ABN 63 149 105 653 ANNUAL REPORT FOR THE FINANCIAL …...Level 29 Duncan Dovico Risk & Assurance Pty...

ABN 63 149 105 653

ANNUAL REPORT

FOR THE FINANCIAL YEAR ENDED

30 JUNE 2015

DATELINE RESOURCES LIMITED FOR THE YEAR ENDED 30 JUNE 2015

2 | P a g e

ANNUAL REPORT

CONTENTS

Page

Corporate Information 3

Directors’ Report 4

Auditor’s Independent Report 17

Corporate Governance Statement 18

Consolidated Statement of Comprehensive Income 26

Consolidated Statement of Financial Position 27

Consolidated Statement of Changes in Equity 28

Consolidated Statement of Cash Flows 29

Notes to the Financial Statements 30

Directors’ Declaration 60

Independent Auditor’s Report 61

Shareholder Information 64

DATELINE RESOURCES LIMITED CORPORATE INFORMATION FOR THE YEAR ENDED 30 JUNE 2015

3 | P a g e

Directors & Officers Bankers

Mark Johnson AO - Executive Chairman National Australia Bank

Stephen Baghdadi - Non-Executive Director Fremantle Business Banking Centre

George Niumataiwalu - Non-Executive Director Level 1, 88 High Street

Gregory Hall – Non Executive Director Fremantle WA 6160

Website: www.nab.com.au

John Smith - Company Secretary

Registered Office Auditors

Level 29 Duncan Dovico Risk & Assurance Pty Ltd

2 Chifley Square Level 12, 90 Arthur Street

Sydney NSW 2000 North Sydney NSW 2060

Website: www.duncandovico.com.au

PO Box 553

South Hurstville NSW 2221

Share Registry

T: +61 (02) 8231 6640 Security Transfers Registrars Pty Ltd

F: +61 (02) 8231 6487 770 Canning Highway

E-mail: [email protected] Applecross WA 6153

Website: www.datelineresources.com.au

Website: www.securitytransfer.com.au

Securities Exchange Solicitors

Australian Securities Exchange Limited ("ASX") Watson Mangioni Lawyers Pty Ltd

Home Exchange – Sydney Level 13

ASX Symbols – DTR (ordinary shares) 50 Carrington Street

Sydney NSW 2000

Australian Company Number Website: www.wmlaw.com.au

ACN 149 105 653

Australian Business Number Domicile and Country of Incorporation

ABN 63 149 105 653 Australia

http://www.metalsx.com.au/

DATELINE RESOURCES LIMITED DIRECTORS REPORT FOR THE YEAR ENDED 30 JUNE 2015

4 | P a g e

The Directors submit their report on Dateline Resources Limited (the “Company” or “Dateline”) for the financial year ended 30 June 2015.

1. INFORMATION ON DIRECTORS

The names and details of the Company’s Directors in office during the financial year and until the date of this report are as follows. Directors were in office for the entire year unless otherwise stated.

Mr Mark Johnson AO Non-Executive Chairman (Appointed 22 April 2013) LLB MBA (Harvard)

Mr Johnson has worked in banking and corporate finance for more than forty years. He retired as Deputy Chairman of Macquarie Bank in mid-2007 and now divides his time between work in the private and public sectors.

Mr Johnson is a senior adviser to Gresham Partners, Chairman of Alinta Energy Ltd and from 2002 to 2013 one of the three Australian members of the APEC Business Advisory Council (ABAC).

During the past three years, Mr Johnson held the following directorships in other ASX listed companies:

Independent Director of Westfield Group (current);

Chairman & Non-Executive Director of Guinness Peat Group plc (resigned 8 April 2011);

George Niumataiwalu Non-Executive Director (Appointed 24 October 2013) BE, GradCert Eng, MSc, MBA, MPA (Harvard)

A Fiji citizen, Mr Niumataiwalu is a highly experienced mining engineer and mineral economist, with broad expertise in corporate finance and government-business relations. After graduation from the University of New South Wales, Mr Niumataiwalu worked in Western Australia for Western Mining Corporation at the Kambalda Nickel Operations and St Ives Gold Mine. He has attained a Western Australian First Class Mine Managers Certificate of Competency.

Mr Niumataiwalu has been involved in mine operation and development in Australia, Fiji and Papua New Guinea over the last 20 years, and most recently in the Hidden Valley and Wafi projects in PNG, and the Tuvatu project in Fiji. George is a director of Fiji-based Kontiki Capital.

Mr Niumataiwalu provides valuable guidance to the Board on operating an exploration company, liaison with the national government and mining project development studies through to mining operations in the Australasia region.

During the past three years, Mr Niumataiwalu has not held any directorships in other ASX listed companies.

Stephen Baghdadi Executive Director (Appointed 3 July 2014)

Mr Baghdadi has a wealth of experience in the mining exploration industry.

During the past three years, Mr Baghdadi held the following directorships in other ASX listed companies:

Non-Executive Chairman of Longreach Oil Limited (Resigned 8 July 2015);

Executive Director of Southern Cross Explorations N.L. (current);


5 | P a g e

Stephen Gemell Non-Executive Director (Appointed 24 October 2013, Resigned 19 August 2014) BE Mining (Hons), FAusIMM, (CP), MAIME, MMICA

Mr Gemell has more than 35 years' experience in the mining industry, having worked throughout Australasia and in Africa, North and South America, Asia, Eastern and Western Europe. He has been Principal of Gemell Mining Engineers, an independent multi-discipline consultancy, since its formation in Kalgoorlie in 1984. He specialises in mineral property assessment and strategic studies. His experience includes operational management in underground and open pit mining in positions from shift boss to resident manager, which has also involved the supervision of CIP/CIL, flotation and alluvial plants. He has subsequently held numerous executive and non-executive directorships, including the positions of CEO and Chairman, in listed mining companies.

He is a Fellow of the AusIMM, a Chartered Professional (Mining), a member of the Valmin Committee and a Member of the American Institute of Mining, Metallurgical and Petroleum Engineers.

During the past three years, Mr Gemell held the following directorships in other ASX listed companies: Non-Executive Chairman of Argent Minerals Limited (current)

Non-Executive Chairman of Eastern Iron Limited (current)

Non-Executive Chairman of Golden Cross Resources Limited (resigned October 2014)

Non-Executive Director of Indochine Mining Limited (resigned June 2013)

Non-Executive Director of UCL Resources Limited (resigned July 2013)

Mr Gregory Hall

Non-Executive Director (Appointed 19 January 2015) B. Applied Geology (1st Class Honours)

Mr Hall is an exploration geologist with over 40 years of international experience. From 1988-2005, he was employed by the Placer Dome group of companies, serving as Chief Geologist -World Wide during the last five years he was there.

Placer Dome was later acquired by Barrick Gold Corporation in early 2006.

Over the course of his career, Mr. Hall had a senior role in the discoveries of both Gold Field's Granny Smith mine and Rio Tinto's Yandi iron ore mine. In addition, he took part in the discoveries of Keringal and Wallaby in Australia's Eastern Goldfields, as well as the definition of AngloGold Ashanti's Sunrise gold mine.

During the past three years, Mr Hall held the following directorships in other ASX listed companies: Non-Executive Director of Namibian Copper NL (current)

Non-Executive Director of Zeus Resources Limited (current)

2. INFORMATION ON COMPANY SECRETARY

Mr John Smith (Appointed 24 October 2013) B. Com, MBA, FCPA

Mr Smith is a Certified Practising Accountant and Chartered Secretary with over 30 years experience as CFO and Company Secretary of ASX listed and unlisted companies.


6 | P a g e

3. DIRECTORS’ SHAREHOLDINGS

The following table sets out each current Director’s relevant interest in shares and rights or options to acquire shares of the Company as at the date of this report.

Directors

Fully Paid Ordinary

Shares

Unlisted Share

Options

Mark Johnson 26,588,875 -

Stephen Gemell 383,125 -

George Niumataiwalu 383,125 -

Stephen Baghdadi - -

Gregory Hall - -

27,355,125 -

4. DIRECTORS’ MEETINGS

Directors

Number Eligible to

Attend Number

Attended

Mark Johnson 13 13

Stephen Gemell 2 2

George Niumataiwalu 13 8

Stephen Baghdadi 13 13

Gregory Hall 7 5

Functions normally assigned to an Audit Committee and Remuneration Committee are undertaken by the full Board.

5. DIVIDENDS

No dividend has been paid during the financial year and no dividend is recommended for the financial year.

6. PRINCIPAL ACTIVITIES

The Company is an Australian-based exploration company with exploration projects in the Republic of Fiji. The Udu Polymetallic Project in Fiji hosts an Inferred Resource of 4.5 million tonnes at 1.2% Cu, 3.9% Zn, 29g/t Ag & 0.3g/t Au in accordance with JORC 2012 Guidelines. The Company plans to focus on exploration and development of the Udu Project and pursue precious metals and base metals opportunities as they arise.


7 | P a g e

7. OPERATING AND FINANCIAL REVIEW

A Operations

Dateline is an exploration company operating in Australia and the Republic of Fiji to acquire, explore, evaluate and exploit gold and copper-zinc deposits, and explore prospective tenements for other minerals.

The Company creates value for shareholders, through exploration activities which develop and quantify resource assets. Once an asset has been developed and quantified within the framework of the JORC guidelines the Company may elect to move to production, to extract and refine ore which is then sold as a primary product.

Tenement Schedule

Project Number Ownership Location

Udu SPL1387 100%* Vanua Levu, Republic of Fiji

Udu SPL1396 100%* Vanua Levu, Republic of Fiji

Udu SPL1494 100%^ Vanua Levu, Republic of Fiji

Udu Application CX814 100% Vanua Levu, Republic of Fiji


* Tenement expired on 22 January 2015 and is in the process of renewal. Refer to Note 13 in the financial report for more information.

^ Tenement expired on 14 September 2015 and is in the process of renewal. Refer to Note 13 in the financial report for more information.

B Financial Performance & Financial Position

The financial results of the Company for the year ended 30 June 2015 are:

30-Jun-15 30-Jun-14 % Change

Cash & cash equivalents ($) 45,907 92,285 (50%)

Net assets ($) 3,350,482 6,917,018 (51%

Revenue ($) 17,597 7,981 120%

Net profit/(loss) after tax ($) (4,512,003) 823,036 N/A

Profit/(loss) per share (cents) -5.67 1.54 -468%

Dividend ($) - - -

C Business Strategies and Prospects for future financial years

The Company actively evaluates the prospects of each project as results from each program become available, these results are available via the ASX platform for shareholders information. The Company then assesses the continued exploration expenditure and further asset development. The Company will continue the evaluation of its mineral projects in the future and undertake generative work to identify and acquire new resource projects.

There are specific risks associated with the activities of the Company and general risks which are largely beyond the control of the Company and the Directors. The risks identified below, or other risk factors, may


8 | P a g e

have a material impact on the future financial performance of the Company and the market price of the Company’s shares.

a) Operating Risks

The operations of the Company may be affected by various factors, including failure to locate or identify mineral deposits, failure to achieve predicted grades in exploration and mining, operational and technical difficulties encountered in mining, difficulties in commissioning and operating plant and equipment, mechanical failure or plant breakdown, unanticipated metallurgical problems which may affect extraction costs, adverse weather conditions, industrial and environmental accidents, industrial disputes and unexpected shortages or increases in the costs of consumables, spare parts, plant and equipment.

b) Environmental Risks

The operations and proposed activities of the Company are subject to the laws and regulations of Australia and the Republic of Fiji concerning the environment. As with most exploration projects and mining operations, the Company’s activities are expected to have an impact on the environment, particularly if advanced exploration or mine development proceeds. It is the Company’s intention to conduct its activities to the highest standard of environmental obligation, including compliance with all environmental laws.

c) Economic

General economic conditions, movements in interest and inflation rates and currency exchange rates may have an adverse effect on the Company’s exploration, development and production activities, as well as on its ability to fund those activities.

d) Market conditions

Share market conditions may affect the value of the Company’s quoted securities regardless of the Company’s operating performance. Share market conditions are affected by many factors such as:

i. general economic outlook;

ii. introduction of tax reform or other new legislation;

iii. interest rates and inflation rates;

iv. Commodity prices;

v. changes in investor sentiment toward particular market sectors;

vi. the demand for, and supply of, capital; and

vii. terrorism or other hostilities.

The market price of securities can fall as well as rise and may be subject to varied and unpredictable influences on the market for equities in general and resource exploration stocks in particular. Neither the Company nor the Directors warrant the future performance of the Company or any return on an investment in the Company.

e) Additional requirements for capital

The Company’s capital requirements depend on numerous factors. Depending on the Company’s ability to generate income, the Company will require further financing. Any additional equity financing will dilute shareholdings, and debt financing, if available, may involve restrictions on financing and operating activities. If the Company is unable to obtain additional financing as needed, it may be required to reduce the scope of its operations and scale back its exploration programmes as the case may be. There is however no guarantee that the Company will be able to secure any additional funding or be able to secure funding on terms favourable to the Company.


9 | P a g e

f) Speculative investment

The above list of risk factors ought not to be taken as exhaustive of the risks faced by the Company or by investors in the Company. The above factors, and others not specifically referred to above, may in the future materially affect the financial performance of the Company and the value of the Company’s shares.

Potential investors should consider that the investment in the Company is speculative and should consult their professional advisers before deciding whether invest.

