ANNUAL REPORT ZAMANCO MINERALS LIMITED · 2018. 11. 29. · A subsequent site visit by Aemco was conducted to undertake a review of the manganese resource potential at Chinsali. The

ANNUAL REPORT 2014

ZAMANCO MINERALS LIMITED

Zamanco Minerals Annual Report 2014

Contents

Contents

Corporate Directory ....................................................................................................................................................................... 1

Review Of Operations .................................................................................................................................................................... 3

Directors’ Report ............................................................................................................................................................................ 8

Corporate Governance Statement ............................................................................................................................................... 17

Auditor’s Independence Declaration ........................................................................................................................................... 23

Consolidated Statement of Profit or Loss and Other Comprehensive Income ............................................................................ 24

Consolidated Statement of Financial Position ............................................................................................................................. 25

Consolidated Statement of Cash Flows ........................................................................................................................................ 26

Consolidated Statement of Changes in Equity ............................................................................................................................. 27

Notes to the Consolidated Financial Statements ......................................................................................................................... 28

Directors’ Declaration .................................................................................................................................................................. 50

Independent Audit Report ........................................................................................................................................................... 51

Additional ASX Information .......................................................................................................................................................... 53

Tenement Schedule ...................................................................................................................................................................... 55

Zamanco Minerals Annual Report 2014 1

Corporate Directory

Directors Share Registry

Geoffrey Donohue Computershare Investor Services Pty Ltd Jacques Badenhorst Level 2, Reserve Bank Building Thomas Hill 45 St George’s Terrace Peter McIntyre PERTH WA 6000 Peter Ironside Company Secretary Auditor Peter Ironside BDO Audit (WA) Pty Ltd 38 Station Street SUBIACO WA 6008 Registered Office Bankers First Floor, 168 Stirling Highway ANZ Bank NEDLANDS WA 6009 32 St Quentins Avenue Telephone: (08) 9287 7625 CLAREMONT WA 6010 Facsimile: (08) 9389 1750 Web Page: www.zamancominerals.com Email: [email protected] Stock Exchange Listing Solicitors ASX Limited Steinepreis Paganin Level 40, Central Park Level 4, The Read Buildings 152-158 St Georges Terrace 16 Milligan Street PERTH WA 6000 PERTH WA 6000 ASX Code: ZAM


Chairman’s Report

Dear Shareholder

As you are aware, on 30 June 2014 Zamanco Minerals Limited (Zamanco or the Company) made an announcement that the

directors had on that day resolved to discontinue with the proposed Serenje Manganese Project in Zambia. The general

resources outlook and difficult operating environment experienced during the 2014 financial year lead the board to conclude

that it was no longer in the best interests of shareholders to continue with the proposed project. The Company began a

structural wind down of the venture on 1 July 2014. This process is well advanced and will be all but complete by 30

September 2014.

At the date of the above announcement, Thomas Hill and Jacques Badenhorst both tendered their resignations as directors

of Zamanco effective 30 September 2014. I take this opportunity to publically thank both Thomas and Jacques for their

efforts over the past two and half years and to wish them every success in future endeavours.

From 1 October 2014, Zamanco will again have a board of directors comprised of the three founding members. We will

continue to consider and evaluate transactions of merit capable of becoming the major undertaking of the Company. Should

such a transaction be identified as containing sufficient merit then shareholders and the market will be kept fully informed in

that regard. This will include adequate disclosure to allow shareholders to make an informed decision should shareholder

approval be required.

As a result of the general resources outlook there are currently a number of small ASX listed mining and exploration

companies seeking to do or find new opportunities to affect back door listings. Zamanco will join that list. The Company does

so in a sound financial position that should afford it the time and financial resources to conclude a transaction of merit that

over time may recover lost and create additional shareholder value.

On behalf of the board I thank you for your continuing support.

Yours Sincerely

Geoff Donohue

Chairman


Review of Operations

OVERVIEW On 30 June 2014, the Board resolved to discontinue the proposed Serenje Manganese Project in Zambia. The decision to discontinue the proposed Serenje Manganese project was preceded by:

On-going review of the exploration plans and results;

the appointment of Aemco Pty Ltd (“Aemco”) as geological consultants in September 2013, replacing Rock & Stock;

a cost reduction program;

divestment of tenements that had limited potential;

the evaluation of other manganese opportunities in Africa and Australia;

contracting with Jazzman Chikwakwa to secure his tenements for exploration, followed by his neglect to fulfill

specific conditions precedent, resulting in the termination of the agreement; and

re-evaluation of the viability of the Serenje Manganese Project.

The directors re-evaluated the general resources outlook and the difficult operating environment and resolved to discontinue the proposed Serenje Manganese Project in Zambia on 30 June 2014. The Company has begun a structural wind down of the venture. This is expected to take 3 months and at completion leave approximately A$ 3 million in the bank. The majority of the tenements and land held in Zambia will be divested and the relevant holding structures may be placed in voluntary liquidation. Based on recommendations made to the Board by Aemco, certain tenements were terminated and others were applied for or contracted for in areas with higher potential for high-grade manganese ores. The Board implemented a cost reduction strategy that focussed expenditure away from the design of the Serenje smelter and the related Bankable Feasibility Study to finding a solution for the manganese resource required to underwrite the Serenje Project. The resulting failure to fulfill obligations in terms of conditions precedent to the agreement with Jazzman Chikwakwa led to the final re-evaluation of mineral prospects available to Zamanco with the resulting decision to wind down the Serenje Project.



Exploration

Exploration during the past twelve months focussed on the Chinsali and Nkundalila projects as well as a review of the tenements held, and of the general geology and manganese potential of Zambia. Earlier conclusions generated a strategy to define a sufficient resource to support the Serenje Ferro Manganese smelter from multiple sites in Zambia due to limited depth extensions of ore bodies experienced in Zambia.

Figure 1. Project Location Plan

Chinsali Project

The several tenements that comprise the Chinsali Project were amalgamated into one license held by the Mutambe Royal Establishment with whom Zamanco has an Exploration and Mining Agreement. Previous work at Chinsali had identified a significant strike length (4.5km) of a narrow, manganese-iron rich tuffaceous horizon. Trenching was completed and sample results and mapping of the trenches have lead the Company to conclude that the horizon is unlikely to contribute a significant grade or tonnage of manganese resource in-line with the Company’s objectives.



Figure 2. Geological plan showing confirmed extent of manganiferous vein and the position of Trenches (1-7) and

Proposed Boreholes (A-K) at Chinsali

The Company’s geological team at the time, Rock & Stock further evaluated the potential of additional manganiferous lodes on the now consolidated larger Chinsali License. A subsequent site visit by Aemco was conducted to undertake a review of the manganese resource potential at Chinsali. The visit confirmed the extensive strike distance of manganese mineralisation. The material is however more ferruginous (~29%Mn, 27%Fe) than expected and trenching indicated little depth extent. A few locations have been supergene enriched (~37-40% Mn, 7-13% Fe). Despite the apparent extensive strike, the conclusions of previous work and those of the current visit indicated that the deposit appears to be marginal. It was decided that it would not be economically viable to proceed with exploration on this tenement. Tenement agreements and interests in the tenement are being terminated.



Nkundalila Project A comprehensive field programme was completed by Zamanco, which resulted in the identification of approximately 3km of outcropping manganiferous vein and the possible extensions of this vein to a further 2.5km of strike (Figure 3).

