For personal use only - Australian Securities Exchange · Business Development and Advisor to the Chairman of TA Enterprise Berhad, ... Annual Report – Period Ended 31 ... been

For

per

sona

l use

onl

y

For

per

sona

l use

onl

y

Raffles Capital Limited and controlled entities ABN 66 009 106 049

Annual Report – Period Ended 31 December 2010 Page 1

Corporate Directory Raffles Capital Limited ACN 009 106 049 ABN 66 009 106 049 Registered and Corporate Office Hudson House Level 2 131 Macquarie Street Sydney NSW 2000 Telephone: +61 2 9251 7177 Facsimile: +61 2 9251 7500 Board of Directors Tan Sri Ibrahim Menudin (Chairman) Vincent Tan Richard Yap

Benjamin Amzalak

Joint Company Secretaries Henry Kinstlinger David Hughes Share Registry Computershare Investor Services Pty Limited Level 3 60 Carrington Street Sydney, NSW 2000 Telephone:1300 850 505 (within Australia)

Auditor

K.S. Black & Co Level 6 350 Kent Street Sydney: NSW, 2000 Telephone: +61 2 88393000

Bankers

St George Bank Limited 2-14 Meredith Street Bankstown NSW 2200

Telephone:+61 2 8760 8100 Lawyers

Piper Alderman Level 23 Governor Macquarie Tower 1 Farrer Place Sydney NSW 2000

Telephone:+61 2 9253 9999

ASX Code – RAF Raffles Capital Limited shares are listed on the Australian Securities Exchange. The shares are suspended from official quotation.

This financial report covers both Raffles Capital Limited as an individual entity and the consolidated entity consisting of Raffles Capital Limited and its consolidated entities.

Raffles Capital Limited is a company limited by shares, incorporated and domiciled in Australia.

Annual General Meeting The Annual General Meeting of Raffles Capital Limited

will be held at Level 2 Hudson House 131 Macquarie Street

Sydney, NSW, 2000 time 11.30 am date 27 May 2011

A formal notice of meeting will be sent in accordance with the Company’s constitution and the Corporations Act, 2001

Contents Page

Corporate Directory 1 Chairman’s Review 2 Review of Operations 3 Directors’ Report 9 Auditor’s Independence Statement 17 Corporate Governance Statement 18 Statement of Comprehensive Income 24 Statement of Financial Position 25 Statement of Changes in Equity 26 Statement of Cash Flows 27 Notes to the Financial Statements 28 Directors Declaration 55 F

or p

erso

nal u

se o

nly



Chairman’s Review

Dear Shareholder,

Securities in Raffles have not traded on the Australian Securities Exchange (ASX) since April 2007 and in order for Raffles’ Shares to be reinstated to trading on the ASX. Raffles must meet the requirements of Chapters 1 and 2 of the ASX Listing Rules. To this end, your Directors have identified a new metals exploration project in NSW and have embarked on a public fundraising.

Raffles currently has a portfolio of equity investments with net assets in the order of $8.3 million and is implementing the change in scale and nature of activities approved by shareholders in December 2009 through establishing a mining exploration and resources business focused on the Precious Metal Resources Limited (PMR) Tenements.

The business is operated by Raffles subsidiary company – PMR.

At the date of this Annual Report, Raffles is seeking to raise $1.5 million through a public offer to fund exploration on the PMR Tenements.

The PMR Tenements are located at Halls Peak, 80 km south-east of Armidale, New South Wales, Australia.

Halls Peak is the inferred volcanic centre for extensive small but high grade Volcanic Massive Sulphide (VMS) deposits rich in copper, lead, zinc and silver, with variable but largely untested gold values. Further exploration aims to locate the right depositional environment to host an economic resource.

Several geochemical and geophysical anomalies are also present that should identify further high grade, near-surface sulphides.

Additional to the VMS prospectivity, there are indications for the presence of orogenic gold from breccia floaters and small pods of Au–rich quartz on the tenements carrying 1 to 10 g/t Au.

Exploration will focus on the three key known sulphide bodies initially aiming to bring them to a proven resource stage quite rapidly through a diamond and reverse circulation drilling program.

The Directors are confident that on completion of the offer Raffles will satisfy ASX requirements for reinstatement of Raffles’ shares to the Official List of the ASX.

Tan Sri Ibrahim Menudin Chairman

For

per

sona

l use

onl

y



Review of Operations

Raffles Capital Limited’s (Raffles) (ASX: RAF) primary focus through 2010 was to establish a business that meets the

ASX requirements for reinstatement to the Official List of the ASX.

Corporate

8 January 2010 The appointment of Richard Yap as Director. Richard Yap has over 20 years experience in investment banking and corporate finance with qualifications of a Bachelor of Economics and a Master of Business Administration from Monash University. He is also currently the Director of Business Development and Advisor to the Chairman of TA Enterprise Berhad, a company listed on the Kuala Lumpur Stock Exchange.

5 February 2010 The resignation of Ian Levy as Director and the appointment of Benjamin Amzalak as Director. Benjamin Amzalak has an extensive background in capital raising, investor relations and broking communications. He has been engaged in capital management, raising in excess of $250 million in new venture capital for mining and other public companies. Today he provides advisory services to public companies in many areas including IPO and Mergers and Acquisitions.

16 July 2010 The appointment of KS Black and Co as auditors of Raffles, replacing Pricewaterhouse Coopers.

19 July 2010 Raffles registered office moved to Hudson House, Level 2, 131 Macquarie Street Sydney.

31 August 2010 Raffles held its Annual General Meeting and adopted a new constitution, providing consistency between the Constitution and the ASX Listing Rules and the Corporations Act 2001.

15 December 2010 Raffles released its Securities Trading Policy.

Subsequent to the end of 2010:

18 February 2011 Raffles lodged a prospectus with ASIC. Raffles is seeking through a public offering to raise $1,500,000 by the issue of 3 million new fully paid ordinary shares priced at $0.50 per share.

The last sale price Raffles traded on the ASX was $0.31 on 24 April, 2007.

In December 2009 shareholders approved a number of transactions, including:

the change in the Company’s name to Raffles Capital Limited;

the acquisition of 80 million shares in Hudson Investment Group Limited; and

a change in the nature and scale of the Company’s activities to property investment and mining and resources.

Raffles currently has a portfolio of equity investments with net assets of approximately $8 million and is implementing the change in scale and nature of activities approved by shareholders in December 2009 through establishing a mining exploration and resources business operated by Raffles’ subsidiary company – Precious Metal Resources Limited (PMR) focused on the PMR Tenements.

For

per

sona

l use

onl

y

Raffles Capital Limited and controlled entities ABN 66 009 106 049 Review of Operations (continued)


Raffles Investments

The following chart shows Raffles' investment tree at 31 December 2010:

For

per

sona

l use

onl

y



Hudson Investment Group Limited (ASX: HGL) Hudson Investment Group Limited (HIGL) is an Australian public company listed on the ASX. It is a holding company and its investment portfolio includes industrial properties in Australia and New Zealand, and investments in listed and unlisted mining and resources companies.

Raffles holds 80.2 million shares representing 31% of the issued capital of HIGL. This is represented as $7.2 million on Raffles’ balance sheet at 31 December 2010.

HIGL investment properties have a balance sheet value of $48 million and include:

44.5 ha site at Warnervale, NSW;

Car park at Hudson House 131 Macquarie Street, Sydney, NSW;

7,700 m2 building on 2.134 ha site at Rouse Hill, NSW

8 residential apartments in CBD Auckland, New Zealand

Figure 1 – Rouse Hill, NSW property.

Hudson Marketing Pty Limited (Hudson Marketing) is a 100% owned subsidiary of HIGL. Hudson Marketing processes and markets attapulgite and absorbent products; it continues to grow with annual sales for 2010 in the order of $8.7 million.

Hudson Marketing owns an attapulgite processing plant in Narngulu, Western Australia. Attapulgite or Fuller’s Earth is an industrial clay material. Hudson Marketing processes and distributes attapulgite based products that are used in the domestic and industrial absorbent, industrial oil refining, agriculture and horticulture industries.

Hudson Marketing also distributes attapulgite products throughout Australia, New Zealand and Asia.

HIGL Resource Investments

HUDSON RESOURCES LIMITED

Hudson Resources Limited (ASX: HRS) Hudson Resources Limited (Hudson) is an Australian public company listed on the ASX specialising in investments in mining assets and listed resources companies.

HIGL holds 30 million shares representing 25.4% of the issued capital of Hudson.

Hudson’s investments are primarily origination by Hudson’s own geological team through proprietary exploration work and in some cases farm in mineralisation opportunities with other explorers by providing support through Hudson’s core competencies of technical evaluation and Asia investor networking.

Hudson has significant strategic investments in other ASX listed companies: Tiaro Coal Limited (ASX: TCM); Australian Bauxite Limited (ASX: ABZ), Sovereign Gold Company Limited (ASX: SOC) and Archer Exploration Limited (ASX: AXE).

For

per

sona

l use

onl

y



Coal – Tiaro Coal Limited (ASX: TCM) Tiaro Coal Limited (Tiaro) is an Australian mining company listed on the ASX undertaking exploration for commercially viable coal deposits with the potential to produce metallurgical (coking, PCI) coals from the Tiaro Coal Measures in southeast Queensland and other coal prospective areas with good infrastructure.