8. SIGNIFICANT CHANGES IN STATE OF AFFAIRS

During the year the following significant events took place:

On 2 July 2014 the Company announced that it had reached agreement with Southern Cross Exploration NL (SXX) for SXX to subscribe for 15,000,000 ordinary shares in Dateline (representing 19.7% of Dateline’s issued capital) following completion of the placement, at an issue price of $0.04 per Share raising $600,000. The issuance of shares and receipt of paid-in capital was completed in two tranches as stated below.

On 25 July 2014, SXX did complete the first tranche of the agreed share placement subscribing for 7,500,000 shares at $0.04 or $300,000.

On 25 November 2014, SXX did complete the second tranche of the agreed share placement subscribing for 7,500,000 shares at $0.04 or $300,000.

In November 2014, the Company and SXX entered into a short-term loan agreement. SXX has lent $550,000 to the company to fund a proposed project which is currently being evaluated. In March 2015, $400,000 was repaid to SXX, the balance outstanding as at 30 June 2015 is $172,192 (including interest). An accrued interest expense of $19,848 was recorded as at 30 June 2015.

In October 2014, the Company made a payment of $200,000 to SXX for its assistance in the above mentioned proposed project which was being evaluated.

In January 2015, Mr. Mark Johnson, the Company’s Chairman and a shareholder of the company, lent $2.5m to the company. This loan exclusive of interest was fully repaid in April 2015. Interest of $22,000 in respect of the loan remains unpaid and is reflected as a current liability as at 30 June 2015.

On 25 May 2015, the Company announced that it had entered into a share sale agreement with the major shareholders of Golden Phoenix Resources Limited (GPR) to acquire all of the issued shares of GPR from its current shareholders.

Overview of GPR

GPR is an unlisted public mineral exploration company which was incorporated in Western Australia in April 2007. The current directors of GPR are Maree Laffan, Greg Hall, Robert Thomson, and Christopher Castle (alternate director for Rob Thomson).

Through its wholly owned subsidiary, GPR has three exploration licences and two exploration licence applications all located in Western Australia. The exploration licences are in relation to the Augustus sedimentary copper project located in the Gascoyne region of Western Australia, and cover three separate copper geochemical anomalies defined by the GSWA geochemical data within the Proterozoic Bangemall Basin.

The licences cover the largest copper anomaly within the GSWA public domain geochemical dataset from modelling, after normalising for lithological variations.


10 | P a g e

The key shareholders of GPR have extensive experience in the exploration sector and project development.

Key Terms of the Acquisition

The acquisition will result in GPR and its subsidiaries becoming wholly owned subsidiaries of the Company.

As consideration for the acquisition, the Company is proposing to issue a total of 22,000416 ordinary fully paid shares in the Company (Consideration Shares) to the current shareholders of GPR.

Following completion of the acquisition, the current shareholders of GPR will hold in aggregate 24.68% of the Company’s issued shares (assuming no further Shared are issued).

The acquisition is proposed to occur in October 2015.

Acquisition of GPR and Related Parties

Mr Greg Hall is a director of both the Company and GPR.

As a result of a review of the carrying value of capitalised exploration costs and the identification of indicators of impairment, a formal valuation was sought to determine the fair value of the exploration costs. As a result of this valuation, an impairment loss of $3.9M was recognised in the current year income statement, as outlined in Note 13. This has resulted in a carrying value of the asset at 30 June 2015 of $3.6M.

9. AFTER BALANCE SHEET DATE EVENTS

Tenement SPL1494 expired on 14 September 2015. An application for renewal of the license is currently before the Fijian authorities. The Board expects the renewal to be granted in due course and without exception.

On 17 September 2015 a general meeting was held where Shareholders approved the above mentioned acquisition of GPR. As of the date of this directors’ report the company has not transferred the consideration effecting the acquisition. The consideration is the agreed shares of the company to the original shareholders of GPR. As a result as at the date of this report the company has not obtained control of GPR. Completion of the transaction will result in GPR becoming a subsidiary of the company and will form part of the company’s consolidated group for accounting purposes.

10. ENVIRONMENTAL ISSUES

The Company needs to comply with environmental regulations at the sites where it has exploration activities. The Board is not aware of any breach of environmental requirements as they apply to the Company. There were no ground disturbing activities conducted during the financial year.


11 | P a g e

11. REMUNERATION REPORT (Audited)

The information provided in this remuneration report has been audited as required by section 308(3C) of the Corporations Act 2001. There were no company executives and other key management personnel who were not also Directors of the Company for the financial year.

The remuneration arrangements detailed in this report are for the Chairman and Non-Executives who held office during the financial year and are as follows:

Directors Position Duration of Appointment

Mark Johnson Non-Executive Chairman Appointed 22 April 2013

Stephen Gemell Non-Executive Director Appointed 24 October 2013, Resigned 19 August 2014

George Niumataiwalu Non-Executive Director Appointed 24 October 2013

Stephen Baghdadi Executive Director Appointed 4 July 2014

Gregory Hall Non-Executive Director Appointed 19 January 2015

The Remuneration Report is set out under the following main headings:

A Remuneration Philosophy

B Remuneration Structure and Approvals

C Remuneration and Performance

D Details of Remuneration

E Share-based Compensation

F Key management Personnel Equity Holdings

G Adoption of Remuneration Report by Shareholders

A Remuneration Philosophy

Key management personnel have authority and responsibility for planning, directing and controlling the activities of the Company. Key management personnel of the Company comprise the Board of Directors only.

The performance of the Company depends upon the quality of its key management personnel. To prosper the Company must attract, motivate and retain appropriately skilled directors and executives.

The Company’s remuneration policy has been designed to align director and executive objectives with shareholder and business objectives, by providing a fixed remuneration component and offering specific long-term incentives based on key performance areas affecting the Company’s financial results. The Board believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best executives and directors to run and manage the Company, as we as create goal congruence between directors, executives and shareholders.

B Remuneration Structure and Approvals

Remuneration of Directors is currently set by the Board of Directors. The Board has not established a separate Remuneration Committee at this point in the Company’s development nor has the Board engaged


12 | P a g e

the services of a remuneration consultant to provide recommendations when setting the remuneration received by Directors. It is considered that the size of the Board along with the level of activity of the Company renders this impractical and the full Board considers in detail all of the matters for which the Directors are responsible.

Executive Remuneration Structure

The Board’s policy for determining the nature and amount of remuneration for Board members and senior executives of the Company is as follows:

The remuneration policy, setting the terms and conditions for the executive directors and other senior executives, was developed and approved by the Board;

All executives may receive a base salary, (which reflects the person’s duties, responsibilities, experience and length of service), superannuation, fringe benefits, options, shares and performance incentives; and

The Board reviews the executive packages annually by reference to the Company’s performance, executive performance and comparable information from industry sectors.

The performance of executives is measured against criteria agreed annually with each executive and is based predominantly on the forecast growth of shareholders’ value. The Board may, however, exercise its discretion in relation to approving incentives, bonuses, options and shares. The policy is designed to attract the highest calibre executives and reward them for performance that results in long-term growth in shareholder wealth. All directors and executives are also entitled to participate in the Company’s share-based incentive plan. All directors and executives employed directly by the Company receive a superannuation guarantee contribution required by the government and do not receive any other retirement benefits.

All remuneration paid to directors and executives is valued at the cost to the Company and is expensed. Options given to directors and executives are valued as the difference between the market price of those shares and the amount paid by the director or executive. Options are valued using a Black-Scholes option pricing model.

Non-Executive Remuneration Structure

The Board’s intention is to remunerate non-executive directors at market rates for time, commitment and responsibilities. The Board of Directors determines the payments to the non-executive directors and reviews their remuneration annually, based on market price, duties and accountability. Independent external advice is sought when required.

The remuneration of non-executive directors consists of Directors’ fees, payable in arrears. The total aggregate fee pool to be paid to Directors (excluding executive directors) is set at $350,000 per year (in accordance with the Company’s Constitution) and as approved by the shareholders of the Company. Non-executive directors do not receive retirement benefits but are able to participate in share-based incentive plan and encouraged to hold shares in order to align director’s interests with shareholder interests.

Non-executive directors may enter into separate consultancy mandates with the Company for the provision of professional and technical services that fall outside the scope of their directorship role. Under this mandate directors receive a consultancy fee in connection with time spent on Company business, including reasonable expenses incurred by them in carrying out this consultancy role.

Further details relating to remuneration of Non-Executive Directors are contained in the Remuneration Table disclosed as Section D of this Report; and within the Notes to the Financial Statements Note 20 Key Management Personnel Disclosures.


13 | P a g e

C Remuneration and Performance

Director remuneration is currently not linked to either long term or short term performance conditions. The Board feels that the terms and conditions of options and shares currently on issue to the Directors are a sufficient, long term incentive to align the goals of the Directors with those of the shareholders to maximise shareholder wealth, and as such, has not set any performance conditions for the Directors of the Company. The Board will continue to monitor this policy to ensure that it is appropriate for the Company in future years.

The following table shows the gross revenue and losses and share price of the Company at the end of each respective financial year:

30-June 15 30-Jun-14 30-Jun-13 30-Jun-12

Revenue ($) 17,597 7,981 3,784 2,625

Net Profit/(loss) ($) (4,512,003) 823,036 (230,289) (458,705)

Share Price ($) 0.012 0.025 0.084 0.170

D Details of Remuneration

The key management personnel of the Company are the Board of Directors.

During the financial year ended 30 June 2015 and 30 June 2014, the Directors received no long-term benefits or termination benefits. The only remuneration received by the Directors within these periods were short-term employee benefits and share-based payments.

Details of the remuneration of the Directors of the Company up to 30 June 2015 are set out below:

Post-

employment

benefits

Share-

based

payments

Salary

& fees

Cash

bonus

Non-

monetary

Other

(v)

Super-

annuation

Options &

rights Total

$ $ $ $ $ $ $

Directors

Mr Johnson - - - - - - - -

Mr Niumataiwalu - - - - - - - -

Mr Baghdadi 35,000 - - - - - 35,000 -

Mr Gemell - - - - - - - -

Mr Hall - - - - - - - -

Sub-total 35,000 - - - - - 35,000 -

Other Key Mgt

None - - - - - - - -

Sub-total - - - - - - - -

Total 35,000 - - - - - 35,000 -

Short-term employee benefitsPercentage of

remuneration

consisting of

options for the

year

%

30-Jun-15


14 | P a g e

Details of the remuneration of the Directors of the Company up to 30 June 2014 are set our below:

Post-

employment

benefits

Share-

based

payments

Salary

& fees

Cash

bonus

Non-

monetary

Other

(v)

Super-

annuation

Options &

rights Total

$ $ $ $ $ $ $

Directors

Mr Johnson - - - - - - - -

Mr Niumataiwalu - - - - - - - -

Mr Baghdadi - - - - - - - -

Mr Gemell - - - - - - - -

Mr De Souza (i) 8,550 - - - - - 8,550 -

Mr King (i) 9,500 - - - - - 9,500 -

Mr Ralston (i) 9,050 - - - - - 9,050 -

Sub-total 27,100 - - - - - 27,100 -

Other Key Mgt

None - - - - - - - -

Sub-total - - - - - - - -

Total 27,100 - - - - - 27,100 -

(i) Mr De Souza, Mr King and Mr Ralston resigned as Director on 24 October 2013

Short-term employee benefitsPercentage of

remuneration

consisting of

options for the

year

%

30-Jun-14

E Share based Compensation

The key management personnel of the Company are the Board of Directors.

The Company rewards Directors for their performance and aligns their remuneration with the creation of shareholder wealth by issuing share options and shares. Share-based compensation is at the discretion of the Board and no individual has a contractual right to participate in any share-based plan or to receive any guaranteed benefits.

Options

There were no options granted to key management personnel as remuneration during the financial year and prior financial year.

Shares

During 2012 financial year, shareholders approved the Director Share Plan (“Director Plan” or “Plan”) whereby shares are allocated to Directors, Executives and other eligible participants. Under the Director Plan, eligible participants are provided with a non-recourse loan from the Company to fund the subscription price of issued shares in accordance with the terms and conditions of the Plan. Eligible participants of the Plan may not deal with the shares while the loan remains outstanding. A full summary of the Plan was set out in the Notice of Meeting dated 17 October 2011.

Although these are shares for legal and taxation purposes, Accounting Standards require they be treated as options for accounting purposes.

No shares were issued to eligible participants in the current financial year.


15 | P a g e

Link to Performance

Options and shares issued under the Plan are treated as options for accounting purposes, there are no performance requirements to be met before exercise can take place largely because by setting the option price or share price at a level above the current share price at the time the options or shares are granted, the Board considers this to be a sufficient, long-term incentive to align the goals of the Directors and management with those of the shareholders to improve the Company’s performance. The Board will continue to monitor this policy to ensure that it is appropriate for the Company in future years.

F Key management personnel holdings

(i) Option holdings of Key Management Personnel

There are no options held by key management personnel.