Figure 3. Nkundalila, mapped Mn-vein and positions of excavation trenches

This confirmed strike and possible strike were trenched with eleven trenches excavated and 486 samples collected. Six of the eleven trenches exposed the deeply weathered manganiferous horizon and within a mineralised sheared metaquartzite horizon. Sample results confirmed the presence of manganese mineralisation down to the level of the base of the trenches (approx. 4m). The horizon has undergone some enrichment and contains extensive limonitic iron The hori on is present along stri e o er m The hori on dips to the north east at 5 and appears to continue at depth although the e tent of the mineralisation is unknown. Field based beneficiation test work was undertaken on a number of composites from the trenches. The work involved rudimentary attrition and washing to test the basic upgradeability of the material. A strategic review of laboratory data received was completed which was followed by a site visit. This confirmed the marginal nature of the deposit and small potential manganese resource. It was decided that it would not be economically viable to proceed with exploration on this tenement. Tenement agreements and interests in the tenement holding subsidiary Zamanfive Minerals Limited are being terminated. Central Mansa Region An extensive desktop geological review and field visits were conducted on existing and historical manganese mines in the Mansa area. The results from these visits indicated that the Mansa region hosts substantial near surface high grade manganese deposits. The mineralisation observed is capable of continuing to depths as much as 65 metres, but it is likely that only the near surface manganese resources will be able to be classified as mineable reserves due to high stripping ratios, shallow water table and low competency of the weathered country rock.



Mansa exploration project 18956-HQ-LPL (granted 10 June 2014) Historical maps, known geology and a visit to region and nearby manganese workings by Aemco have highlighted the potential of the tenement in a known manganese area. This tenement is being retained in the holding subsidiary Zamanthree Minerals Limited. Mansa exploration project 15817-HQ-LPL A thick cover of eroded material and laterite that makes geological mapping and reconnaissance work difficult covers this tenement. Numerous reports of manganese or “blac roc ” were followed up by a reconnaissance isit but no positi e indicators were found at any of these reported areas. Elsewhere on the licence a number of locations of manganese-enriched laterite were found, however based on the extent of the tenement and the low levels of manganese indications it was concluded that a large amount of money would be required to explore the area on a green fields basis. The risk return profile was considered too great. Tenement agreements and interests in the tenement holding subsidiary Zamantwo Minerals Limited are being terminated. Milenge exploration project 12897-HQ-LPL Following desktop studies of the general geology, the tenement area was visited and traversed by Rock and Stock but no outcrops or soil anomalies of manganese could be located. Only outcrops of granite and andesitic lavas were found. Tenement agreements and interests in the tenement holding subsidiary Zamanone Mining Limited are being terminated. Kampumba exploration project 14340-HQ-SPP A review and site evaluation on this licence took place that confirmed that the manganese deposit is only supergene-enriched manganese grading into low grade iron rich schist (35-55% Fe). While the licence itself appears to hold no further potential a decision was made not to proceed with exploration on this tenement. Tenement agreements are being terminated. Interests in the tenement holding subsidiary Zamanthree Minerals Limited are being maintained as this entity will continue to hold the Mansa exploration tenement 18956-HQ-LPL. Mkushi exploration project 15836-HQ-LPL & 17585-HQ-LPL A strategic review and ground evaluation took place which confirmed that the ore found on these tenements has an average grade of 29-32% Mn, 2-4% Fe and 17-26% Si. As this material does not comply with the planned feed grade for the proposed smelter (30-35% Mn, 25-30% Fe, Silica < 10%), expenditure was stopped. Tenement agreements and interests in the tenement holding subsidiary Zamanfour Minerals Limited are being terminated. The information in this report that relates to Exploration Targets and Exploration Results is based on information extracted from the reports entitled Second Quarter Activities and Cashflow Report dated 31 January 2014, First Quarter Activities and Cashflow Report dated 22 October 2013, and June 2013 Annual Report dated 20 September 2013 and are available to view on www.zamancominerals.com. The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.


Directors’ Report

Your Director’s submit their report for the year ended 30 June 2014. DIRECTORS The Directors in office at the date of this report and at any time during the year are as follows. Directors were in office for the entire period unless otherwise stated. Geoffrey Donohue Jacques Badenhorst (resigning with effect from 30 September 2014) Thomas Hill (resigning with effect from 30 September 2014) Peter McIntyre Peter Ironside

INFORMATION ON DIRECTORS Geoffrey Donohue (B.Com, CPA) Chairman and Non-executive Director

Mr Geoff Donohue has over 29 years’ experience at both board and senior management level within public companies and the securities industry. Mr Donohue holds a Bachelor of Commerce from James Cook University of North Queensland, Graduate Diploma in Financial Analysis from the Securities Institute of Australia and is a Certified Practicing Accountant. Other Current Directorships of Listed Companies: None. Former Directorships of Listed Companies in last three years Essa Australia Limited – resigned 15 March 2011. Thomas Hill (B.Eng, MBL) Executive Director

Mr Thomas Hill has over 13 years’ experience as a director of companies listed on the Johannesburg Stock Exchange (JSE). His involvement was with the initial listing of these companies, funding and management. He holds an Engineering (electronics) degree from the University of Pretoria and a Master's degree in Business Leadership from the University of South Africa, (their MBA program). Thomas has built his experience around the listing, funding and running of listed companies and has focused extensively on the minerals and mining industry in Southern Africa where he works with well-established mining companies and practitioners to bring mining and mineral processing projects to the market. Other Current Directorships of Listed Companies: None. Former Directorships of Listed Companies in last three years: None. Jacques Badenhorst (NHD Ext. Met, MSAIMM, MMMA,IODSA) Non-executive Director (effective 14 November 2013, previously Managing Director)

Mr Jacques Badenhorst is an Extractive Metallurgical Engineer, who studied at the University of Johannesburg and has 15 years’ hands on experience. Jacques was responsible for the design and operational management of various operations, including, platinum, copper, vanadium, diamond, gold and ferrochrome recovery plants in Southern Africa. Jacques held senior management positions with companies including Grinaker LTA and AngloGold. He is a member of SAIMM (South African Institute for Mining and Metallurgy), MMMA (Mine Metallurgical Managers Association) and the Institute of Directors (IOD) of South Africa. Other Current Directorships of Listed Companies: None. Former Directorships of Listed Companies in last three years: None.


Directors’ Report

INFORMATION ON DIRECTORS - continued Peter McIntyre (BSc, MBA, FIEAust) Non-executive Director

Mr Peter McIntyre has been in the mining industry for over 32 years.

As an engineer, he has been involved with the development of a number of major projects, and at a corporate level he has established and steered various companies through their early stages into significant companies.

As the Managing Director, he established Extract Resources Limited and grew the company from a junior explorer to an ASX1 company with a +A$2B mar et capitalisation at the time of his departure E tract’s success was founded on the discovery of the world-class Rossing South uranium project in Namibia, which following development will be ranked as the second largest uranium project in the world.

He was a founding director of Kalahari Minerals (AIM-listed) and a non-executive director of Carbon Energy Ltd (an ASX listed company).

Mr McIntyre is a chartered Civil Engineer and a Fellow, Institution of Engineers, Australia. He also completed an MBA program at the Massachusetts Institute of Technology in Boston.

