's compliance with this continuous disclosure policy and
update it from time to time, if necessary.
ASX PRINCIPLES COMPLIANCE STATEMENT
ASX Corporate Governance Council's Corporate Reference * Compliance
Governance Principles and Recommendations
--------------------------------------------- ------------ -----------
Principle 1 - Lay solid foundations for management and
oversight
1.1 Companies should establish the functions 1a Comply
reserved to the Board and those delegated
to senior executives and disclose those
functions
1.2 Companies should disclose the process Remuneration Comply
for evaluating the performance of senior report
executives
1.3 Companies should provide the information 1a, Comply
indicated in the Guide to reporting on Remuneration
Principle 1. report
---- ------------------------------------------- -------------- -------
Principle 2 - Structure the Board to add value
2.1 A majority of the Board should be independent 1b, 1d Comply
directors
2.2 The chair should be an independent director 1d Comply
2.3 The roles of the chair and chief executive 1d, Comply
officer should not be exercised by the Directors'
same individual report
The Board should establish a nomination
2.4 committee 2c Comply
2.5 Companies should disclose the process 1g, 2a Comply
for evaluating the performance of the
Board, its committees and individual directors
2.6 Companies should provide the information 1b, 1f, 1g, Comply
indicated in the Guide to reporting Principle 2a,
2. Directors'
report
---- ------------------------------------------------ ------------ -------
Principle 3 - Promote ethical and responsible
decision-making
3.1 Companies should establish a code of conduct 4a Comply
and disclose the code or a summary of
the code as to:
* the practices necessary to maintain confidence in the
Group's integrity
* the practices necessary to take into account their
legal obligations and the reasonable expectations of
their stakeholders
* the reasonability and accountability of individuals
for reporting and investigating reports of unethical
practices.
3.2 Companies should establish a policy concerning 4b Comply
diversity and disclose the policy or summary
of that policy. The policy should include
requirements for the Board to establish
measurable objectives for achieving gender
diversity for the Board to assess annually
both the objectives and progress in achieving
them.
3.3 Companies should disclose in each annual 4b Comply
report the measurable objectives for achieving
gender diversity set by the Board in accordance
with the diversity policy and progress
towards achieving them.
3.4 Companies should disclose in each annual 4b Comply
report the proportion of women employees
in the whole organisation, women in senior
executive positions and women on the Board.
3.5 Companies should provide the information 4a, 4b, 4c Comply
indicated in the Guide to reporting on
Principle 3
---- ------------------------------------------------------------------ ----------- -------
* Reference to the Corporate Governance Statement, unless otherwise stated
ASX PRINCIPLES COMPLIANCE STATEMENT (continued)
ASX Corporate Governance Council's Corporate Reference Compliance
Governance Principles and Recommendations
--------------------------------------------- ---------- -----------
Principle 4 - Safeguard integrity in financial reporting
4.1 The Board should establish an Audit and Risk 2b Comply
Management Committee
4.2 The Audit and Risk Management Committee should
be structured so that it: 2b Comply
* consists only of non-executive directors 2b Comply
2b Comply
2b Comply
* consists of a majority of independent directors
* is chaired by an independent chair, who is not chair
of the Board
* has at least three members
4.3 The Audit and Risk Management Committee should 2a Comply
have a formal charter
4.4 Companies should provide the information 2a, 2b, Comply
indicated in the Guide to reporting on Principle Directors'
4. report
---- ----------------------------------------------------------------- ------------ ----------
Principle 5 - Making timely and balanced disclosure
5.1 Companies should establish written policies 5, 5a Comply
designed to ensure compliance with ASX Listing
Rule disclosure requirements and to ensure
accountability at a senior executive level
for that compliance and disclose those policies
or a summary of those policies.
5.2 Companies should provide the information 5a Comply
indicated in the Guide to reporting on Principle
5.
---- -------------------------------------------------- ------ -------
Principle 6 - Respect the rights of shareholders
6.1 Companies should design a communications 5 Comply
policy for promoting effective communication
with shareholders and encouraging their participation
at general meetings and disclose their policy
or a summary of that policy.
6.2 Companies should provide the information 5 Comply
indicated in the Guide to reporting on Principle
6.
---- ------------------------------------------------------- -------
Principle 7 - Recognise and manage risk
7.1 Companies should establish policies for the 2b, 3, 3a Comply
oversight and management of material business
risks and disclose a summary of those policies.
7.2 The Board should require management to design 3, 3b Comply
and implement the risk management and internal
control system to manage the Group's material
business risks and report to it on whether
those risks are being managed effectively.
The Board should disclose that management
has reported to it as to the effectiveness
of the Group's management of its material
business risks.
7.3 The Board should disclose whether it has 3b Comply
received assurance from the chief executive
officer (or equivalent) and the chief financial
officer (or equivalent) that the declaration
provided in accordance with section 295A
of the Corporations Act is founded on a sound
system of risk management and internal control
and that they system is operating effectively
in all material respects in relation to financial
reporting risks.
7.4 Companies should provide the information 2b, 3, 3a, Comply
indicated in the Guide to reporting on Principle 3b,
7. Directors'
report
---- --------------------------------------------------- ------------ -------
ASX PRINCIPLES COMPLIANCE STATEMENT (continued)
ASX Corporate Governance Council's Corporate Reference Compliance
Governance Principles and Recommendations
--------------------------------------------- ---------- -----------
Principle 8 - Remunerate fairly and responsibly
8.1 The Board should establish a Remuneration 2a, 2c, Comply
and Nomination Committee Remuneration
report
8.2 The Remuneration and Nomination Committee
should be structured so that it: 2c Comply
* consists of a majority of independent directors 2c Comply
2c Comply
* is chaired by an independent chair
* has at least three members.
8.3 Companies should clearly distinguish the Remuneration Comply
structure of non-executive directors' report
remuneration from that of executive directors
and senior executives.
8.4 Companies should provide the information 2a, 2c, Comply
indicated in the Guide to reporting on Remuneration
Principle 8. report
---- ------------------------------------------------------------ --------------- ---------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2012
31 December 31 December 1 January
2012 2011 2011
Restated Restated
(1)
Note $ $ $
--------------------------------------------- -------------------- -------------------- --------------------
Assets
Cash and cash equivalents 19 4,078,830 11,475,475 16,245,289
Other receivables 17 52,508 346,180 704,518
Prepayments 18 32,768 38,719 -
Current tax asset 14 - 286,275 -
-------------------- -------------------- --------------------
Total current assets 4,164,106 12,146,649 16,949,807
-------------------- -------------------- --------------------
Investments 16 427,778 2,464,000 4,640,000
Other receivables 17 1,436,200 653,033 -
Property, plant and equipment 15 770,183 1,769 -
Total non-current assets 2,634,161 3,118,802 4,640,000
-------------------- -------------------- --------------------
Total assets 6,798,267 15,265,451 21,589,807
-------------------- -------------------- --------------------
Liabilities
Trade and other payables 24 1,890,328 901,761 855,517
Employee benefits 23 97,069 18,222 -
-------------------- -------------------- --------------------
Total current liabilities 1,987,397 919,983 855,517
-------------------- -------------------- --------------------
Provision for site restoration 25 470,000 - -
-------------------- -------------------- --------------------
Total non-current liabilities 470,000 - -
-------------------- -------------------- --------------------
Total liabilities 2,457,397 919,983 855,517
-------------------- -------------------- --------------------
Net assets 4,340,870 14,345,468 20,734,290
==================== ==================== ====================
Equity
Share capital 21 66,704,237 35,717,898 28,398,058
Reserves 1,074,760 2,350,860 5,231,300
Accumulated losses (63,438,127) (23,723,290) (12,895,068)
-------------------- -------------------- --------------------
Total equity attributable
to equity holders of the
Company 4,340,870 14,345,468 20,734,290
==================== ==================== ====================
(1) With effect from 1 January 2012, the directors of
Bullabulling Gold Limited determined that the presentation currency
of the Company and its subsidiaries will be Australian dollars. As
such, in accordance with AASB 101.39, a third consolidated
Statement of Financial Position and notes to the restated amounts
of GGG Resources plc has been presented. The standard requires that
the change in presentation currency is shown from the first day of
the prior year to which the change is made, being 1 January
2011.
The above consolidated statement of financial position should be
read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2012
2012 2011
Note $ $
----------------------------------------------------- ------ -------------------- --------------------
Gain on acquisition of investment 13 1,656,075 -
Other income 13 - 407,803
Administrative expenses 13 (2,605,768) (3,055,177)
Other expenses 13 (1,267,847) (143,744)
Impairment of investment 16 (376,222) -
Auzex Resources Limited pre-acquisition
exploration expensed 13 (32,894,832) -
Exploration expenditure - current year 13 (5,661,081) (8,232,743)
Gain on disposal of subsidiary 10 1,444,608 -
Goodwill written off 13 (701,803) -
-------------------- --------------------
Results from operating activities (40,406,870) (11,023,861)
-------------------- --------------------
Finance income 459,137 705,025
Finance expense - (745)
Net finance income 13 459,137 704,280
-------------------- --------------------
Loss before income tax (39,947,733) (10,319,581)
Income tax benefit / (expense) 14 332,700 (508,641)
Loss for the period (39,615,033) (10,828,222)
==================== ====================
Other comprehensive income
Changes in fair value on equity instruments (368,149) -
measured at fair value through other comprehensive
income
Foreign currency translation difference
of foreign operations (1,416,648) (101,721)
Net change in fair value of available for
sale assets - (2,778,719)
-------------------- --------------------
Other comprehensive loss for the period,
net of income tax (1,784,797) (2,880,440)
-------------------- --------------------
Total comprehensive loss for the period (41,399,830) (13,708,662)
==================== ====================
Loss attributable to owners of the Company (39,615,033) (10,828,222)
==================== ====================
Total comprehensive loss attributable to
owners
of the Company (41,399,830) (13,708,662)
==================== ====================
Loss per share
Basic and diluted (cents per share) 22 (15.51) (0.06)
==================== ====================
The above consolidated statement of comprehensive income should
be read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2012
Attributable to equity holders of the Company
Equity-based Available
Share Translation benefits for sale Accumulated
capital reserve reserve asset reserve losses Total
Note $ $ $ $ $ $
--------------- ---------- ------------------- ------------------- ------------------- ------------------- ------------------- --------------
Balance at 1 January 2012
(restated) 35,717,898 1,391,466 591,245 368,149 (23,723,290) 14,345,468
Adjustments
arising from
change in
functional
currency on 1
January 2012 3(b)(ii) 387,766 25,182 (62,501) - (99,804) 250,643
------------------- ------------------- ------------------- ------------------- ------------------- --------------
Balance at 1 January 2012,
restated 36,105,664 1,416,648 528,744 368,149 (23,823,094) 14,596,111
Total
comprehensive
loss for the
year
Loss for the year - - - - (39,615,033) (39,615,033)
Other
comprehensive
loss for the
year
Recycling of foreign
exchange translation
reserve to profit or loss - (1,416,648) - - - (1,416,648)
Change in fair value of
equity instruments
measured at fair value
through other
comprehensive income - - - (368,149) - (368,149)
------------------- ------------------- ------------------- ------------------- ------------------- --------------
Total other comprehensive
loss - (1,416,648) - (368,149) - (1,784,797)
------------------- ------------------- ------------------- ------------------- ------------------- --------------
Total comprehensive loss
for the
period - (1,416,648) - (368,149) (39,615,033) (41,399,830)
------------------- ------------------- ------------------- ------------------- ------------------- --------------
The above consolidated statement of changes in equity should be
read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2012 (continued)
Attributable to equity holders of the Company
Equity-based Available
Share Translation benefits for sale Accumulated
capital reserve reserve asset reserve losses Total
Notes $ $ $ $ $ $
--------------- -------- ------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Transactions
with owners,
recorded
directly in
equity
Contributions
by and
distributions
to owners
Exercise of
4,400,000
warrants 847,706 - - - - 847,706
Issue of 118,353,753
ordinary shares for
acquisition of asset 28,553,437 - - - - 28,553,437
Issue of 13,500,000
ordinary shares for
acquisition of tenement 1,215,000 - - - - 1,215,000
Capital
raising costs (17,570) - - - - (17,570)
Share based
payment
transactions 26 - - 546,016 - - 546,016
------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Total
contributions
by and
distributions
to owners 30,598,573 - 546,016 - - 31,144,589
------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Total changes - - - - - -
in ownership
interests
of
subsidiaries
------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Total
transactions
with owners 30,598,573 - 546,016 - - 31,144,589
------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Balance at 31
December 2012 66,704,237 - 1,074,760 - (63,438,127) 4,340,870
=================== =================== =================== =================== =================== ===================
The above consolidated statement of changes in equity should be
read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2012 (continued)
Attributable to equity holders of the Company
Equity-based Available
Share Translation benefits for sale Accumulated
capital reserve reserve asset reserve losses Total
Note $ $ $ $ $ $
--------------- ------- ------------------- ------------------- ------------------- ------------------- ------------------- --------------
Balance at 1
January 2011 28,398,058 1,484,347 600,085 3,146,868 (9,865,319) 23,764,039
Adjustments
arising from
change in
accounting
policy 9 - - - - (3,029,749) (3,029,749)
------------------- ------------------- ------------------- ------------------- ------------------- --------------
28,398,058 1,484,347 600,085 3,146,868 (12,895,068) 20,734,290
Loss for the
year - - - - (10,828,222) (10,828,222)
Other
comprehensive
loss for the
year
Exchange differences on
translation of
foreign operations - (92,881) (8,840) - - (101,721)
Change in fair
value of
available
for sale
assets - - - (2,778,719) - (2,778,719)
------------------- ------------------- ------------------- ------------------- ------------------- --------------
Total other
comprehensive
loss - (92,881) (8,840) (2,778,719) - (2,880,440)
------------------- ------------------- ------------------- ------------------- ------------------- --------------
Total
comprehensive
loss for the
year - (92,881) (8,840) (2,778,719) (10,828,222) (13,708,662)
------------------- ------------------- ------------------- ------------------- ------------------- --------------
The above consolidated statement of changes in equity should be
read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2012 (continued)
Attributable to equity holders of the Company
Equity-based Available
Share Translation benefits for sale Accumulated
capital reserve reserve asset reserve losses Total
Notes $ $ $ $ $ $
--------------- --------- ------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Transactions
with owners,
recorded
directly in
equity
Contributions
by and
distributions
to owners
Issue of ordinary shares 7,994,745 - - - - 7,994,745
Capital raising costs (674,905) - - - - (674,905)
Share based - - - - - -
payment
transactions
------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Total contributions by
and distributions
to owners 7,319,840 - - - - 7,319,840
------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Total changes - - - - - -
in ownership
interests
of
subsidiaries
------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Total transactions with
owners 7,319,840 - - - - 7,319,840
------------------- ------------------- ------------------- ------------------- ------------------- -------------------
Balance at 31 December
2011 35,717,898 1,391,466 591,245 368,149 (23,723,290) 14,345,468
=================== =================== =================== =================== =================== ===================
The above consolidated statement of changes in equity should be
read in conjunction with the accompanying notes.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2012
2012 2011
Note $ $
---------------------------------------------- ------ -------------------- --------------------
Cash flows from operating activities
Net cash (paid to)/received from suppliers,
employees and customers (4,258,094) (3,500,148)
Income tax received / (paid) 618,975 (508,641)
Payments for exploration, evaluation and
development (6,774,792) (8,394,692)
-------------------- --------------------
Net cash used in operating activities 19(b) (10,413,911) (12,403,751)
-------------------- --------------------
Cash flows from investing activities
Interest received 431,110 704,902
Acquisition of subsidiary, net of cash 1,943,629 -
Proceeds from sale of property, plant and 1,000 -
equipment
Acquisition of property, plant and equipment (55,803) (1,800)
Net cash from investing activities 2,319,936 703,102
-------------------- --------------------
Cash flows from financing activities
Proceeds from issue of shares and options 847,706 7,994,745
Capital raising costs (17,570) (674,904)
Net cash from financing activities 830,136 7,319,841
-------------------- --------------------
Net decrease in cash and cash equivalents (7,263,839) (4,380,808)
Cash and cash equivalents at 1 January 11,475,475 16,245,289
Effect of exchange rate fluctuations on
cash held (132,806) (389,006)
Cash and cash equivalents at 31 December 19(a) 4,078,830 11,475,475
==================== ====================
The above consolidated statement of cash flows should be read in
conjunction with the accompanying notes.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2012
1. REPORTING ENTITY
Bullabulling Gold Limited (the "Company"), is a company
domiciled in Australia. The address of the Company's registered
office is Level 2, 55 Carrington Street, Nedlands, Western
Australia. The consolidated financial statements of the Group as at
and for the year ended 31 December 2012 comprise the Company and
its subsidiaries (together referred to as the "Group" and
individually as "Group Entities"). The Group primarily is involved
in the mineral exploration and development industry in
Australia.