Hudson holds 31.8 million shares representing 39% of the issued capital of Tiaro.

Bauxite - Australian Bauxite Limited (ASX: ABZ) Australian Bauxite Limited (ABx) is an Australian mining company listed on the ASX which holds the core of the newly discovered Eastern Australian Bauxite Province. Its 32 bauxite tenements in Queensland, NSW and Tasmania covering 7,231 km2 were rigorously selected on 3 principles:

good quality bauxite; proximity to infrastructure connected to export ports; and, free of socio-environmental or native title land constraints.

All tenements are 100% owned and free of obligations for processing and third-party royalties. ABx has already discovered many bauxite deposits and new discoveries are still being made as knowledge and expertise grows.

ABx’s bauxite is high quality and can be processed into alumina at low temperature – the type that is in short-supply globally. At ABx’s first drilling prospect in Inverell, northern NSW, an interim resource of 35 million tonnes has been reported from drilling 15% to 20% of the area prospective for bauxite and a resource of 12 million tonnes of bauxite has been reported at the Taralga project in southern NSW based on limited, first-pass reconnaissance drilling. Results from the Binjour Plateau in central QLD confirm that ABx has discovered a significant bauxite deposit including some bauxite of outstandingly high quality. ABx aspires to identify bauxite resources in excess of 200 million tonnes in one of the world’s best bauxite provinces.

ABx has the potential to create significant bauxite developments in three states - Queensland, New South Wales, Victoria and Tasmania. Its bauxite deposits are favourably located for direct shipping of bauxite to both local and export customers. Drilling of the ABx bauxite discoveries in Tasmania has only recently commenced but bauxite is con-firmed to extend over relatively large areas.

Hudson holds 55.6 million shares representing 55% of the issued capital of ABx.

Gold – Sovereign Gold Company Limited (ASX: SOC)

Sovereign Gold Company Limited (Sovereign Gold) is an Australian mining company listed on the ASX which is exploring a large Intrusion-Related Gold System at the Rock River-Uralla Goldfield in New South Wales. Its projects cover 1,200 square kilometres.

The project is located around the township of Uralla, 21km southwest of Armidale, New South Wales, Australia, with superb infrastructure logistics. It is close to major roads, rail, airport, labour source, university, power, and engineering.

For

per

sona

l use

onl

y



Available production records indicate that the Rocky River-Uralla Goldfield yielded 5,193 kg (approximately 167,000 ounces) of gold mostly from tertiary deep leads during the period 1858-1967.

Sovereign Gold’s exploration objective is to locate the hard rock ore sources.

Hudson holds 40 million shares representing 56% of the issued capital of Sovereign Gold.

Archer Exploration Limited (ASX: AXE)

Archer Exploration Limited (Archer) is an Australian mining company listed on the ASX and is a copper, gold and uranium explorer focused on the discovery of ore deposits. Archer owns a portfolio of projects, covering an area in excess of 7,000 km2, in the highly prospective Gawler Craton and Adelaide Fold Belt regions of South Australia. Archer’s Evelyn Dam prospect in the West Roxby Project is an iron ore-copper-gold-uranium (IOCG-U) target which has a gravity anomaly similar in size to the nearby Olympic Dam operations.

Hudson Resources holds 6.5 million shares representing 10% of the issued capital of Archer.

HIGL holds 6.2 million shares representing 9.6% of Archer.

Precious Metal Resources Limited

Raffles is seeking to commit some $1.25 million toward exploration on the PMR tenements.

PMR1 Pty Ltd, a wholly owned subsidiary of PMR is the holder of Exploration Licences 5339, 4474 and 7679 (PMR Tenements) located at Halls Peak, 80 km south-east of Armidale, New South Wales, Australia.

Halls Peak is the inferred volcanic centre for extensive small but high grade Volcanic Massive Sulphide (VMS) deposits rich in copper, lead, zinc and silver, with variable but largely untested gold values. Further exploration aims to locate the right depositional environment to host a major deposit in excess of 100,000 tonnes (t). Several geochemical and geophysical anomalies are also present that should identify further high grade, near-surface sulphides.

Additional to the VMS prospectivity, there are indications for the presence of orogenic gold from breccia floaters and small pods of Au–rich quartz on the tenements carrying 1 to 10 g/t Au(fieldwork by vendors, Leu reports).

A substantial body of exploration data has been generated over the years by the Geology Survey of NSW and a number of major mining companies including, BHP Ltd., MIM Ltd., The Zinc Corporation, Allstate Exploration NL, Carpentaria Exploration Co. Ltd., CRA Exploration Limited and Amoco Minerals Australia Co. Raffles, through PMR will expand on this work, unhindered by the plethora of small prospectors that originally held prime areas.

Exploration will focus on the three key known sulphide bodies initially aiming to bring them to a proven resource stage quite rapidly through a diamond and reverse circulation drilling program.

For

per

sona

l use

onl

y



PMR Proposed Development Program

1. Mining

Currently, the main areas of interest are the Gibsons Mine Area, Faints-Firefly and Khans Creek Lode, which at today’s prices are highly attractive targets. The sulphide lenses outcrop and only short adits were required to access the sulphide, e.g. BHP’s adit (1973) was developed for only 27m to intersect the sulphides at Khans Creek. The Silver Tunnel is accessible at surface via a direct drive on the sulphides and all lodes are accessible by existing dirt roads, however the topography is steep and the width of the roads currently limits the size of trucks to haul ore.

It is likely on current limited assay data that useful gold credits will be available once mining starts. Compared to other metals, there are relatively few assays of the gold content of massive sulphides. Gold, where assayed, is often low and recorded as a trace.

In the Gibsons Mine Area, there is the possibility that pattern drilling may reveal a sufficient density of small stacked stratabound VMS bodies to support open cut mining. As these essentially occur at surface, only a short adit is needed to access the sulphide. If the general grade of potential ore lenses at Hall Peak have a gold equivalent of 0.7 to 2 oz/t (based on numerous reports including those by Vendor, Leu reports), as currently indicated, then shallow narrow vein mining should be cost effective. The intention is to ship unprocessed ore to off-take buyers for direct smelting.

An independent engineering study will be commissioned to review the mine development costs, (capital costs), exploration and mine production costs, infrastructure costs, transport costs, and port costs, to direct ship Gibson’s ore.

To produce direct shipping ore from the Gibson’s and Milking Cow lodes will require an engineering feasibility study covering stockpiling, blending, stripping ratio and waste disposal.

An approximate estimate of the drilling cost is $0.5M. Given a sulphide body the size of Gibson’s, the total value of a tonne of possible ore is approximately $1,700. If costs of extraction and processing are between $700 and $800/t, the project has a potential value of around $33M; more if extensions are found. This has to be offset by the capital expenditure at the mine, local infrastructure upgrades (roads) and a possible upgrading of the bridge over the Chandler River.

2. Metallurgy and Treatment

Fine grinding and flotation tests will be undertaken to establish if saleable concentrates of galena (lead), sphalerite (zinc), copper (chalcopyrites) and silver can be produced from the ores. If successful, the company will be able to generate a cash flow early in the exploration program that underpins the initial capital investment. Alternatively, the Run-Of-Mine ore can be crushed to ⅛ inch and concentrated on tables for direct shipping.

The Silver Tunnel silver-rich sulphides average 25.23% Pb and 50.9 oz Ag (in Leu, 1998).

3. Exploration

Exploration will focus on the three key known sulphide bodies initially and bring them to a proven resource stage quite rapidly through a diamond and reverse circulation drilling program.

The principal exploration objective will be to pattern drill the Gibsons Mine area, specifically the Gibson’s No. 1 Lode. This near-surface mine area was diamond drilled in 1970 by Allstate Exploration and interpretation of drillhole data showed apparent widths of 3-5m, possibly open to the northwest. Mineralisation will most probably consist of a series of lensy, discontinuous sulphide pods rather than a coherent structure.

Exploration will also extend over the numerous superficially explored lodes (e.g. the Swedes Tunnel Lode and the sulphide bodies at Devils Drop and Sunnyside Field, etc.) and prospective gossans and geochemical and geophysical anomalies. F

or p

erso

nal u

se o

nly



Directors’ Report Your Directors present their report on the consolidated entity consisting of Raffles Capital Limited (the Company) formerly known as Freight Links Express Holdings (Australia) Limited and the entities it controlled at the end of, or during, the 8 months ended 31 December 2010. The Company changed its financial reporting date to 31 December 2010. Principal activities The consolidated entity operates predominately in one business and one geographical segment being investment in commercial properties, mining and resources within Australia. Review of Operations A summary of consolidated revenues and results is set out below:

8 months to 31 Dec 2010

12 months to 30 April 2010

$ $

Revenue from continuing operations 27,714 217,812 Other Income - 65,994 Expenses (105,379) (360,820)Income tax expense (6,092) - Net (loss)/profit attributable to members of Raffles Capital Limited (83,757) (77,014)

Results

Cents Cents

Basic (loss) earnings per share (0.40) (0.37)Diluted (loss) earnings per share (0.40) (0.37)

Net loss for the period ended 31 December 2010 amounted to $83,757 compared to loss $77,014 in the previous year.