Other Current Directorships of Listed Companies: None. Former Directorships of Listed Companies in last three years: None. Peter Ironside (B.Com, CA) Non-executive Director and Company Secretary Mr Peter Ironside has a Bachelor of Commerce Degree and is a Chartered Accountant and business consultant with over 28 years’ experience in the exploration and mining industry. Mr Ironside has a significant level of accounting, financial compliance and corporate governance experience including corporate initiatives and capital raisings. Mr Ironside has been a Director and/or Company Secretary of several ASX listed companies including Integra Mining Limited and Extract Resources Limited (before $2.18Bn takeover) and is currently a non-executive director of Stavely Minerals Limited. Other Current Directorships of Listed Companies: Stavely Minerals Limited Former Directorships of Listed Companies in last three years: Integra Mining Limited - resigned 1 January 2013. MEETINGS OF THE COMPANY’S DIRECTORS There were 9 meetings of the Company’s Directors held during the year ended 30 June 2014 and the number of meetings attended by each Director were:

Meetings Held

Meetings Attended

Geoff Donohue 9 9 Jacques Badenhorst 9 9 Thomas Hill 9 9 Peter McIntyre 9 8 Peter Ironside 9 8

Resolutions during the year were passed by a circulating resolution.


Directors’ Report

DIRECTORS’ SHAREHOLDING INTERESTS The interest of each Director in the share capital of the Company at the date of this report is as follows:

Fully Paid

Ordinary Shares Options

Direct

Interest

Indirect

Interest

Direct

Interest

Indirect

Interest

Geoffrey Donohue

1,650,000

8,010,867

-

-

Thomas Hill 9,800 1,212,500 - -

Jacques Badenhorst - 1,212,500 - -

Peter McIntyre - 6,274,930 - -

Peter Ironside 858,950 6,745,916 - -

EARNINGS PER SHARE Basic Earnings Per Share was a loss of 4.65 cents (2013 Restated: loss of 5.15 cents).

DIVIDENDS No dividend has been paid or declared by the Company up to the date of this report. The Directors do not recommend that any amount be paid by way of dividend.

CORPORATE INFORMATION Corporate Structure Zamanco Minerals Limited is a company limited by shares that is incorporated and domiciled in Australia. Zamanco Minerals Limited has prepared a consolidated financial report incorporating the entities that it controlled during the year under review as follows:

Zamanco Minerals Limited - parent entity APG Resources Pty Ltd - 100% owned Zamanco Holdings Limited (Mauritius) - 100% owned Zamanco Minerals Limited (Zambia) - 100% owned Zamanone Mining Limited (Zambia) - 80% owned Zamantwo Minerals Limited (Zambia) - 80% owned Zamanthree Minerals Limited (Zambia) - 80% owned Zamanfour Minerals Limited (Zambia) – 49% owned Zamanfive Minerals Limited (Zambia) - 100% owned Zamansix Minerals Limited (Zambia) - 100% owned Zamanseven Minerals Limited (Zambia) - 100% owned

Nature of Operations and Principal Activities The principal activities of the Group during the financial year were mineral exploration and associated studies for manganese in Zambia.

Review of Operations Refer to the Review of Operations preceding this Directors’ Report.


Directors’ Report

SUMMARY OF FINANCIAL POSITION, ASSET TRANSACTIONS AND CORPORATE ACTIVITIES A summary of key financial indicators for Zamanco, with prior period comparison, is set out in the following table:

30 June 2014

RESTATED 30 June 2013

$ $

Cash and cash equivalents held at year end 3,367,634 4,816,311

Net loss for the year after tax 2,998,452 2,954,079

Included in loss for the year:

Exploration expensed (693,615) (1,848,479)

Exploration impairment (1,737,100) (186,700)

Basic loss per share (cents) from continuing operations (4.65) (5.15)

Net cash used in operating activities (1,448,677) (2,488,540)

Net cash used in investing activities - (157,452)

Net cash from financing activities - 5,629,250

SIGNIFICANT CHANGES IN STATE OF AFFAIRS Significant changes in the state of affairs of the Group during the financial year are detailed in the Review of Operations and the financial review in this report.

LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS On 30 June 2014, the Company made an announcement that the directors had on that day resolved to discontinue with the proposed Serenje Manganese Project in Zambia. Zamanco will continue to consider and evaluate transactions of merit capable of becoming the major undertaking of the Company. ENVIRONMENTAL REGULATIONS The Group’s environmental obligations are regulated by the laws of the countries in which the Group has its operations. The Group has a policy to either meet or where possible, exceed its environmental obligations. No environmental breaches have been notified by any governmental agency as at the date of this report. The Directors have considered compliance with the National Greenhouse and Energy Reporting Act 2007 which requires entities to report annual greenhouse gas emissions and energy use. The Directors have assessed that there are no current reporting requirements, but may be required to do so in the future. EVENTS OCCURRING AFTER THE REPORTING PERIOD There are no other matters or circumstances that have arisen since 30 June 2014 that have or may significantly affect the operations, results, or state of affairs of the Group in future financial years.


Directors’ Report

REMUNERATION REPORT (AUDITED) This report details the nature and amount of remuneration for each director and executive of Zamanco Minerals Limited. The information provided in this remuneration report has been audited as required by section 308(3C) of the Corporations Act 2001. For the purposes of this report key management personnel of the Group are defined as those persons having authority and responsibility for planning, directing and controlling the major activities of the Group, directly or indirectly, including any director (whether executive or otherwise) of the parent company and all key management personnel. Details of Key Management Personnel during the Year Non-Executive Directors Geoffrey Donohue - Non-executive Chairman (from 5 April 2007) Peter Ironside - Director (from 5 April 2007) Peter McIntyre - Director (from 5 April 2007) Jacques Badenhorst - Director (from 14 November 2013, previously Managing Director) Executive Directors Thomas Hill - Director (from 10 February 2012) Remuneration Governance The Board is responsible for ensuring that the Company’s remuneration structures are aligned with the long-term interests of the Company and its shareholders Once the Board is of a sufficient si e and structure, and the Company’s operations are of a sufficient magnitude, to assist the Board in fulfilling its duties, the Board will establish a Remuneration Committee. Until that time, the Board has taken a view that the full Board will hold special meetings or sessions as required. The Board are confident that this process is stringent and full details of remuneration policies and payments are provided to shareholders in the annual report and on the Company’s website The Board has adopted the following policies for Directors’ and e ecuti es’ remuneration. A. Remuneration policy The Board of Directors maintains remuneration policies which are aimed at attracting and retaining a motivated workforce and management team. The intention is to match the outcomes from the remuneration system with the performance of the Company and ultimately the value received by our shareholders on a long-term basis. As an overall policy, the Group will remunerate in such a way that it:

motivates Directors and management to pursue the long-term growth and success of the Group; and

demonstrates a clear relationship between key executive performance and remuneration. B. Remuneration structure In accordance with best practice corporate governance, the structure of Non-executive Director and executive compensation is separate and distinct. Non-executive Directors’ Remuneration: Non-e ecuti e Directors’ fees are paid within an aggregate limit which is appro ed by the shareholders from time to time This limit is currently set at $300,000. Any newly appointed Non-executive Directors will serve in accordance with a standard ser ice contract, drafted by the Company’s lawyers, which sets out remuneration arrangements Retirement payments, if any, are agreed to be determined in accordance with the rules set out in the Corporations Act as at the time of the Director’s retirement or termination. Non-executive Directors may be offered options as part of their remuneration, subject to shareholder approval. Executive Remuneration: Senior executives, including Executive Directors, are engaged under the terms of individual employment contracts. Such contracts are based upon standard terms drafted by the Company’s lawyers E ecuti e Directors do not recei e any directors’


Directors’ Report

fees in addition to their remuneration arrangements. Executive Directors may be offered options as part of their remuneration, subject to shareholder approval. The monetary package is divided between a base salary/consulting fee and, for non-directors, an incentive portion if considered appropriate. Base salary/consulting fees are set to reflect the market salary for a position and individual of comparable responsibility and experience. Base salary/consulting fees are regularly compared with the external market and during recruitment activities generally. It is the policy of the Company to maintain a competitive salary structure to ensure continued availability of experienced and effective management and staff. There are no executives at this stage. There is no lin between the remuneration policy and the Company’s performance. Details of the nature and amount of each element of each Director, including any related company and each of the officers of the Company receiving the highest emoluments are set out in section D of this report. C. Service Agreements On appointment to the Board, all non-executive directors enter into a service agreement with the Company in the form of a letter of appointment. The letter summarises the Board policies and terms, including compensation, relevant to the office of director.