2. BASIS OF PREPARATION
(a) Statement of compliance
The consolidated financial statements are general purpose
financial statements which have been prepared in accordance with
Australian Accounting Standards ("AASBs") adopted by the Australian
Accounting Standards Board ("AASB") and the Corporations Act 2001.
The consolidated financial statements comply with International
Financial Reporting Standards (IFRS's) and interpretations adopted
by the International Accounting Standards Board (IASB).
Bullabulling Gold Limited is a for-profit entity for the purpose
of preparing the financial statements.
The consolidated financial statements were approved for issue by
the Board of Directors on 27 March 2013.
(b) Basis of measurement
The consolidated financial statements have been prepared on the
historical cost basis, except share-based payments which are
measured at fair value.
(c) Going concern
The consolidated year end financial report has been prepared on
a going concern basis, which contemplates the continuity of normal
business activity and the realisation of assets and the settlement
of liabilities in the normal course of business.
The Group has a history of successfully raising capital to fund
its exploration and development activities. In addition, the Group
has the capacity to delay or cancel a number of expenses that are
discretionary in nature, including administrative costs and
exploration and development programs that are not contractually
binding.
The Directors have reviewed the business outlook and are of the
opinion that the use of the going concern basis of accounting is
appropriate as they believe the Group will be able to raise the
funds that it requires to carry on business.
2. BASIS OF PREPARATION (continued)
(d) Changes in accounting policy and disclosures
The financial statements are presented in Australian
dollars.
Presentation currency
The operational activities of the Group are conducted in
Australian dollars. Subsequent to the acquisition of GGG Resources
plc on 29 March 2012, the directors resolved to change the
presentation currency of the Group from British pounds to
Australian dollars to reflect a more consistent and meaningful
reflection of the Group's underlying performance. The change in
presentation currency took effect on 1 January 2012. The
operational activities of the Group are conducted in Australia and
these activities and the majority of the Groups' expenditure is
denominated in Australian dollars. As a result, the Board considers
that the change in presentational currency will provide
shareholders with a more consistent and meaningful reflection of
the Group's underlying performance.
Exploration and evaluation expenditure
On 12 September 2012 the board resolved to change the
exploration and development accounting policy such that current and
future exploration is expensed through profit and loss. Comparative
figures have been represented to reflect the change in accounting
policy (see note 9).
(e) Functional and presentation currency
Items included in the financial statements of each of the
Group's operations are measured using the currency of the primary
economic environment in which it operates (the 'functional
currency'). The consolidated financial statements are presented in
Australian dollars, which is the Group's functional and
presentation currency.
(f) Use of estimates and judgements
The preparation of the consolidated financial statements in
conformity with IFRSs requires management to make judgements,
estimates and assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities, income
and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimate is revised and in any future periods
affected.
Information about significant areas of estimation uncertainty
and critical judgements in applying accounting policies that have
the most significant effect on the amount recognised in the
financial statements are described as follows:
Estimates and assumptions
(i) Exploration and evaluation assets
Following the change in accounting policy (refer note 9),
exploration, evaluation and development expenditure is expensed to
profit and loss when incurred.
(ii) Recognition of tax losses
In accordance with the Group's accounting policies for deferred
taxes (refer note 3(l)), a deferred tax asset is recognised for
unused tax losses only if it is probable that future taxable
profits will be available to utilise those losses. Determination of
future taxable profits requires estimates and assumptions as to
future events and circumstances, in particular, whether successful
development and commercial exploitation, or alternatively
judgements about commodity prices, exchange rates, future capital
requirements, future operational performance and the timing of
estimated cash flows. Changes in these estimates and assumptions
could impact on the amount and probability of estimated taxable
profits and accordingly the recoverability of deferred tax assets.
The Group currently does not recognise deferred tax assets.
2. BASIS OF PREPARATION (continued)
(f) Use of estimates and judgements (continued)
(iii) Share-based payments
As set out in note 26, share-based payments have been calculated
at fair value using the Black & Scholes method and have been
recognised as either an employee or professional expense, according
to its nature.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied
consistently to all periods presented in these consolidated
financial statements, and have been applied consistently by Group
entities, except as explained in note 2(d), which addresses changes
in accounting policies.
(a) Basis of consolidation
(i) Subsidiaries
Subsidiaries are entities controlled by the Group. Control
exists when the Group has the power to govern the financial and
operating policies of an entity so as to obtain benefits from its
activities. In assessing control, potential voting rights that
currently are exercisable are taken into account. The financial
statements of subsidiaries are included in the consolidated
financial statements from the date that control commences until the
date control ceases.
In the Company's financial statements, investments in
subsidiaries are carried at cost.
(ii) Transactions eliminated on consolidation
Intra-group balances, and any unrealised income and expenses
arising from intra-group transactions, are eliminated in preparing
the consolidated financial statements.
Gains and losses are recognised when the contributed assets are
consumed or sold by the equity accounted investees or, if not
consumed or sold by the equity accounted investee, when the Group's
interest in such entities is disposed of.
(b) Foreign Currency
(i) Foreign Currency Transactions
Transactions in foreign currencies are translated to the
respective functional currencies of Group entities at exchange
rates at the dates of the transactions. Monetary assets and
liabilities denominated in foreign currencies at the reporting date
are retranslated to the functional currency at the foreign exchange
rate at that date. The foreign currency gain or loss on monetary
items is the difference between amortised cost in the functional
currency at the beginning of the period, adjusted for effective
interest and payments during the period, and the amortised cost in
foreign currency translated at the exchange rate at the end of the
year.
Non-monetary assets and liabilities denominated in foreign
currencies that are measured at fair value are retranslated to the
functional currency at the exchange rate at the date that the fair
value was determined. Non-monetary items in a foreign currency that
are measured in terms of historical cost are translated using the
exchange rate at the date of the transaction. Foreign currency
differences arising on retranslation are recognised in profit or
loss.
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(b) Foreign Currency (continued)
(ii) Functional Currency
The functional currency of an entity is the currency of the
primary economic environment in which the entity operates, which
should reflect the economic substance of the underlying events and
circumstances relevant to the Group.
On 29 March 2012 Bullabulling Gold Limited acquired 100% of GGG
Resources plc by way of scheme of arrangement. At the time
Bullabulling Gold Limited had a functional currency of Australian
dollars as it is the currency that reflects the underlying
transactions of the entity. Expenses and liabilities will be
incurred in Australian dollars and future capital raisings will be
in Australian dollars. GGG Resources plc had a functional currency
of British pounds.
As a result of the merger GGG Resources plc is being managed
from Australia, and the only asset held by GGG Resources plc is in
Australia and will comprise the only activity of the Group. Future
capital for GGG Resources plc will be provided by Bullabulling Gold
Limited.
As a result of the above changed circumstances, the Board
resolved to change the functional currency of GGG Resources plc to
Australian dollars, effective from the date of the merger.
To give effect to the changes in functional currency, the
assets, liabilities and equity of group entities with a British
pound functional currency as at 29 March 2012 were converted to
Australian dollars at a fixed exchange rate on 29 March 2012 of
0.654.
(c) Business combinations
Business combinations occur where control over another business
is obtained and results in the consolidation of its assets and
liabilities. All business combinations, including those involving
entities under common control, are accounted for by applying the
purchase method.
The purchase method requires an acquirer of the business to be
identified and for the cost of the acquisition and fair values of
identifiable assets and liabilities to be determined as at
acquisition date, being the date that control is obtained. Cost is
determined as the aggregate of fair values of assets given, equity
issued and liabilities assumed in exchange for control together
with costs directly attributable to the business combination. Any
deferred consideration payable is discounted to present value using
the entity's incremental borrowing rate.
Goodwill is recognised initially at the excess of cost over the
acquirer's interest in the net fair value of the identifiable
assets and liabilities recognised. If the fair value of the
acquirer's interest is greater than cost, the surplus is
immediately recognised in profit or loss.
Bullabulling Gold Limited was incorporated on 15 September 2011
with 3 shares on issue. The merger between Bullabulling Gold
Limited and GGG Resources plc resulted in Bullabulling Gold Limited
issuing shares to acquire all the issued shares of GGG Resources
plc. GGG Resources plc owned a 50% interest in the Bullabulling
gold project, and this was its primary asset. At the time of the
merger Bullabulling Gold Limited only had 3 shares on issue, and as
a result of the merger GGG Resources plc shareholders effectively
ended up owning 100% of Bullabulling Gold Limited. As Bullabulling
Gold Limited did not have any ongoing activity or processes at the
date of the merger, prior to the merger it would not have been
deemed a business. As a result, the merger is not a business
combination and therefore the transaction is accounted for in
accordance with AASB 2 "Share based payments". The overall
accounting effect is very similar to that of a reverse
acquisition.
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(c) Business combinations (continued)
This accounting treatment applies only to the business
combination transactions at the acquisition date and does not apply
to transactions after the reverse acquisition date.
Reverse acquisition accounting applies only to the consolidated
financial statements.
Because the consolidated financial statements represent a
continuation of the financial statements of GGG Resources plc, the
principles and guidance on the preparation and presentation of the
consolidated financial statements in a reverse acquisition set out
in AASB 3 have been applied:
-- fair value adjustments arising at acquisition were made to
Bullabulling Gold Limited's assets and liabilities, not those of
GGG Resources plc;
-- the cost of the acquisition is based on the notional amount
of shares that GGG Resources plc would need to issue to acquire the
majority interest of Bullabulling Gold Limited's shares that the
shareholders did not own after the acquisition, times the fair
value of GGG Resources plc shares at acquisition date;
-- retained earnings and other equity balances in the
consolidated financial statements at the date of acquisition are
the retained earnings and other equity balances of GGG Resources
plc immediately before the acquisition;
-- a share-based payment transaction arises whereby GGG
Resources plc is deemed to have issued shares in exchange for the
net assets of Bullabulling Gold Limited;
-- the amount recognised as issued equity instruments in the
consolidated financial statements has been determined by adding the
share-based payment to the issued equity of GGG Resources plc
immediately before the business combination;
-- the equity structure in the consolidated financial statements
(the number and type of equity instruments issued) at the date of
acquisition reflects the equity structure of Bullabulling Gold
Limited, including the equity instruments issued by Bullabulling
Gold Limited to effect the acquisition;
-- the results for the six months ended 30 June 2012 comprise
the results of GGG Resources plc, and the results of Bullabulling
Gold Limited subsequent to the acquisition.
(d) Asset Acquisition
On 16 April 2012 Bulllabulling Gold Limited acquired 100% of the
issued shares of Auzex Resources Limited by way of a merger by
scheme of arrangement. Auzex Resources Limited shareholders (other
than GGG Resources plc which held shares in Auzex Resources
Limited) received shares in Bullabulling Gold Limited that resulted
in those shareholders having a percentage equivalent to the same
economic interest in the Bullabulling Project as they held
immediately before the merger took effect.
In accordance with the merger implementation agreement, and
prior to the merger, Auzex Resources Limited spun its non
Bullabulling gold project assets into another entity.