Dividends The Directors have determined that no dividend will be paid for the period ending 31 December 2010. Directors The following persons were Directors of the Company during the whole of the period and up to the date of this report, unless otherwise stated:

Tan Sri Ibrahim Menudin (Chairman) Non-Executive Director Vincent Tan Executive Director Richard Yap Non-Executive Director Benjamin Amzalak Non-Executive Director

Information on Directors

Directors Tan Sri Ibrahim Menudin B Com FCA Chairman/Non-Executive Director Appointed a Director on 16 December 2009 Tan Sri Ibrahim Menudin, a Malaysian citizen, is the Director and Chairman of Suria Capital Holdings Berhad (“Suria Capital”). Suria Capital is a public-listed company on the Main Board of Bursa Malaysia Berhad. Tan Sri was formerly the Chief Executive Officer of Bumiputra Investment Fund of Sabah until 1985. He had also served as Chairman of Sabah Gas Industries Sdn Bhd, Deputy Chairman of Sabah Forest Industry Sdn Bhd as well as being board member of other Sabah Government corporations ranging from finance, forestry, and manufacturing, plantations, hotel and property development.

For

per

sona

l use

onl

y

Raffles Capital Limited and controlled entities ABN 66 009 106 049 Directors’ Report (continued)


He was previously appointed a board member of Malaysian Mining Corporation Berhad and Group Chief Executive and was also a board member of Ashton Mining Limited and Plutonic Resources Limited. Other Current Directorships Tan Sri Ibrahim Menudin is Non-Executive Director of Hudson Resources Limited since 2007 and Non-Executive Director of Tiaro Coal Limited. Former Directorships in the last three years of listed companies None Special Responsibilities None Vincent Tan B Com and Admin CA Executive Director Appointed a Director on 16 December 2009 Vincent Tan is a chartered accountant and has over the past thirty-five years worked in a range of industries, including insurance, securities trading, finance and property. Mr Tan has held senior management positions in a number of public and non-government organisations and has broad experience in corporate structuring. Other Current Directorships Non-executive Director of Australian Bauxite Limited Former Directorships in Last Three Years of Listed Companies Executive Director of Hudson Investment Group Limited, Executive Director of Hudson Resources Limited and Executive Director of Tiaro Coal Limited Special Responsibilities None Richard Yap B Econ, MBA, CPA Non-Executive Director Appointed a Director on 8 January 2010 Mr Yap has over 20 years experience in investment banking and corporate finance with qualifications of a Bachelor of Economics and a Master of Business Administration from Monash University. Mr Yap is also currently the Director of Business Development and Advisor to the Chairman of TA Enterprise Berhad, a company listed on the Kuala Lumpur Stock Exchange. Other Current Directorships None Former Directorships in Last Three Years of Listed Companies None Special Responsibilities None

For

per

sona

l use

onl

y



Benjamin Amzalak B. Com (Marketing & Finance) Non-Executive Director Appointed a Director on 5 February 2010 Mr Amzalak has an extensive background in capital raising, investor relations and broking communications. He has been engaged in capital management, raising in excess of $250 million in new venture capital for mining and other public companies. Today he provides advisory services to public companies in many areas including Initial Public Offerings and Mergers and Acquisitions. Other Current Directorships None Former Directorships in Last Three Years of Listed Companies None Special Responsibilities None Joint Company Secretaries Henry Kinstlinger Henry Kinstlinger has the past twenty-five years been actively involved in the financial and corporate management of a number of public companies and non-governmental organisations. He is a corporate consultant with broad experience in investor and community relations and corporate and statutory compliance. David Hughes David Hughes was appointed to the position of Joint Company Secretary on 11 November 2010. Before joining the Company, he has held similar positions with other listed companies for over 20 years. He is currently the Company Secretary of the following other ASX listed public companies; Latrobe Magnesium Limited, Hudson Investment Group Limited, Tiaro Coal Limited, Hudson Resources Limited, and Joint Company Secretary of Imperial Corporation Limited, Sovereign Gold Company Limited and Australian Bauxite Limited. Chief Financial Officer Francis Choy M.Comm MBA FCPA(HK) CPA Francis Choy has held a number of senior positions in corporate financial management roles throughout Australia and South East Asia. He has extensive experience in project finance, compliance, acquisition and investment appraisals. He has been involved in project financial, financial management of property development and telecommunication projects in South East Asia. He held senior financial roles for numerous public listed companies both in Hong Kong and Australia. Meetings of Directors The number of meetings of the company’s Board of Directors held during the period ended 31 December 2010, and the numbers of meetings attended by each Director were:

Attended Held Whilst in

Office

Attended Held Whilst in

Office

Attended Held Whilst

in OfficeTan Sri Ibrahim Menudin 6 7 - - - -Vincent Tan 7 7 - - - -Richard Yap 6 7 - - - -Benjamin Amzalak 7 7 - - - -

Directors Meetings Remuneration Committee Meetings

Audit Committee Meetings

For

per

sona

l use

onl

y



Significant changes in the state of affairs On 16 July 2010, shareholders approved the change of the Company’s auditor; PricewaterhouseCoopers was replaced by KS Black & Co.

On 19 July 2010, the Company and Hudson Investment Group Limited advised that they had agreed that the proposed acquisition of Hudson Marketing Pty Limited will not proceed and Hudson Investment Group Limited will refund the deposit monies paid.

On 19 July 2010, the Company changed its registered office address to Hudson House, Level 2, 131 Macquarie Street Sydney NSW Australia 2000.

Raffles incorporated and holds an 80% interest Precious Metal Resources Limited.

Matters subsequent to the end of the financial year 18 February 2011 – Raffles lodged a prospectus with ASIC. Raffles is seeking through a public offering to raise $1,500,000 by the issue of 3 million new fully paid ordinary shares at $0.50 per share. Other than the matters stated above, no matter or circumstance has arisen since 31 December 2010 that has significantly affected, or may significantly affect: (a) the consolidated entity’s operations in future financial years, or (b) the results of those operations in future financial years, or (c) the consolidated entity’s state of affairs in future financial years. Likely Developments Information on likely developments in the operations of the Group, known at the date of this report has been covered generally within the report. In the opinion of the Directors providing further information would prejudice the interests of the Group. Environmental regulation The Company operates within the resources sector and conducts its business activities with respect for the environment while continuing to meet the expectations of the shareholders, employees and suppliers. The Company aims to ensure that the highest standard of environmental care is achieved, and that it complies with all relevant environmental legislation. The Directors are mindful of the regulatory regime in relation to the impact of the Company’s activities on the environment. There have been no known breaches by the Company during the reporting period. To the best of the Directors’ knowledge, the Company has adequate systems in place to ensure compliance with the requirements of all environmental legislation described above and are not aware of any breach of those requirements during the financial year and up to the date of the Directors’ Report.

For

per

sona

l use

onl

y



Remuneration report - audited The information provided in this remuneration report has been audited as required by section 308 (3c) of the Corporations Act 2001. Remuneration Committee The Remuneration Committee reviews and approves policy for determining Executive’s remuneration and any amendments to that policy. The Committee makes recommendations to the Board on the remuneration of Executive Directors (including base salary, incentive payments, equity awards and service contracts) and remuneration issues for Non-Executive Directors. The members of the Remuneration Committee during the period is made up of the whole Board. Options granted to directors and key management personnel do not have performance conditions. As such the Group does not have a policy for directors and key management personnel removing the “at risk” aspect of options granted to them as part of their remuneration. Directors’ and other Key Management Personnel remuneration

The following persons were Directors of the Company during the whole of the financial year, unless otherwise stated:

Tan Sri Ibrahim Menudin (Non Executive Chairman) Vincent Tan (Executive Director) Richard Yap (Non Executive Director) Benjamin Amzalak (Non Executive Director)

The following persons were other key management personnel of the Group during the financial year:

David Hughes (Joint Company Secretary) Henry Kinstlinger (Joint Company Secretary) Francis Choy (Chief Financial Officer)

Principles used to determine the nature and amount of remuneration (audited) The Board is remunerated equitably on the basis of equal responsibility for all Directors. Executive’s remuneration and other terms of employment are reviewed annually having regard to relevant comparative information and independent expert advice. As well as basic salary, remuneration packages include superannuation. Directors are also able to participate in an Employee Share Option Plan. Remuneration packages are set at levels that are intended to attract and retain executives capable of managing the Group’s operations. Consideration is also given to reasonableness, acceptability to shareholders and appropriateness for the current level of operations. Remuneration of Non-Executive Directors is determined by the Board based on recommendations from the Remuneration Committee and the maximum amount approved by shareholders from time to time. Cash bonuses Cash bonuses granted to directors and officers are at the discretion of the Remuneration Committee. No bonus was granted for the financial year ended 31 December 2010. Performance conditions The elements of remuneration as detailed within the Remuneration Report are dependent on the satisfaction of the individual’s performance and the Group’s financial performance.