Remuneration and other terms of employment for the executive directors and the other key management personnel are also formalised in service agreements. Other major provisions of the agreements relating to remuneration are set out below.

Name Term of agreement

Base salary / consulting fees

(at 30/6/14) Termination

benefit *

Geoffrey Donohue - Non-executive Chairman

1

Commenced 14 November 2007 - required to retire at the third annual general meeting after election.

$26,160 None

Thomas Hill – Director3 Commenced 1 December 2011 until 30

November 2014 extendable by mutual written agreement

$224,000 3 months

Peter Ironside – Non-executive Director & Company Secretary

1


$26,160 None

Jacques Badenhorst – Non-executive Director

2


$44,800 None

Peter McIntyre - Non-executive Director1 Commenced 14 November 2007 -

required to retire at the third annual general meeting after election.

$26,160 None

* Termination benefits are paid on early termination by the Company, other than for gross misconduct.

1. No fees paid under service agreements for the year (2013: nil).

2. Fees paid to Sable S.A. of which Mr Jacques Badenhorst is a director and shareholder.

3. Fees paid to Basel-Stadt S.A of which Mr Thomas Hill is a director and shareholder.


Directors’ Report

REMUNERATION REPORT (AUDITED) – continued D. Details of remuneration

Short Term Benefits

Post Employment

Benefits

Year

Cash salary, consulting fees and movement in leave

provisions $

Directors fees $

Superannuation $

Total $

Directors

G Donohue1 2014

2013 - -

- -

- -

- -

J Badenhorst2 2014

2013 100,775 223,272

- -

- -

100,775 223,272

P Ironside1 2014

2013 - -

- -

- -

- -

T Hill3

2014 2013

211,000 223,127

- -

- -

211,000 223,127

P McIntyre1 2014

2013 - -

- -

- -

- -

Total

2014

2013

311,775

446,399

-

-

-

-

311,775

446,399

1 Each of the above non-executive directors elected to forego remuneration payable under their ser ice agreements in line with the Company’s focus on cash preser ation

2 Fees paid to Sable S.A. of which Mr Jacques Badenhorst is a director and shareholder.

3 Fees paid to Basel-Stadt S.A of which Mr Thomas Hill is a director and shareholder.

There were no performance related payments made during the year. E. Share Based Compensation There were no options granted as remuneration during 2014 or 2013.

F. Equity Holdings and Movements during the Year

(a) Shareholdings of Key Management Personnel

30 June 2014 Balance at

Beginning of the year

Net change during the year

Balance at

End of the year

Name Direct

Interest Indirect Interest

Direct Interest

Indirect Interest

Geoffrey Donohue 1,650,000 7,988,417 - 1,650,000 7,988,417

Jacques Badenhorst - 1,212,500 - - 1,212,500

Thomas Hill 9,800 1,212,500 - 9,800 1,212,500

Peter McIntyre - 6,237,236 37,694 - 6,274,930

Peter Ironside 858,950 6,745,916 - 858,950 6,745,916

Total Shares 2,518,750 23,396,569 37,694 2,518,750 23,434,263


Directors’ Report

There were no shares granted during the year as compensation (2013: nil). There were no shares issued upon exercise of options (2013: 9,700,000). There were no options held by Key Management Personnel as at 30 June 2014.

G. Use of Remuneration Consultants During the financial year ended 30 June 2014, the Company did not engage any external remuneration consultants to review its existing remuneration policies. H. Voting and comments made at the Company’s 2013 Annual General Meeting (AGM) The Company received 100% of votes for its remuneration report for the 2013 financial year and no specific feedback at the AGM or throughout the year on its remuneration policies. I. Other Transactions with Key Management Personnel Mr Jacques Badenhorst, Director, is a shareholder and director of MRD (Pty) Ltd. During the year no payments were made

(2013: $15,117) for office rental and administration/consulting services at normal commercial rates.

Mr Peter Ironside, Director, is a shareholder and director of Ironside Pty Ltd. Ironside Pty Ltd is a shareholder of the 168

Stirling Highway Syndicate, the entity which owns the premises Zamanco occupies in Western Australia. Mr Geoff Donohue,

Director, is a shareholder and director of Rembu Pty Ltd. Rembu Pty Ltd is also a shareholder of the 168 Stirling Highway

Syndicate, the entity which owns the premises Zamanco occupies in Western Australia. During the year an amount of $32,832

(net of GST) (2013: $45,839) was paid for office rental at normal commercial rates.

Mr Geoff Donohue, Director, is a shareholder and director of Rembu Pty Ltd. During the year an amount of $12,000 (net of

GST) (2013: nil) was paid to the Company for office rental at normal commercial rates.

This is the end of the audited remuneration report.


Directors’ Report

SHARES UNDER OPTION There are no unissued ordinary shares of the Company under option at the date of this report INDEMNIFICATION AND INSURANCE OF OFFICERS There is no insurance in place at the present time.

PROCEEDINGS ON BEHALF OF THE COMPANY

The Company was not a party of any proceedings during the year.

AUDITOR INDEPENDENCE

The auditors’ independence declaration as required by Section 307C of the Corporations Act 2001 for the year ended 30 June 2014 has been received and can be found after the Corporate Governance Statement.

AUDITOR

BDO Audit (WA) Pty Ltd continues in office in accordance with Section 327 of the Corporations Act 2001.

NON-AUDIT SERVICES

The following non-audit services were provided by associated entities of BDO Audit (WA) Pty Ltd. The Directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act. The nature and scope of each type of non-audit service provided means that auditor’s independence was not compromised. Associated entities of BDO Audit (WA) Pty Ltd received or are due to receive the following amounts for the provision of non-audit services:

2014 2013

$ $

Tax Compliance Services 11,321 13,148

Accounting Services - 2,922

Other 400 -

11,721 16,070

Refer to note 14 in the financial statements for details of fees paid / payable to the auditor of the parent entity and its associated entities.

CORPORATE GOVERNANCE

In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of Zamanco Minerals Limited support and adhere to the principles of corporate go ernance The Company’s Corporate Go ernance Statement is contained in the following section of this report.

Signed in accordance with a resolution of the Directors. Geoffrey Donohue Chairman Perth, Western Australia 29 September 2014


Corporate Governance

This statement outlines the main corporate governance practices that have been formally adopted by the Directors. These corporate governance practices comply with the ASX Corporate Governance Council recommendations unless otherwise stated. Board of Directors The Board operates in accordance with the broad principles set out in its charter. Role and Responsibilities of the Board The Board is responsible for ensuring that the Company is managed in a manner which protects and enhances the interests of its shareholders and takes into account the interests of all stakeholders. This includes setting the strategic directions for the Company, establishing goals for management and monitoring the achievement of these goals.