(ii) Shareholdings

Details of shares held directly, indirectly or beneficially by key management personnel and their related parties at any time during the financial year ended 30 June 2015 are set out below:

Company Directors and Related Parties

Opening Balance

Received as Remuneration

Exercise of Options

Net Change Other

Closing Balance

Mr. Johnson 26,588,875 - - - 26,588,875

Mr. Gemell 383,125 - - - 383,125

Mr. Niumataiwalu 383,125 - - - 383,125

Mr. Baghdadi - - - - -

Mr. Hall - - - - -

27,355,125 - - - 27,355,125

Details of shares held directly, indirectly or beneficially by key management personnel and their related parties at any time during the financial year ended 30 June 2014 are set out below:

Company Directors and Related Parties

Opening Balance

Received as Remuneration

Exercise of Options

Net Change Other

Closing Balance

Mr. Johnson 500,000 - - 26,588,875 26,588,875

Mr. Gemell - - - 383,125 383,125

Mr. Niumataiwalu - - - 383,125 383,125

Mr. Ralston 100,000 - 250,000 - 350,000

Mr. De Souza 750,000 - - - 750,000

1,600,000 - - 27,355,125 28,455,125

G Adoption of Remuneration Report by Shareholders

The adoption of the Remuneration Report for the financial year ended 30 June 2015 was put to the shareholders of the Company at the Annual General Meeting held 21 November 2014. The resolution was passed without amendment on a show of hands. The Company did not receive any specific feedback at the AGM or throughout the year on its remuneration practices.

12. OPTIONS

At the date of this report, there were no unissued ordinary shares of Dateline under option.


16 | P a g e

13. PROCEEDINGS ON BEHALF OF THE COMPANY

No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party, for the purposes of taking responsibility on behalf of the Company for all or part of those proceedings.

14. INDEMNIFYING OFFICERS

During the financial year, the Company paid a premium in respect of a contract insuring all its Directors and current Executive Officers against a liability incurred as such a director or executive officer to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium. The Company has not otherwise, during or since the financial year, indemnified or agreed to indemnify an officer or auditor of the Company against a liability incurred as such an officer or auditor.

15. NON-AUDIT SERVICES

There were no non-audit services provided by the Company’s auditors during the financial year.

16. LEAD AUDIOR’S INDEPENDENCE DECLARATION

The lead auditor’s independence declaration for the financial year ended 30 June 2015 has been received and can be found on page 17.

Signed in accordance with a resolution of the Board of Directors.

Mr Mark Johnson Non Executive Chairman 30 September 2015

DUNCAN DOVICO

17 | P a g e

Auditors’ Independence Declaration

In accordance with section 307C of the Corporations Act 2001, I declare that, to the best of my knowledge

and belief, during the year ended 30 June 2014 there has been:

(i) no contraventions of the auditor independence requirements as set out in the Corporations Act 2001

in relation to the audit; and

(ii) no contraventions of any applicable code of professional conduct in relation to the audit.

This declaration is in respect of Dateline Resources Limited and its controlled entity during the year.

DUNCAN DOVICO RISK & ASSURANCE PTY LIMITED

Rosemary Megale

Director

Sydney, 30 September 2015.

D U N C A N D O V I C O R I S K & A S S U R A N C E P T Y L I M I T E D LEVEL 12, 90 ARTHUR STREET, NORTH SYDNEY NSW 2060 PO BOX 1994 , NORTH SYDNEY NSW 2059

T: (02) 9922 1166 F: (02) 9922 2044 E: [email protected] ABN 39 151 805 275 Liability limited by a scheme approved under Professional Standards Legislation

DATELINE RESOURCES LIMITED CORPORATE GOVERNANCE FOR THE YEAR ENDED 30 JUNE 2015

18 | P a g e

CORPORATE GOVERNANCE STATEMENT

The Board of Directors of Dateline Resources Limited (the “Company” or “Dateline”) seeks to act professionally and ethically while executing its responsibilities as it guides and monitors the business and affairs of the Company on behalf of the shareholders by whom they are elected and to whom they are accountable.

The Board of the Company has considered the principles of good corporate and best practice recommendations of the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations (Principles and Recommendations). ASX Listing Rule 4.10.3 requires the Company to disclose the extent to which it follows or diverges from these best practice recommendations in its Annual Report.

The Role of the Board & Management The Company has formalised and disclosed the roles and responsibilities of the Board and those delegated to senior management. The Board is responsible for the overall corporate governance of Dateline, including its ethical behaviour, strategic direction, establishing goals for management and monitoring the achievement of those goals with a view to optimising company performance and maximising shareholder value. The role of management is to support the Chief Executive Officer and implement the running of the general operations and financial business of the Company, in accordance with the delegated authority of the Board. Scheduled meetings of the Board are to be held throughout the year and the Board meets on other occasions to deal with matters that require attention between scheduled meetings. The responsibility for the operation and administration of the Company is delegated by the Board to the Chief Executive Officer. The Board is responsible for:

Appointment of the Chief Executive Officer and other senior executives and the determination of their terms and conditions including remuneration and termination;

Driving the strategic direction of the Company, ensuring resources are available to meet objectives and monitoring management’s performance;

Reviewing and ratifying systems of risk management and internal compliance and control, codes of conduct and legal compliance;

Approving and monitoring the progress of major capital expenditure, capital management and significant acquisitions and divestitures;

Approving and monitoring budget and the adequacy and integrity of financial and other reporting;

Approving the annual, half yearly and quarterly accounts;

Approving significant changes to the organisational structure;

Approving the issue of any securities of the Company;

Ensuring a high standard of corporate governance practice and regulatory compliance and promoting ethical and responsible decision making; and

Recommending to shareholders the appointment of the external auditor and meeting with the external auditor.

Dateline has obligations to its stakeholder to ensure the Company is managed with appropriate due diligence and that all necessary processes are implemented to minimise risk and maximise business opportunities.


19 | P a g e

To this end, all commercial arrangements, capital expenditure, operational expenditure and other commitments are appropriately documented and have been authorised by the Board.

The composition of the Board is determined in accordance with the Company constitution and the following principals and guidelines:

The Board should comprise of at least three Directors with a majority of Non-Executive Directors;

The Board should comprise of Directors with an appropriate range of qualifications and expertise; and

The Board should meet formally at least four times per annum and informally on an as required basis with all Directors being made aware of, and having available, all necessary information, to participate in an informed discussion of all agenda items.

Directors in Office

At the date of this statement the following Directors are in office:

Name Position Independent

Mr Mark Johnson Non- Executive Chairman No

Mr George Niumataiwalu Non-Executive Director Yes

Mr Stephen Baghdadi Executive Director No

Mr Gregory Hall Non-Executive Director Yes

The skills, experience, expertise and tenure of each director are disclosed in the Directors’ Report within this Annual Report.

Director Independence

The Company recognises that independent Directors are important in verifying to shareholders that the Board is properly fulfilling its role and is diligent in holding senior management accountable for its performance.

Directors of Dateline Resources Limited are considered to be independent when they are independent of management and free from any business or other relationship that could materially interfere with, or could reasonably be perceived to materially interfere with, the exercise of their unfettered and independent judgement.

In making this assessment, the Board considers all relevant facts and circumstances. Relationships that the Board will take into consideration when evaluating independence are whether a Non-Executive Director:

is a substantial shareholder of the Company or an officer of, or otherwise associated directly with, a substantial shareholder of the Company;

is employed, or has previously been employed in an executive capacity by the Company or another Company member, and there has not been a period of at least three years between ceasing such employment and serving on the Board;

has within the last three years been a principal of a material professional advisor or a material consultant to the Company or another Company member, or an employee materially associated with the service provided;

is a material supplier or customer of the Company or other Company member, or an officer of or otherwise associated directly or indirectly with a material supplier or customer; or

has a material contractual relationship with the Company or another Company member other than as a Director.


20 | P a g e

At the date of signing of this report, Mr Johnson is not deemed to be independent. Mr Johnson is the majority shareholder of Dateline. Up to 30 June 2015 Mr Johnson had received no fees as he has elected not to receive director fees due to this interest.

After considering all facts and circumstances mentioned above in regards to evaluating the independent status of a director, at the date of signing this report the Company deems Mr Niumataiwalu to be independent.

After considering all facts and circumstances mentioned above in regards to evaluating the independent status of a director, at the date of signing this report the Company deems Mr Baghdadi not to be independent as he holds the position of executive director.

After considering all facts and circumstances mentioned above in regards to evaluating the independent status of a director, at the date of signing this report the Company deems Mr Hall to be independent.

During the current financial year the Board has met to consider appointments to management and the Board and have considered the balance of skills and experience required of Board members for the size and state of development of Dateline. The Board believes that it has the right numbers and skill sets within its board members for the current size of the Company and is confident that each non-executive director brings independent judgement to bear on Board decisions. If additional skill sets are considered to be necessary, the Board seeks candidates from the wider market and chooses the most appropriate person for the role required.

Where additional skills are considered necessary for specific purposes, access is made to independent professional advice at the expense of the Company.

Chairman and Chief Executive Officer The ASX Corporate Governance Council Recommendations recommend that the chair be independent and that the roles of chair and Chief Executive Officer should not be exercised by the same individual. Mr Mark Johnson is not considered independent by the Board due to his interest in Dateline. However, due to his interest and experience with the Udu Project the Board considers his role as Non-Executive Chairman appropriate in the Company’s current circumstances.

Appointment to the Board

The Board of Directors undertakes the role of a Nomination Committee which identifies and recommends potential director appointments. Where a casual vacancy arises during the year, the Board has procedures to select the most suitable candidate with the appropriate experience and expertise to ensure a balanced and effective board. Any director appointed during the year to fill a casual vacancy or as an addition to the current Board, holds office until the next Annual General Meeting and is then eligible for re-election by the shareholders.

New directors receive a letter of appointment which sets out the terms of their appointment. On appointment, an induction program is available to directors that include individual sessions with members of the executive team.

Evaluation of Senior Executives

Senior executives have a formal job description and letter of appointment describing the term of office, duties, rights, responsibilities and entitlements upon termination.

The performance of senior executives is reviewed annually before the budgets are approved for the next financial year. This process is a formal one with the executive’s performance assess against company and


21 | P a g e

personal benchmarks. Benchmarks are agreed with the respective senior executives and reviews are based upon the degree of achievement against those benchmarks.

Induction procedures are in place to allow new senior executives to participate fully and actively in management decision-making. The induction program includes an orientation of:

The Company’s financial position, strategies, operations and risk management policies; and

The respective rights, duties responsibilities and roles of the Board and senior executives.

There are no senior executives during the financial year ended 30 June 2015.

The Company Secretary is accountable directly to the Board, through the Chair, on all matters to do with the proper functioning of the Board.

Ethical Business Practices

The Board is bound by the Company’s Board Charter and Code of Conduct (as disclosed in the Company’s Corporate Governance Plan). The Board understands the obligations for ethical and responsible decision making. All Directors and Officers are expected to:

a) comply with the law; b) act in the best interests of the Company; c) be responsible and accountable for their actions; and d) observe the ethical principles of honesty and fairness, including prompt disclosure of potential

conflicts.

The Board has procedures in place for reporting any matters that may give rise to unethical practices or conflicts between the interests of a director or senior executive and those of the Company. These procedures are reviewed as required by the Board. The Company has adopted a Conflict of Interest Policy, as a part of the Code of Conduct, that clarifies he processes for directors and senior executives to determine and disclose when a conflict of interest exists.

Shareholding and Trading

The Board encourages directors and senior executives to own shares in the Company to further link their interests with the interests of all shareholders. Trading of shares by directors and senior executives is prohibited under certain circumstances and as described in the ASX Listing Rules and during certain periods of the financial year. A director or senior executive must not deal in the company’s shares at any time when he or she has unpublished information which, if generally available, might affect the share price. Directors and senior executives are required to first obtain consent from the Chairman or Company Secretary before dealing in the Company’s securities.

Safeguard Integrity

The Board of Directors performs the duties of the Audit and Risk Committee and operates under a charter to enable it to perform its role and responsibilities. Where appropriate, the Company’s external auditors are invited to attend Board meetings relating to Audit and Risk matters. As the Board is comprised of two independent Non-Executive Directors, one non-independent Director and one Executive Director, the Company does not comply with ASX Recommendation 4.2 which recommends that the audit committee is structured as follows:

consists only of non-executive directors

consists of a majority of independent directors

is chaired by an independent chair, who is not chair of the board


22 | P a g e

has at least three members

The Board considers that the Company is not of a size at the moment that justifies having a separate audit committee and additional independent non-executive directors. Though the Company intends to seek out and appoint additional independent directors to the Board when size and scale of the Company justify and warrant their inclusion, for the time being the Company maintains a mix of Directors from different backgrounds with complementary skills and experience. The qualifications of the Directors together with their attendances at Board Meetings are disclosed in the Directors’ Report within this Annual Report.

The Board is responsible to fulfil its responsibilities in relation to the identification of the areas of significant business risks and monitor the following:

the quality and integrity of the Company’s financial statements, accounting policies and financial reporting and disclosure practices;

compliance with all applicable laws, regulations and company policy;

the effectiveness and adequacy of internal control process;

the performance of the Company’s external auditors and their appointment and removal;

the independence of the external auditor and the rotation of the lead engagement partner; and

the identification and management of business risks.

The Executives of the Company provide the Board with additional assurances regarding the reliability of the financial information for inclusion in the financial statements. The Chief Executive Officer in his or her Executive and Financial capacity is required to declare to the Board that in his or her opinion the Financial Statements and the note to the Accounts within the Annual Report are in accordance with the Corporations Act 2001, comply with the Accounting Standards and the Corporations Regulations 2001 and give a true and fair view of the financial position of the Company and are based upon a sound system of risk management and internal compliance and control prior to the signing of the Directors’ Declaration in the Annual Report.

Independent Advice

The Board recognised that in certain circumstances individual directors may need to seek independent professional advice, at the expense of the Company. Any advice received will be made available to other directors.

Timely and Balanced Disclosure

The Board recognises the need to comply with ASX Listing Rule 3.1 concerning continuous disclosure.

At each meeting of directors, consideration is given as to whether notice of material information concerning the Company, including its financial position, performance, ownership and governance has been made available to all investors.