Bullabulling Gold Limited acquired Auzex Resources Limited with
the only key asset being its retained 50% interest in the
Bullabulling gold project. As the acquisition of Auzex Resources
Limited is not deemed a business acquisition, the transaction must
be accounted for as a share based payment for the net assets
acquired.
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(d) Asset Acquisition (continued)
When an asset acquisition does not constitute a business
combination, the assets and liabilities are assigned a carrying
amount based on their relative fair values in an asset purchase
transaction and no deferred tax will arise in relation to the
acquired assets and assumed liabilities as the initial recognition
exemption for deferred tax under AASB 112 applies. No goodwill will
arise on the acquisition and transaction costs of the acquisition
will be included in the capitalised cost of the asset.
(e) Financial instruments
(i) Non-derivative financial assets
The Group initially recognises loans and receivables and
deposits on the date that they are originated. All other financial
assets (including assets designated at fair value through profit or
loss) are recognised initially on the trade date at which the Group
becomes a party to the contractual provisions of the
instrument.
The Group derecognises a financial asset when the contractual
rights to the cash flows from the asset expire, or it transfers the
rights to receive the contractual cash flows on the financial asset
in a transaction in which substantially all the risks and rewards
of ownership of the financial asset are transferred. Any interest
in transferred financial assets that is created or retained by the
Group is recognised as a separate asset or liability.
Financial assets and liabilities are offset and the net amount
presented in the statement of financial position when, and only
when, the Group has a legal right to offset the amounts and intends
either to settle on a net basis or to realise the asset and settle
the liability simultaneously.
The Group has the following non-derivative financial assets:
cash and other receivables.
Loans and receivables
Loans and receivables are financial assets with fixed or
determinable payments that are not quoted in an active market. Such
assets are recognised initially at fair value plus any directly
attributable transaction costs. Subsequent to initial recognition
loans and receivables are measured at amortised cost using the
effective interest method, less any impairment losses.
Loans and receivables comprise other receivables.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call
deposits. Bank overdrafts that are repayable on demand and form an
integral part of the Group's cash management are included as a
component of cash and cash equivalents for the purpose of the
statement of cash flows.
Accounting for finance income and expense is discussed in note
3(k).
(ii) Non-derivative financial liabilities
The Group initially recognises debt securities issued and
subordinated liabilities on the date that they are originated. All
other financial liabilities (including liabilities designated at
fair value through profit or loss) are recognised initially on the
trade date at which the Group becomes a party to the contractual
provisions of the instrument. The Group derecognises a financial
liability when its contractual obligations are discharged,
cancelled or expire. Financial assets and liabilities are offset
and the net amount presented in the statement of financial position
when, and only when, the Group has a legal right to offset the
amounts and intends either to settle on a net basis or to realise
the asset and settle the liability simultaneously.
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(e) Financial instruments (continued)
(ii) Non-derivative financial liabilities (continued)
The Group has the following non-derivative financial
liabilities: trade and other payables.
Such financial liabilities are recognised initially at fair
value plus any directly attributable transaction costs. Subsequent
to initial recognition these financial liabilities are measured at
amortised cost using the effective interest rate method.
(iii) Share capital
Ordinary Shares
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of ordinary shares and share
options are recognised as a deduction from equity, net of any tax
effects.
Dividends
Dividends are recognised as a liability in the period in which
they are declared.
(f) Property, plant and equipment
(i) Recognition and measurement
Items of property, plant and equipment are measured at cost less
accumulated depreciation and accumulated impairment losses.
Cost includes expenditure that is directly attributable to the
acquisition of the asset. When parts of an item of property, plant
and equipment have different useful lives, they are accounted for
as separate items of property, plant and equipment.
Gains and losses on disposal of an item of property, plant and
equipment are determined by comparing the proceeds from disposal
with the carrying amount of property, plant and equipment and are
recognised net within "other income" and "other expenses" in profit
or loss.
(ii) Depreciation
Depreciation is calculated over the depreciable amount, which is
the cost of an asset, or other amount substituted for cost, less
its residual value.
Depreciation is recognised in profit or loss on a reducing
balance basis over the estimated useful lives of each part of an
item of property, plant and equipment, since this most closely
reflects the expected pattern of consumption of the future economic
benefits embodied in the asset. Leased assets are depreciated over
the shorter of the lease term and their useful lives unless it is
reasonably certain that the Group will obtain ownership by the end
of the lease term.
The estimated useful lives for the current and comparative
periods are as follows:
2012 2011
----------------------- -------- --------
Plant and equipment 10%-20% 10%-20%
Motor vehicles 10%-20% 10%-20%
Fixtures and fittings 33% 33%
Computer equipment 20%-33% 33%
----------------------- -------- --------
Depreciation methods, useful lives and residual values are
reviewed at each reporting date and adjusted if appropriate.
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(g) Exploration and evaluation
Exploration for and evaluation of mineral resources is the
search for mineral resources after the entity has obtained legal
rights to explore in a specific area, as well as the determination
of the technical feasibility and commercial viability of extracting
the mineral resource. Accordingly, exploration and evaluation
expenditures are those expenditures incurred by the Group in
connection with the exploration for and evaluation of mineral
resources before the technical feasibility and commercial viability
of extracting a mineral resource are demonstrable.
Accounting for exploration and evaluation expenditures is
assessed separately for each 'area of interest'. An 'area of
interest' is an individual geological area which is considered to
constitute a favourable environment for the presence of a mineral
deposit or has been proved to contain such a deposit.
Expenditure incurred on activities that precede exploration and
evaluation of mineral resources, including all expenditure incurred
prior to securing legal rights to explore an area, is expensed to
profit and loss as incurred.
(h) Impairment
(i) Non-derivative financial assets
A financial asset not carried at fair value through profit or
loss is assessed at each reporting date to determine whether there
is any objective evidence that it is impaired. A financial asset is
considered to be impaired if objective evidence indicates that one
or more loss events has had a negative effect on the estimated
future cash flows of that asset that can be estimated reliably.
Objective evidence that financial assets (including equity
securities) are impaired can include default or delinquency by a
debtor, restructuring of an amount due to the Group on terms that
the Group would not consider otherwise, indications that a debtor
or issuer will enter bankruptcy, or the disappearance of an active
market for a security. In addition, for an investment in an equity
security, a significant or prolonged decline in its fair value
below its cost is objective evidence of impairment.
The Group considers evidence of impairment for receivables and
held-to-maturity investment securities at both a specific asset and
collective level. All individually significant receivables and
held-to-maturity investment securities are assessed for specific
impairment. All individually significant receivables and
held-to-maturity investment securities found not to be specifically
impaired are then collectively assessed for any impairment that has
been incurred but not yet identified. Receivables and
held-to-maturity investment securities that are not individually
significant are collectively assessed for impairment by grouping
together receivables and held-to-maturity investment securities
with similar risk characteristics.
In assessing collective impairment the Group uses historical
trends of the probability of default, timing of recoveries and the
amount of loss incurred, adjusted for management's judgement as to
whether current economic and credit conditions are such that the
actual losses are likely to be greater or less than suggested by
historical trends.
An impairment loss in respect of a financial asset measured at
amortised cost is calculated as the difference between its carrying
amount and the present value of the estimated future cash flows
discounted at the original effective interest rate. An impairment
loss in respect of an available-for-sale financial asset is
calculated by reference to its fair value.
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(h) Impairment (continued)
(ii) Non-financial assets
The carrying amounts of the Group's non-financial assets, other
than inventories and deferred tax assets are reviewed at each
reporting date to determine whether there is any indication of
impairment. If any such indication exists then the asset's
recoverable amount is estimated. For goodwill and intangible assets
that have indefinite lives or that are not yet available for use,
the recoverable amount is estimated each year at the same time.
The recoverable amount of an asset or cash-generating unit is
the greater of its value in use and its fair value less costs to
sell. 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.
An impairment loss is recognised if the carrying amount of an
asset or its cash-generating unit exceeds its recoverable amount.
Impairment losses are recognised in profit or loss.
(i) Employee benefits
(i) Share-based payment transactions
The share option programme allows Group employees to acquire
shares of the Group. The grant date fair value of share-based
payment awards granted to employees is recognised as an employee
expense, with a corresponding increase in equity, over the period
that the employees unconditionally become entitled to the awards.
The amount recognised as an expense is adjusted to reflect the
number of awards for which the related service and non-market
vesting conditions are expected to be met, such that the amount
ultimately recognised as an expense is based on the number of
awards that do not meet the related service and non-market
performance conditions at the vesting date. For share-based payment
awards with non-vesting conditions, the grant date fair value of
the share-based payment is measured to reflect such conditions and
there is no true-up for differences between expected and actual
outcomes.
The fair value of the options granted is measured using the
Black & Scholes formula, taking into account, the terms and
conditions upon which the options were granted. The amount
recognised as an expense is adjusted to reflect the actual number
of share options that vest, except for those that fail to vest due
to market conditions not being met.
(ii) Wages, salaries and annual leave
Liabilities for employee benefits for wages, salaries and annual
leave represent present obligations resulting from employees'
services provided to reporting date, calculated at discounted
amounts based on remuneration wage and salary rates that the Group
expects to pay as at the reporting date.
(iii) Long service leave
The provision for employee benefits to long service leave is the
amount of future benefit that employees have earned in return for
their services in the current and prior periods. The provision is
calculated using current future increases in wage and salary
rates
(j) Provisions
A provision is recognised if, as a result of a past event, the
Group has a present legal or constructive obligation that can be
estimated reliably, and it is probable that an outflow of economic
benefits will be required to settle the obligation. Provisions are
determined by discounting the expected future cash flows at a
pre-tax rate that reflects current market assessments of the true
value of money and the risks specific to the liability.
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(j) Provisions (continued)
Site Restoration
In accordance with the Group's published environment policy and
applicable legal requirements, a provision for site restoration in
respect of contaminated and disturbed land, and the related
expense, is recognised when the land is contaminated or
disturbed.
(k) Finance income and finance costs
Finance income comprises interest income on funds invested and
foreign exchange gains. Interest income is recognised as it accrues
in profit or loss, using the effective interest method.
Finance costs comprise interest expense on borrowings and
impairment losses recognised on financial assets. All borrowing
costs are recognised in profit or loss using the effective interest
method.
(l) Income tax
Income tax expense comprises current and deferred tax. Current
and deferred tax is recognised in profit or loss except to the
extent that it relates to items recognised directly in equity or in
other comprehensive income.
Current tax is the expected tax payable or receivable on the
taxable income or loss for the year, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to
tax payable in respect of previous years.
Deferred tax is recognised in respect of temporary differences
between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for taxation
purposes. Deferred tax is not recognised for the following
temporary differences: the initial recognition of assets and
liabilities in a transaction that is not a business combination and
that affects neither accounting nor taxable profit or loss, and
differences relating to investments in subsidiaries to the extent
that it is probable that they will not reverse in the foreseeable
future.
Deferred tax is measured at the tax rates that are expected to
be applied to temporary differences when they reverse, based on
laws that have been enacted or substantively enacted by reporting
date. Deferred tax assets and liabilities are offset if there is a
legally enforceable right to offset current tax liabilities and
assets, and they relate to income taxes levied by the same tax
authority on the same taxable entity but they intend to settle
current tax assets and liabilities on a net basis or their tax
assets and liabilities will be realised simultaneously.
A deferred tax asset is recognised for unused tax losses, tax
credits and deductible temporary differences, to the extent that it
is probable that future taxable profits will be available against
which they can be utilised. Deferred tax assets are reviewed at
each reporting date and are reduced to the extent that it is no
longer probable that the related tax benefit will be realised.
Tax consolidation
The Company and its wholly-owned Australian resident entity are
not a consolidated group for tax purposes.
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(m) Goods and services tax
Revenues, expenses and assets are recognised net of the amount
of goods and services tax (GST), except where the amount of GST
incurred is not recoverable from the taxation authority. In these
circumstances, the GST is recognised as part of the cost of
acquisition of the asset or as part of the expense.
Receivables and payables are recognised with the amount of GST
included. The net amount of GST recoverable from, or payable to,
the ATO is included as a current asset or liability in the balance
sheet.
Cash flows are included in the statement of cash flows on a
gross basis. The GST components of cash flows arising from
investing and financing activities which are recoverable from, or
payable to, the ATO are classified as operating cash flows.
(n) Earnings per share
The Group presents basic and diluted earnings per share (EPS)
data for its ordinary shares. Basic EPS is calculated by dividing
the net profit or loss attributable to ordinary shareholders of the
company by the weighted average number of ordinary shares
outstanding during the period.
Diluted EPS is determined by adjusting the profit or loss
attributable to ordinary shareholders and the weighted average
number of ordinary shares outstanding for the effects of all
dilutive potential ordinary shares, which comprises share options
granted to employees.
(o) Segment reporting
Determination and presentation of operating segments
An operating segment is a component of the Group that engages in
business activities from which it may earn revenues and incur
expenses, including revenues and expenses that relate to
transactions with any of the Group's other components. All
operating segments' operating results are regularly reviewed by the
Group's CEO to make decisions about resources to be allocated to
the segment and assess its performance, and for which discrete
financial information is available.
Segment results that are reported to the CEO include items
directly attributable to a segment as well as those that can be
allocated on a reasonable basis. Unallocated items comprise mainly
corporate assets (primarily the Group's headquarters), head office
expenses, and income tax assets and liabilities.
Segment capital expenditure is the total cost incurred during
the period to acquire property, plant and equipment.
(p) Revenue recognition
Revenue from the sale of goods in the course of ordinary
activities is measured at the fair value of the consideration
received or receivable. Amounts disclosed as revenue are net of
returns, trade allowances, rebates and amounts collected on behalf
of third parties. Revenue from services rendered is recognised in
the consolidated statement of comprehensive income in proportion to
services provided.
(q) Other income
Other income is recognised when the amount can be reliably
measured and control of the right to receive the income has passed
to the Group.
(r) Operating leases
Payments made under operating leases are expensed on a straight
line basis over the term of the lease.
3. SIGNIFICANT ACCOUNTING POLICIES (continued)
(s) Trade and other payables
Trade and other payables are stated at their amortised costs.