For

per

sona

l use

onl

y



The Board undertakes an annual review of its performance and the performance of the Board Committees. Details of the nature and amount of each element of the remuneration of each Director of the Company and each specified executive of the Company and the Group receiving the highest remuneration are set out in the following tables. The remuneration amounts are the same for the Company and the Group. Details of remuneration (audited) Details on the nature and amount of each element of the emoluments of each Director/Key Management Personnel of the Company for the year ended 31 December 2010 are set out below.

Consolidated Share based payments

Cash salary and fees

Cash bonus

Non-monetary benefits

Super-annuation

Retirement benefits

Options Total

Directors $ $ $ $ $ $ $Tan Sri Ibrahim Menudin - - - - - - - Vincent Tan - - - - - - - Richard Yap - - - - - - - Benjamin Amzalak - - - - - - - Directors - Total - - - - - - -

Other Key Management PersonnelHenry Kinstlinger 2,500 - - - - - 2,500 David Hughes - - - - - - - Francis Choy - - - - - - -

KMP - Total 2,500 - - - - - 2,500

Consolidated Share based payments


Cash bonus


Super-annuation

Retirement benefits

Options Total

$ $ $ $ $ $ $Tan Sri Ibrahim Menudin - - - - - - - Vincent Tan - - - - - - - Richard Yap - - - - - - - Benjamin Amzalak - - - - - - - Ian Levy - - - - - - - Eric Khua Kian Keong 13,863 - - - - - 13,863 Thomas Woo Sai Meng 22,123 - - - - - 22,123 Henry Chua Tiong Hock 27,712 - - - - - 27,712 Peter Phillips 24,357 - - 766 - - 25,123 Captain Shaw Pao Sze 24,357 - - 766 - - 25,123 Alan Keith Bennel 3,260 - - - 3,260

Total 115,672 - - 1,532 - - 117,204

Eight months to 31 December 2010

Year ended 30 April 2010Post-employment benefitsShort term benefits

Short term benefits Post-employment benefits

The amounts reported represent the total remuneration paid by entities in the Raffles Capital Group in relation to managing the affairs of all the entities within the Group.

Directors received fees for their services as Directors of the Company. The Group has no employees, and thus, there are no other officers’ emoluments. Full disclosure of key management personnel disclosed in note 17.

End of Remuneration Report

For

per

sona

l use

onl

y



Loans to Directors and executives There have been no loans to Directors in the 8 months period to 31 December 2010. Directors’ interests Particulars of Interest in the Issued Capital of the Company’s Ordinary Shares and Options at the date of signing the Directors’ Report are: Directors Shares Indirect Nature of Interest

Tan Sri Ibrahim Menudin -

Vincent Tan 11,933,084 Vincent Tan is a Director of Pacific Portfolio Investments Pty Ltd

Vincent Tan 1,000,000 Vincent Tan is a Director of Raffles Equities Limited

Richard Yap -

Benjamin Amzalak 1,000,000 Benjamin Amzalak is a Director of MM&R Pty Limited

Benjamin Amzalak 1,000,000 Benjamin Amzalak is a Director of Sing Capital Pty Ltd

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 purpose of taking responsibility on behalf of the company for all or part of those proceedings. No proceedings have been brought or intervened in on behalf of the company with leave of the Court under section 237 of the Corporations Act 2001. Indemnification and insurance of Directors The company has not, during or since the financial year, in respect of any person who is or has been an officer of the company or related body corporate: (a) indemnified or made any relevant agreement for indemnifying against a liability incurred as an officer, including costs

and expenses in successfully defending legal proceedings; or (b) paid or agree to pay a premium in respect of a contract insuring against a liability incurred as an officer for the costs or

expenses to defend legal proceedings. Non-audit services The Company may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s expertise and experience with the Group are important.

Details of the amounts paid or payable to the auditor for audit and non-audit services provided during the year are set out below.

The board of Directors has considered the position and, in accordance with advice received from the audit committee, is satisfied that the provision of the non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services by the auditor, as set out below, did not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:

All non-audit services have been reviewed by the audit committee to ensure they do not impact the impartiality and objectivity of the auditor.

None of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants.

For

per

sona

l use

onl

y



During the year the following fees were paid or payable for services provided by the auditor of the parent entity, its related practices and non-related audit firms:





$ $ $ $Audit services:Amounts paid or payable to auditors for audit and review of the financial report for the entity or any entity in the Group - Pricewaterhouse Coopers - 50,000 - 50,000 - K.S. Black & Co 16,400 16,400 16,400 16,400

16,400 66,400 16,400 66,400 Taxation and other advisory services:Amounts paid or payable to auditors for non audit taxation and advisory services for the entity or any entity in the Group.Taxation - K.S. Black & Co 7,200 7,200 7,200 7,200 Other Advisory Services - K.S Black & Co 855 - 855 -

8,055 7,200 8,055 7,200

Consolidated Parent Entity

Auditor’s independence declaration A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 17. This report is made in accordance with a resolution of the Directors.

Vincent Tan Benjamin Amzalak Director Director

29 March 2011

Sydney

For

per

sona

l use

onl

y

For

per

sona

l use

onl

y



CORPORATE GOVERNANCE STATEMENT

Overview

The Company and the Board of Directors are committed to achieving and demonstrating the highest standards of corporate governance and aim to comply with the “Principles of Good Corporate Governance and Best Practice Recommendations” set by the ASX Corporate Governance Council.

However, given the current size of both the Company's operations and the Board of Directors, it is not appropriate, cost effective or practical to comply fully with those principles and recommendations.

Where a recommendation has not been followed this fact has been disclosed together with the reasons for the departure.

Consistent with the ASX best practice recommendations, the Company’s corporate government practices are regularly reviewed.

Compliance with ASX Corporate Governance Council best practice recommendations

The ASX listing rules requires public listed companies to include in their annual report a statement regarding the extent to which they have adopted the ASX Corporate Governance Council best practice recommendations.

This statement provides details of the Company’s adoption of the best practice recommendations.

Principle 1 – Lay solid foundations for management and oversight.

Companies should establish and disclose the respective roles and responsibilities of board and management.

Board Responsibilities

The Board of Directors is accountable to shareholders for the performance of the group. In carrying out its responsibilities, the board undertakes to serve the interest of shareholders honestly, fairly and diligently.

The Board’s responsibilities are encompassed in a formal charter. The charter is reviewed annually to determine whether any changes are necessary or desirable.

The responsibilities of the Board include:

reporting to shareholders and the market;

ensuring adequate risk management processes exist and are complied with;

reviewing internal controls and external audit reports;

ensuring regulatory compliance;

monitoring financial performance, including approval of the annual and half-yearly financial reports and liaison with the Company’s auditors;

reviewing the performance of senior management;

monitoring the Board composition, Director selection and Board processes and performance;

validating and approving corporate strategy;

reviewing the assumptions and rationale underlying the annual plans and approving such plans; and

authorising and monitoring major investment and strategic commitments.

Director’s Education

The Company issues a formal letter of appointment for new Directors setting out the terms and conditions relevant to that appointment and the expectations of the role of the Director.

The Company also provides a formal induction process which provides key information on the nature of the business and its operations.

Continuing education is provided via the regular Board updates provided by the divisional chief executives.

Role of Chairman and Chief-Executive Officer

The Chairman is responsible for leading the Board, ensuring that Board activities are organised and efficiently conducted and for ensuring the Directors are properly briefed for meetings. The Chairman is also responsible for implementing the Consolidated Entity’s strategies and Board policies.

For

per

sona

l use

onl

y

Raffles Capital Limited and controlled entities ABN 66 009 106 049 Corporate Governance Statement (continued)

Annual Report – Period Ended 30 April 2010 Page 19

The Chief Executive Officer (CEO) has been delegated responsibilities for managing the day to day operations of the Company.

A formal charter is in place which lays out the duties and responsibilities of the CEO.

This charter also requires that the responsibilities and accountabilities of both the board of Directors and the CEO are clearly defined. The assessment and monitoring of the CEO is the chief responsibility of the board.

Performance is assessed against pre-determined objectives on a regular basis.

The Chairman’s other responsibilities include:

- Ensuring that general meetings are conducted efficiently and that shareholders have adequate opportunity to express their views and obtain answers to their queries.

- Present the view of the Board formally.

Principle 2 – Structure the board to add value

Companies should have a board of an effective composition, size and commitment to adequately discharge its responsibilities and duties.

Board of Directors

Composition of the board

The Board is comprised of one Executive Director and three Non-Executive Directors, all of whom have a broad range of skills and expertise.

There are three independent Directors. In determining independence the board has regard to the guidelines of Directors independence in the ASX Corporate Governance Council and Best Practice Recommendations and other best practice guidelines.

The Board considers that its composition provides for the timely and efficient decision making required for the Company in its current circumstances.

The Board’s size and composition is subject to limits imposed by the Company’s constitution which provides for a minimum of three Directors and a maximum of ten.

Details of the members of the Board, their experience, expertise and qualifications are set out in the Directors’ Report on pages 9-11.