The Continuous Disclosure Policy also requires senior executives in possession of disclosable information to comply with the policy.

Communication with Shareholders

The Board aims to ensure that shareholders, on behalf of whom they act, are informed of all major developments affecting the Company’s activities and its state of affairs, including information necessary to assess the performance of the directors.

Communication with shareholders is achieved through the distribution of the following information:

The Annual Report distributed to shareholders;

The Half Yearly Report and Quarterly Reports which is available on the Company’s website;


23 | P a g e

The Annual General Meeting and General Meetings called to obtain shareholder approval for board action as appropriate. Shareholders are encouraged to attend and participate at the Company’s Annual General Meeting and General Meetings;

Letters to shareholders when considered appropriate and informative;

Announcements on the Australian Securities Exchange; and

Investor information on the Company’s website www.datelineresources.com.au

The Company strives to ensure that company announcements via the ASX are made in a timely manner, are factual, do not omit material information and are expressed in a clear and objective manner.

Shareholders’ Role

The shareholders of the Company are responsible for voting on the election of directors at the Annual General Meeting in accordance with the constitution.

All directors (other than the Executive Directors) are subject to re-election by rotation, no later than every three years.

The Annual General Meeting also provides shareholders with the opportunity to express their views on matters concerning the Company and to vote on other items of business for resolution by shareholders.

The Company’s auditor, Duncan Dovico Risk & Assurance Pty Ltd, make available a partner of the firm to be in attendance at the Annual General Meeting and to be available to answer shareholder questions in relation to the audit.

Risk Management

The entire Board is responsible for overseeing the risk management function. The Board is responsible for ensuring the risks and opportunities are identified on a timely basis. The Board determines the Company’s “risk profile” and is responsible for overseeing and approving risk management strategies and policies, internal compliance and internal control.

The Board has mechanisms in place to ensure that management’s objectives and activities are aligned with the risks identified by the Board. These include the following:

Implementation of Board approved operating plans and budgets;

Board monitoring of progress against these budgets, including the monitoring of key performance indicators of both financial and non-financial nature; and

The establishment of committees to report on specific risks when identified.

Internal Risk Management System Compliance

The Board has not received a report from management as to the effectiveness of the Company’s management of its material business risks. The Board’s collective experience will enable accurate identification of the principal risks that may affect the Company’s business. Key operational risks and their management will be items for deliberation at Board Meetings. The Company has identified a series of operational risks which it believes to be inherent in the industry in which the Company operates. These include:

changed operating, market or regulatory environments;

fluctuations in commodity demand;

fluctuations in exchange rates and inflation rates; and

increasing costs of operations.

http://www.datelineresources.com.au/


24 | P a g e

Please refer to the Operating and Financial Review for further detail on the Company’s material risks.

The Board requires that the Chief Executive Officer and Chief Financial Officer, or equivalent, every half year, to provide a statement confirming that a sound system of risk management and internal control is in place and that the system is operating effectively in all material respects in relation to financial risks. The Board has received that assurance.

Monitoring Performance

The Board and senior executives monitor the performance of the Company through the preparation of monthly management accounts. The monthly management accounts are prepared using accrual accounting and report each segment’s result. The monthly management accounts are compared to monthly budgets, which have been prepared on the basis of capital availability and exploration results.

The monitoring of the Company’s performance by the Board and management assists in identifying the correct allocation of resources to maximise the overall return to shareholders.

A performance evaluation of executives was not undertaken during the year however the Board has a process for performance evaluation when it is appropriate to be conducted.

Details of the structure of non-executive directors’ and senior executives’ remuneration are included in the Remuneration Report within the Directors’ Report in this Annual Report.

During the year the board undertook a performance review of the Board of Directors, managed by the Chair at the time, Mr Johnson. The conclusions of the self-assessment of the Board’s performance during the previous year and any recommendations for improvement which become apparent from that review, are discussed by the Board.

The performance evaluation was undertaken using the process disclosed above.

Nomination and Remuneration

Nomination Committee

The role of the Nomination Committee is undertaken by the full Board of Directors. The Board has adopted a Nomination Committee Charter to ensure that the responsibilities of the Board are discharged in an appropriate manner.

The role of the Nomination Committee is to support and advise the Board in:

determine the appropriate size and composition of the Board;

determine the terms and conditions of appointment to and retirement from the Board;

develop appropriate criteria for Board membership

reviewing membership of the Board and proposing candidates for consideration by the Board; and

arranging a review of the Board’s own performance.

The Board met during the year and considered that for the size of the Company and state of its development, the number of directors and their skills and experience were appropriate. The Board is aware of the need to continually assess the skills available to the Board. Where additional skills are considered necessary, candidates for director are sought from the wider market place with a view to selecting the most appropriate candidate for the chosen role.


25 | P a g e

Remuneration Committee

The role of the Remuneration Committee is undertaken by the full Board of Directors. The Board has adopted a Remuneration Committee Charter to ensure that the responsibilities of the Board are discharged in an appropriate manner.

The role of the Remuneration Committee is to determine the Company’s remuneration plans, policies and practices, including compensation arrangements for non-executive directors, executive directors and senior executives. It is also responsible for considering general remuneration policies and practices, recruitment and termination policies and superannuation requirements.

The Company has a policy to preclude its executives from entering into transactions to limit their economic risk from investing in the company shares, options or rights where those investments are unvested and has made executives aware of their obligations in relation to financial commitments against shares issued under the share plan and has requested that they take sufficient professional advice in relation to their individual financial position.

There are no retirement schemes or retirement benefits other than statutory benefits for non-executive directors.

Gender Diversity

The Company has adopted a diversity policy as part of their Corporate Governance Plan. The Company recognises the benefits arising from board diversity, and is committed to providing a diverse workplace that embraces and promotes diversity.

Dateline is an equal opportunity employer and chooses candidates after widely canvassing the market on the basis of selecting the most appropriate candidate based on merit and suitability for the role.

Currently the Company does not any employees as the operations are managed by the Board. The operations are carried out through the engagement of independent consultants and the administration is outsourced to a services company. There are currently no women on the Board of Dateline Resources or employed by the Company.

Given the Company’s size and that it has no employees, the Board does not consider it appropriate to formalise the establishment of measurable diversity objectives. As the operations grow, the Board will give consideration to the setting of such objectives and their achievement through the appointment of appropriate candidates to the Board and senior executive positions as they become available.

DATELINE FIJI PTY LIMITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2015

26 | P a g e

Note 30-Jun-15 30-Jun-14

$ $

Continuing operations

Interest Income 6 17,597 7,981

Writing off of assets - (97,128)

Impairment of Capitalised Exploration Expenditure 13 (3,887,581) -

Discount on acquisition - 1,209,052

Interest Expense (41,848) -

Administration expenses 7 (600,171) (296,869)

Profit/(Loss) from continuing operations before income tax (4,512,003) 823,036

Income tax expense 8 - -

Profit/(loss) from continuing operations after income tax (4,512,003) 823,036

Other comprehensive profit/(loss)

Foreign Currency Translation Reserve 359,429 (2,449)

Total comprehensive profit/(loss) for the period (4,152,574) 820,587

Profit/(loss) for the period is attributable to:

Owners of the Company (4,512,003) 823,036

(4,512,003) 823,036

Total comprehensive profit/(loss) for the period attributable to:

Owners of the Company (4,152,574) 820,587

(4,152,574) 820,587

Cents Cents

Profit/(loss) per share from continuing operations attributable to the ordinary equity holders of the Company:

Basic profit/(loss) per share – cents per share 18 (6.16) 1.54 Diluted profit/(loss)loss per share – cents per share 18 (6.16) 1.54

Total comprehensive profit/(loss) per share attributable to the ordinary equity holders of the Company:

Basic profit/(loss) per share – cents per share 18 (5.67) 1.54 Diluted profit/(loss) per share – cents per share 18 (5.67) 1.54

This Statement of Comprehensive Income is to be read in conjunction with the accompanying notes

DATELINE FIJI PTY LIMITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2015

27 | P a g e

Note 30-Jun-15 30-Jun-14

$ $

Current Assets

Cash & cash equivalents 9 45,907 92,285

Trade & other receivables 10 12,895 27,024

Financial Assets 11 19,635 60,554

Total Current Assets 78,437 179,863

Non-Current Assets

Plant & equipment 12 11,321 24,346

Exploration & evaluation expenditure 13 3,600,000 6,905,340

Total Non-Current Assets 3,611,321 6,929,686

TOTAL ASSETS 3,689,758 7,109,549

Current Liabilities

Trade & other payables 14 189,277 70,531

Loans from Related Parties 15 150,000 122,000

Total Current Liabilities 339,276 192,531

TOTAL LIABILITIES 339,276 192,531

NET ASSETS 3,350,482 6,917,018

Equity attributable to the equity holders of the Company

Contributed equity 16 7,763,196 7,177,157

Reserves 17 625,694 266,265

Accumulated losses

(5,038,409) (526,404)

TOTAL EQUITY 3,350,482 6,917,018

This Statement of Financial Position is to be read in conjunction with the accompanying notes

DATELINE FIJI PTY LIMITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2015

28 | P a g e

Issued Capital

Accumulated Losses

Foreign Currency

Translation Reserve

TOTAL

$ $ $ $

Balance as at 1 July, 2014 7,177,157 (526,404) 266,265 6,917,018

Total profit / (loss) (4,512,574) (4,512,574)

Total other comprehensive income 359,429 359,429

Total comprehensive Income for the Period - (4,512,003) 359,429 (4,152,574)

Conversion of loan to equity - - - -

Contributions of equity 586,038 - - 586,038

Balance as at 30th June 2015 7,763,195 (5,038,409) 625,694 3,350,482

Issued Capital

Accumulated Losses

Foreign Currency Reserve TOTAL

$ $ $ $

Balance as at 1 July, 2013 4,888,477 (1,349,440) 268,714 3,807,751

Total profit / (loss) 823,036 823,036

Total other comprehensive income (2,449) (2,449)

Total comprehensive Income for the Period - 823,036 (2,449) 820,587

Conversion of loan to equity 1,583,731 - - 1,583,731

Contributions of equity 704,949 - - 704,949

Balance as at 30 June, 2014 7,177,157 (526,404) 266,265 6,917,018

This Statement of Changes in Equity is to be read in conjunction with the accompanying notes

DATELINE FIJI PTY LIMITED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2015

29 | P a g e

30-Jun-15 30-Jun-14

$ $

Cash flows used in operating activities

Payment to suppliers and employees (439,760) (200,318)

Interest received 17,597 7,981

Cash received from disposal of financial assets - 66,367

Net cash flows used in operating activities (422,163) (125,970)

Cash flows used in investing activities

Payment for plant & equipment - (11,677)

Payment for exploration & evaluation expenditure (232,771) (1,433,397)

Net cash flows used in investing activities (232,771) (1,445,074)

Cash flows from financing activities

Pre reverse acquisition advances - 458,025

Net Proceeds from issue of shares 586,039 -

Repayment of related party loans (3,027,483)

Proceeds from borrowings 3,050,000 -

Net cash flows from financing activities 608,556 458,025

Net increase/(decrease) in cash and cash equivalents (46,378) (1,113,019)

Cash and cash equivalents acquired - 669,905

Cash and cash equivalents at beginning of period 92,285 535,399

Cash and cash equivalents at end of period 45,907 92,285

This Statement of Cash Flows is to be read in conjunction with the accompanying notes

DATELINE FIJI PTY LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2015

30 | P a g e

1. REPORTING ENTITY

Dateline Resources Limited (the “Company”) is a company limited by shares incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange Limited (“ASX”). The Company is a for-profit entity for the purposes of preparing the financial statements. The address of its registered office and principal place of business is disclosed in the Corporate Directory of the annual report.

Due to the reverse acquisition which occurred on 3 October 2013 (see note 3a), Dateline Fiji Pty Ltd has been determined to be the accounting acquirer and as a result, the financial statements for the year ended 30 June 2015 have been prepared as the consolidated financial statement of Dateline Fiji Pty Ltd as if it is the accounting parent company.

The nature of the operations and principal activities of the Company are described in the Directors’ Report.

2. BASIS OF PREPARATION

(a) Statement of compliance

The financial report is a general purpose financial report which has been prepared in accordance with Australian Accounting Standards (AASBs) (including Australian Interpretations) adopted by the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. The financial report of the Company also complies with International Financial Reporting Standards (IFRSs) and interpretations adopted by the International Accounting Standards Board.

The financial statements were approved by the Board of Directors on 30 September 2015.

(b) Basis of measurement

The financial statements have been prepared on the historical cost basis. Cost is based on the fair values of the consideration given in exchange for assets.

(c) Principles of consolidation

Subsidiaries are all entities over which the group has control. The group controls an entity when the group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are deconsolidated from the date that control ceases. The acquisition method of accounting is used to account for business combinations by the group

Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group.

(d) Foreign currency transactions

(i) Functional and presentation currency

Items included in the financial statements of each of the group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’).

The consolidated financial statements are presented in Australian dollars, which is Dateline Resources Limited and Dateline Fiji Pty Limited's functional and presentation currency.

(ii) Transactions and balances


31 | P a g e

Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in profit or loss. They are deferred in equity if they relate to qualifying cash flow hedges and qualifying net investment hedges or are attributable to part of the net investment in a foreign operation. Foreign exchange gains and losses that relate to borrowings are presented in the income statement, within finance costs. All other foreign exchange gains and losses are presented in the income statement on a net basis within other income or other expenses.