Trade payables are non-interest bearing and are normally settled
within 60 days.
(t) Available for sale financial assets
Available for sale financial assets, comprising principally
marketable equity securities, are non-derivatives that are either
designated in this category or not classified in any of the other
categories. They are includes in non-current assets unless the
investment matures or management intends to dispose of the
investment within 12 months of the end of the reporting period.
Investments are designated as available for sale if they do not
have fixed maturities and fixed or determinable payments and
management intends to hold them for the medium to long term.
4. NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED
A number of new standards, amendments to standards and
interpretation are effective for annual periods beginning after 1
January 2012, and have not been applied in preparing these
consolidated financial statements. Those which may be relevant to
the Group are set out below. The Group does not plan to adopt these
standards early.
(a) AASB9 Financial Instruments (2010), AASB 9 Financial Instruments (2009)
AASB 9 (2009) introduces new requirements for the classification
and measurement of financial assets. Under AASB 9 (2009), financial
assets are classified and measured based on the business model in
which they are held and the characteristics of their contractual
cash flows. AASB 9 (2010) introduces additions relating to
financial liabilities. The IASB currently has an active project
that may result in limited amendments to the classification and
measurement requirements of AASB 9 and add new requirements to
address the impairment of financial assets and hedge
accounting.
AASB 9 (2010 and 2009) is effective for annual periods beginning
on or after 1 January 2015 with early adoption permitted. The Group
does not plan to adopt this standard early as the extent of the
impact has not been determined.
4. NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED (continued)
(b) AASB10 Consolidated Financial Statements, AASB 11 Joint
Arrangements, AASB 12 Disclosure of Interests in Other Entities
(2011)
AASB 10 introduces a single control model to determine whether
an investee should be consolidated. As a result, the Group may need
to change its consolidation conclusion in respect of its investees,
which may lead to changes in the current accounting for these
investees (see Note 3(a)(i)).
Under AASB 11, the structure of the joint arrangement, although
still an important consideration, is no longer the main factor in
determining the type of joint arrangement and therefore subsequent
accounting.
-- The Group's interest in a joint operation, which is an
arrangement in which the parties have rights to the assets and
obligations for the liabilities, will be accounted for on the basis
of the Group's interest in those assets and liabilities.
-- The Group's interest in a joint venture, which is an
arrangement in which the parties have rights to the net assets,
will be equity accounted.
AASB 12 brings together into a single standard all the
disclosure requirements about an entity's interests in
subsidiaries, joint arrangements, associates and unconsolidated
structured entities. The Group is currently assessing the
disclosure requirements for interests in subsidiaries in comparison
with the existing disclosures. AASB 12 requires the disclosure of
information about the nature, risks and financial effects of these
interests.
These standards are effective for annual periods beginning on or
after 1 January 2013 with early adoption permitted. The Group does
not plan to adopt this standard early as it is unlikely to impact
the financial statements.
(c) AASB13 Fair Value Measurement (2011)
AASB 13 provides a single source of guidance on how fair value
is measured, and replaces the fair value measurement guidance that
is currently dispersed throughout Australian Accounting Standards.
Subject to limited exceptions, AASB 13 is applied when fair value
measurements or disclosures are required or permitted by other
AASBs. The Group is currently reviewing its methodologies in
determining fair values (see Note 5). AASB 13 is effective for
annual periods beginning on or after 1 January 2013 with early
adoption permitted. The Group does not plan to adopt this standard
early as it is unlikely to impact the financial statements.
5. DETERMINATION OF FAIR VALUES
A number of the Group's accounting policies and disclosures
require the determination of fair value, for both financial and
non-financial assets and liabilities. Fair values have been
determined for measurement and / or disclosure purposes based on
the following methods. When applicable, further information about
the assumptions made in determining fair values is disclosed in the
notes specific to that asset or liability.
Share-based payment transactions
The fair value of stock options is based on market value, if
available. If market value is not available, then the fair value of
stock options is measured using the Black and Scholes model.
Measurement inputs include share price on measurement date,
exercise price of the instrument, expected volatility, weighted
average expected life of the instruments (based on historical
experience and general option holder behaviour), expected
dividends, and the risk-free interest rate (based on government
bonds). Service and non-market performance conditions attached to
the transactions are not taken into account in determining fair
value.
6. FINANCIAL RISK MANAGEMENT
Overview
The Group has exposure to the following risks from their use of
financial instruments:
-- credit risk
-- liquidity risk
-- market risk
This note presents information about the Group's exposure to
each of the above risks, the Group's objectives, policies and
processes for measuring and managing risk, and the Group's
management of capital. Further quantitative disclosures are
included throughout these financial statements.
Risk management framework
The Board of Directors has overall responsibility for the
establishment and oversight of the Group's risk management
framework. The Board has established the Audit and Risk Management
Committee, which is responsible for developing and monitoring the
Group's risk management policies. The committee reports regularly
to the Board of Directors on its activities.
The Group's risk management policies are established to identify
and analyse the risks faced by the Group, to set appropriate risk
limits and controls, and to monitor risks and adherence to limits.
Risk management policies and systems are reviewed regularly to
reflect changes in market conditions and the Group's
activities.
The Audit and Risk Management Committee oversees how management
monitors compliance with the Group's risk management policies and
procedures, and reviews the adequacy of the risk management
framework in relation to the risks faced by the Group.
(a) Credit risk
Credit risk is the risk of financial loss to the Group if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations, and arises principally from the
Group's receivables from customers and investment securities.
Exposure to credit risk
The carrying amount of financial assets represents the maximum
credit exposure. The maximum exposure to credit risk at the
reporting date was:
Carrying amount
2012 2011
$ $
--------------------------- -------------------- --------------------
Other receivables 1,488,708 999,213
Cash and cash equivalents 4,078,830 11,475,475
-------------------- --------------------
5,567,538 12,474,688
None of the Group's receivables are past due.
Cash and cash equivalents
The Group limits its exposure to credit risk by only depositing
with authorised banking institutions and only with counterparties
that have an acceptable credit rating.
Trade and other receivables
As the Group operates primarily in exploration activities, it
does not have trade receivables and therefore is not exposed to
credit risk in relation to trade receivables with the exception of
the office sub-lease.
6. FINANCIAL RISK MANAGEMENT (continued)
(a) Credit risk (continued)
Trade and other receivables (continued)
The maximum exposure to credit risk for trade and other
receivables at the reporting date by geographic region was:
Carrying amount
2012 2011
$ $
----------- -------------------- --------------------
Australia 1,488,708 999,213
==================== ====================
The maximum exposure to credit risk for trade and other
receivables at the reporting date by type of counterparty was:
Carrying amount
2012 2011
$ $
------------------------------------------------ -------------------- --------------------
Authorised banking institutions and government
agencies 1,464,227 653,033
Office sub-lease income 24,463 -
Other 18 346,180
-------------------- --------------------
1,488,708 999,213
==================== ====================
Management does not expect any counterparty to fail to meet its
future obligations and therefore the Group has not established an
allowance for impairment that represents their estimate of incurred
losses in respect of intercompany loans and receivables and
investments.
(b) Liquidity risk
Liquidity risk is the risk that the Group will not be able to
meet its financial obligations as they fall due. The Group's
approach to managing liquidity is to ensure, as far as possible,
that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the
Group's reputation.
The Group ensures that it has sufficient cash on demand to meet
expected operational expenses. This excludes the potential impact
of extreme circumstances that cannot reasonably be predicted, such
as natural disasters.
6. FINANCIAL RISK MANAGEMENT (continued)
(b) Liquidity risk (continued)
The following are the contractual maturities of financial
liabilities, including estimated interest payments and excluding
the impact of netting arrangements:
Carrying Contractual 6 months
amount cash flows or less
$ $ $
-------------------------------------- ------------------ ------------------ ------------------
31 December 2012
Non-derivative financial liabilities
Trade and other payables 1,890,328 (1,890,328) (1,890,328)
------------------ ------------------ ------------------
1,890,328 (1,890,328) (1,890,328)
================== ================== ==================
31 December 2011
Non-derivative financial liabilities
Trade and other payables 901,761 (901,761) (901,761)
------------------ ------------------ ------------------
901,761 (901,761) (901,761)
================== ================== ==================
(c) Capital risk management
The Group's objectives when managing capital are to safeguard
the Group's ability to continue as a going concern, so as to
maintain a strong capital base sufficient to maintain future
exploration and development of its projects. In order to maintain
or adjust the capital structure, the Group may return capital to
shareholders or issue new shares. The Group's focus has been to
raise sufficient funds through equity to fund exploration and
evaluation activities.
There were no changes in the Group's approach to capital
management during the year.
The Group entities are not subject to externally imposed capital
requirements.
(d) Market risk
Market risk is the risk that changes in market prices, such as
foreign exchange rates, interest rates, commodity prices and equity
prices will affect the Group's income or the value of its holdings
of financial instruments. The objective of market risk management
is to manage and control market risk exposures within acceptable
parameters, while optimising the return. The Group is exposed to
currency or any other market risk with the exception of interest
rate risk as detailed below.
6. FINANCIAL RISK MANAGEMENT (continued)
(d) Market risk (continued)
(i) Foreign currency risk management
The Group is exposed to currency risks on expenses that are
denominated in a currency other than the respective functional
currencies of Group entities, which is primarily the Australian
dollar (AUD). The currencies in which these transactions will
primarily be denominated are AUD, GBP and USD.
The Group's exposure to foreign currency risk during the current
and prior year was as follows:
31 December 2012 31 December 2011
GBP USD GBP USD
$ $ $ $
--------------------------- -------------- ----------------- -------------- -----------------
Cash and cash equivalents 62,079 - 41,936 2,214,743
Trade and other payables (5,186) - (108,221) -
Net exposure 56,893 - (66,285) 2,214,743
============== ================= ============== =================
In the prior financial year the functional currency was GBP as
the parent company, GGG Resources plc is a company registered in
the UK. The functional currency of the Group changed in 2012
following the reverse merger between Bullabulling Gold Limited and
GGG Resources plc.
The following significant exchange rates applied during the
year:
Reporting date
Average rate spot rate
AUD 2012 2011 2012 2011
----------------- -------------- -------------- -------------- ----------
UK Pound (GBP) 0.6548 0.6438 0.6414 0.6583
US Dollar (USD) 1.0327 1.0329 1.0371 1.0174
The Group was exposed to US dollars (USD) and UK Sterling (GBP).
The following table details the Group's sensitivity to a 10%
increase and decrease in the Australian dollar against the relevant
foreign currencies and represents management's assessment of the
possible change in foreign exchange rates. The sensitivity analysis
includes only outstanding foreign currency denominated monetary
items and adjusts their translation at the period end for a 10%
change in foreign currency rates. The sensitivity analysis includes
external loans as well as loans to foreign operations within the
Group where the denomination of the loan is in a currency other
than the currency of the lender or the borrower. A positive number
indicates an increase in profit or loss where the Australian dollar
strengthens against the respective currency.
6. FINANCIAL RISK MANAGEMENT (continued)
(d) Market risk (continued)
(i) Foreign currency risk management (continued)
Impact on profit
and loss
and equity
2012 2011
$ $
--------------------------- ----------------- -----------
If AUD strengthens by 10%
GBP (5,172) 9,154
USD - (197,897)
If AUD weakens by 10%
GBP 6,321 (11,188)
USD - 241,873
(ii) Interest rate risk
The Group only has interest rate risk relating to its funds on
deposit with banking institutions. Accordingly, the Group does not
hedge its interest rate risk exposure (see note 6(d)(ii) for
sensitivity analysis).
Profile
At the reporting date the interest rate profile of the Group's
interest bearing financial instruments was:
Carrying amount
2012 2011
$ $
--------------------------- -------------------- --------------------
Variable rate instruments
Financial assets 328,830 1,416,717
-------------------- --------------------
328,830 1,416,717
Fair value sensitivity analysis for fixed rate instruments
The Group does not account for any fixed rate financial assets
and liabilities at fair value through profit or loss. Therefore a
change in interest rates at the reporting date would not affect
profit or loss.
6. FINANCIAL RISK MANAGEMENT (continued)
(d) Market risk (continued)
(ii) Interest rate risk (continued)
Cash flow sensitivity analysis for variable rate instruments
A change of 100 basis points in interest rates at the reporting
date would have increased / (decreased) profit and loss by the
amounts shown below. This analysis assumes that all other variables
remain constant. The analysis is performed on the same basis for
2011.
Profit or loss
100 bp 100 bp
increase decrease
$ $
--------------------------- -------------------- --------------------
31 December 2012
Variable rate instruments 3,288 (3,288)
-------------------- --------------------
Cash flow sensitivity 3,288 (3,288)
==================== ====================
31 December 2011
Variable rate instruments 14,165 (14,165)
-------------------- --------------------
Cash flow sensitivity 14,165 (14,165)
==================== ====================
At the reporting date the Group did not hold any variable rate
financial liabilities.
(e) Fair values of financial assets and liabilities
The fair value of financial assets and financial liabilities
must be estimated for recognition and measurement or for disclosure
purposes.
The fair value of the financial assets and liabilities, together
with their carrying amounts shown in the consolidated statement of
financial position, are as follows:
2012 2011
Carrying Fair Carrying Fair
Amount Value Amount Value
$ $ $ $
------------- ----------------- ----------------- ----------------- -----------------
Investments 427,778 427,778 2,464,000 2,464,000
6. FINANCIAL RISK MANAGEMENT (continued)
(e) Fair values of financial assets and liabilities (continued)
AASB 7 Financial Instruments: Disclosures requires disclosure of
the fair value measurements by level of the following fair value
measurement hierarchy:
(i) Level 1 - quoted prices (unadjusted) in active markets for
identical assets and liabilities;
(ii) Level 2 - inputs other than quoted prices included within
level 1 that are observable for the asset or liability, either
directly (as prices) or indirectly (derived from prices); and
(iii) Level 3 - inputs for the asset or liability that are not
based on observable market data (unobservable inputs)
The table below analyses financial instruments carried at fair
value, by valuation method:
Level Level Level Total
1 2 3
$ $ $ $
------------------ ----------------- ----------------- ----------------- ----------------
31 December 2012
Investments - 427,778 - 427,778
================= ================= ================= ================
31 December 2011
Investments 2,464,000 - - 2,464,000
================= ================= ================= ================
7. REVERSE MERGER
On 29 March 2012 Bullabulling Gold Limited acquired the shares
of GGG Resources plc. Due to Bullabulling Gold Limited being a
shell Group, this transaction was accounted for as a reverse
acquisition whereby GGG Resources plc is the parent entity for
accounting purposes (see also details under note 3c).