A summary of the key responsibilities of the Board include: 1. Strategy - Providing strategic guidance to the Group, including contributing to the development of and approving the

corporate strategy, acquisitions and divestures;

2. Financial performance - Approving budgets, monitoring management and financial performance;

3. Financial reporting and audits - Monitoring financial performance including approval of the annual and half-year financial reports and liaison with the external auditors;

4. Leadership selection and performance - Appointment, performance assessment and removal of the Managing Director. Ratifying the appointment and/or removal of other senior management, including the Company Secretary and other Board members;

5. Remuneration - Management of the remuneration and reward systems and structures for executive management and staff;

6. Risk management - Reviewing, ratifying and monitoring risk management systems (including an established code of conduct and share trading policy), internal controls and legal compliance; and

7. Relationships with the exchanges, regulators and continuous disclosure - Ensuring that the capital markets are kept informed of all relevant and material matters and ensuring effective communications with shareholders.

Composition of the Board The names and details of the Directors of the Company in office at the date of this Statement are set out in the Directors’ Report. The composition of the Board is determined using the following principles:

Persons nominated as Non-executive Directors shall be expected to have qualifications, experience and expertise of benefit to the Company and to bring an independent iew to the Board’s deliberations Persons nominated as Executive Directors must be of sufficient stature and security of employment to express independent views on any matter.

The Chairperson should ideally be independent, but in any case be Non-executive and be elected by the Board based on his/her suitability for the position.

The roles of Chairperson and Managing Director should not be held by the same individual.

All Non-executive Directors are expected voluntarily to review their membership of the Board from time-to-time ta ing into account length of ser ice, age, qualifications and e pertise rele ant to the Company’s then current policy and programme, together with the other criteria considered desirable for composition of a balanced board and the overall interests of the Company.



The Company considers that the Board should have at least three Directors (minimum required under the Company's Constitution) and strives to have a majority of independent Directors but acknowledges that this may not be possible at all times due to the size of the Company. Currently the Board has five Directors, none of which are independent directors. The Board believes that the Directors can make, and do make, quality and independent judgements in the best interests of the Company on all relevant issues, notwithstanding that they are not independent. The number of Directors is maintained at a level which will enable effective spreading of workload and efficient decision making.

The Chairman, Mr Geoff Donohue, is not an independent Director. However, the Board believes Mr Donohue is the

most appropriate person for the position of Chairman because of his experience and proven track record as a public company director.

The Board has accepted the following definition of an independent Director: “An independent Director is a Director who is not a member of management (a Non-executive Director) and who:

is not a substantial shareholder of the Company or an officer of, or otherwise associated, directly or indirectly, with a substantial shareholder of the Company;

has not within the last three years been employed in an executive capacity by the Company or another group member, or been a Director after ceasing to hold any such employment;

is not a principal of a professional adviser to the Company or another group member; is not a significant consultant, supplier or customer of the Company or another group member, or an officer of or

otherwise associated, directly or indirectly, with a significant consultant, supplier or customer; has no significant contractual relationship with the Company or another group member other than as a Director of the

Company; has not served on the Board for a period which could, or could reasonably be perceived to, materially interfere with

the Director’s ability to act in the best interests of the Company; and is free from any interest and any business or other relationship which could, or could reasonably be perceived to,

materially interfere with the Director’s ability to act in the best interests of the Company ”

Zamanco considers a significant consultant, supplier or customer to be material if the total of their annual invoices amounts to more than 5% of the Company’s total e penditure in that category Independent Professional Advice and Access to Company Information Each Director has the right of access to all rele ant Company information and to the Company’s e ecuti es and, subject to prior consultation with the Chairman, may see independent professional ad ice at the Company’s e pense A copy of ad ice received by the Director is made available to all other members of the Board. Nomination Committee / Appointment of New Directors Because the size of the Company and the size of the Board, the Directors do not believe it is appropriate to establish a separate Nomination Committee. The Board has taken a view that the full Board will hold special meetings or sessions as required. The Board are confident that this process for selection and review is stringent and full details of all Directors are provided to shareholders in the annual report and on the web. The composition of the Board is reviewed on an annual basis to ensure the Board has the appropriate mix of expertise and experience. Where a vacancy exists, through whatever cause, or where it is considered that the Board would benefit from the services of a new director with particular skills, the Board determines the selection criteria for the position based on the skills deemed necessary for the Board to best carry out its responsibilities and then appoints the most suitable candidate who must stand for election at the next general meeting of shareholders. Term of Office Under the Company's Constitution, the minimum number of Directors is three. At each Annual General Meeting, one third of the Directors (excluding the Managing Director) must resign, with Directors resigning by rotation based on the date of their appointment. Directors resigning by rotation may offer themselves for re-election.



Performance of Directors and Managing Director The performance of all Directors, the Board as a whole and the Managing Director and Company Secretary are reviewed annually. The Board meets once a year with the specific purpose of conducting a review of its composition and performance. This review includes:

Determining the appropriate balance of skills and experience required to suit the Company’s current and future strategies;

Comparing the requirements above against the skills and experience of current Directors and executives; Assessing the independence of each Director; Measuring the contribution and performance of each Director; Assessing any education requirements or opportunities; and Recommending any changes to Board procedures, Committees or the Board composition.

A review was undertaken during the year ended 30 June 2014. The Company currently has no senior executives and therefore no performance evaluation was undertaken during the year by the Board. Conflict of Interest In accordance with the Corporations Act and the Company’s Constitution, Directors must eep the Board ad ised, on an ongoing basis, of any interest that could potentially conflict with those of the Company. Where the Board believes a significant conflict exists, the Director concerned does not receive the relevant Board papers and is not present at the Board meeting whilst the item is considered. Diversity The Company is committed to workplace diversity and has established a Diversity Policy. Diversity includes, but is not limited

to, gender, age, ethnicity and cultural background.

The Diversity Policy defines the initiatives which assist Zamanco with maintaining and improving the diversity of its workforce. In accordance with this policy and ASX Corporate Governance Principles, the Board has established the following objectives in relation to gender diversity. The aim is to achieve these objectives over the next 2 to 3 years as positions become vacant and appropriately skilled candidates are available: Proportion of Women

Actual Objective

Organisation as a whole 25% 40%

Executive Management Team Nil 25%

Board Nil 25%

Remuneration

The Company’s practice is to remunerate fairly and responsibly and part of the remuneration is to be incenti e based as

considered appropriate by the Board.

The performance of the Company depends upon the quality of its Directors and executives. To prosper, the Company must

attract, motivate and retain highly skilled Directors and executives.



To this end, the Company embodies the following principles in its remuneration framework:

provide competitive rewards to attract high calibre executives; link executive rewards to shareholder value; and establish appropriate performance hurdles in relation to variable executive remuneration.