The position / status and term in office of each Director at the date of this report is as follows:

Name of Director Position/Status Term in Office

Tan Sri Ibrahim Menudin Chairman/ Independent 1 year 3 months

Vincent Tan Executive Director / Non-Independent 1 year 3 months

Richard Yap Non-Executive Director / Independent 1 year 2 months

Benjamin Amzalak Non-Executive Director / Independent 1 year

The Board currently holds four scheduled meetings each year together with any ad hoc meetings as may be necessary. The Board met seven times during the year and Directors’ attendance is disclosed on page 11 of the Directors’ Report.

Access to Independent Professional Advice

All Directors are required to bring an independent judgement to bear on board decisions.

To facilitate this, each Director has the right of access to all relevant Company information and to the Company’s Executives. The Directors also have access to external resources as required to fully discharge their obligations as Directors of the Company. The use of this resource is co-ordinated through the chairman of the board.

For

per

sona

l use

onl

y


Annual Report – Period Ended 30 April 2010 Page 20

Nomination Committee

The role of the nominations committee is undertaken by the full board.

The Board reviews its composition on an annual basis to ensure that the Board has the appropriate mix of expertise and experience. When a vacancy exists, for whatever reason, or where it is considered that the Board would benefit from the services of a new Director with particular skills, the Board will select appropriate candidates with relevant qualifications, skills and experience. External advisers may be used to assist in such a process. The Board will then appoint the most suitable candidate who must stand for election at the next general meeting of shareholders.

For Directors retiring by rotation, the board assesses the Director before recommending re-election.

The ASX Corporate Governance Council's "Principles of Good Corporate Governance and Best Practice Recommendations" recommends the appointment of a Nomination Committee for prospective Board appointments. The Board considers that the Company and the Board are currently not of sufficient size to justify the establishment of a separate Nomination Committee.

Board Performance Evaluation

The Company has processes in place to review the performance of the Board and its committees and individual Directors. Each year the Board of Directors give consideration to broad corporate governance matters, including the relevance of existing committees and to reviewing its own and individual Directors performance. The Chairman is responsible for monitoring the contribution of individual Directors and consulting with them in any areas of improvement.

Individual Directors use an approved form to assess the performance of the board and the chairman.

Principle 3 – Promote ethical and responsible decision making

Companies should actively promote ethical and responsible decision making.

Code of Conduct

The Board acknowledges the need for continued maintenance of the highest standards of Corporate Governance Practices and ethical conduct by all Directors and employees of the Consolidated Entity.

The Company has established a code of conduct applicable to all Directors and employees. The requirement to comply with the code is mandatory and is communicated to all employees. The code sets out standards of conduct, behaviour and professionalism.

The shareholder communications strategy, the securities trading policy and the continuous disclosure policy collectively form a solid foundation for the Company’s ethical practices.

Policy on Dealing in Company Securities

The Company has a policy on how and when the Directors and employees may deal in the Company’s securities.

In addition to these legal and regulatory restrictions, the Company has adopted a robust trading policy whereby trading in Company shares are prohibited under certain circumstances, and short-term trading is discouraged.

The purpose of this policy is to ensure that the Directors and employees deal in the Company’s securities in a manner which properly reflects their fiduciary duty, and that they do not transact in those securities whilst in possession of price sensitive information.

This policy requires that all Directors and Senior Executives to disclose their share trade intentions to the Managing Director or Chairman prior to dealing in the Company’s securities.

The Company maintains compliance standards and procedures to ensure that the policy is properly implemented. In addition there is also an internal review mechanism to assess compliance and effectiveness. Details of both the Company’s Code of Conduct and Share Trading Policy which, among other things, describes ‘closed periods’ and ‘prohibited periods’ that describes when trading is restricted. These policies have been lodged with the ASX and are contained on the Company’s website under Corporate Governance.

For

per

sona

l use

onl

y



Diversity and Gender

The Board embraces the view that “diversity is an economic driver of competitiveness for companies” (from Corporate Governance Principles with 2010 Recommendations). The Board’s substantial international experience arises from the diversity of its members’ cultural background. At this stage, the Board has not formalised a diversity policy as suggested in Recommendation 3.2. It is the Board’s position that the spirit of this Recommendation is self-evident from the structure of the Board and its senior management team. The Company has likewise yet to adopt Recommendations 3.3 and 3.4. These Recommendations require that a diversity policy include measurement objectives for facilitating greater participation of woman to the Board, and produce tables describing the proportion of females across the Company’s Board, management and employee tiers. The implementation of an appropriate diversity policy to reflect the circumstances of the Company and the industry in which the Company operates is currently under review. The Board wishes to note that it supports these Recommendations in principle and anticipates their adoption in the near future.

Principle 4 – Safeguard integrity in financial reporting

Companies should have a structure to independently verify and safeguard the integrity of their financial reporting.

Audit Committee

The role of the Audit Committee is undertaken by the full board.

The committee did not meet during the year and the members’ attendance records is disclosed in the table of Directors’ meetings included in the Directors’ Report on page 11.

The committee has a formal charter which has been reviewed by the committee and the board.

The minutes of the committee meetings are reviewed in the subsequent meeting of the board and the chairman of the committee reports on the committees conclusions and recommendations.

The responsibilities of the Audit Committee include:

reviewing the annual and half year financial reports to ensure compliance with Australian Accounting Standards and generally accepted accounting principles;

monitoring corporate risk management practices;

review and approval of the Consolidated Entity’s accounting policies and procedures;

reviewing the nomination, performance and independence of the external auditors; and

organising, reviewing and reporting on any special reviews or investigations deemed necessary by the Board.

The structure of the audit committee does not comply with recommendations 4.2 in that it does not consist of only non-executive Directors. This matter continues to be under review and as circumstances allow consideration will be given to the appropriate time to adopt the ASX Corporate Governance Guideline.

The audit committee has received confirmation in writing from the Chief Executive Officer and Chief Financial Officer that:

The Company’s Financial Report for the financial year ended presents a true and fair view in all material respects of the Company’s financial position and operational result and are in accordance with relevant accounting standards.

External Auditors

The full Board is responsible for the appointment, removal and remuneration of the external auditors, and reviewing the terms of their engagement, and the scope and quality of the audit. In fulfilling its responsibilities, the Board receives regular reports from management and the external auditors at least once a year, or more frequently if necessary. The external auditors have a clear line of direct communication at any time to the Chairman of the Board.

The current auditors, K.S. Black & Co, were appointed in 2010. The Australian accounting bodies’ statement on professional independence requires mandatory rotation of audit partners for listed companies every five years. K.S. Black & Co confirms that they conform with the requirements of this statement.

K.S. Black & Co are required to attend the Annual General Meeting and be available to answer shareholder questions about the conduct of the audit and the preparation and content of the Auditor's Report.

For

per

sona

l use

onl

y



Principle 5 – Make timely and balanced disclosure

Companies should promote timely and balanced disclosure of all material matters concerning the Company.

The Company promotes timely and balanced disclosure of any material matters concerning the Company.

The Company has a written policy on information disclosure that focuses on continuous disclosure of any information concerning the Company and its controlled entities that a reasonable person would expect to have a material effect on the price of the Company’s securities.

The Company Secretary in consultation with the Chairman and CEO, is responsible for communications with the ASX. He is also responsible for ensuring compliance with the continuous disclosure requirements of the ASX Listing Rules, and overseeing and co-ordinating information disclosure to the ASX, analysts, brokers, shareholders, the media and the general public.

Principle 6 – Respect the rights of shareholders

Companies should respect the rights of shareholders and facilitate the effective exercise of those rights.

Communication with Shareholders

The Board recognises and respects the rights of our shareholders as the beneficial owners of the Company. In order to facilitate the effective exercise of those rights, the Company follows a communications strategy that aims to empower shareholders by:

communicating effectively with them; providing easy access to balanced and understandable information about the Company; and encouraging and facilitating shareholder participation in general meetings.

The Company achieves this through the following avenues:

i) Regular mailings The Company provides shareholders with copies of all announcements made to the ASX by mail on request. Copies are also available via an electronic link to the ASX web site, ensuring that all shareholders are kept informed about the Company.

Shareholders also have the option of receiving a hard copy of the Annual Report each year.

ii) General meetings All shareholders are invited to attend the Annual General Meetings which are held at the Company’s Registered Office in Sydney. The full Board and senior executives are present and available to answer questions from the floor, as are the External Auditor and a representative from the Company’s legal advisors.

Principle 7 – Recognise and manage risk

Companies should establish a sound system of risk oversight and management and internal control.

The Board oversees the establishment, implementation and review of the Company’s Risk management System. To ensure it meets its responsibilities, the Board has implemented appropriate systems for identifying, assessing, monitoring and managing material risk throughout the organisation.

Management is required to provide monthly status reports to the Board which identify potential areas of business risk arising from changes in the financial and economic circumstances of its operating environment.

The Board regularly assess the Company’s performance in light of risks identified by such reports.

Management are also required to design implement and review the Company’s risk management and internal control system. The Board reviews the effectiveness of the implementation of the Company’s risk management and internal control on a regular basis.

The Board does not employ an internal auditor, although as part of the Company’s strategy to implement an integrated framework of control, the Board requested the external auditors review internal control procedures. Recommendations once presented are considered by the Board.

The Chairman and Chief Financial Officer have stated in writing to the Board that:

The Company’s financial reports present a true and fair view in all material respects of the Company’s financial condition and operating results and are in accordance with relevant accounting standards.