The value of the transaction is as follows:
2012 2011
$ $
------------------------------------------ -------- ----------------------------- -----------------------------
Share based payment 26 - -
Net liabilities acquired in Bullabulling
Gold Limited (1) 701,803 -
Goodwill written off 701,803 -
============================= =============================
(1) included in net liabilities of Bullabulling Gold Limited is
cash and cash equivalents held amounting to $(2,974).
8. ASSET ACQUISITION
On 16 April 2012, Bullabulling Gold Limited acquired Auzex
Resources Limited, a Group listed on the ASX. The acquisition was
essentially to acquire Auzex Resources Limited's share of the
Bullabulling assets with no infrastructure or personnel.
The consideration payable was 0.909 Bullabulling Gold Limited
shares for every one share held in Auzex Resources Limited, and
0.909 Bullabulling Gold Limited options for every one option held
in Auzex Resources Limited.
Details of the fair value of the assets and liabilities acquired
as at 16 April 2012 are as follows:
$
--------------------------------------------- --------------------------
Purchase consideration comprises:
Cash adjustment paid to Auzex Resources
Limited 4,700,000
Existing shares held 2,874,667
118,353,573 ordinary shares 28,553,437
2,154,242 options exercisable between 18.54
and 20.47 cents each 433,404
Total consideration 36,561,508
Acquisition related costs attributable to
assets acquired 1,994,529
38,556,037
==========================
8. ASSET ACQUISITION (continued)
$
----------------------------------- --- --------------------------
Net assets acquired:
Cash and cash equivalents 6,634,436
Trade and other receivables 695,517
Property, plant and equipment 406,872
Exploration and evaluation assets * 32,894,832
Trade and other payables (1,840,620)
Provisions (235,000)
--------------------------
38,556,037
==========================
* this amount was written off to the profit and loss in line
with the change in accounting policy as disclosed in note 9.
9. VOLUNTARY CHANGE OF ACCOUNTING POLICY
The consolidated financial statements have been prepared on the
basis of a retrospective application of a voluntary change in
accounting policy relating to exploration and evaluation
expenditure.
The new exploration and evaluation expenditure accounting policy
is to expense all exploration and evaluation expenditure, including
acquisition costs and exploration expenditure, where JORC compliant
(or JORC equivalent) Resource has been identified.
The previous accounting policy was that expenditure on
exploration and evaluation activities in relation to areas of
interest which had not reached a stage which permitted reasonable
assessment of the existence or otherwise of economically
recoverable reserves were capitalised as incurred.
The new accounting policy was adopted on 31 December 2012 and
has been applied retrospectively. The Directors believe that the
change in accounting policy will provide more relevant information
and no less reliable information to users of the consolidated
financial statements. Both the previous and the new accounting
policy are compliant with AASB 6 Exploration for Evaluation of
Mineral Resources.
The impact of the change in accounting policy on the
Consolidated Statement of Comprehensive Income, Consolidated
Statement of Financial Position and Consolidated Statement of Cash
Flows is included in the tables on the following page.
9. VOLUNTARY CHANGE OF ACCOUNTING policy (continued)
This voluntary change involves restating the following
balances:
31 Dec Increase/ 31 Dec 01 Jan Increase/ 1 Jan
2011 (Decrease) 2011 2011 (Decrease) 2011
Previous (Restated) Previous (Restated)
Policy Policy
$ $ $ $ $ $
------------- ------------------ ------------------ ------------------- ----------------- ---------------- ---------------------
Consolidated statement of financial
position (extract)
Capitalised
tenement
acquisition
costs 11,262,492 (11,262,492) - 3,029,749 (3,029,749) -
------------- ------------------ ------------------ ------------------- ----------------- ---------------- ---------------------
Net assets 25,607,960 (11,262,492) 14,345,468 23,764,039 (3,029,749) 20,734,290
Accumulated
losses (12,460,798) (11,262,492) (23,723,290) (9,865,319) (3,029,749) (12,895,068)
------------- ------------------ ------------------ ------------------- ----------------- ---------------- ---------------------
Total equity 25,607,960 (11,262,492) 14,345,468 23,764,039 (3,029,749) 20,734,290
------------- ------------------ ------------------ ------------------- ----------------- ---------------- ---------------------
Consolidated comprehensive income statement
(extract)
Exploration
expenses - 8,232,743 8,232,743
------------- ------------------ ------------------ -------------------
Loss before
income
tax (2,086,838) (8,232,743) (10,319,581)
------------- ------------------ ------------------ -------------------
Income tax
benefit
/ expense (508,641) - (508,641)
------------- ------------------ ------------------ -------------------
Loss for the
year (2,595,479) (8,232,743) (10,828,222)
------------- ------------------ ------------------ -------------------
Basic and diluted loss per share for the prior year has also
been restated.
9. VOLUNTARY CHANGE OF ACCOUNTING POLICY (continued)
This voluntary change involves restating the following
balances:
31 Dec Increase/ 31 Dec
2011 (Decrease) 2011
Previous (Restated)
Policy
$ $ $
----------------------------------------- ----------------- ---------------- -------------------
Consolidated statement of Cash Flows (extract)
Payments for exploration and evaluation
of expenditure - (8,394,692) (8,394,692)
----------------------------------------- ----------------- ---------------- -------------------
Net cash used in operating activities (4,009,059) (8,394,692) (8,394,692)
----------------------------------------- ----------------- ---------------- -------------------
Payments for exploration and evaluation
expenditure capitalised (8,394,692) 8,394,692 -
----------------------------------------- ----------------- ---------------- -------------------
Net cash (used in ) / from investing
activities (7,691,630) 8,394,692 703,062
----------------------------------------- ----------------- ---------------- -------------------
Basic and diluted loss per share for the prior year has also
been restated.
10. DISPOSAL OF SUBSIDIARIES
During the financial year the Group disposed of the following
subsidiaries:
-- Nexon Asia Group Limited
-- Central China Minerals Limited
-- CCG Copper Limited
-- GGG Mining Limited, formerly CCG Xinjiang Limited
-- CCG Korea Limited
-- Central China Goldfields plc
-- GGG Australia Pty Ltd
2012 2011
$ $
------------------------------------- -------------------- --------------------
Gain on dissolution of subsidiaries 1,444,608 -
==================== ====================
Basic earnings per share (cents) 0.57 -
==================== ====================
The gain on disposal of these subsidiaries is attributable to
the dissolution of the foreign operations in December 2012 and the
resulting reversal of foreign currency translation reserve carried
forward from prior years.
11. OPERATING SEGMENTS
Information about reportable segments
The Group has identified its operating segments on the internal
reports that are reviewed and used by the Board of Directors (chief
operating decision makers) in assessing performance and determining
the allocation of resources.
The Group currently operates in one operating segment being gold
exploration and evaluation.
Reportable segments disclosed are based on aggregating tenements
where the evaluation and exploration interests are considered to
form a single project. This is indicated by:
-- having the same ownership structure;
-- exploration being focused on the same mineral or type of mineral; and
-- exploration programs targeting the tenements as a group,
indicated by the use of the same exploration team shared geological
data and knowledge across the tenements.
Unless otherwise stated, all amounts reported to the Board of
Directors as the chief decision maker with respect to operating
tenements, are determined in accordance with AASB 8 Operating
Segments.
Reconciliation of reportable segment loss, assets and
liabilities and other material items
2012 2011
$ $
----------------------------------------------- -------------------- --------------------
Profit / (loss) before income tax
Total (loss) / profit for reportable segment (38,555,913) (8,232,743)
Unallocated amounts: other corporate expenses (1,850,957) (2,791,118)
Finance expense - (745)
Finance income 459,137 705,025
(39,947,733) (10,319,581)
==================== ====================
Assets
Total assets for reportable segment - -
Other assets 6,798,267 15,265,451
-------------------- --------------------
6,798,267 15,265,451
==================== ====================
Liabilities
Total liabilities for reportable segment - -
Other liabilities (2,457,397) (919,983)
-------------------- --------------------
(2,457,397) (919,983)
==================== ====================
12. PERSONNEL EXPENSES
2012 2011
Note $ $
---------------------------------------------------- -------------------- --------------------
Wages and salaries (staff) 217,140 -
Directors and executives remuneration 1,199,549 816,744
Contributions to defined contribution plans 25,624 -
(staff)
Increase / (decrease) in liability for 9,777 -
annual leave (staff)
Payroll tax 84,814 -
Other associated personnel expenses 123,752 26,131
1,660,656 842,875
==================== ====================
Expensed in exploration and evaluation 310,769 -
Expensed in administrative expenses 1,349,887 842,875
-------------------- --------------------
1,660,656 842,875
==================== ====================
13. LOSS BEFORE TAX
2012 2011
Note $ $
------------------------------------------------ ------ -------------------- --------------------
Loss before income tax includes the following
specific
gains, losses and expenses:
Gain on acquisition of investment (i) 1,656,075 -
==================== ====================
Gain on disposal of dormant subsidiaries 10 1,444,608 -
==================== ====================
Foreign exchange gain (iv) - 407,803
==================== ====================
Administrative expenses:
Personnel expenses 12 1,349,887 842,875
Advertising and publicity 260,639 -
Communication and information services 41,653 -
Travelling and Motor vehicle expenses 185,037 -
Office administration (ii) 540,390 2,212,302
Bank charges 43,600 -
Share registry and statutory fees 184,562 -
-------------------- --------------------
2,605,768 3,055,177
==================== ====================
Other expenses
Professional fees 673,585 143,713
Depreciation and amortisation 195,593 31
Foreign exchange loss (iv) 397,900 -
(Gain) / loss on disposal of fixed assets 769 -
1,267,847 143,744
==================== ====================
Finance income and expense
Interest income on bank deposits 453,600 705,025
Other interest income 5,537 -
Other interest expense - (745)
459,137 704,280
==================== ====================
Exploration & evaluation expensed through
profit & loss
Auzex Resources Limited pre-acquisition 32,894,832 -
exploration expensed
Current year expenditure 5,661,081 8,232,743
-------------------- --------------------
38,555,913 8,232,743
==================== ====================
Goodwill written off (iii) 701,803 -
==================== ====================
Impairment of available for sale financial
asset 16 376,222 -
==================== ====================
13. LOSS BEFORE TAX (continued)
Notes to support loss before tax table
(i) The above gain relates to the fair value movement of assets
previously reflected in reserves which has now been recognised in
the consolidated statement of comprehensive income (see note
8);
(ii) Breakdown for the comparative year is not available due to
UK Reporting not requiring a detailed breakdown;
(iii) The cost relates to the merger of Bullabulling Gold
Limited and GGG Resources plc as disclosed under note 7. The
goodwill is written off to profit or loss as it was not considered
recoverable due to Bullabulling Gold Limited being a dormant Group
at acquisition.
(iv) Gains and losses on foreign exchange result from movements
in the value of the Australian Dollar against the UK Pound and US
Dollar.
14. INCOME TAX EXPENSE
2012 2011
Note $ $
--------------------------------------------------- ------------------------- ---------------------
Current tax (benefit) / expense
Current period (12,196,530) -
Withholding tax - 508,641
R&D tax concession (332,700) -
-------------------- --------------------
(12,529,230) 508,641
-------------------- --------------------
Deferred tax benefit
Origination and reversal of temporary differences 12,196,530 -
Total income tax (benefit) / expense (332,700) 508,641
==================== ====================
14. INCOME TAX EXPENSE (continued)
Numerical reconciliation between tax expense and pre-tax
accounting loss
2012 2011
$ $
---------------------------------------------- -------------------- --------------------
(Loss) / profit for the period (39,615,033) (10,828,222)
Total income tax (benefit) / expense (332,700) 508,641
-------------------- --------------------
(Loss) / profit excluding income tax (39,947,733) (10,319,581)
==================== ====================
Income tax using the Group's domestic tax
rate
of 30% (2011: 30%) (11,984,320) (3,095,874)
Non-deductible expenses (212,210) 5,076
Current year tax losses not brought to
account 12,196,530 3,017,662
Effect of tax rules in foreign jurisdictions - 508,641
R&D tax concession (332,700) -
Net of change in tax rate - 73,136
Income tax (benefit) / expense (332,700) 508,641
==================== ====================
Deferred tax benefit not recognised in
equity
Net deferred tax (credited to equity) 124,811 -
Tax losses
Unused tax losses for which no deferred
tax asset
has been recognised 45,408,806 11,205,220
==================== ====================
Potential tax benefit at 30% (2011: 30%) 13,622,642 3,361,566
==================== ====================
All unused tax losses were incurred by Australian entities.
Potential future income tax benefits of $642,896 (2011:
$605,265) attributable to timing differences have not been brought
to account because the directors do not believe it is appropriate
to regard realisation of the future income tax benefits as
probable.
The benefit of these tax losses will only be obtained if:
i) future assessable income is derived of a nature and of an
amount sufficient to enable the benefit to be realised;
ii) the conditions for deductibility imposed by tax legislation continue to be complied with;
iii) no changes in tax legislation adversely affect the Group in realising the benefit; and
iv) satisfaction of either the continuity of ownership or the same business test.