(e) New accounting standards and interpretations

In the current year, the group has applied a number of new and revised AASBs issued by the Australian Accounting Standards Board (AASB) that are mandatorily effective for an accounting period that begins on or after 1 July 2014, and therefore are relevant for the current year end.

AASB 2012-3 ‘Amendments to Australian Accounting Standards – Offsetting Financial Assets and Financial Liabilities’

The amendments to AASB 132 clarify the requirements relating to the offset of financial assets and financial liabilities. Specifically, the amendments clarify the meaning of ‘currently has a legally enforceable right of set-off’ and ‘simultaneous realisation and settlement’.

As the group does not have any financial assets and financial liabilities that qualify for offset, the application of the amendments does not have any material impact on the disclosures or on the amounts recognised in the group's consolidated financial statements.

AASB 2013-3 ‘Amendments to AASB 136 – Recoverable Amount Disclosures for Non-Financial Assets’

The amendments to AASB 136 remove the requirement to disclose the recoverable amount of a cash-generating unit (CGU) to which goodwill or other intangible assets with indefinite useful lives had been allocated when there has been no impairment or reversal of impairment of the related CGU. Furthermore, the amendments introduce additional disclosure requirements applicable to when the recoverable amount of an asset or a CGU is measured at fair value less costs of disposal. These new disclosures include the fair value hierarchy, key assumptions and valuation techniques used which are in line with the disclosure required by AASB 13 ‘Fair Value Measurements’.

The application of these amendments does not have any material impact on the disclosures in the group's consolidated financial statements.


32 | P a g e

AASB 2013-4 ‘Amendments to Australian Accounting Standards – Novation of Derivatives and Continuation of Hedge Accounting

The amendments to AASB 139 provide relief from the requirement to discontinue hedge accounting when a derivative designated as a hedging instrument is novated under certain circumstances. The amendments also clarify that any change to the fair value of the derivative designated as a hedging instrument arising from the novation should be included in the assessment and measurement of hedge effectiveness.

As the group does not have any derivatives that are subject to novation, the application of these amendments does not have any material impact on the disclosures or on the amounts recognised in the group's consolidated financial statements.

AASB 2013-5 ‘Amendments to Australian Accounting Standards – Investment Entities’

The amendments to AASB 10 define an investment entity and require a reporting entity that meets the definition of an investment entity not to consolidate its subsidiaries but instead to measure its subsidiaries at fair value through profit or loss in its consolidated and separate financial statements.

To qualify as an investment entity, a reporting entity is required to:

obtain funds from one or more investors for the purpose of providing them with investment management services;

commit to its investor(s) that its business purpose is to invest funds solely for returns from capital appreciation, investment income, or both; and

measure and evaluate performance of substantially all of its investments on a fair value basis.

Consequential amendments have been made to AASB 12 and AASB 127 to introduce new disclosure requirements for investment entities.

As the Company is not an investment entity (assessed based on the criteria set out in AASB


33 | P a g e

10 as at 1 July 2014), the application of the amendments does not have any material impact on the disclosures or the amounts recognised in the group's consolidated financial statements.

AASB 2014-1 ‘Amendments to Australian Accounting Standards’ (Part A: Annual Improvements 2010–2012 and 2011–2013 Cycles)

The Annual Improvements 2010-2012 has made number of amendments to various AASBs, which are summarised below.

The amendments to AASB 2 (i) change the definitions of ‘vesting condition’ and ‘market condition’; and (ii) add definitions for ‘performance condition’ and ‘service condition’ which were previously included within the definition of ‘vesting condition’. The amendments to AASB 2 are effective for share based payment transactions for which the grant date is on or after 1 July 2014.

The amendments to AASB 3 clarify that contingent consideration that is classified as an asset or a liability should be measured at fair value at each reporting date, irrespective of whether the contingent consideration is a financial instrument within the scope of AASB 9 or AASB 139 or a non-financial asset or liability. Changes in fair value (other than measurement period adjustments) should be recognised in profit and loss. The amendments to AASB 3 are effective for business combinations for which the acquisition date is on or after 1 July 2014.

The amendments to AASB 8(1) require an entity to disclose judgements made by management in applying the aggregation criteria to operating segments, including a description of the operating segments aggregated and the economic indicators assessed in determining whether the operating segments have ‘similar economic characteristics’; and (ii) clarify that a


34 | P a g e

reconciliation of the total of the reportable segments’ assets to the entity’s assets should only be provided if the segment assets are regularly provided to the chief operating decision-maker.

The amendments to the basis for conclusions of AASB 13 clarify that the issue of AASB 13 and consequential amendments to AASB 139 and AASB 9 did not remove the ability to measure short-term receivables and payables with no stated interest rate at their invoice amounts without discounting, if the effect of discounting is immaterial.

The amendments to AASB 116 and AASB 138 remove perceived inconsistencies in the accounting for accumulated depreciation/amortisation when an item of property, plant and equipment or an intangible asset is revalued. The amended standards clarify that the gross carrying amount is adjusted in a manner consistent with the revaluation of the carrying amount of the asset and that accumulated depreciation/amortisation is the difference between the gross carrying amount and the carrying amount after taking into account accumulated impairment losses.

The amendments to AASB 124 clarify that a management entity providing key management personnel services to a reporting entity is a related party of the reporting entity. Consequently, the reporting entity should disclose as related party transactions the amounts incurred for the service paid or payable to the management entity for the provision of key management personnel services. However,


35 | P a g e

disclosure of the components of such compensation is not required.

The Annual Improvements 2011-2013 has made number of amendments to various AASBs, which are summarised below.

The amendments to AASB 3 clarify that the standard does not apply to the accounting for the formation of all types of joint arrangements in the financial statements of the joint arrangement itself.

The amendments to AASB 13 clarify that the scope of the portfolio exception for measuring the fair value of a group of financial assets and financial liabilities on a net basis includes all contracts that are within the scope of, and accounted for in accordance with, AASB 139 or AASB 9, even if those contracts do not meet the definitions of financial assets or financial liabilities within AASB 132.

The amendments to AASB 140 clarify that AASB 140 and AASB 3 are not mutually exclusive and application of both standards may be required. Consequently, an entity acquiring investment property must determine whether:

- the property meets the definition of investment property in terms of AASB 140; and

- the transaction meets the definition of a business combination under AASB 3.

The application of these amendments does not have any material impact on the disclosures or


36 | P a g e

on the amounts recognised in the group's consolidated financial statements.

AASB 2014-1 ‘Amendments to Australian Accounting Standards’ (Part B: Defined Benefit Plans: Employee Contributions Amendments to AASB 119)

The amendments to AASB 119 clarify how an entity should account for contributions made by employees or third parties to defined benefit plans, based on whether those contributions are dependent on the number of years of service provided by the employee.

For contributions that are independent of the number of years of service, the entity may either recognise the contributions as a reduction in the service cost in the period in which the related service is rendered, or to attribute them to the employees’ periods of service using the projected unit credit method; whereas for contributions that are dependent on the number of years of service, the entity is required to attribute them to the employees’ periods of service.

The application of these amendments to AASB 119 does not have any material impact on the disclosures or on the amount recognised in the group's consolidated financial statements.

Interpretation 21 ‘Levies’

Interpretation 21 ‘Levies’ Interpretation 21 addresses the issue as to when to recognise a liability to pay a levy imposed by a government. The Interpretation defines a levy, and specifies that the obligating event that gives rise to the liability is the activity that triggers the payment of the levy, as identified by legislation. The Interpretation provides guidance on how different levy arrangements should be accounted for, in particular, it clarifies that neither economic compulsion nor the going concern basis of financial statements preparation implies that an entity has a present obligation to pay a levy that will be triggered by operating in a future period.

The application of this Interpretation does not have any material impact on the disclosures or on the amounts recognised in the group's consolidated financial statements.

AASB 1031 ‘Materiality’, AASB

The revised AASB 1031 is an interim standard that cross-references to other Standards and


37 | P a g e

2013-9 ‘Amendments to Australian Accounting Standards’ – Conceptual Framework, Materiality and Financial Instruments’ (Part B: Materiality), AASB 2014-1 ‘Amendments to Australian Accounting Standards’ (Part C: Materiality)

the ‘Framework for the Preparation and Presentation of Financial Statements’ (issued December 2013) that contain guidance on materiality. The AASB is progressively removing references to AASB 1031 in all Standards and Interpretations. Once all of these references have been removed, AASB 1031 will be withdrawn. The adoption of AASB 1031, AASB 2013-9 (Part B) and AASB 2014-1 (Part C) does not have any material impact on the disclosures or the amounts recognised in the group's consolidated financial statements.

There are no other new and revised Standards and Interpretations adopted in these financial statements affecting the reporting results or financial position.

(f) Early adoption of standards

The Company has not elected to apply any pronouncements before their operative date in the annual reporting period beginning 1 July 2014.

(g) Going concern

The financial report has been prepared on a going concern basis, which contemplates the continuity of normal business activities and the realisation of assets and liabilities in the normal course of business.

During the year, the consolidated entity incurred a net loss of $4,152,574 (2014: $820,587 profit) and a net cash outflow of $46,378 (2014: $1,113,019 outflow) and net cash out flow from operations of $422,163 (2014:$125,970). As at 30 June 2015, the consolidated entity also had a net current liability of $339,276 (2014: 192,531) and cash assets of $45,907 (2014: $92,285).

The ability of the consolidated group to continue as a going concern is dependent upon the group being able to generate sufficient funds to satisfy exploration commitments and working capital requirements. The directors are in the process of taking the following measures which have been designed to ensure that the going concern assumption remains appropriate and that the group is able to settle liabilities and commitments as and when they are due:

- Extending the maturity of amounts due to directors and other related parties;

- Reducing management and administration costs;

- Seeking other funding opportunities through various transactions including mergers or joint

ventures,

- The Board has resolved that an capital equity raising is to take place prior to December 2015,

- Adopting all appropriate measures to ensure that cash flows remain sufficient to ensure that it

remains a going concern.

The directors believe that the going concern basis for the preparation of the financial report of the group is appropriate. The directors note that should the group be unsuccessful in implementing the above mentioned measures, the group may be unable to realise its assets or discharge its liabilities in the normal ordinary course of business and at the amounts stated in the financial report.


38 | P a g e

3. SIGNIFICANT ACCOUNTING POLICIES

The accounting policies set out below have been applied consistently in these financial statements.

(a) Reverse Acquisition Accounting

Dateline Resources Limited is listed on the Australian Securities Exchange. Dateline Resources Limited completed the legal acquisition of Dateline Fiji Pty Limited on 3rd October 2013.

Under the principles of AASB 3 Business Combinations Dateline Fiji Pty Limited was deemed to be the acquirer for accounting purposes. Therefore, the transaction has been accounted for as a reverse acquisition under AASB3. Accordingly, the consolidated financial statements of Dateline Resources Limited have been prepared as a continuation of the consolidated financial statements of Dateline Fiji Pty Limited.

(b) Revenue recognition

Interest Revenue

Revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset.

(c) Income tax

Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.

Deferred income tax is recognised except where the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit; and in respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred tax assets are only recognised to the extent that it is probable that the temporary differences will not reverse in the foreseeable future and the group is able to control the timing of the reversal of the temporary differences.

Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.

Deferred tax assets and deferred tax liabilities shall be offset only if:

(a) there is a legally enforceable right to set-off current tax assets against current tax liabilities; and (b) the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation

authority on either: (i) the same taxable entity; or (ii) different taxable entities which intend either to settle current tax liabilities and assets on a net

basis, or to realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantially enacted at the balance sheet date.


39 | P a g e

Income taxes relating to items recognised directly in equity are recognised in equity and not in the Statement of Comprehensive Income.

(d) Other taxes

Revenues, expenses, assets and liabilities are recognised net of the amount of GST except where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and receivables and payables are stated with amounts of GST included.

The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the Statement of Financial Position.

Commitments or contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.

(e) Cash and cash equivalents

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly

liquid investments with original maturities of three months or less, and bank overdrafts.

(f) Plant and equipment

Owned assets

Items of plant and equipment are stated at cost less accumulated depreciation (see below) and impairment losses.

Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a work condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

When parts of an item of plant and equipment have different useful lives, they are accounted for as separate items (major components).

Subsequent costs

The Company recognises in the carrying amount of an item of plant and equipment the cost of replacing part of such an item when that cost is incurred if it is probable that the future economic benefits embodied within the item will flow to the Company and the cost of the item can be measured reliably. All other costs are recognised in the Statement of Comprehensive Income as an expense as incurred.

Depreciation

Depreciation is charged to the Statement of Comprehensive Income using a straight line method over the estimated useful lives of each part of an item of plant and equipment.

The estimated useful lives in the current financial year are as follows:

Plant and equipment 3 years.

Office Equipment 3 years

The residual value, the useful life and the depreciation method applied to an asset are reassessed at least annually.


40 | P a g e

(g) Exploration and evaluation

Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an exploration and evaluation asset in the year in which they are incurred where the following conditions are satisfied:

(i) The rights to tenure of the area of interest are current; and

(ii) At least one of the following conditions is also met: (a) The exploration and evaluation expenditures are expected to be recouped through successful

development and exploration of the area of interest, or alternatively, by its sale; or (b) Exploration and evaluation activities in the area of interest have not, at the reporting date, reached

a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing.

Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, studies, exploratory drilling, trenching and sampling and associated activities and an allocation of depreciation and amortisation of assets used in exploration and evaluation activities. General and administrative costs are only included in the measurement of exploration and evaluation costs where they are related directly to operational activities in a particular area of interest.

Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The recoverable amount of the exploration and evaluation asset (or the cash-generating unit(s) to which it has been allocated, being no larger than the relevant area of interest) is estimated to determine the extent of the impairment loss (if any). Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in previous years. Where a decision is made to proceed with development in respect of a particular area of interest, the relevant exploration and evaluation asset is tested for impairment and the balance is then classified to development.

(h) Trade and other payables

Trade payables and other payables are carried at amortised costs and represent liabilities for goods and services provided to the Company prior to the end of the financial year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of these goods and services.

(i) Contributed equity

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

(j) Earnings per share

Basic earnings per share

Basic earnings per share is determined by dividing net profit or loss after income tax attributable to members of the Company, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.

Diluted earnings per share


41 | P a g e

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.

(k) Investments and other financial assets

Classification

The Company classifies its financial assets in the following categories: financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments and available-for-sale financial assets. The classification depends on the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition and, in the case of assets classified as held-to-maturity, re-evaluates this designation at the end of each reporting date.

Loans and receivables

Loans and receivable are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for those with maturities greater than 12 months after the reporting period which are classified as non-current assets. Loans and receivables are included in trade and other receivables (Note 10 Trade & Other Receivables) in the Statement of Financial Position.

Recognition and derecognition

Regular way purchases and sales of financial assets are recognised on trade-date, the date on which the Company commits to purchase or sell the asset.

Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.

When securities classified as available-for-sale are sold, the accumulated fair value adjustments recognised in other comprehensive income are reclassified to profit or loss as gains and losses from investment securities.

Measurement

At initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.

Loans and receivable are subsequently carried at amortised cost using the effective interest method.

Details on how the fair value of financial instruments is determined is disclosed in Note 19: Financial Risk Management.

Impairment

The Company assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. In the case of equity investments classified as available-for-sale, a significant


42 | P a g e

or prolonged decline in the fair value of the security below its cost is considered an indicator that the assets are impaired.

(i) Assets carried at amortised cost

For loans and receivables, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in profit or loss. If a loan or held-to-maturity investment has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

As a practical expedient, the Company may measure impairment on the basis of an instrument’s fair value using an observable market price.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised in profit or loss.

(ii) Assets classified as available-for-sale

If there is objective evidence of impairment for available-for-sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss – is removed from equity and recognised in profit or loss.

Impairment losses on equity instruments that were recognised in profit or loss are not reversed through profit or loss in a subsequent period.

If the fair value of a debt instrument classified as available-for-sale increases in subsequent period and the increase can be objectively related to an event occurring after the impairment loss was recognised in profit or loss, the impairment loss is reversed through profit or loss.

(l) Critical accounting estimates and judgments

The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. The Directors evaluate estimates and judgments incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Company. 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.

In particular, information about significant areas of estimation uncertainty and critical judgments in applying accounting policies that have the most significant effect on the amount recognised in the financial statements are described in the following notes:

(i) Exploration & Evaluation Expenditure

The Company’s accounting policy for exploration and evaluation is set out in Note 3(f) above. If, after having capitalised expenditure under this policy, the Directors conclude that the Company is unlikely to recover the expenditure by future exploration or sale, then the relevant capitalised amount will be written off to the Statement of Comprehensive Income.


43 | P a g e

(ii) Impairment of Capitalised Exploration & Evaluation Expenditure

During the year, circumstances indicated that an impairment of the exploration expenditure may have been incurred and according a valuation took place. As a result the group’s capitalised exploration expenditure is stated at its fair value less cost to sell and an impairment loss has been recognised. Refer to Note 13 for more information regarding the estimate of the fair value and key assumptions used.

(iii) Expiration of Mining Tenements

All three tenements owned by the company are expired and in the process of being renewed. The board of directors is confident and concluded that all three tenements will be renewed successfully. Refer to Note 13 for more information regarding this judgement and the related reasoning.

4. NEW ACCOUNTING STANDARDS AND INTERPRETATIONS ISSUED BUT NOT YET EFFECTIVE

At the date of authorisation of the financial statements, the Standards and Interpretations listed below were in issue but not yet effective.

Standard/Interpretation Effective for annual reporting periods beginning on or after

Expected to be initially applied in the financial year ending

AASB 9 ‘Financial Instruments’, and the relevant amending standards

1 January 2018 30 June 2019

AASB 15 ‘Revenue from Contracts with Customers’ and AASB 2014-5 ‘Amendments to Australian Accounting Standards arising from AASB 15’


AASB 2014-3 ‘Amendments to Australian Accounting Standards – Accounting for Acquisitions of Interests in Joint Operations’


AASB 2014-4 ‘Amendments to Australian Accounting Standards – Clarification of Acceptable Methods of Depreciation and Amortisation’


AASB 2014-6 ‘Amendments to Australian Accounting Standards – Agriculture: Bearer Plants’


AASB 2014-9 ‘Amendments to Australian Accounting Standards – Equity Method in Separate Financial Statements’


AASB 2014-10 ‘Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture’


AASB 2015-1 ‘Amendments to Australian Accounting Standards – Annual



44 | P a g e

Improvements to Australian Accounting Standards 2012-2014

Cycle’

AASB 2015-2 ‘Amendments to Australian Accounting Standards – Disclosure Initiative:

Amendments to AASB 101’


AASB 2015-3 ‘Amendments to Australian Accounting Standards arising from the Withdrawal of AASB 1031 Materiality’

1 July 2015 30 June 2016

AASB 2015-4 ‘Amendments to Australian Accounting Standards – Financial Reporting Requirements for Australian Groups with a Foreign Parent’

1 July 2015 30 June 2016

AASB 2015-5 ‘Amendments to Australian Accounting Standards – Investment Entities: Applying the Consolidation Exception’


The new standards, interpretations and amendments are not expected to have a significant impact on the

financial statements.


45 | P a g e

5. SEGMENT INFORMATION

AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Company that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance.

The segments are consistent with the internal management reporting information that is regularly reviewed by the chief operating decision maker, being the Board of Directors.

The reportable segments are based on aggregated operating segments determined by the similarity of economic characteristics, the nature of the activities and the regulatory environment in which those segments operate. Prior period segment information has been restated to reflect the current composition of reportable segments.

Management has identified two reportable operating segments based on the two principal locations of its projects – Australia and Fiji. Unallocated results, assets and liabilities represent corporate amounts that are not core to the reportable segments. Segment assets include the costs to acquire tenements and the capitalised exploration costs of those tenements.

30 June 2015 Australia Fiji

Consolidation Entries

TOTAL

A$ A$ A$ A$

Revenues (16,689) (908) - (17,597)

Segment loss/(profit) 600,918 4,421,612 (510,527) 4,512,003

Total Segment Assets 12,370,503 3,997,836 (12,678,581) 3,689,758

Total Segment Liabilities 2,076,053 4,768,350 (6,505,125) 339,277

30 June 2014 A$ A$ A$ A$

Revenues (10,553) (3,174) 5,746 (7,981)

Segment loss/(profit) (753,347) 28,857 (98,545) (823,035)

Total Segment Assets 11,982,421 7,400,475 (12,273,347) 7,109,549

Total Segment Liabilities 1,673,092 4,621,124 (6,101,685) 192,531


46 | P a g e

6. INTEREST INCOME 30-Jun-15 30-Jun-14

$ $

Interest Income 17,597 7,981

17,597 7,981

7. ADMINISTRATION EXPENSES 30-Jun-15 30-Jun-14

$ $

Consulting and corporate expenses 390,726 205,987

Compliance and regulatory expenses 24,445 9,831

Depreciation expenses 13,025 9,703

Other administration expenses 171,974 66,249

600,171 291,769

8. INCOME TAX EXPENSE 30-Jun-15 30-Jun-14

$ $

(a) Income tax expense

Current tax - -

Deferred tax - -

- -

(b) Numerical reconciliation of income tax expense to

prima facie tax payable

Loss from continuing operations before income tax expense (4,512,003) 823,036

Tax at the Australian tax rate of 30% (2014 - 30%) (1,353,601) 246,911

Tax effects of amounts which are not deductible (taxable)

in calculating taxable income:

Non-deductible / (deductible) expenditure 48,708 41,127

Difference in overseas tax rates 201 2,886

Temporary difference not brought to account 1,305,322 (290,924)

Income tax expense - -

(c) Tax losses

Unused tax losses * 3,567,407 2,943,180

* The entities in the group has not formed a tax consolidated group and the unused tax losses

consisted of tax losses from entities in the group which calculate the income tax their own.


47 | P a g e

9. CASH & CASH EQUIVALENTS 30-Jun-15 30-Jun-14

$ $

Cash at bank and in hand 45,907 92,285

45,907 92,285

(a) Reconciliation of net profit/(loss) after tax to net cash flows used in operating activities

30-Jun-15 30-Jun-14

$ $

Net profit / (loss) after income tax (4,512,004) 823,036

Adjustments for :

Depreciation 10,039 19,204

Discount on Acquisition - (1,209,052)

Impairment of exploration and evaluation expenditure 3,887,581 88,087

Change in assets and liabilities

(Increase)/decrease in trade and other receivables 32,556 183,709

(Increase)/decrease in financial assets 40,919 -

Increase/(decrease in trade and other payables 118,746 (30,954)

Net cash flows used in operating activities (422,163) (125,970)

10. TRADE & OTHER RECEIVABLES 30-Jun-15 30-Jun-14

$ $

Other receivables 12,895 27,024

12,895 27,024

(a) Trade receivables past due but not impaired

There were no trade receivables past due but not impaired. (b) Fair value and credit risk

Due to the short-term nature of these receivables, their carrying amount is assumed to approximate their fair value.

The maximum exposure to credit risk at the reporting date is the carrying amount of each class of receivables mentioned above. Refer to Note 19 for more information on the risk management policy of the Company and the credit quality of the Company’s trade receivables.


48 | P a g e

11. FINANCIAL ASSETS 30-Jun-15 30-Jun-14

$ $

ANZ term deposits 19,635 60,554

19,635 60,554

ANZ term deposits are held as security for bonds required by the Fijian Mineral and Resources Department in regard to the tenements that Matai Holdings (Fiji) Limited holds at Udu Point.

Refer to Note 19 for more information on the risk management policy of the Company and the credit quality of the Company’s Financial Assets.

12. PLANT & EQUIPMENT 30-Jun-15 30-Jun-14

$ $

Carrying amount of plant & equipment 11,321 24,346

(a) Plant and equipment

At Cost 48,682 48,682

Less accumulated depreciation (48,129) (44,167)

Total plant and equipment 553 4,515

Movement during the year

Balance at the beginning of the year 4,515 11,391

Additions - 2,636

Disposals - -

Depreciation expense (3,962) (9,512)

Balance at the end of the year 553 4,515

(a) Office equipment

At Cost 32,056 32,056

Less accumulated depreciation (21,288) (12,225)

Total office equipment 10,768 19,831


Balance at the beginning of the year 19,831 29,523

Additions - 9,041

Disposals - (9,041)

Depreciation expense (9,063) (9,692)

Balance at the end of the year 10,768 19,831


49 | P a g e

13. EXPLORATION & EVALUATION EXPENDITURE 30-Jun-15 30-Jun-14

$ $

Carrying amount of exploration expenditure 3,600,000 6,905,340


Balance at the beginning of the year 6,905,340 5,694,863

Expenditure incurred during the year (including the FX revaluation difference) 582,241 1,298,564

Impairment of Capitalised Exploration Expenses (3,887,581) -

Tenements abandoned and written off - (88,087)

Balance at the end of the year 3,600,000 6,905,340

Exploration and evaluation expenditure capitalised relates to expenditure incurred and capitalised for the Udu Polymetallic Exploration Project in Fiji and has been accounted for in accordance with AASB 6 Exploration for and Evaluation of Mineral Resources.

On 22 January 2015 the exploration leases for tenements SPL1387 and SPL1396 expired. At the time of expiration the renewal process had not yet been completed with the Fijian authorities. Whilst the renewal process is ongoing at the time of signing of the financial report, the board expect the license to be renewed without exception.

On 14 September 2015 tenement SPL1494 expired. At the time of expiration the renewal process had not yet been completed with the Fijian authorities. Whilst the renewal process is ongoing at the time of signing of the financial report, the board expect the license to be renewed without exception

The ultimate recoupment of costs carried forward for exploration expenditure is dependent on the successful development and commercial exploitation, or alternatively, the sale of the respective area of interest and also dependent on the group’s ability to renew the expired tenements without exception.

Impairment of the assets and estimate of the fair value

Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The ultimate recoverability of exploration and evaluation expenditure is dependent upon the successful development and exploitation of the area of interest, or alternatively, by its sale.

The Board determined that impairment indicators were present during the financial year and engaged an independent third party expert to determine the fair value of exploration and evaluation assets as at 30 June 2015. The preferred fair value given in the report is $3,591,621. The value falls within level 3 of the fair value hierarchy due to one or more significant inputs not being based on observable market data.. Although observable market transactions and market information are not fully available, the valuation estimates the fair value at which an orderly transaction to sell the asset would take place between market participants at the measurement date under current market conditions (i.e. an exit price at the measurement date from the perspective of a market participant that holds the asset). The board of directors also concluded that the cost to sale of the asset is not material for the financial report and will approximate the recoverable amount of the asset to its preferred fair value given in the valuation report.

Having relied on the independent valuation as provided by Minnelex, the Board has determined that it forms a reasonable basis for the estimation of the fair value as defined by AASB 13 Fair value Measurement and that all the tenements will be successfully renewed as stated in the above paragraph.