A full discussion of the Company’s remuneration philosophy and framework and the remuneration received by Directors in the current year is included in the remuneration report, which is contained within the Report of the Directors. There are no schemes for retirement benefits for Non-executive directors, other than superannuation. Board Remuneration Committee Due to the limited size of the Company and of its operations and financial affairs, the use of a separate remuneration committee is not considered efficient. The Board has taken a view that the full Board will hold special meetings or sessions as required. The Board is confident that this process for determining remuneration is stringent and full details of remuneration policies and payments are provided to shareholders in the remuneration report in the Report of the Directors and on the web. Risk Oversight and Management The Board is responsible for ensuring there are adequate policies in relation to risk management, compliance and internal control systems. In summary, the Company policies are designed to ensure strategic, operational, legal, reputation and financial risks are identified, assessed, effectively and efficiently managed and monitored to enable achievement of the Company’s business objecti es A summary of the risks recognised by the Board can be found in the corporate governance information section of the Company website at www.zamancominerals.com. Considerable importance is placed on maintaining a strong control environment. The Board actively promotes a culture of quality and integrity. Control procedures cover management accounting, financial reporting, compliance and other risk management issues. The Board encourages management accountability for the Company’s financial reports by ensuring ongoing financial reporting during the year to the Board. Annually, the Company Secretary (who is responsible for preparing the financial reports) and the CEO (or equivalent) are required to state in writing to the Board that in all material respects:

Declaration required under s295A of the Corporations Act 2001 - the financial records of the Group for the financial year have been properly maintained; the financial statements and notes comply with the accounting standards; the financial statements and notes for the financial year give a true and fair view; and any other matters that are prescribed by the Corporations Act regulations as they relate to the financial

statements and notes for the financial year are satisfied.

Additional declaration required as part of corporate governance - the risk management and internal compliance and control systems in relation to financial risks are sound,

appropriate and operating efficiently and effectively. These declarations were received for the June 2014 financial year.

http://www.zamancominerals.com/



Audit Committee Due to the limited size of the Company and of its operations and financial affairs, the use of a separate audit committee is not considered appropriate In addition to management’s accountability, the Board assures integrity of the financial statements by:

(a) reviewing the Company's statutory financial statements to ensure the reliability of the financial information presented and compliance with current laws, relevant regulations and accounting standards;

(b) monitoring compliance of the accounting records and procedures, in conjunction with the Company’s auditor, on matters

overseen by the Australian Securities and Investments Commission, ASX and Australian Taxation Office; (c) ensuring that management reporting procedures, and the system of internal control, are of a sufficient standard to

pro ide timely, accurate and rele ant information as a sound basis for management of the Group’s business; (d) reviewing audit reports and management letters to ensure prompt action is taken by the Company's management; and (e) when required, nominating the external auditor and at least annually reviewing the external auditor in terms of their

independence and performance in relation to the adequacy of the scope and quality of the annual statutory audit and half-year review and the fees charged.

Code of Conduct The Company has developed a Code of Conduct (the Code) which has been fully endorsed by the Board and applies to all Directors and employees. The Code is regularly reviewed and updated as necessary to ensure it reflects the highest standards of beha iour and professionalism and the practices necessary to maintain confidence in the Company’s integrity In summary, the Code requires that at all times all Company personnel act with the utmost integrity, objectivity and in compliance with the letter and the spirit of the law and Company policies.

Share Trading Policy The Board has adopted a specific policy in relation to Directors and officers, employees and other potential insiders buying and selling shares. Directors, officers, consultants, management and other employees are prohibited from trading in the Company’s shares, options and other securities if they are in possession of price-sensitive information.

Under the Company's Security Trading Policy personnel must receive written approval prior to any dealing in Zamanco’s securities.

The Directors are satisfied that the Company has complied with its policies on ethical standards, including trading in securities.

Market Disclosure Policies The Board has a Market Disclosure Policy to ensure the compliance of the Company with the various laws and ASX Listing Rule obligations in relation to disclosure of information to the market. The Managing Director is responsible for ensuring that all employees are familiar with and comply with the policy. Zamanco is committed to: (a) ensuring that shareholders and the market are provided with timely and balanced information about its activities; (b) complying with the general and continuous disclosure principles contained in the ASX Listing Rules and the Corporations

Act 2001; and (c) ensuring that all market participants have equal opportunities to receive externally available information issued by

Zamanco.



Communication with Shareholders The Company places significant importance on effective communication with shareholders. Information is communicated to shareholders through the distribution of the annual and half yearly financial reports, quarterly reports on activities, announcements through ASX and the media, on the Company’s web site and through the Managing Director’s presentation at the annual general meeting. In addition, news announcements and other information are sent by email to all persons who have requested their name to be added to the email list. If requested, the Company will provide general information by email, facsimile or post. The Company will, wherever practicable, take advantage of new technologies that provide greater opportunities for more effective communications with shareholders. Company Website Zamanco has made available full details of all its corporate governance principles, which can be found in the corporate governance information section of the Company website at www.zamancominerals.com.

http://www.zamancominerals.com/


Auditor’s Independence Declaration


Consolidated Statement of Profit or Loss and Other Comprehensive Income

For the Year Ended 30 June 2014

Consolidated

Year Ended

30 June 2014

Year Ended

30 June 2013

Note $ $

RESTATED

Revenues

Interest revenue 114,473 96,454

Other 11,438 -

Total revenues 125,911 96,454

Expenses

Compliance costs (34,305) (35,090)

Accommodation & travel costs (41,489) (92,092)

Consultants Fees (297,443) (363,512)

Depreciation 5 (39,541) (22,962)

Diminution – Investments 7 (4,000) (12,000)

Insurance (4,431) (6,842)

Legal Fees (41,936) (72,601)

Staff costs (14,686) (46,690)

Exploration expensed (693,615) (1,848,479)

Exploration impairment 6 (1,737,100) (186,700)

Other expenses (215,817) (363,565)

Total expenses (3,124,363) (3,050,533)

Loss before income tax for the year (2,998,452) (2,954,079)

Income tax expense 2 - -

Profit/(loss) after income tax attributable to members of Zamanco Minerals Limited

(2,998,452) (2,954,079)

Non-controlling interests - -

(2,998,452) (2,954,079)

Other comprehensive income/(loss)

Items that may be reclassified subsequently to profit or loss:

Exchange difference on translation (126,070) 404,393

Total comprehensive loss after income tax for the year (3,124,522) (2,549,686)

Total comprehensive loss attributable to members of Zamanco Minerals Limited

(3,124,522) (2,549,686)

Non-controlling interests - -

(3,124,522) (2,549,686)

Loss per share for the year attributable to the members of Zamanco Minerals Limited

Cents Cents

Basic loss per share 3 (4.65) (5.15)

The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.



Consolidated Statement of Financial Position

As at 30 June 2014

Consolidated

30 June 2014 30 June 2013

Note $ $

ASSETS

Current Assets

Cash and cash equivalents 19(a) 3,367,634 4,816,311

Trade and other receivables 4 63,515 46,815

Other assets 653 653

Total Current Assets 3,431,802 4,863,779

Non-Current Assets

Property, plant and equipment 5 86,471 141,079

Deferred exploration and evaluation costs 6 4,457 1,794,400

Other financial assets 7 1,000 5,000

Total Non-Current Assets 91,928 1,940,479

Total Assets 3,523,730 6,804,258

LIABILITIES

Current Liabilities

Trade and other payables 8 97,968 253,974

Total Current Liabilities 97,968 253,974

Total Liabilities 97,968 253,974

Net Assets 3,425,762 6,550,284

Equity

Issued capital 9 10,122,974 10,122,974

Reserves 10 277,982 404,052

Accumulated losses (6,975,194) (3,976,742)

Capital and reserves attributable to members of Zamanco Minerals Limited

3,425,762 6,550,284

Total Equity 3,425,762 6,550,284

The above consolidated statement of financial position should be read in conjunction with the accompanying notes.