15. PROPERTY, PLANT AND EQUIPMENT
Fixtures Office
and and Motor Field
fittings computer vehicles equipment Total
equipment
$ $ $ $ $
------------------ ------------------ ------------------ -------------------------- --------------------------- -----------------------
Gross carrying
amount
Balance at 1 - - - - -
January
2011
Additions - 1,800 - - 1,800
------------------ ------------------ -------------------------- --------------------------- -----------------------
Balance at 31
December
2011 - 1,800 - - 1,800
================== ================== ========================== =========================== =======================
Balance at 1
January
2012 - 1,800 - - 1,800
Additions 18,715 37,088 - - 55,803
Additions on
acquisition
of
subsidiary - 3,514 18,025 481,562 503,101
Reclassification
of
exploration to
Property,
Plant &
Equipment - 3,514 18,025 481,562 503,101
Disposals - - - (3,319) (3,319)
Balance at 31
December
2012 18,715 45,916 36,050 959,805 1,060,486
================== ================== ========================== =========================== =======================
Depreciation and
impairment
losses
Balance at 1 - - - - -
January
2011
Depreciation for
the
year - 31 - - 31
Balance at 31
December
2011 - 31 - - 31
================== ================== ========================== =========================== =======================
Balance at 1
January
2012 - 31 - - 31
Depreciation for
the
year 1,850 7,481 8,581 177,681 195,593
Depreciation on
acquisition
of
subsidiary - 85 3,606 92,538 96,229
Disposals - - - (1,550) (1,550)
Balance at 31
December
2012 1,850 7,597 12,187 268,669 290,303
================== ================== ========================== =========================== =======================
Carrying amounts
Balance at 31
December
2011 - 1,769 - - 1,769
================== ================== ========================== =========================== =======================
Balance at 31
December
2012 16,865 38,319 23,863 691,136 770,183
================== ================== ========================== =========================== =======================
16. INVESTMENTS
2012 2011
$ $
---------------------------------- ---- ------------------------- --------------------------
Opening balance 2,464,000 4,640,000
Additions (i) 804,000 514,846
Revaluation 393,545 (2,778,719)
Effects of foreign exchange 17,122 87,873
Deemed disposal upon acquisition
of 100% of Auzex
Resources Limited 8 (2,874,667) -
Impairment of investment (376,222) -
------------------------- --------------------------
Closing balance 427,778 2,464,000
=========================
(i) The addition in the current period relates to the in-specie
distribution of Auzex Exploration Pty Ltd which was undertaken by
Auzex Resources Limited prior to the Group being acquired by
Bullabulling Gold Limited as disclosed in note 8. The comparative
additions relate to the purchase of shares in Auzex Resources
Limited on-market. At the reporting date, the investment was
revalued down to its current share price which resulted in an
impairment of $376,222 being expensed through profit and loss.
17. OTHER RECEIVABLES
2012 2011
$ $
---------------------- -------------------- --------------------
Bank interest income 28,027 -
Office rental income 24,463 -
Deposits and bonds 1,436,200 653,033
Other receivables 18 346,180
1,488,708 999,213
==================== ====================
Current 52,508 346,180
Non-current 1,436,200 653,033
1,488,708 999,213
==================== ====================
18. PREPAYMENTS
2012 2011
$ $
--------------------------- ---------------------------- -----------------------------
Insurance 6,246 -
Office rent and outgoings 21,517 -
Other 5,005 38,719
---------------------------- -----------------------------
Less than one year 32,768 38,719
============================
19. CASH AND CASH EQUIVALENTS
(a) Reconciliation of cash and cash equivalents
The Group's exposure to interest rate risk and a sensitivity
analysis for financial assets and liabilities are disclosed in note
6.
2012 2011
$ $
-------------------------------------------- -------------------- --------------------
Cash at bank and on hand 328,830 11,475,475
Funds on term deposit 3,750,000 -
-------------------- --------------------
Cash and cash equivalents in the statement
of cash flows 4,078,830 11,475,475
==================== ====================
The perceived credit risk is low as cash and cash equivalents
are with authorised deposit taking institutions.
19. CASH AND CASH EQUIVALENTS (continued)
(b) Reconciliation of cash flows from operating activities
2012 2011
Note $ $
------------------------------------------------- -------- -------------------- --------------------
Cash flows from operating activities
(Loss) / profit for the period (39,615,033) (10,828,222)
Adjustments for:
Depreciation 15 195,593 31
Loss on sale of property, plant & equipment 13 769 -
Gain on acquisition of investment (1,656,075) -
Gain on disposal of subsidiaries (1,444,609) -
Exploration expenditure 32,688,153 -
Finance income 13 (459,137) (864,580)
Equity-settled share-based payment transactions 112,612 -
Impairment of investments 13 376,222 -
Unallocated expenses written off 303,378 -
Net loss on foreign exchange transactions 13 397,900 (141,894)
(9,100,227) (11,834,665)
-------------------- --------------------
Change in other receivables (67,803) (627,932)
Change in prepayments 258 -
Change in current tax assets 286,275 -
Change in trade and other payables (1,827,884) 58,846
Change in employee benefits provisions 295,470 -
-------------------- --------------------
(10,413,911) (12,403,751)
Interest paid - -
Income taxes paid - -
-------------------- --------------------
Net cash used in operating activities (10,413,911) (12,403,751)
==================== ====================
20. DEFERRED TAX ASSETS AND LIABILITIES
Unrecognised deferred tax assets and liabilities
Unrecognised deferred tax assets and liabilities are
attributable to the following:
Assets Liabilities Net
2012 2011 2012 2011 2012 2011
$ $ $ $ $ $
------------- -------------------- -------------------- -------------------- -------------------- ------------------- --------------------
Other
receivables - - (8,408) - (8,408) -
Black hole
deductible
costs -
S40-880 605,265 605,265 - - 605,265 605,265
Other
creditors 43,382 - - - 43,382 -
Provisions 161,396 - - - 161,396 -
Carry
forward tax
losses 13,622,642 3,361,566 - - 13,622,642 3,361,566
-------------------- -------------------- -------------------- -------------------- ------------------- --------------------
Net tax
(assets) /
liabilities 14,432,685 3,966,831 (8,408) - 14,424,277 3,966,831
==================== ==================== ==================== ==================== =================== ====================
21. CAPITAL AND RESERVES
(a) Share capital
Ordinary shares
2012 2012 2012 2011 2011 2011
Number $ Number $
------------------------- ------------------------------- -------------------------- ---------------------------- --------------------------
On issue at 1 January 166,280,301 35,717,898 145,423,590 28,398,058
Change in - 387,766 - -
functional currency
adjustment
Issue of shares at 38.85
cents each on
ASX (31 May 2011) - - 20,322,500 7,895,127
Issue of shares at 18.65
cents each on
AIM (30 November 2011) - - 534,211 99,618
Exercise of warrants at
28.08 cents each 4,400,000 847,706 - -
1 for 1 in-specie 170,680,298 - - -
distribution for
the
acquisition of GGG
Resources plc
Reverse acquisition (170,680,298) - - -
of Bullabulling
Gold
by GGG Resources
plc
Issue of shares at 20.4
cents each pursuant
to the acquisition of
the 50% share of
Bullabulling assets held
by Auzex Resources
Limited 118,353,573 28,553,437 - -
Issue of shares at 9
cents each pursuant
to acquisition of
tenement 13,500,000 1,215,000 - -
Capital raising costs - (17,570) - (674,905)
On issue at 31 December 302,533,874 66,704,237 166,280,301 35,717,898
=============================== ========================== ============================ ==========================
Due to the financial statements being the continuation of GGG
Resources plc, the share capital reflects the share capital of GGG
Resources plc at the date of acquisition plus the share capital
movements of Bullabulling Gold Limited post acquisition being the
legal parent. No value was attributed to the 1 for 1 in-specie
distribution due to the acquisition being deemed a reverse merger
(see note 7).
21. CAPITAL AND RESERVES
(b) Issuance of ordinary shares
On 25 January 2012 4,400,000 warrants at a market value of 28.08
cents each were exercised in GGG Resources plc. The fair value of
the shares on the date of settlement was 2.5 cents per share.
On 16 April 2012 the scheme of arrangement between Bullabulling
Gold Limited and Auzex Resources Limited was approved by the
Supreme Court of Queensland. As a result, 118,353,573 ordinary
shares were issued pursuant to the acquisition of the Bullabulling
assets held by Auzex Resources Limited. (see note 8). The value of
the shares and options is based on the fair value of the acquired
assets which includes exploration which was independently valued by
CSA Global Pty Ltd.
On 7 December 2012 13,500,000 ordinary shares at 9 cents each
were issued for the acquisition of the Resolute tenement. The value
of the shares is based on the market price of the shares on the
date the tenement was acquired.
(c) Ordinary shares
The holders of ordinary shares are entitled to receive dividends
as declared from time to time and are entitled to one vote per
share at meetings of the Group. Option holders cannot participate
in any new shares issues by the Group without exercising their
options.
In the event of a winding up of the Group, ordinary shareholders
rank after all other shareholders and creditors and are fully
entitled to any proceeds on liquidation.
All issued shares are fully paid.
The Group has also issued share options (see note 26).
21. CAPITAL AND RESERVES
(d) Reserves
Equity-based benefits reserve
The equity-based benefits reserve represents the cost of options
that have been granted and vested as share-based payments but not
exercised. This reserve will be transferred to accumulated losses
should these options be exercised, or reversed through profit and
loss should certain vesting conditions not be met. The reserve also
includes the value of options issued for asset acquisitions (see
note 8 and 26).
On 23 February 2012, 3,275,000 options with an exercise price
between 48.72 and 57.86 cents each issued by GGG Resources plc
expired.
Foreign currency translation reserve
The translation reserve comprises all foreign currency
differences arising from the translation of the financial
statements of foreign operations.
Available for sale asset reserve
The available for sale asset reserve comprises the cumulative
net change in the fair value of available-for-sale financial assets
until the investments are derecognised or impaired.
(e) Reserves
At the date of this report, there are 15,359,242 options on
issue in Bullabulling Gold Limited. The exercise price ranges from
8.81 cents to 59.22 cents, and the exercise dates range from
October 2013 to November 2016.
22. LOSS PER SHARE
(a) Basic loss per share
The calculation of basic loss per share at 31 December 2012 was
based on the loss attributable to ordinary shareholders of
$39,615,033 (2011: $10,828,222) and a weighted average number of
ordinary shares outstanding of 255,390,216 (2011: 157,441,212)
calculated as follows:
Loss attributable to ordinary shareholders
2012 2011
$ $
-------------------------------- -------------------- --------------------
(Loss) / profit for the period (39,615,033) (10,828,222)
Weighted average number of ordinary shares (basic)
2012 2011
Number Number
------------------------------------------- ----------------- -----------------
Issued ordinary shares at 1 January 166,280,301 145,423,590
Effect of shares issued during the period 89,109,915 12,017,622
----------------- -----------------
255,390,216 157,441,212
22. LOSS PER SHARE (continued)
(b) Diluted loss per share
The calculation of diluted loss per share at 31 December 2012
was based on the loss attributable to ordinary shareholders of
$39,615,033 (2011: $10,828,222) and a weighted average number of
ordinary shares outstanding after adjustment for the effects of all
dilutive potential ordinary shares of 255,390,216 (2011:
157,441,212) calculated as follows:
Weighted average number of ordinary shares (diluted)
2012 2011
Number Number
-------------------------------------------- -------------------- --------------------
Weighted average number of ordinary shares
(basic) 255,390,216 157,441,212
Effect of share options on issue - -
-------------------- --------------------
255,390,216 157,441,212
At 31 December 2012, 15,359,242 options (2011: 16,380,000
options) were excluded from diluted weighted average number of
ordinary shares calculation as their effect would have been
anti-dilutive.
23. EMPLOYEE BENEFITS
2012 2011
$ $
------------------------------ -------------------- --------------------
Current
Liability for annual leave 67,987 -
Liability for superannuation 29,082 -
Liability for PAYE (UK) - 18,222
-------------------- --------------------
97,069 18,222
==================== ====================
Current 97,069 18,222
Non-current - -
97,069 18,222
==================== ====================
24. TRADE AND OTHER PAYABLES
2012 2011
$ $
----------------------------------------- -------------------- --------------------
Current
Trade payables 360,064 98,161
Stamp duty 1,414,738 -
Non-trade payables and accrued expenses 115,526 803,600
-------------------- --------------------
1,890,328 901,761
Current 1,890,328 901,761
The Group's exposure to liquidity risk related to trade and
other payables is disclosed in note 27.
25. SITE RESTORATION PROVISION
2012 2011
$ $
---------------------------- ---------------------------- -----------------------------
Site restoration provision 470,000 -
============================ =============================
The restoration provision relates to restoration of the
tenements where drilling has occurred in prior years. Bank
guarantees totalling $1,275,000 are held by the West Australian
government to secure tenement rehabilitation obligations.
26. SHARE-BASED PAYMENT PLANS
(a) Description of the share-based payment arrangements
At 31 December 2012 the Group has the following share-based
payment arrangements.
$
---------------------------------------------- ------------- ----------------------------
(i) Shares provided in respect of merger with GGG -
Resources plc
Shares and options provided for acquisition of
(ii) Auzex Resources Limited 28,986,841
(iii) Options issued to key management personnel 112,612
(i) On 29 March 2012, the 170,680,298 shares on issue in GGG
Resources plc were cancelled and replaced with the same number of
Bullabulling Gold Limited shares. This transaction resulted in a
reverse merger (see note 7) and effectively involved a share based
payment. However, as this transaction resulted in GGG Resources plc
shareholders effectively owning 100% of Bullabulling Gold Limited,
the consideration being the share-based payment is valued as
nil.
(ii) During the accounting period Bullabulling Gold Limited
acquired 50% of the Bullabulling assets held by way of acquiring
Auzex Resources Limited by the issue of shares and options. The
value of the shares was $28,553,437 and the value of the options
was $433,404. Refer note 8 for further details.
(iii) At a general meeting on 13 June 2012, shareholders
approved the issue of 3,000,000 options to Mr Brett Lambert with a
calculated value of between 8.81 and 11.89 cents each. The value of
each tranche of options is recognised as directors' remuneration
over their respective vesting periods.