50 | P a g e

The valuation assessment adopted a highbred fair value approach by taking the average results of two methods:

1. Multiple of exploration expenditure: Fair value is determined based on the total direct expenditure incurred for each relevant tenement. A multiple is then applied based on current market conditions ultimately determined by the independent third party expert.

2. Geoscientific method: Fair value is determined by breaking the value of the asset down into two components:

i. Value of tenement Licenses (“ELS”). The price a market participant is willing to pay for the rights to each tenement; and

ii. Resource value (“UDU”) which calculates the value of resources underground based on inferred quantities of the resource.

A number of unobservable inputs were used in determining fair value. The key unobservable inputs are as

follows:

Geoscientific factors: 6-22.5; Prospective Enhancement Multiplier: 1.1-1.4; Past Expenditure $8m; Budget:$50,000; In ground value: 1%-1.5% Current depressed market reduction: 50%; Ore recoverability: 75%; Grades:

o Zinc – 3.9

o Copper – 1.2

o Gold 0.3

o Silver 29

Tonnes: 4,5300,00

Resource factor: 0.75%-1.25%; Resources factor reduction: 40%; and Basic acquisition cost of tenements calculated at $2,500 per square kilometre.

The unobservable inputs outlined above have a direct relationship to fair value as they underpin the value

assigned to each tenement.

The key observable input used in determining fair value for each valuation method is as follows:

Current market price of metals

o Zinc - $AUD 2,731

o Copper $AUD $8,063

o Gold $AUD 1,568

o Silver $AUD21


51 | P a g e

The valuation report provides the following range for the fair value of the assets and the board determined the mid-point of $3,600,000 to be the most appropriate recoverable amount:

Low High Average

A$ A$ A$

3,000,000 4,400,000 3,600,000

The valuation assessment and the related impairment test led to the recognition of an impairment loss of $3,887,581 in the statement of profit or loss in the current year. This impairment loss has resulted in a carrying value of the asset of $3,600,000 as at 30 June 2015.

14. TRADE & OTHER PAYABLES 30-Jun-15 30-Jun-14

$ $

Trade and sundry creditors 57,562 38,913

Other accruals 89,867 31,620

Interest accruals:

- Interest on loan from Mark Johnson 22,000 -

- Interest on loan from SXX 19,848 -

189,277 70,533

Trade & other payables are non-interest bearing and are predominantly settled on 30-day terms.

15. LOANS FROM RELATED PARTIES 30-Jun-15 30-Jun-14

$ $

Current

Amounts owed to Southern Cross Resources NL 150,000 -

Amounts owed to Mr. Mark Johnson - 122,000

Total current loans from shareholders 150,000 122,000

The 2015 Balance of $150,000 is an unsecured loan from Southern Cross Exploration NL. Details of the loan are as follows:

- Loan facility and drawdown amount: $550, 000 with $150,000 remaining unpaid at year end; - Interest rate: 10% per annum - Repayment date: the later of 31 August 2015 and 6 months from the issue of a notice in writing from

the lender to the borrower requesting repayment of the principal sum.

During the year, interest of $19,848 relating to the loan was recognised in the income statement and

remained unpaid as at 30 June 2015.

The 2014 loan balance of $122,000 was in the form of a Bond Deed Loan owed to Mr. Mark Johnson. This has been fully repaid as per the terms of the Bond deed Loan.


52 | P a g e

16. CONTRIBUTED EQUITY Consolidated

2015 2014

(a) Share Capital

Ordinary Capital

Number of Shares 76,300,000 61,300,000

Paid Up $7,763,196 $7,177,157

(b) Movements in Share Capital Consolidated

Number of Shares $

01 Jul 2014 Opening Balance 61,300,000 7,177,157

25 Jul 2014 Issue of shares to Southern Cross Exploration NL

7,500,000 300,000

25 Jul 2014 Share Issue Costs (13,961)

25 Nov 2014 Issue of shares to Southern Cross Exploration NL

7,500,000

300,000

30 June 2015 Closing Balance 76,300,000 7,763,196

Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number of and amounts paid on the shares held.

At shareholders meetings, each ordinary share is entitled to one vote per share when a poll is called, otherwise each shareholder has one vote on a show of hands.

At 30 June 2015 there were 76,300,000 fully paid ordinary shares on issue, all of which are freely tradeable. There are no preference shares on issue.

(c) Capital Management

The Company’s capital includes share capital, reserves and accumulated losses. The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders. The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. In order to achieve this, the Company may issue new shares in order to meet its financial obligations. There are no externally imposed capital requirements.

17. RESERVES 30-Jun-15 30-Jun-14

$ $

Foreign Currency Translation Reserve 625,694 266,265

The foreign currency translation reserve records exchange differences arising on

translation of the foreign controlled subsidiary.


53 | P a g e

18. EARNINGS PER SHARE

The calculation of basic loss per share at 30 June 2015 was based on the loss attributable to ordinary shareholders of $4,512,003 (2014: profit $823,036) and a weighted average number of ordinary shares outstanding during the financial year ended 30 June 2015 of 73,209,341 (2014: 53,384,892) calculated as follows:

(a) Basic profit/(loss) per share 30-Jun-15 30-Jun-14

Net profit/(loss) per share attributable to ordinary equity holders of the Company ($)

($4,512,003) $823,036

Weighted average number of ordinary shares for basis per share (No) 73,209,341 53,384,892

Continuing operations

- Basic profit/(loss) per share (cents) (6.16) 1.54

(b) Diluted profit/(loss) per share

Potential ordinary shareholders are not considered dilutive, thus diluted profit/(loss) per share is the

same as basic loss per share.

19. FINANCIAL RISK MANAGEMENT

The Company’s principal financial instruments consist of deposits with banks, receivables, other

financial assets and payables. At the reporting date, the Company had the following mix of financial

assets and liabilities.

30-Jun-15 30-Jun-14

$ $

Financial Assets

Cash & cash equivalents 45,907 92,285

Trade & other receivables 12,895 27,024

Financial Assets 19,635 60,554

78,437 179,863

Financial Liabilities

Trade & other payables 189,277 70,533

Loans from Related Parties 150,000 122,000

339,276 192,533

Net exposure (260,839) (12,670)

Financial risk management

The main risks arising from the Company’s financial instruments are interest rate risk, credit risk, foreign currency risk and liquidity risk. The Company uses different methods to measure and manage different types of risks to which it is exposed. Primary responsibility for identification and control of financial risks rests with the Board of Directors.


54 | P a g e

(a) Interest rate risk

Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates. The Company is exposed to interest rate risk as it invests funds at both fixed and floating interest rates. The risk is managed by maintaining an appropriate mix between fixed and floating rate deposits. The Company has no borrowings that has an interest component.

30-Jun-15 30-Jun-14

$ $

Financial Assets

Cash & cash equivalents 45,907 92,285 Financial Liabilities

Loans from Related Parties 150,000 122,000 Sensitivity Based on interest bearing financial assets and liability stated above, management has not presented the sensitivity analysis as the results are immaterial.

Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral where appropriate, as a means of mitigating the risk of financing loss from defaults. The Company’s exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties.

The carrying amount of financial assets recorded in the financial statements, net of any provision for losses, represents the Company’s maximum exposure to credit risk. All trade and other receivables are due within 30 days and none are past due.

(i) Cash

The Company’s primary banker is National Australia Bank. The Board considers the use of this financial institution, which has a short term rating of A- from Standards and Poors to be sufficient in the management of credit risk with regards to these funds.

30-Jun-15 30-Jun-14

Cash at Bank and short term banks deposits $ $

Standard & Poors Rating : A 45,907 92,285

(ii) Trade & other receivables

While the Company has policies in place to ensure that transactions with third parties have an appropriate credit history, the management of current and potential credit risk exposures is limited as far as is considered commercially appropriate. Up to the date of this report, the Board has placed no requirement for collateral on existing debtors.


55 | P a g e

(iii) Other financial assets

ANZ term deposits are held as security for bonds required by the Fijian Mineral and Resources Department in regard to the tenements that Matai Holdings (Fiji) Limited holds at Udu Point. The Board considers the use of this financial institution, which has a short term rating of A- from Standards and Poors to be sufficient in the management of credit risk with regards to these funds.

(b) Foreign currency risk

The group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the Fijian dollar. The group's exposure to foreign currency risk at the end of the reporting period , expressed in Australian Dollar, was as follows:

30-Jun-15 30-Jun-14

$ $

Cash at Bank and short term banks deposits (Fijian Dollars) 29,354 38,022

Receivables (Fijian Dollars) 1,561 20,741

Payables (Fijian Dollars) 50,698 43,296

Management has set up a policy requiring group companies to manage their foreign exchange risk against their functional currency. Due to the limited scope of the overseas activities and group's strict control on the cash flow , the risk is considered to be limited to the group. Management has not presented the sensitivity analysis as the results are immaterial.

(c) Liquidity risk management

Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities. The Company has no borrowings.

Ultimate responsibility for liquidity risk management rests with the Board of Directors, who have built an appropriate liquidity risk management framework for the management of the Company’s short, medium and long-term funding and liquidity management requirements.

The Company manages liquidity risk by continually monitoring cash reserves and cash flow forecasts to ensure that financial commitments can be met as and when they fall due.

As at 30 June 2015, all of the group's financial liability are non-interest bearing and will mature in less than 6 months.

20. KEY MANAGEMENT PERSONNEL DISCLOSURES

(a) Key management personnel compensation

30-Jun-15 30-Jun-14

$ $

Compensation by category

Short term employee benefits 35,000- 27,100

35,000 27,100


56 | P a g e

Information regarding individual Directors and Executive compensation and some equity instruments disclosures as permitted by Corporations Regulation 2M.3.03 is provided in the remuneration report section of the Directors’ report. (b) Material contracts

(i) Directors’ Deeds of Indemnity

With every Director appointment, the Company enters into a deed of indemnity, insurance and access with each of its Directors. During the 2015 financial year the Company entered into of Deed of Indemnity with Mr Baghdadi and Mr Hall, with effect from their appointment dates. Under these deeds, the Company agrees to indemnify each Director to the extent permitted by the Corporations Act (2001) against any liability arising as a result of the Director acting in the capacity as a Director of the Company. The Company is also required to maintain insurance policies for the benefit of the Directors and must also allow the Directors to inspect Company documents in certain circumstances.

(ii) Loans to Directors

There were no loans made to Directors during the financial year 1st July 2014 to 30th June 2015.

(iii) Other Fees Paid to/accrued for Directors

Other than that provided in the remuneration section of the Directors’ report, the following fees were paid to Directors:

During the financial year, operating expenses of $129,000 were reimbursed to Stephen Baghdadi. These expenses were incurred on behalf of the company and were in relation to travel and evaluation costs incurred in the process of the evaluation of an international mining prospect.

During the financial year, interest expense of $22,000 in relation to a short-term loan from Mr Mark Johnson to the company was recognised in the income statement and remained unpaid as at 30 June 2015. The short-term loan was fully repaid during the year. Refer to note 21(ii).

21. RELATED PARTY DISCLOSURES

i. Key management personnel

Disclosures relating to directors and executives are set out in note 20 Key Management Personnel Disclosures.

ii. Payment to and Loan received from shareholders

In November 2014, the Company and SXX entered into a short-term loan agreement. SXX advanced $550,000 to the company to fund a proposed project which is currently being evaluated. In March 2015, $400,000 was repaid to SXX, the balance outstanding as at 30 June 2015 is $172,192 (including interest). An accrued interest expense of $19,848 was recorded at 30 June 2015.Refer to note 15 for more information about the loan.

In October 2014, the Company made a payment of $200,000 to SXX for its assistance in the above mentioned proposed project.

In January 2015, Mr. Mark Johnson, the Company’s Chairman and shareholder, lent $2.5m to the company to assist with short term financing needs. This loan excluding interest was fully repaid in April 2015. Interest on the loan payable to Mr. Mark Johnson amounted to $22,000. As at 30 June 2015 the full amount of the interest was unpaid and is recorded as an amount payable.


57 | P a g e

iii. Subsidiaries and associates

Ownership Ownership

Country of Interest (%) Interest (%)

Name of subsidiary Incorporation 30.6.15 30.6.14

Dateline Resources Limited (a) Australia 50.00%(c) -

Matai Holdings (Fiji) Ltd (b) Fiji 100.00% 100.00%

(a) Dateline Resources Ltd completed the legal acquisition of Dateline Fiji

Pty Ltd on 3rd October, 2013. The transaction is considered to be a reverse acquisition and Dateline Fiji is deemed to be the accounting acquirer.

(b) Matai Holdings (Fiji) Ltd is 100% owned by Dateline Fiji Pty Ltd

(c) This represent the deemed ownership interest percentage in the reverse acquisition.

22. COMMITTMENTS

(a) Exploration & Evaluation Commitments

30-Jun-15 30-Jun-14

$ $

Within one year 135,077 94,117

After one year but not more than five years 1,229,981 -

After more than five years - -

Total minimum commitment 1,365,058 94,117

The commitments above are discretionary and subject to mining expenditure. They relate to the exploration tenements granted to, and under application by the Company.

(b) Lease commitments

Operating lease contracted for office rental payable for next twelve month is $0 (2014:$25,000)

23. SUBSEQUENT EVENTS

On 14 September 2015 tenement SPL1494 expired. At the time of expiration the renewal process had not yet been completed with the Fijian authorities. Whilst the renewal process is ongoing at the time of signing of the financial report, the board expect the license to be renewed without exception.