Consolidated Statement of Cash Flows


Consolidated

Year Ended

30 June 2014

Year Ended

30 June 2013

Note $ $

RESTATED

Cash flows from operating activities

Receipts 29,829 29,035

Interest received 114,473 96,454

Payments to suppliers and employees (696,948) (1,015,531)

Payments for exploration & evaluation (896,031) (1,598,498)

Net cash flows used in operating activities 19(b) (1,448,677) (2,488,540)

Cash flows from investing activities

Payments for Property, plant and equipment - (157,452)

Payments for investments - -

Payments for exploration - -

Net cash flows used in investing activities - (157,452)

Cash flows from financing activities

Proceeds from issue of shares - 5,880,000

Payment of share issue costs - (250,750)

Net cash inflows from financing activities - 5,629,250

Net increase/(decrease) in cash and cash equivalents held

(1,448,677) 2,983,258

Add opening cash and cash equivalents brought forward 4,816,311 1,833,053

Closing cash and cash equivalents carried forward 3,367,634 4,816,311

The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.


Consolidated Statement of Changes in Equity


Issued

Capital

Foreign Currency

Translation Reserve

Share Based Payments

Reserve

Accumulated Losses

Total

Equity

$ $ $ $ $

CONSOLIDATED

At 1 July 2012 - RESTATED 4,493,724 (517) 176 (1,022,663) 3,470,720

Exchange differences on translation - 404,393 - - 404,393

Loss for the year - - - (2,954,079) (2,954,079)

Effect of restatement - - - -

Total comprehensive loss for the year - 404,393 - (2,954,079) (2,549,686)

Transactions with owners in their capacity as owners:

Issue of share capital, net of transaction costs

5,629,250 - - - 5,629,250

Share based payments - - - - -

At 30 June 2013 10,122,974 403,876 176 (3,976,742) 6,550,284

Exchange differences on translation - (126,070) - - (126,070)

Loss for the year - - - (2,998,452) (2,998,452)

Total comprehensive loss for the year - (126,070) - (2,998,452) (3,124,522)

Transactions with owners in their capacity as owners:

Issue of share capital, net of transaction costs

- - - - -

Share based payments - - - - -

At 30 June 2014 10,122,974 277,806 176 (6,975,194) 3,425,762

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.


Notes to the Consolidated Financial Statements

1. ACCOUNTING POLICIES

(i) Basis of Accounting

These general purpose financial statements for year ended 30 June 2014 have been prepared in accordance with Corporations Act 2001 and Australian Accounting Standards (including Australian Accounting Interpretations) and authoritative pronouncements of the Australian Accounting Standards Board. These financial statements have been prepared in accordance with the historical costs convention with the exception of investments which have been measured at fair value. Zamanco Minerals Limited is a for-profit entity for the purpose of preparing the financial statements. The functional currency and presentation currency of Zamanco Minerals Limited is Australian dollars. The financial report of Zamanco Minerals Limited for the year ended 30 June 2014 was authorised for issue in accordance with a resolution of Directors on 26 September 2014.

(ii) Statement of Compliance

This financial report complies with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

(iii) Adoption of New and Revised Standards

The Group has not elected to apply any pronouncements before their operative date in the annual reporting year beginning 1 July 2014. None of the new standards and amendments to standards that are mandatory for the first time for the financial year beginning 1 July 2013 affected any of the amounts recognised in the current year or any prior period and are not likely to affect future periods. Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2014 reporting year. The Group’s assessment of the impact of these new standards and interpretations that may have an impact on the Group are set out below: AASB 9 Financial Instruments (effective from 1 January 2018) AASB 9 amends the requirements for classification and measurement of financial assets. The standard is not applicable until 1 January 2018, and the Group does not believe this will have a material impact on the financial statements.

VOLUNTARY CHANGE OF ACCOUNTING POLICY

Exploration and evaluation expenditure and recognition of assets The report for the year ended 30 June 2014 has been prepared on the basis of a retrospective application of a voluntary change in accounting policy relating to exploration and evaluation expenditure. The previous accounting policy was to capitalise and carry forward exploration and evaluation expenditure as an asset when rights to tenure of the area of interest are current and either:

• such expenditure is expected to be recovered through successful development and commercial exploitation of the area of interest; or

• the exploration activities in the area of interest have not yet reached a stage which permits reasonable assessment of the existence of economically recoverable reserves and active and significant operations in, or in relation to, the area of interest are continuing.

Accumulated exploration expenditure, which no longer satisfied the above policy, was written off to profit and loss to the extent to which they are considered to be impaired.



1. ACCOUNTING POLICIES - continued The new exploration and evaluation expenditure accounting policy is to charge exploration and evaluation expenditure against profit and loss as incurred; except for acquisition costs and for expenditure incurred after a decision to proceed to development is made, in which case the expenditure will be capitalised as an asset. The new accounting policy was adopted on 22 October 2013 and has been applied retrospectively. Management judges that the change in policy will result in the financial report providing more relevant and no less reliable information because it leads to a more transparent treatment of exploration and evaluation expenditure. Both the previous and new accounting policies are compliant with AASB 6 Exploration for and Evaluation of Mineral Resources. The voluntary change involves restating the following the balances: Consolidated statement of profit or loss and other comprehensive income (extract)

30 June 2013

Previous Policy Increase/

(Decrease) 30 June 2013

Restated

Exploration expensed - 1,848,479 (1,848,479)

Exploration impairment (2,035,179) (1,848,479) (186,700)

Loss for the period (2,954,079) - (2,954,079)

Other comprehensive income

Exchange difference on translation 404,393 - 404,393

Total comprehensive (loss) after income tax attributable to members of Zamanco Minerals Limited

(2,549,686) - (2,549,686)

Cents per Share

Cents per

Share

Basic (loss) per share (5.15) - (5.15)

Statement of cash flows (extract)

30 June 2013

Previous Policy Increase/

(Decrease) 30 June 2013

Restated

Payments for exploration & evaluation - 1,598,498 (1,598,498)

Net cash flows used in operating activities (890,042) 1,598,498 (2,488,540)

Payments for exploration & evaluation expenditure capitalised

(1,598,498) (1,598,498) -

Net cash flows used in investing activities (1,755,950) (1,598,498) (157,452)



1. ACCOUNTING POLICIES - continued

(iv) Significant Accounting Estimates and Judgments

Significant accounting judgments

In the process of applying the Group’s accounting policies, management has made the following judgments, apart from those involving estimations, which have the most significant effect on the amounts recognised in the financial statements.

Exploration assets

The Group’s accounting policy for e ploration e penditure is set out at Note 1( ). The application of this policy necessarily requires management to make certain estimates and assumptions as to future events and circumstances. Any such estimates and assumptions may change as new information becomes available. If, after having capitalised expenditure under the policy, it is concluded that the expenditures are unlikely to be recovered by future exploitation or sale, then the relevant capitalised amount will be written off to the profit or loss.

Significant accounting estimates and assumptions

The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting year are: Impairment of assets In determining the recoverable amount of assets, in the absence of quoted market prices, estimations are made regarding the present value of future cash flows using asset-specific discount rates and the recoverable amount of the asset is determined. Value-in-use calculations performed in assessing recoverable amounts incorporate a number of key estimates. Commitments - Exploration The Group has certain minimum exploration commitments to maintain its right of tenure to exploration permits. These commitments require estimates of the cost to perform exploration work required under these permits.