On 28 November 2012, the board resolved to issue 1,500,000
options to Mr Mark Braghieri with a calculated value of between
10.2 and 14.9 cents each. The value of each tranche of options is
recognised as directors' and senior executives' remuneration over
their respective vesting periods.
Equity-settled share option programme
The board established an Employee Option Plan whereby the board
may offer free options to persons ("Eligible Persons") who are:
-- full time or part time employees (including a person engaged
by the Group under a consultancy agreement); or
-- directors' of the Group based on a number of criteria
including contribution to the Group, period of employment,
potential contribution to the Group in the future and other factors
the board considers relevant.
Options granted under the plan carry no dividend or voting
rights.
When exercisable, each option is converted into one ordinary
share within fourteen days after the receipt of a properly executed
notice of exercise and application monies. The Group will issue to
the option holder, the number of shares specified in that notice.
The Group will apply for official quotation of all shares issued
and allotted pursuant to the exercise of the options.
Options may not be transferred other than to an associate of the
holder.
The fair value of services received for share options granted is
based on the fair value of options granted, measured using the
Black-Scholes formula.
26. SHARE-BASED PAYMENT PLANS (continued)
(b) Terms and conditions of share-option programme
The terms and conditions relating to the grant of existing share
options are as follows:
Tranche Grant date Number of Vesting conditions Expiry date Contractual
instruments life of options
-------- -------------- ------------ ------------------------------------------ ---------------- ----------------
1 29 March 2012 500,000 Vested upon granting 6 October 2014 2.52 years
2 29 March 2012 3,425,000 Vested upon granting 23 April 2015 3.07 years
3 29 March 2012 1,150,000 Vested upon granting 30 June 2015 3.25 years
23 November
4 29 March 2012 3,630,000 Vested upon granting 2015 3.65 years
5 16 April 2012 1,766,621 Vested upon granting 21 October 2013 1.52 years
6 16 April 2012 387,621 Vested upon granting 28 October 2014 2.53 years
7 13 June 2012 1,000,000 The 10 day VWAP share price equals or 1 May 2014 1.88 years
exceeds
the exercise price during the 12 month
period
commencing 1 May 2013
8 13 June 2012 1,000,000 The 10 day VWAP share price equals or 1 May 2015 2.88 years
exceeds
the exercise price during the 12 month
period
commencing 1 May 2014
9 13 June 2012 1,000,000 The 10 day VWAP share price equals or 1 May 2016 3.88 years
exceeds
the exercise price during the 12 month
period
commencing 1 May 2015
10 29 November 500,000 Exercisable at a price equal to 130% of 26 November 1.99 years
2012 the 5 2014
day VWAP immediately prior to the
contract commencement
date of 26 November 2012. The options
vest after
12 months and expire after 24 months
11 29 November 500,000 Exercisable at a price equal to 160% of 26 November 2.99 years
2012 the 5 2015
day VWAP immediately prior to the
contract commencement
date of 26 November 2012. The options
vest after
24 months and expire after 36 months
12 29 November 500,000 Exercisable at a price equal to 190% of 26 November 3.99 years
2012 the 5 2016
day VWAP immediately prior to the
contract commencement
date of 26 November 2012. The options
vest after
36 months and expire after 48 months
15,359,242
============
26. SHARE-BASED PAYMENT PLANS (continued)
(b) Terms and conditions of share-option programme (continued)
Notes in relation to the table on terms and conditions of share
options
Tranche 1 - 4 these options were modified as a result of the
reverse merger (refer note 7) and reflect the replacement options
issued to GGG option holders a the time of the merger. As the fair
value of the replacement options (as calculated by Black Scholes
option pricing model) was less than the value of the original
options, there was no incremental fair value and accordingly no
expense has been recorded with respect to the options.
Tranche 5 - 6 these options formed part of the consideration for
the asset acquisition as disclosed in note 8. Refer to note 21 of
how the fair value of these options was determined.
(c) Inputs for measurement of grant date fair values
The fair value of services received in return for share options
granted was based on the fair value of share options on the date
granted, measured using the Black Scholes options pricing model.
The model inputs were the exercise price, the terms of the option,
the impact of dilution, the share price at grant date and expected
price volatility of the underlying share, the expected dividend
yield and the risk free interest rate for the term of the
option.
The expected price volatility was estimated by considering
historic average share price volatility, if available, (based on
the remaining life of the options), adjusted for any expected
changes to future volatility due to publicly available information
and volatility within the mining industry. The inputs used in the
measurement of the fair values at grant date of the share based
payment plans are the following:
Fair value of share options Tranche Tranche Tranche Tranche Tranche Tranche
and assumptions 7 8 9 10 11 12
----------------------------- ------------ ------------ ------------ ------------ ------------ ------------
Fair value at grant date 8.81 cents 10.66 cents 11.89 cents 4.31 cents 4.82 cents 5.28 cents
Share price 21.0 cents 21.0 cents 21.0 cents 9.0 cents 9.0 cents 9.0 cents
Exercise price 28.4 cents 31.6 cents 36.8 cents 10.2 cents 12.6 cents 14.90 cents
Expected volatility 95% 95% 95% 95% 95% 95%
Option life 1.88 years 2.88 years 3.88 years 1.99 years 2.99 years 3.99 years
Vesting period 0.88 years 1.88 years 2.88- years 0.99 years 1.99 years 2.99 years
Risk free rate 2.48% 2.48% 2.48% 2.73% 2.73% 2.73%
26. SHARE-BASED PAYMENT PLANS (continued)
(d) Disclosure of share option programme
The number and weighted average exercise prices of share options
are as follows:
Weighted Weighted
average Number of average Number of
exercise options exercise Options
price price
2012 2012 2011 2011
------------------------------- ------------------- ------------------- ------------------- --------------------
Outstanding at 1 January 14.9 cents 16,380,000 14.9 cents 16,380,000
Expired during the period 49.3 cents (3,275,000) - cents -
Exercised during the period 18.79 cents (4,400,000) - cents -
Cancelled and modified during 63.3 cents (8,705,000) - cents -
the period
Granted during the period 63.3 cents 15,359,242 - cents -
Outstanding at 31 December 27.4 cents 15,359,242 14.9 cents 16,380,000
=================== ====================
Exercisable at 31 December 28.1 cents 10,859,242 14.9 cents 16,380,000
=================== ====================
The options outstanding at 31 December 2012 have an exercise
price between 10.2 and 59.22 cents (2011: between 10.36 and 59.22
cents) and a weighted average contractual life of 2.32 years (2011:
2.64 years).
6,654,242 options were granted during the year (2011: no options
granted).
4,400,000 options were exercised during the year (2011: no
options exercised).
3,275,000 options expired during the year (2011: no options
expired).
(e) Amount expensed to profit and loss
The number and weighted average exercise prices of share options
are as follows:
2012 2011
$ $
----------------- -------------------- --------------------
Granted in 2012 112,612 -
-------------------- --------------------
Each tranche of options is recognised as personnel expenses over
their respective vesting periods.
27. COMMITMENTS
2012 2011
$ $
------------------------------------------------ -------------------- --------------------
Lease of office premises
Less than one year 235,799 33,333
Between one and five years 805,647 -
-------------------- --------------------
1,041,446 33,333
==================== ====================
Sub-lease payments
Future minimum lease payments expected
to be received in relation to non-cancellable
sub-leases of operating leases
Less than one year (105,996) -
Between 1 and 5 years (362,153) -
-------------------- --------------------
(468,149) -
==================== ====================
Mineral exploration
Not later than one year 526,060 -
==================== ====================
28. CONTINGENCIES
The Group has no contingent assets or liabilities.
29. RELATED PARTIES
(a) Key management personnel compensation
The key management personnel compensation included in 'personnel
expenses' (see note 10) is as follows:
2012 2011
$ $
------------------------------ -------------------- --------------------
Short term employee benefits 1,029,886 807,654
Non-monetary benefits 57,051 9,090
Post-employment benefits 112,612 -
1,199,549 816,744
==================== ====================
(b) Individual directors and executives compensation
Information regarding individual directors and executive's
compensation and some equity instruments disclosures as required by
Corporations Regulation 2M.3.03 is provided in the remuneration
report section of the directors' report.
Apart from the details disclosed in this note, no director has
entered into a material contract with the Group since the end of
the previous financial year and there were no material contracts
involving directors' interests existing at year end.
29. RELATED PARTIES (continued)
(c) Options and rights over equity instruments
The movement during the reporting period in the number of
options over ordinary shares in Bullabulling Gold Limited held,
directly, indirectly or beneficially, by each key management
person, including their related parties, is as follows:
Vested and
Held at Granted ** Held Vested Exercisable
1 as com- * Other at during 31 December
January pensation Exercised changes 31 December the 2012
2012 2012 year
------------ -------------------------- ---------------------------- ---------------------------- -------------------------- --------------- ------------------------- -----------------------------
Directors
Brett
Lambert - 3,000,000 - - 3,000,000 - -
Jeff
Malaihollo 2,905,000 - - (1,375,000) 1,530,000 - 1,530,000
David
McArthur 375,000 - - - 375,000 - 375,000
Nigel Clark 1,300,000 - - - 1,300,000 - 1,300,000
Chris Baker - - - 94,852 94,852 94,852 94,852
John Lawton - - - 711,391 711,391 711,391 711,391
Peter
Ruxton 2,175,000 - - - 2,175,000 - 2,175,000
Paul
McGroary 1,450,000 - - - 1,450,000 - 1,450,000
Michael
Short 1,450,000 - - - 1,450,000 - 1,450,000
Ciceron
Angeles 1,200,000 - - - 1,200,000 - 1,200,000
Senior
Executives
Mark
Braghieri - 1,500,000 - - 1,500,000 - -
* Other changes represent options that were cancelled or
acquired through scheme of arrangement;
** Or on date of resignation;
29. RELATED PARTIES (continued)
(d) Options and rights over equity instruments (continued)
Vested and
Held at Granted Held at Vested Exercisable
1 as com- * Other 31 December during 31 December
January pensation Exercised changes 2011 the 2011
2011 year
------------ --------------------------- ----------------------------- ----------------------------- -------------------------- --------------- ------------------------- ------------------------
Directors
Jeff
Malaihollo - - - 2,905,000 2,905,000 2,905,000 2,905,000
David
McArthur - - - 375,000 375,000 375,000 375,000
Nigel Clark - - - 1,300,000 1,300,000 1,300,000 1,300,000
Peter
Ruxton - - - 2,175,000 2,175,000 2,175,000 2,175,000
Paul
McGroary - - - 1,450,000 1,450,000 1,450,000 1,450,000
Michael
Short - - - 1,450,000 1,450,000 1,450,000 1,450,000
Ciceron
Angeles - - - 1,200,000 1,200,000 1,200,000 1,200,000
* Other changes represent options that were acquired through scheme of arrangement.
29. RELATED PARTIES (continued)
(e) Movements in shares
The movement during the reporting period in the number of
ordinary shares in Bullabulling Gold Limited held, directly,
indirectly or beneficially, by each key management person,
including their related parties, is as follows:
* Held at Acquired ** Held at
1 January through 31
2012 Purchases scheme of Sales December
arrangement 2012
------------ ---------------------- -------------------------------- ---------------------- ---------------------------- ------------------
Directors
Peter
Mansell - 750,000 - - 750,000
Jeff
Malaihollo 1,726,799 75,000 - - 1,801,799
Nigel Clark 2,138,616 - - - 2,138,616
Chris Baker - - 467,222 - 467,222
John Lawton - - 6,751,635 (1,989,999) 4,761,366
Peter
Ruxton 1,282,668 - - - 1,282,668
Paul
McGroary 3,190,000 - - - 3,190,000
Michael
Short 1,333,333 - - - 1,333,333
Ciceron
Angeles 294,933 - - - 294,933
* Or on date of appointment;
** Or on date of resignation;
No shares were granted to key management personnel during the
reporting period as compensation in 2011 or 2012.
29. RELATED PARTIES (continued)
(e) Movements in shares (continued)
* Held at Received Held at
1 January on exercise 31
2011 Purchases of options Sales December
2011
------------ ------------------ -------------------------------- ---------------------- ---------------------------- --------------------
Directors
Jeff
Malaihollo 1,726,799 - - - 1,726,799
Nigel Clark 2,138,616 - - - 2,138,616
Peter
Ruxton 1,282,668 - - - 1,282,668
Paul
McGroary 3,190,000 - - - 3,190,000
Michael
Short 1,333,333 - - - 1,333,333
Ciceron
Angeles 294,933 - - - 294,933
* Or on date of appointment;
No shares were granted to key management personnel during the
reporting period as compensation in 2011 or 2012.
29. RELATED PARTIES (continued)
(f) Other related parties
Contributions to superannuation funds on behalf of employees are
disclosed in note 8.