For

per

sona

l use

onl

y



The integrity of the financial statements is founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the Board. The Company’s risk management and internal compliance and control system is operating efficiently in all material respects.

The Board requires this declaration to be made bi-annually. Principle 8 – Remunerate fairly and responsibly

Companies should ensure that the level and composition of remuneration is sufficient and reasonable and that its relationship to performance is clear.

The role of the remuneration committee is undertaken by the full board.

The Committee meets as often as required, but no less than once per year.

The committee has adopted a formal charter.

The main responsibilities of the Committee are to:

review and approve the Consolidated Entity’s policy for determining executive remuneration and any amendments to that policy;

review the on-going appropriateness and relevance of the policy

consider and make recommendations to the Board on the remuneration of executive Directors (including base salary, incentive payments, equity awards and service contracts);

review and approve the design of all equity based plans;

review and approve the total proposed payments under each plan; and

review and approve the remuneration levels for non-executive Directors.

The Committee did not meet during the year. Executive Directors and Executive Remuneration

The remuneration committee reviews and approves the policy for determining executives’ remuneration and any amendments to that policy.

Executive remuneration and other terms of employment are reviewed annually having regard to relevant comparative information and independent expert advice.

Remuneration packages include basic salary, superannuation and the rights of participation in the Company’s Share Option Plan and Employee Share Option Plan.

Remuneration packages are set at levels that are intended to attract and retain executives capable of effectively managing the Company’s operations.

Consideration is also given to reasonableness, acceptability to shareholders and appropriateness for the current level of operations.

Non-Executive Directors

Remuneration on Non-Executive Directors is determined by the Board based on recommendations from remuneration committee, relevant comparative information, independent expert advice and the maximum amount approved by shareholders from time to time.

Further information on Directors and executive remuneration is included in the remuneration report which forms part of the Directors’ report. F

or p

erso

nal u

se o

nly



Statement of Comprehensive Income For the period ended 31 December 2010


12 months to 30 April

2010



Notes$ $ $ $

Revenue from continuing operations 4 16,156 217,812 16,156 217,812Other income 4 11,558 65,994 11,558 59,383Administration expenses 5 (105,022) (353,920) (97,099) (353,917)Finance expenses (357) (6,900) (357) (6,900)Profit/(loss) before income tax (77,665) (77,014) (69,742) (83,622)

Tax expense 6 (6,092) - (6,092) -

Profit/(loss) after tax for the year (83,757) (77,014) (75,834) (83,622)

Other Comprehensive IncomeOther comprehensive income for the year net of tax

- - - -

Total comprehensive income for the year - - - -

Total Comprehensive Income/(loss) attributable to members of Raffles Capital Limited (83,757) (77,014) (75,834) (83,622)

Cents CentsBasic earnings per share 19 (0.40) (0.37)Diluted earnings per share 19 (0.40) (0.37)

The above statement of comprehensive income should be read in conjunction with the accompanying notes

For

per

sona

l use

onl

y



Statement of Financial Position As at 31 December 2010

31-Dec-10 30-Apr-10 31-Dec-10 30-Apr-10$ $ $ $

ASSETSCurrent assetsCash and cash equivalents 7 242,712 505,590 242,712 505,590Trade and other receivables 8 64,596 555,048 44,596 555,048Other financial assets 9 866,335 229,075 866,335 229,075Total current assets 1,173,643 1,289,713 1,153,643 1,289,713

Non-current assetsTrade and other receivables 8 - - 26,923 - Other financial assets 9 7,218,090 7,200,000 7,219,090 7,200,000 Mining tenements 11 200,250 - - - Total non-current assets 7,418,340 7,200,000 7,246,013 7,200,000

Total assets 8,591,983 8,489,713 8,399,656 8,489,713

LIABILITIESCurrent liabilitiesTrade and other payables 12 53,789 68,012 53,789 68,012Provisions 13 - - - - Total current liabilities 53,789 68,012 53,789 68,012

Non-current liabilitiesOther Payable 12 200,000 - - - Total Non-current liablities 200,000 - - -

Total liabilities 253,789 68,012 53,789 68,012

Net assets 8,338,194 8,421,701 8,345,867 8,421,701

EQUITYContributed equity 14 10,395,502 10,395,502 10,395,502 10,395,502 Retained profits / (accumulated losses) 15 (2,057,558) (1,973,801) (2,049,635) (1,973,801)

Total equity attributable to equity holder of parent equity

8,337,944 8,421,701 8,345,867 8,421,701

Minority Interest 250 - - -

Total Equity 8,338,194 8,421,701 8,345,867 8,421,701

Notes

Consolidated Parent entity

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

For

per

sona

l use

onl

y



Statement of Changes in Equity For the period ended 31 December 2010

Consolidated Issued Capital ReservesAccumulated

LossesMinority Interest Total Equity

$ $ $ $ $

At 30 April 2010 10,395,502 - (1,973,801) - 8,421,701 Loss for the period - - (83,757) - (83,757)Movement for the year - - - 250 250

At 31 December 2010 10,395,502 - (2,057,558) 250 8,338,194

At 30 April 2009 10,395,502 - (1,586,282) - 8,809,220 Loss for the period - - (77,014) - (77,014)Dividend paid - - (310,505) - (310,505)

At 30 April 2010 10,395,502 - (1,973,801) - 8,421,701

Parent Entity Issued Capital ReservesAccumulated

LossesMinority Interest

Total Equity

$ $ $ $ $

At 30 April 2010 10,395,502 - (1,973,801) - 8,421,701 Loss for the period - - (75,834) - (75,834)Dividend paid - - - - -

At 31 December 2010 10,395,502 - (2,049,635) - 8,345,867

At 30 April 2009 10,395,502 - (1,579,674) - 8,815,828 Loss for the period - - (83,622) - (83,622)Dividend paid - - (310,505) - (310,505)

At 30 April 2010 10,395,502 - (1,973,801) - 8,421,701

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

For

per

sona

l use

onl

y



Statement of Cash Flows For the period ended 31 December 2010





$ $ $ $Cash flows from operating activities

Payments to suppliers and employees (117,592) (450,991) (109,669) (449,991)Interest received 16,156 217,812 16,156 217,812 Income taxes (paid)/refunded (6,092) - (6,092) -

Net cash inflow/(outflow) from operating activities 24 (107,528) (233,179) (99,605) (232,179)

Cash flows from investing activities Acquisition of Investment (655,350) (7,959,075) (656,350) (7,959,075)

Tenement deposit (30,000) - (10,000) - Advance from controlled parties - - (26,923) -

Net cash inflow/(outflow) from investing activities (685,350) (7,959,075) (693,273) (7,959,075)

Cash flows from financing activitiesRepayment of borrowing/dep paid 530,000 (66,933) 530,000 (66,933)Dividends paid to company's shareholders 16 - (310,505) - (310,505)

Net cash inflow/(outflow) from financing activities 530,000 (377,438) 530,000 (377,438)

Net increase/(decrease) in cash and cash equivalents (262,878) (8,569,692) (262,878) (8,568,692)

Cash and cash equivalents at the beginning of the financial period 505,590 9,075,282 505,590 9,074,282Cash and cash equivalents at the end of the financial period 7 242,712 505,590 242,712 505,590


Notes

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

For

per

sona

l use

onl

y



Notes to the Financial Statements For the period ended 31 December 2010

1. Corporate Information

The financial report of Raffles Capital Limited (the Company) for the period ended 31 December 2010 was authorised for issue in accordance with a resolution of the Directors on 29 March, 2011 and covers the Company as an individual entity as well as the Consolidated Entity consisting of the Company and its subsidiaries as required by the Corporations Act 2001. During the year, the Company changed its financial reporting date to 31 December 2010.

The financial report is presented in Australian currency.

The Company is a company limited by shares incorporated and domiciled in Australia whose shares are publicly traded on the Australian Securities Exchange (ASX). At this time, the Company’s shares are suspended from trading.

2. Statement of Significant Accounting Policies

a Basis of Preparation

This general purpose financial report has been prepared in accordance with Australian Accounting Standards, other authoritative pronouncement of the Australian Accountancy Standards Board and the Corporations Act 2001.

Statement of Compliance

Australian Accounting Standards ('AASBs') include Australian equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report of Raffles Capital Limited complies with International Financial Reporting Standards.

Critical accounting estimates and assumptions

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances.

Details of critical accounting estimates and assumptions about the future made by management at reporting date are set out below:

Impairment of assets

The Company assess impairment at each reporting date by evaluating conditions specific to the Group that may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Calculations performed in assessing recoverable amounts incorporate a number of key estimates.

Critical judgements

Management have made the following judgements when applying the Group's accounting policies:

Recognition of deferred tax assets

In line with the Group’s accounting policy (Note 2f) and as disclosed in Note 6, deferred tax assets have not been recognised.

Measurement of financial assets

If there is an active market for financial assets they have been fair valued in line with market prices, if not they are carried at cost.

Historical cost convention

These financial statements have been prepared under the historical cost convention except for where noted in these accounting policies.