(v) Summary of Significant Accounting Policies

Basis of consolidation

The consolidated financial statements include the financial statements of Zamanco Minerals Limited (“the Company”), and its subsidiaries (“the Group” or “Group”) The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist. A list of controlled entities is contained in note 15 to the financial statements. Where an entity has been acquired during the year, its results are included in consolidated results from the date control commenced. Unrealised gains and losses and inter-entity balances resulting from transactions with or between controlled entities are eliminated in full on consolidation. Cash and cash equivalents

Cash and short-term deposits in the statements of financial position comprise cash at bank and in hand and short-term deposits with an original maturity of three months or less. For the purposes of the Statements of Cash Flows, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts.




(v) Summary of Significant Accounting Policies - continued

Foreign currency translation

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 Zamanco Minerals Limited’s functional and presentation currency. Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of profit or loss and other comprehensive income, except when they are deferred in equity as qualifying cash flow hedges and qualifying net investment hedges, or are attributable to part of the net investment in a foreign operation.

Translation differences on financial assets and liabilities carried at fair value are reported as part of the fair value gain or loss. Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss. Translation differences on non-monetary financial assets, such as equities classified as available-for-sale financial assets are included in the fair value reserve in equity.

Group companies The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position;

income and expenses per the profit or loss are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and

all resulting exchange differences are recognised in other comprehensive income.

On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other financial instruments designated as hedges of such investments, are taken to shareholders' equity. When a foreign operation is sold or any borrowings forming part of the net investment are repaid, a proportionate share of such exchange differences is reclassified to profit or loss, as part of the gain or loss on sale where applicable. Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entities and translated at the closing rate. Trade and other receivables

Receivables are initially recognised at fair value and subsequently measured at amortised cost, less allowance for doubtful debts. Current receivables for GST are due for settlement within 30 days and other current receivables within 12 months. They are recognised initially at fair value and subsequently at amortised cost.





Share-based payment transactions

The Group may provide benefits to employees (including directors) and consultants of the Group in the form of share-based payment transactions, whereby services are rendered in e change for shares or rights o er shares (‘equity-settled transactions’) The cost of these equity-settled transactions is measured by reference to the fair value at the date at which they are granted. Share-based payments – options with an exercise price The fair value of these payments is determined using a Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option. The fair value of the options granted is adjusted to reflect market conditions, but excludes the impact of any non-market vesting conditions. Non-market vesting conditions, if any, are included in assumptions about the number of options likely to be exercisable. Upon exercise of the options, the proceeds received, net of any transaction costs, are credited to issued capital. Jointly controlled interests

The proportionate interests in the assets, liabilities and expenses of a joint interest activity have been incorporated in the financial statements under the appropriate headings. Details of the joint operations are set out in Note 17. Property, plant and equipment

Plant and equipment, including motor vehicles, are stated at cost less accumulated depreciation and any impairment. Depreciation is calculated on a reducing balance basis to write off the net cost of each item of plant and equipment over its expected useful life, being 2.5 to 5 years. Exploration and Evaluation Expenditure

Exploration and evaluation expenditure is charged against profit and loss as incurred; except for acquisition costs and for expenditure incurred after a decision to proceed to development is made, in which case the expenditure will be capitalised as an asset. Restoration costs expected to be incurred are provided for as part of exploration, evaluation, development or production phases that give rise to the need for restoration. Impairment of assets

At each reporting date, the Group assesses whether there is any indication that an asset may be impaired. Where an indicator of impairment exists, the Group makes a formal estimate of recoverable amount. Where the carrying amount of an asset exceeds its recoverable amount the asset is considered impaired and is written down to its recoverable amount. Recoverable amount is the greater of fair value less costs to sell and value in use. It is determined for an individual asset, unless the asset's value in use cannot be estimated to be close to its fair value less costs to sell and it does not generate cash inflows that are largely independent of those from other assets or groups of assets, in which case, the recoverable amount is determined for the cash-generating unit to which the asset belongs. When the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-generating unit is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.





Restoration, rehabilitation, and environmental costs

The group recognises any legal restoration obligation as a liability at the time a legal liability exists. The carrying amount of the long lived assets to which the legal obligation relates is increased by the restoration obligation costs and amortised over the producing life of the asset. Investments and other financial assets

Non-current in estments in subsidiaries are carried at their cost of acquisition in the Company’s statement of financial position. An impairment for investment is made where the Company has assessed the investment as not recoverable. Investments in listed entities are categorised as financial assets at fair value through profit or loss. Designation is re-evaluated at each reporting date, but there are restrictions on reclassifying to other categories. When these financial assets are recognised initially, they are measured at fair value. At each reporting date, gains or losses on these financial assets are recognised in profit or loss. Trade and other payables

Trade payables and other payables are recognised initially at fair value and subsequently at amortised cost and represent liabilities for goods and services provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make future payments in respect of the purchase of these goods and services. The amounts are unsecured and usually paid within 30 days of recognition. Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the profit or loss net of any reimbursement. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost. Employee entitlements

Liabilities for wages and salaries, including non-monetary benefits, annual leave, and any other employee entitlements expected to be settled within twelve months of the reporting date are measured at their nominal amounts based on remuneration rates which are expected to be paid when the liability is settled. Employee entitlements expenses and revenues arising in respect of wages and salaries, non-monetary benefits, annual leave, long service leave, sick leave and other entitlements are charged against profits on a net basis. Contributions are made to employee superannuation plans and are charged as expenses when incurred.





Issued capital

Issued and paid up capital is recognised at the fair value of the consideration received by the Company. Any transaction costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share proceeds received. Revenue Recognition

Revenues are recognised at fair value of the consideration received net of the amount of goods and services tax (GST) or Value Added Tax (VAT) payable to the taxation authority. Exchanges of goods or services of the same nature and value without any cash consideration are not recognised as revenues. Interest revenue

Interest revenue is recognised as it accrues, taking into account the effective yield on the financial asset. Income tax

Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the reporting date. Deferred income tax is provided on all temporary differences in the statement of financial position between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax is recognised for all taxable temporary differences, except where the deferred tax arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss.

Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-forward of unused tax assets and unused tax losses can be utilised. The carrying amount of deferred income tax assets is reviewed at each reporting 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 income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date. Unrecognised deferred income tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Income taxes relating to items recognised directly in equity are recognised in equity and not in the profit or loss.

Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation authority.





Other taxes

Revenues, expenses and assets are recognised net of the amount of GST or VAT, except where the amount of GST or VAT incurred is not recoverable from the taxation authority. In these circumstances the GST or VAT is recognised as part of the cost of acquisition of the asset or as part of an item of the expense as applicable.

Receivables and payables are stated with the amount of GST or VAT included. The net amount of GST or VAT recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the statement of financial position.

Cash flows are included in Statements of Cash Flows on a gross basis. The GST or VAT components of cash flows arising from investing and financing activities that are recoverable from, or payable to, the taxation authority are classified as operating cash flows.

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

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions. Earnings per share

Basic earnings per share is calculated as net profit attributable to members of the parent, adjusted to exclude any costs of servicing equity (other than dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any bonus element. Diluted earnings per share is calculated as net profit attributable to mem

Documents

ANNUAL REPORT ZAMANCO MINERALS LIMITED · 2018. 11. 29. · A subsequent site visit by Aemco was conducted to undertake a review of the manganese resource potential at Chinsali. The