30. GROUP ENTITIES
Place of Financial 2012 2011
Name incorporation Year end % %
------------------------------- -------------- ---------- ----- -----
Parent entity
Bullabulling Gold Limited Australia 31 Dec
Subsidiary
Bullabulling Gold (UK) Limited UK 31 Dec 100 -
(1)
Bullabulling Operations Pty Australia 31 Dec 100 -
Ltd (2)
(1) formerly known as GGG Resources plc
(2) formerly known as Auzex Resources Pty Ltd and formerly Auzex
Resources Limited
32. AUDITORS' REMUNERATION
2012 2011
$ $
-------------------------------------------------- ------------------------ --------------------------
BDO Australia
Audit and other assurance services
Audit and review of financial reports 66,441 15,000
Other assurance services:
Admission to AIM UK Stock Exchange 5,292 -
Total remuneration for audit and other assurance
services 71,733 15,000
------------------------ --------------------------
Taxation services
Tax compliance services 885 -
Tax advice on substitute accounting and 31,556 -
acquisition
Tax advice on employee share schemes and 30,992 -
R&D
------------------------ --------------------------
Total remuneration for taxation services 63,433 -
------------------------ --------------------------
Total remuneration of BDO Australia 135,166 15,000
======================== ==========================
32. AUDITORS' REMUNERATION (continued)
2012 2011
$ $
-------------------------------------------------- ------------------------ --------------------------
Non-BDO audit firms
Audit and other assurance services
Audit and review of financial reports 2,620 78,596
Other assurance services:
Scheme Arrangement 3,750 -
HMRC Compliance 1,355 -
------------------------ --------------------------
Total remuneration for audit and other assurance
services 7,725 78,596
------------------------ --------------------------
Taxation services
Tax compliance services 11,146 -
Tax advice on R&D tax concession 69,867
International tax consulting 3,250 -
Tax advice on Class ruling 20,207 -
Tax advice on employee share schemes 180 -
------------------------ --------------------------
Total remuneration for taxation services 104,650 -
------------------------ --------------------------
Other services
General accounts preparation 32,589 -
Dissolution of foreign subsidiaries 5,814 -
Total remuneration for other services 38,403 -
------------------------ --------------------------
Total remuneration of non-BDO audit firms 150,778 78,596
======================== ==========================
TOTAL AUDITORS' REMUNERATION 285,944 93,596
======================== ==========================
It is the Group's policy to employ BDO on assignments additional
to their statutory audit duties where BDO's expertise and
experience with the Group are important. These assignments are
principally tax advice, due diligence on acquisitions and mergers
and employee share schemes, or where BDO is awarded assignments on
a competitive basis. It is the group's policy to seek competitive
tenders for all major consulting projects.
33. PARENT GROUP DISCLOSURES
As at, and throughout the financial year ended 31 December 2012,
the parent entity of the Group was Bullabulling Gold Limited.
2012 2011
$ $
---------------------------------------------- -------------------- --------------------
Result of the parent entity
Profit / (loss) for the year 882,790 (30,099)
Other comprehensive income - -
-------------------- --------------------
Total comprehensive income / (loss) for
the year 882,790 (30,099)
==================== ====================
Financial position of parent entity at
year end
Current assets 146,299 35
-------------------- --------------------
Total assets 35,144,698 35
==================== ====================
Current liabilities 4,005,756 30,131
-------------------- --------------------
Total liabilities 4,005,756 30,131
==================== ====================
Total equity of the parent entity comprising
of:
Share capital 29,740,235 3
Equity-settled benefits reserve 546,016 -
Retained earnings / (accumulated losses) 852,692 (30,099)
-------------------- --------------------
Total equity 31,138,943 (30,096)
==================== ====================
Commitments
Office rent
Less than one year 235,799 33,333
Between one and five years 805,647 -
-------------------- --------------------
1,041,446 33,333
==================== ====================
Sub-lease payments
Less than one year (105,996) -
Between one and five years (362,153) -
-------------------- --------------------
(468,149) -
==================== ====================
34. EVENTS OCCURING AFTER THE REPORTING DATE
On 14(th) March 2013, the Group announced a 1 for 2
non-renounceable entitlement offer to raise $7.6 million.
Other than the matters discussed above, there have been no
matters of circumstance that have arisen since the end of the
financial year that have significantly affected, or may
significantly affect, the operations of the Group, the results of
these operations, or the state of affairs of the Group in future
financial years.
DIRECTORS' DECLARATION
1 In the opinion of the directors of Bullabulling Gold Limited (the "Group"):
(a) the consolidated financial statements and notes, and the
Remuneration report set out in section 4 in the Directors' Report,
are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Group's financial
position as at 31 December 2012 and of its performance for the
financial year ended on that date; and
(ii) complying with Australian Accounting Standards and the
Corporations Regulations 2001 and other mandatory professional
reporting requirements; and
(b) there are reasonable grounds to believe that the Group will
be able to pay its debts as and when they become due and
payable.
2 The directors have been given the declarations required by
Section 295A of the Corporations Act 2001 from the chief executive
officer and chief financial officer for the financial year ended 31
December 2012.
3 The directors draw attention to note 2(a) to the consolidated
financial statements, which includes a statement of compliance with
International Financial Reporting Standards.
Signed in accordance with a resolution of the directors:
Dated at Perth this 27(th) day of March 2013.
BRETT LAMBERT
Director
INDEPENDENT AUDIT REPORT
SECURITIES EXCHANGE INFORMATION
Additional information required by the ASX Limited Listing Rules
and not disclosed elsewhere in this report is set out below.
1. SHAREHOLDER INFORMATION
(a) Distribution of fully paid ordinary shares at 15 March 2013
Number of
Category Shareholders Shares held
------------------------ --------------------- ---------------------
1 - 1,000 214 79,662
1,001 - 5,000 631 2,182,040
5,001 - 10,000 389 3,019,771
10,001 - 100,000 802 27,352,383
100,001 and over 227 269,900,015
--------------------- ---------------------
2,263 302,533,871
===================== =====================
(b) Marketable Parcel
The number of shareholders holding less than a marketable parcel
of ordinary shares is 1,059.
(c) Voting rights
Ordinary shares
There are no restrictions on voting rights attached to the
ordinary shares. On a show of hands every member present in person
shall have one vote and upon a poll, every member present or by
proxy shall have one vote for every share held.
Options
There are no voting rights attached to the options.
(d) Substantial shareholders
The number of shares held by substantial shareholders and their
associates are set out below:
Ordinary shares
Name Number of Shares
--------------------------------------- -----------------------
National Nominees Limited 17,850,491
TD Direct Investing Nominees (Europe)
Limited <SMKTNOMS 15,281,861
(e) Unlisted 21 October 2013 Options
There are 1,766,621 options held by 5 holders on issue that are
exercisable at 11.0 cents on or before 21 October 2013.
1. SHAREHOLDER INFORMATION (continued)
(f) Unlisted 1 May 2014 Options
There are 1,000,000 options held by 1 holder on issue that are
exercisable at 28.4 cents on or before 1 May 2014.
(g) Unlisted 6 October 2014 Options
There are 500,000 options held by 2 holders on issue that are
exercisable at 10.36 cents on or before 6 October 2014.
(h) Unlisted 28 October 2014 Options
There are 387,621 options held by 2 holders on issue that are
exercisable at 20.9 cents on or before 28 October 2014.
(i) Unlisted 26 November 2014 Options
There are 500,000 options held by 1 holder on issue that are
exercisable at 10.2 cents on or before 26 November 2014.
(j) Unlisted 23 April 2015 Options
There are 3,425,000 options held by 7 holders on issue that are
exercisable at 11.84 cents on or before 23 April 2015.
(k) Unlisted 1 May 2015 Options
There are 1,000,000 options held by 1 holder on issue that are
exercisable at 31.6 cents on or before 1 May 2015.
(l) Unlisted 30 June 2015 Options
There are 1,150,000 options held by 2 holders on issue that are
exercisable at 14.8 cents on or before 30 June 2015.
(m) Unlisted 23 November 2015 Options
There are 3,630,000 options held by 8 holders on issue that are
exercisable at 59.22 cents on or before 23 November 2015.
(n) Unlisted 26 November 2015 Options
There are 500,000 options held by 1 holder on issue that are
exercisable at 12.6 cents on or before 26 November 2015.
(o) Unlisted 1 May 2016 Options
There are 1,000,000 options held by 1 holder on issue that are
exercisable at 36.8 cents on or before 1 May 2016.
(p) Unlisted 26 November 2016 Options
There are 500,000 options held by 1 holder on issue that are
exercisable at 14.9 cents on or before 26 November 2016.
(q) Shareholders
The twenty largest shareholders hold 51.93% of the total issued
ordinary shares in the Group as at 15 March 2013.
2. TOP TWENTY SHAREHOLDERS AS AT 15 March 2013
Ordinary shares
Percentage
of
Number of Issued Shares
Name Shares
------------------------------------------------------- -------------- -----------------
1 National Nominees Limited 17,850,491 5.90
2 TD Direct Investing Nominees (Europe) Limited
<SMKTNOMS> 15,281,861 5.05
3 Resolute (Treasury) Pty Ltd 13,500,000 4.46
4 HSBC Custody Nominees (Australia) Limited 12,981,814 4.29
5 L R Nominees Limited <Nominee> 11,437,950 3.78
6 Barclayshare Nominees Limited 9,456,338 3.13
7 The Bank of New York (Nominees) Limited <RBSGF> 9,220,000 3.05
8 Auzex Exploration Limited 7,022,472 2.32
9 Misty Grange Pty Ltd <BJ & LA Winsor S/F Pens
A/C> 7,000,000 2.31
10 HSBC Global Custody Nominee (UK) Limited <940506> 6,384,574 2.11
11 HSBC Global Custody Nominee (UK) Limited <860158> 6,250,166 2.07
12 The Bank of New York (Nominees) Limited <UKREITS> 6,060,209 2.00
13 JP Morgan Nominees Australia Limited <Cash Income
A/C> 5,183,816 1.71
14 Hargreaves Lansdown (Nominees) Limited <HLNOM> 4,975,098 1.64
15 Securities Services Nominees Limited <2060000> 4,772,854 1.58
16 HSBC Client Holdings Nominee (UK) Limited <731504> 4,766,476 1.58
17 Peninsula Goldfields Pty Ltd 4,738,641 1.57
18 Forsyth Barr Custodians Ltd <Forsyth Barr Ltd
Nominee A/C> 4,069,754 1.35
19 Jim Nominees Limited <Jarvis> 3,209,196 1.06
20 HSDL Nominees Limited 2,924,383 0.97
-------------- -----------------
157,086,093 51.93
============== =================
3. TENEMENTS LISTING AT 15 MARCH 2013
Bullabulling Gold Limited has used the cash and assets in a form
readily convertible to cash, that it had at the time of admission
to the Australian Securities Exchange, in a manner consistent with
Bullabulling Gold Limited's business objectives
Tenement Description Tenement Numbers Percentage
Interest
Bullabulling Project - Coolgardie
District E15/1263 100%
Bullabulling Project - Coolgardie
District E15/1264 100%
Bullabulling Project - Coolgardie
District E15/1320 100%
Bullabulling Project - Coolgardie
District E15/1331 100%
Bullabulling Project - Coolgardie
District E15/1349 100%
Bullabulling Project - Coolgardie
District E15/1350 100%
Bullabulling Project - Coolgardie
District L15/156 100%
Bullabulling Project - Coolgardie
District L15/157 100%
Bullabulling Project - Coolgardie
District L15/158 100%
Bullabulling Project - Coolgardie
District L15/196 100%
Bullabulling Project - Coolgardie
District L15/206 100%
Bullabulling Project - Coolgardie
District L15/206 100%
Bullabulling Project - Coolgardie
District L15/218 100%
Bullabulling Project - Coolgardie
District L15/222 100%
Bullabulling Project - Coolgardie
District L15/328 100%
Bullabulling Project - Coolgardie
District L15/330 100%
Bullabulling Project - Coolgardie
District L15/331 100%
Bullabulling Project - Coolgardie
District L15/332 100%
Bullabulling Project - Coolgardie
District L15/333 100%
Bullabulling Project - Coolgardie
District L15/334 100%
Bullabulling Project - Coolgardie
District L15/336 100%
Bullabulling Project - Coolgardie
District L15/339 100%
Bullabulling Project - Coolgardie
District M15/282 100%
Bullabulling Project - Coolgardie
District M15/483 100%
Bullabulling Project - Coolgardie
District M15/503 100%
Bullabulling Project - Coolgardie
District M15/529 100%
Bullabulling Project - Coolgardie
District M15/552 100%
Bullabulling Project - Coolgardie
District M15/554 100%
Bullabulling Project - Coolgardie
District M15/1414 100%
Bullabulling Project - Coolgardie
District P15/4799 100%
Bullabulling Project - Coolgardie
District P15/4887 100%
----------------------------------- ------------------ -----------
3. TENEMENTS LISTING AT 15 MARCH 2013 (continued)
Tenement Description Tenement Numbers Percentage
Interest
Bullabulling Project - Coolgardie
District P15/5186 100%
Bullabulling Project - Coolgardie
District P15/5187 100%
Bullabulling Project - Coolgardie
District P15/5188 100%
Bullabulling Project - Coolgardie
District P15/5354 100%
Bullabulling Project - Coolgardie
District P15/5355 100%
Bullabulling Project - Coolgardie
District P15/5356 100%
Bullabulling Project - Coolgardie
District P15/5357 100%
Bullabulling Project - Coolgardie
District P15/5358 100%
Bullabulling Project - Coolgardie
District P15/5381 100%
Bullabulling Project - Coolgardie
District P15/5382 100%
Bullabulling Project - Coolgardie
District P15/5383 100%
Bullabulling Project - Coolgardie
District P15/5384 100%
Bullabulling Project - Coolgardie
District P15/5385 100%
Bullabulling Project - Coolgardie
District P15/5386 100%
Bullabulling Project - Coolgardie
District P15/5387 100%
Bullabulling Project - Coolgardie
District P15/5388 100%
Bullabulling Project - Coolgardie
District P15/5512 100%
Bullabulling Project - Coolgardie
District P15/5513 100%
Bullabulling Project - Coolgardie
District P15/5514 100%
Bullabulling Project - Coolgardie
District P15/5515 100%
Bullabulling Project - Coolgardie
District P15/5516 100%
Bullabulling Project - Coolgardie
District P15/5533 100%
Bullabulling Project - Coolgardie
District P15/5535 100%
Bullabulling Project - Coolgardie
District P15/5538 100%
Bullabulling Project - Coolgardie
District P15/5539 100%
Bullabulling Project - Coolgardie
District P15/5540 100%
Bullabulling Project - Coolgardie
District P15/5541 100%
Bullabulling Project - Coolgardie
District P15/5567 100%
Bullabulling Project - Coolgardie
District P15/5661 100%
Bullabulling Project - Coolgardie
District P15/5663 100%
Bullabulling Project - Coolgardie
District P15/5664 100%
Bullabulling Project - Coolgardie
District P15/5669 100%
Bullabulling Project - Coolgardie
District P15/5673 100%
Bullabulling Project - Coolgardie
District P15/5674 100%
----------------------------------- ------------------ -----------
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR JRMJTMBMTBJJ
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