For

per

sona

l use

onl

y

Raffles Capital Limited and controlled entities ABN 66 009 106 049 Notes to the Financial Statements For the period ended 31 December 2010 cont’d


b Principles of consolidation

Subsidiaries

The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Raffles Capital Limited (“the parent entity”) as at 31 December 2010 and the results of all subsidiaries for the year then ended. The Company and its subsidiaries together are referred to in this financial report as the Group.

Subsidiaries are all those entities over which the Group has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity.

Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases.

The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group.

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

Minority interests in the results and equity of subsidiaries are shown separately in the consolidated Statement of Comprehensive Income and Statement of Financial Position respectively.

Investments in subsidiaries are accounted for at cost in the individual financial statements of Raffles Capital Limited.

c Segment reporting

A business segment is a group of assets and operations engaged in providing products or services that are subject to risks and returns that are different to those of other business segments. A geographical segment is engaged in providing products or services within a particular economic environment and is subject to risks and returns that are different from those of segments operating in other economic environments. Reporting to management by segments is on this basis

d Foreign currency translation

(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 financial statements are presented in Australian dollars, which is Raffles Capital Limited’s functional and presentation currency.

(ii) 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 Comprehensive Income.

(iii) Group companies The results and financial position of all the Group entities 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 for each Statement of Comprehensive Income 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 as a separate component of equity.

For

per

sona

l use

onl

y



On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other currency instruments designated as hedges of such investments, are taken to shareholders’ equity. When a foreign operation is sold or borrowings repaid, a proportionate share of such exchange differences are recognised in the Statement of Comprehensive Income as part of the gain or loss on sale where applicable.

e Revenue recognition

Revenue is recognised at the fair value of consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances and duties and taxes paid. The following specific recognition criteria must also be met before revenue is recognised:

Sale of Goods

Revenue from sale of goods is recognised when the significant risks and rewards of ownership have passed to the buyer and can be reliably measured. Risks and rewards are considered passed to buyer when goods have been delivered to the customer.

Interest

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

f Income Tax

The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements, and to unused tax losses.

Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities are settled, based on those tax rates which are enacted or substantively enacted. The relevant tax rates are applied to the cumulative amounts of deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception is made for certain temporary differences arising from the initial recognition of an asset or a liability. No deferred tax asset or liability is recognised in relation to these temporary differences if they arose in a transaction, other than a business combination, that at the time of the transaction did not affect either accounting profit or taxable profit or loss.

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.

Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.

Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.

The Company and its wholly owned entities are part of a tax-consolidated group under Australian Taxation law. Raffles Capital Limited is the head entity in the tax-consolidated group. Tax expense/income, deferred tax liabilities and deferred tax assets arising from temporary differences of the members of the tax-consolidated group are recognised in the separate financial statements of the members of the tax-consolidated group using the ‘separate taxpayer within group’ approach.

Current tax liabilities and assets and deferred tax assets arising from unused tax losses and tax credits of the members of the tax-consolidated group are recognised by the Company (as head entity in the tax-consolidated group).

The amounts receivable/payable under tax funding arrangements are due upon notification by the entity which is issued soon after the end of each financial year. Interim funding notices may also be issued by the head entity to its wholly owned subsidiaries. These amounts are recognised as current inter-company receivables or payables.

For

per

sona

l use

onl

y



g Goods and services tax (GST)

Revenues, expenses and assets 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 the amount of GST included.

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

Cash flows are included in Statement of Cash Flows on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating cash flows.

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

h Cash and cash equivalents

For the purposes of the Statement of Cash Flows, cash includes cash on hand and in at call deposits with banks or financial institutions, investment in money market instruments maturing within less than 6 months, net of bank overdrafts.

i Trade and other receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost, less provision for doubtful debts. Trade receivables are due for settlement no more than 60 days from the date of recognition.

Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off. A provision for doubtful receivables is established when there is objective evidence that entities in the Group will not be able to collect all amounts due according to the original terms of receivables.

j Inventories

Raw materials, work in progress and finished goods Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials, direct labour and an appropriate proportion of variable and fixed overhead expenditure, the latter being allocated on the basis of normal operating capacity. Costs are assigned to individual items of inventory on the basis of weighted average costs. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.

k Impairment of assets

Assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units). Non financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at each reporting period.

l Financial Instruments

Recognition and initial measurement

Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions to the instrument. For financial assets, this is equivalent to the date that the company commits itself to either the purchase or sale of the asset (ie trade date accounting is adopted).

Financial instruments are initially measured at fair value plus transaction costs, except where the instrument is classified ‘at fair value through profit or loss’, in which case transaction costs are expensed to profit or loss immediately.

For

per

sona

l use

onl

y



Classification and subsequent measurement

Finance instruments are subsequently measured at either of fair value, amortised cost using the effective interest rate method, or cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, between knowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair value. In other circumstances, valuation techniques are adopted.

Amortised cost is calculated as:

(a) the amount at which the financial asset or financial liability is measured at initial recognition; (b) less principal repayments; (c) plus or minus the cumulative amortisation of the difference, if any, between the amount initially

recognised and the maturity amount calculated using the effective interest method; and (d) less any reduction for impairment.

The effective interest method is used to allocate interest income or interest expense over the relevant period and is equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees, transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying value with a consequential recognition of an income or expense in profit or loss. The Group does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the requirements of accounting standards specifically applicable to financial instruments.

(i) Financial assets at fair value through profit or loss Financial assets are classified at ‘fair value through profit or loss’ when they are either held for trading for the purpose of short-term profit taking, derivatives not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented risk management or investment strategy. Such assets are subsequently measured at fair value with changes in carrying value being included in profit or loss.

(ii) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments

that are not quoted in an active market and are subsequently measured at amortised cost.

Loans and receivables are included in current assets, except for those which are not expected to mature within 12 months after reporting date. (All other loans and receivables are classified as non-current assets.)

(iii) Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or determinable payments, and it is the Group’s intention to hold these investments to maturity. They are subsequently measured at amortised cost.

Held-to-maturity investments are included in non-current assets, except for those which are expected to mature within 12 months after reporting date. (All other investments are classified as current assets.) If during the period the Group sold or reclassified more than an insignificant amount of the held-to-maturity investments before maturity, the entire held-to-maturity investments category would be tainted and reclassified as available-for-sale.

(iv) Available-for-sale financial assets Available-for-sale financial assets are non-derivative financial assets that are either not suitable to be classified into other categories of financial assets due to their nature, or they are designated as such by management. They comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed or determinable payments. Available-for-sale financial assets are included in non-current assets, except for those which are expected to be disposed of within 12 months after reporting date. (All other financial assets are classified as current assets.)

For

per

sona

l use

onl

y



(v) Financial Liabilities Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost.

Fair value

Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to similar instruments and option pricing models.

Impairment

At the end of each reporting period, the Group assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a prolonged decline in the value of the instrument is considered to determine whether an impairment has arisen. Impairment losses are recognised in the statement of comprehensive income.

Derecognition

Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is transferred to another party whereby the entity no longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised where the related obligations are either discharged, cancelled or expired. The difference between the carrying value of the financial liability extinguished or transferred to another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss.

m Fair value estimation

The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes.

The fair value of financial instruments traded in active markets is based on quoted market prices at the Statement of Financial Position date. The quoted market price used for financial assets held by entities in the Consolidated Entity is the current bid price; the appropriate quoted market price for financial liabilities is the current ask price.

The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. Entities in the Consolidated Entity use a variety of methods and make assumptions that are based on market conditions existing at each balance date. Quoted market prices or dealer quotes for similar instruments are used for long-term debt instruments held. Other techniques, such as estimated discounted cash flows, are used to determine fair value for the remaining financial instruments.

The nominal value less estimated credit adjustments of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to entities in the Consolidated Entity for similar financial instruments.

n Property, plant and equipment

Land and buildings are shown at fair value, based on periodic valuations by external independent valuers, less subsequent depreciation for buildings. Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset. All other plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Consolidated Entity and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the Statement of Comprehensive Income during the financial period in which they are incurred.

Increases in the carrying amounts arising on revaluation of land and buildings are credited to the asset

For

per

sona

l use

onl

y



revaluation reserve in equity. A revaluation surplus is credited to the asset revaluation reserve included within shareholder’s equity unless it reverses a revaluation decrease on the same asset previously recognised in the Statement of Comprehensive Income. A revaluation deficit is recognised in the Statement of Comprehensive Income unless it directly offsets a previous revaluation surplus on the same asset in the asset revaluation reserve. On disposal, any revaluation reserve relating to sold assets is transferred to retained earnings. Independent valuations are performed regularly to ensure the carrying amounts of land and buildings do not differ materially from the fair value at the Statement of Financial Position date.

Land is not depreciated. Depreciation on other assets is calculated using the straight line, over their estimated useful lives, as follows:

- Plant and equipment 5 – 15 years - Buildings 30 years

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each Statement of Financial Position date.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount (note 2 (m)).

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the Statement of Comprehensive Income.

o Investment property

Investment property is held for long-term rental yields and is not occupied by the Group. Investment property is carried at fair value, which is based on active market prices, adjusted, if necessary, for any difference in the nature, location or condition of the specific asset. If this information is not available, the Group uses alternative valuation methods such as recent prices in less active markets or discounted cash flow projections. These valuations are reviewed annually. Changes in fair values are recorded in the Statement of Comprehensive Income as part of other income.

p Tenement exploration, valuation and development costs.