On 17 September 2015, a general meeting of the company was held where shareholders approved the acquisition of GPR. As at the date of this financial report, no consideration had been transferred in respect of the acquisition as the required level of shareholder approval in GPR had not yet been reached. At the time of signing of the financial report the company did not have control of GPR. Consideration for the acquisition will be transferred upon the company obtaining the required level of shareholder approval. Consideration for the acquisition comprises of the issue of shares in the company to the existing shareholders of GPR. Once this transaction is completed, the subsidiary will form part of the consolidated group of the company.

Other than the events noted above, there have been no other subsequent events since financial year end which require disclosure or adjustment in the financial report.


58 | P a g e

24. CONTINGENT LIABILITIES

No contingent liabilities were noted by the Company for the financial year ended 30 June 2015 (2014:nil).

25. DIVIDENDS

No dividend has been paid during the financial year and no dividend is recommended for the financial year.

26. REMUNERATION OF AUDITORS 30-Jun-15 30-Jun-14

$ $

Amounts received or due and receivable by Duncan Dovico Risk &

Assurance Pty Ltd for:

An audit or review of the financial report of the Company 39,300 36,300

Other services in relation to the Company - 11,000

39,300 47,300


59 | P a g e

27. PARENT ENTITY INFORMATION

(a) Financial Position 30-Jun-15 30-Jun-14

$ $

Assets

Current assets 227,582 4,509,223

Non-current assets 3,194,629 3,194,629

Total Assets 3,422,211 7,703,852

Liabilities

Current liabilities 1,787,910 1,646,439

Non-Current liabilities - -

Total Liabilities 1,787,910 1,646,439

Net Assets 1,634,301 6,057,413

Equity

Issued equity 6,472,208 6,472,208

Retained earnings (4,837,907) (414,795)

Total Equity 1,634,301 6,057,413

(b) Financial Performance 30-Jun-15 30-Jun-14

$ $

Loss for the year 4,421,612 68,003

Other comprehensive income - -

Total Comprehensive Income 4,421,612 68,003

(c) GUARANTEES ENTERED INTO BY THE PARENT ENTITY

No guarantees have been entered into by the parent entity in relation to the debts of its subsidiaries.

(d) COMMITMENTS AND CONTINGENCIES OF THE PARENT ENTITY

There were no commitments and contingencies for the parent entity as at 30 June 2015 and 2014.

DATELINE RESOURCES LIMITED DIRECTORS' DECLARATION FOR THE YEAR ENDED 30 JUNE 2015

60 | P a g e

In the Directors’ opinion: a) the financial statements and notes set out on pages 33 to 57 are in accordance with the Corporations Act

2001, including: (i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory

professional reporting requirements, and (ii) giving a true and fair view of the Company’s financial position as at 30 June 2015 and of its

performance for the financial year ended on that date, and b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they

become due and payable. Note 2(a) confirms that the financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board. This declaration is made in accordance with a resolution of the directors. On behalf of the Board of Directors

Mr Mark Johnson Executive Chairman 30 September 2015

DUNCAN DOVICO

61 | P a g e

Independent Auditor’s Report to the members of Dateline Resources Limited

Report on the Financial Report

We have audited the accompanying financial report of Dateline Fiji Pty Limited (the company) and its

controlled entities which comprises the consolidated statement of financial position as at 30 June 2015, and

the consolidated statement of comprehensive income, consolidated statement of cash flows and

consolidated statement of changes in equity for the year ended on that date, a summary of significant

accounting policies, other explanatory notes and the directors’ declaration of the consolidated entity

comprising the company and the entities it controlled at the year’s end or from time to time during the

financial year ended 30 June 2015.

Directors’ Responsibility for the Financial Report

The directors of the company are responsible for the preparation and fair presentation of the financial report

in accordance with Australian Accounting Standards (including the Australian Accounting Interpretation) and

the Corporations Act 2001. This responsibility includes establishing and maintaining internal control relevant

to the preparation and fair presentation of the financial report that is free from material misstatement,

whether due to fraud or error. In Note 2, the directors also state, in accordance with Accounting Standard

AASB 101 Presentation of Financial Statements, that compliance with the Australian equivalents to

International Financial Reporting Standards ensures that the financial report, comprising the consolidated

financial statements and notes, complies with International Financial Reporting Standards.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our

audit in accordance with Australian Auditing Standards. These Auditing Standards require that we comply

with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain

reasonable assurance whether the financial report is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the

financial report. The procedures selected depend on the auditor’s judgement, including the assessment of

the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk

assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation

of the financial report in order to design audit procedures that are appropriate in the circumstances, but not

for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.

An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of

accounting estimates made by the directors, as well as evaluating the overall presentation of the financial

report.


LEVEL 12, 90 ARTHUR STREET, NORTH SYDNEY NSW 2060 PO BOX 1994 , NORTH SYDNEY NSW 2059 T: (02) 9922 1166 F: (02) 9922 2044 E: [email protected] ABN: 39 151 805 275

Liability limited by a scheme approved under the Professional Standards Legislation

DUNCAN DOVICO

62 | P a g e

Our procedures include reading the other information in the Annual Report to determine whether it contains

any material inconsistencies with the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our

audit opinion.

Independence

In conducting our audit, we have complied with independence requirements of the Corporations Act 2001.

Auditor’s Opinion

In our opinion, the financial report of Dateline Fiji Pty Limited and its controlled entities is in accordance with

the Corporations Act 2001, including:

(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2015

and of its performance for the year ended on that date; and

(ii) complying with Australian Accounting Standards (including the Australian Accounting

Interpretations) and the Corporations Regulations 2001; and

(iii) the consolidated financial report also complies with International Financial Reporting

Standards as disclosed in Note 2.

Emphasis of Matter - Material Uncertainty Regarding Continuation as a Going Concern

Without qualification to the opinion expressed above, attention is drawn to the following matters. As

indicated in note 2(g) to the financial report, the Company incurred a net loss of $4,152,574 (2014: profit of

$ 820,587) for the financial year then ended and net cash outflows of $422,163 (2014: $125,970). The ability

of the consolidated group to continue as a going concern is dependent upon the group being able to raise

funds by way of either debt or equity to satisfy both Group exploration commitments and working capital

requirements. As outlined in note 2(g), should additional funds not be generated such that exploration assets

are maintained and working capital requirements met then there exists a material uncertainty that may cast

significant doubt as to the company's ability to continue as a going concern and therefore the company may

be unable to realise its assets and discharge its liabilities in the normal course of business and at the amounts

stated in the financial report.

Emphasis of Matter - Material Uncertainty Regarding the renewal of the expired tenements

Without qualification to the opinion expressed above, attention is drawn to the following matter. As at the

time of signing of the financial report, all of the Group’s tenements held in Fiji have expired and are in the

process of renewal.

DUNCAN DOVICO RISK & ASSURANCE PTY LIMITED LEVEL 12, 90 ARTHUR STREET, NORTH SYDNEY NSW 2060 PO BOX 1994 , NORTH SYDNEY NSW 2059 T: (02) 9922 1166 F: (02) 9922 2044 E: [email protected] ABN: 39 151 805 275


DUNCAN DOVICO

63 | P a g e

The carrying value of the capitalised exploration and evaluation expenditure attached to these tenements

was $3,600,000 as at 30 June 2015 (2014: $6,905,340). The inability of the Group to renew these tenements

may result in the Group not having title to the exploration expenditure incurred in relation to these sites.

Should title to the sites not be retained then the carrying value of the exploration expenditure is $NIL.

Emphasis of Matter- Material Uncertainty regarding the recoverable value of the capitalised exploration

and evaluation expenditure

The carrying value of the capitalised exploration and evaluation expenditure at year end reflected a write

down to its recoverable amount of $3,600,000. The recoverable amount was determined following an

independent valuation prepared by Minnelex Pty Ltd. The recoverable amount determined is dependent on

the valuation methodology and key assumptions adopted in the valuation report and as disclosed in Note 13

to the financial report. The ultimate recoupment of the carrying value at year end is dependent upon

retention of title to the expenditure and either the successful development and commercial exploitation of

the sites or alternatively the sale of the respective tenements.

Other Matter

Following the reverse acquisition of Dateline Resources Limited by Dateline Fiji Pty Limited in the 2014

financial year, the financial report of Dateline Resources Limited has been prepared as if Dateline Fiji Pty

Limited is the parent entity of the consolidated group.

Report on the Remuneration Report

We have audited the Remuneration Report of Dateline Resources Limited for the year ended 30 June 2015

as set out on pages 11 to 15 of the Directors Report. The directors of the company are responsible for the

preparation and presentation of the Remuneration Report in accordance with section 300A of the

Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our

audit conducted in accordance with Australian Auditing Standards.

Auditor’s Opinion

In our opinion the Remuneration Report of Dateline Resources Limited for the year ended 30 June 2015,

complies with section 300A of the Corporations Act 2001.


ROSEMARY MEGALE

DIRECTOR

Sydney, 30 September 2015

DUNCAN DOVICO RISK & ASSURANCE PTY LIMITED LEVEL 12, 90 ARTHUR STREET, NORTH SYDNEY NSW 2060 PO BOX 1994 , NORTH SYDNEY NSW 2059 T: (02) 9922 1166 F: (02) 9922 2044 E: [email protected] ABN: 39 151 805 275


DATELINE RESOURCES LIMITED ADDITIONAL INFORMATION FOR THE YEAR ENDED 30 JUNE 2015

64 | P a g e

The following additional information was applicable as at 24 September 2015.

1. Number of Holders of each class of equity security and the voting rights attached: Class of Security No. of Holders Voting Rights Attached

Ordinary Shares 336 Each shareholder is entitled to one vote per share held Unlisted Options 0 N/A

There are a total of 76,300,000 ordinary fully paid shares on issue. There are no shares subject to voluntary escrow.

2. Distribution schedule of the number of holders of fully paid ordinary shares is as follows:

Distribution of Holders

Number of Fully Paid Ordinary Shareholders

1 - 1,000 58

1,001 - 5,000 10

5,001 - 10,000 36

10,001 - 100,000 134

100,001 and above 75

3. Holders of non-marketable parcels

Holders of non-marketable parcels are deemed to be those who shareholding is valued at less than $500. • There are 163 shareholders who hold less than a marketable parcel of shares. • The number of fully paid ordinary shareholdings held in less than marketable parcels is 1,816,001.

4. Substantial shareholders

As at report date there are two substantial shareholders.

5. Share buy-backs

There is no current on-market buy-back scheme.

6. Director Share Plan

On 18 November 2011, Shareholders approved the implementation of the “Director Share Plan” (Director Plan). An Eligible Participant who is invited to subscribe for Director Plan shares may also be invited to apply for a non-recourse loan up to the amount payable in respect of the shares accepted by the Eligible Participant.

There are currently 500,000 shares that have been issued under this Director Plan with the subscription price having been funded by the Company for these shares in accordance with the terms and conditions of the Director Plan. These shares are currently under a Company-imposed trading lock until such a time as the loan has been repaid.

While these are issued shares for legal and taxation purposes, Accounting Standards require they be recognised as shares issued at nil value and accounted for as options with a share-based payment expense to the Company. The repayment term of each loan to the Eligible Participant is four (4) years. The loans are interest free. A full summary of the Director Plan was set out in the Notice of Meeting dated 17 October 2011.

DATELINE RESOURCES LIMITED ADDITIONAL INFORMATION FOR THE YEAR ENDED 30 JUNE 2015

65 | P a g e

7. Top 20 Shareholders

The top 20 largest fully paid ordinary shareholders together held 75.68% of the securities in this class and are listed below:

RANK HOLDER NAME QUANTITY %

HOLDING

1 JOHNSON MARK RODERICK G 26,588,875 34.85%

2 SOUTHERN CROSS EXPL NL 15,000,000 19.66%

3 CAPP STEWART 2,681,875 3.51%

4 TRAIAN JOHNNY 2,510,001 3.29%

5 HAWTHORN CAP PL 1,425,000 1.87%

6 WEBBER JULIE 1,115,572 1.46%

7 BUSHDAWN PL 1,000,000 1.31%

8 M & K KORKIDAS PL 915,257 1.20%

9 DIAS EMANUEL JOSE F 859,610 1.13%

10 GRIGORIADIS PETER TAKIS 631,550 0.83%

11 PIGRAM ROBERT BRUCE 615,000 0.81%

12 BEAMOND DAVID ADAM + G 612,700 0.80%

13 FENCOURT ENTPS PL 600,000 0.79%

14 NATIONAL NOM LTD 500,000 0.66%

15 BAGNALL JOHN 500,000 0.66%

16 TENBAGGA RES FUND PL 500,000 0.66%

17 FURLONG ALLAN JOHN 450,000 0.59%

18 PHILLIPS ANDREW 435,000 0.57%

19 SAMMY RES PL 400,000 0.52%

20 BSMAH PL 400,000 0.52%

TOP 20 TOTAL 57,740,440 75.68%

8. Unquoted Equity Securities The Company has no listed unquoted equity securities on issue

9. Interest in Mining Licences The Company is an exploration entity, below is a list of its interest in licences, where the licences are situated and the percentage of interest held.

Project Number Ownership Location

Udu SPL1387 100% Vanua Levu, Republic of Fiji





ABN 63 149 105 653 ANNUAL REPORT FOR THE FINANCIAL …...Level 29 Duncan Dovico Risk & Assurance Pty...

Documents

Transcript of ABN 63 149 105 653 ANNUAL REPORT FOR THE FINANCIAL …...Level 29 Duncan Dovico Risk & Assurance Pty...