Costs incurred in the exploration for, and evaluation of, tenements for suitable resources are carried forward as assets provided that one of the following conditions is met:

the carrying values are expected to be justified through successful development and exploitation of the area of interest; or

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

Expenses failing to meet at least one of the aforementioned conditions are expensed as incurred. Costs associated with the commercial development of resources are deferred to future periods, provided they are, beyond any reasonable doubt, expected to be recoverable. These costs are be amortised from the commencement of commercial production of the product to which they relate on a straight-line basis over the period of the expected benefit.

q Leases

Company as lessee Leases of property, plant and equipment where the Group has substantially all the risks and rewards of ownership are classified as finance leases and capitalised at inception of the lease at the fair value of the leased property, or if lower, at the present value of the minimum lease payments. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged to the Statement of Comprehensive Income over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset or the lease term.

Leases where the lessor retains substantially all the risks and rewards of ownership of the net asset are classified as operating leases. Payments made under operating leases (net of incentives received from

For

per

sona

l use

onl

y



the lessor) are charged to the Statement of Comprehensive Income on a straight-line basis over the period of the lease.

Company as lessor

Lease income from operating leases is recognised in the Statement of Comprehensive Income on a straight-line basis over the lease term. Initial direct costs incurred in negotiating operating leases are added to the carrying value of the leased asset and recognised as an expense over the lease term on the same bases as the lease income.

r Trade and other payables

These amounts represent liabilities for goods and services provided to the Group prior to the end of

financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition.

s Borrowings

All loans and borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the Statement of Comprehensive Income over the period of the loans and borrowings using the effective interest method.

t Employee benefits

Wages and Salaries, Annual Leave and Personal Sick Leave Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating personal sick leave expected to be settled within one year of Statement of Financial Position date are recognised in other liabilities in respect of employees' services rendered up to Statement of Financial Position date and are measured at amounts expected to be paid when the liabilities are settled. Liabilities for non-accumulating personal sick leave are recognised when leave is taken and measured at the actual rates paid or payable. Long Service Leave The liability for long serve leave is recognised in the provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date.

u Contributed equity

Ordinary shares are classified as equity. Costs directly attributable to the issue of new shares or options are shown as a deduction from the equity proceeds, net of any income tax benefit.

v Share-based payments Ownership-based remuneration is provided to employees via an employee share option plan.

Share-based compensation is recognised as an expense in respect of the services received, measured on a fair value basis.

The fair value of the options at grant date is independently determined using a Black Sholes option pricing model that takes into account the exercise price, the term of the option, the vesting and performance criteria, the impact of dilution, the non-tradeable nature of the option, 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 excludes the impact of any non-market vesting conditions (for example, profitability and sales growth targets). Non-market vesting conditions are included in assumptions about the number of options that are expected to become exercisable. At each Statement of Financial Position date, the Group revises its estimate of the number of options that are expected to become exercisable. The employee benefit expense recognised each period takes into account the most recent estimate.

Upon the exercise of options, the balance of the share-based payments reserve relating to those options is transferred to share capital.

For

per

sona

l use

onl

y



w Earnings per share (EPS)

Basic EPS is calculated as net profit attributable to members, adjusted to exclude costs of servicing equity (other than dividends), divided by the weighted average number of ordinary shares, adjusted for any bonus element.

Diluted EPS is calculated as net profit attributable to members, adjusted for costs of servicing equity (other than dividends), the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as expenses; and other non-discretionary changes in revenues or expenses during the period that would result from the dilution of potential ordinary shares; divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element.

x New Accounting Standards for Application

The AASB has issued new and amended accounting standards and interpretations that have mandatory application dates for future reporting periods. The Group has decided against early adoption of these standards. There are no standards and interpretations applicable.

y Status of ASX trading halt

The consolidated entity sold its property investment business to a third party in August 2005, representing the loss of its core business activity at that time. Since then the consolidated entity has had the principal activity of investing cash reserves in short term deposits. Management requested a trading halt on 24 April 2007.

During the year under review, management have pursued various business opportunities in a bid to resume operation of the property investment business and obtain ASX approval for the trading halt to be lifted.

The Company is actively pursuing ventures as well as working with ASX to ensure compliance with its requirements as a listed entity and is working towards its reinstatement.

For

per

sona

l use

onl

y



3. Financial risk management

a. General objectives, policies and processes

In common with all other businesses, the Group is exposed to risks that arise from its use of financial instruments. This note describes the Group’s objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

There have been no substantive changes in the Group’s exposure to financial instrument risks, its objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.

The Board has overall responsibility for the determination of the Group’s risk management objectives and polices and, whilst retaining ultimate responsibility for them, it has delegated the authority for designing and operating processes that ensure the effective implementation of the objectives and policies to the Group’s finance function. The Groups' risk management policies and objectives are therefore designed to minimise the potential impacts of these risks on the results of the Group where such impacts may be material.

The Board receives reports from the Chief Financial Officer through which it reviews the effectiveness of the processes put in place and the appropriateness of the objectives and policies it sets. The Group’s finance function is to also review the risk management policies and processes and report their findings to the Audit Committee.

The overall objective of the Board is to set polices that seek to reduce risk as far as possible without unduly affecting the Group’s competitiveness and flexibility. Further details regarding these policies are set out below.

31-Dec-10 30-Apr-10 31-Dec-10 30-Apr-10Financial assets $ $ $ $CurrentCash and cash equivalents 242,712 505,590 242,712 505,590 Trade and other receivables 64,596 555,048 44,596 555,048 Financial assets 866,335 229,075 866,335 229,075 Non-CurrentFinancial Assets 7,218,090 7,200,000 7,219,090 7,200,000

8,391,733 8,489,713 8,372,733 8,489,713

Financial liabilitiesCurrentTrade and other payables 53,789 68,012 53,789 68,012 Non-CurrentOther payable 200,000 - - -

253,789 68,012 53,789 68,012


b. Credit Risk Credit risk is the risk that the other party to a financial instrument will fail to discharge their obligation resulting in the Group incurring a financial loss. This usually occurs when debtors or counterparties to derivative contracts fail to settle their obligations owing to the Group excluding the available for sale financial assets.

The maximum exposure to credit risk at balance date is the carrying amount of the financial assets, as summarised under note(a) above.

The maximum exposure to credit risk at balance date, all located in Australia, as summarised under note (a) above.

c. Liquidity risk

Liquidity risk is the risk that the Group may encounter difficulties raising funds to meet commitments associated with financial instruments that is, borrowing repayments. Bank loans and payable are details below. It is the policy of the Board of Directors that treasury reviews and maintains adequate committed credit facilities. The company manages liquidity risk by monitoring forecast cash flow and maturity profiles of financial assets and liabilities to ensure adequate liquid funds are maintained.

For

per

sona

l use

onl

y



Maturity Analysis of financial assets Carrying

AmountContractual Cash flows < 6 mths

6- 12 mths 1-3 years > 3 years

Weighted Average

Interest RateConsolidated31 Dec 2010

$ $ $ $ $ $

CurrentCash-floating interest rate 41,436 41,436 41,436 - - - Cash-fixed interest rate 201,276 201,276 201,276 - - - Trade and other receivables 64,596 64,596 34,596 30,000 - - Financial assets 866,335 - - - - - Non-currentFinancial assets 7,218,090 - - - - -

Total financial assets 8,391,733 307,308 277,308 30,000 - - 4.78%

Carrying Amount

Contractual Cash flows < 6 mths


Weighted Average

Interest RateConsolidated 30 April 2010

$ $ $ $ $ $

CurrentCash-floating interest rate 255,590 255,590 255,590 - - - Cash-fixed interest rate 250,000 250,000 250,000 - - - Trade and other receivables 555,048 25,048 25,048 - - -

Financial assets 229,075 - - - - - Non-currentFinancial assets 7,200,000 - - - - -

Total financial assets 8,489,713 530,638 530,638 - - - 4.79%

Maturity Analysis of financial assets

Carrying Amount



Parent Entity31 Dec 2010

$ $ $ $ $ $

CurrentCash floating interest rate 41,436 41,436 41,436 - - - Cash fixed interest rate 201,276 201,276 201,276 - - - Trade and other receivables 44,596 44,596 34,596 10,000 - - Financial assets 866,335 - - - - - Non-currentFinancial assets 7,219,090 - - - - -

Total financial assets 8,372,733 287,308 277,308 10,000 - - 4.78%

Carrying Amount



Parent Entity30 April 2010

$ $ $ $ $ $

CurrentCash floating interest rate 255,590 255,590 255,590Cash fixed interest rate 250,000 250,000 250,000

Trade and other receivables 555,048 25,048 25,048 - - - Financial assets 229,075 - - - - - Non-currentFinancial assets 7,200,000 - - - - -

Total financial assets 8,489,713 530,638 530,638 - - - 4.79%

For

per

sona

l use

onl

y



Maturity Analysis of financial liabilities Carrying

AmountContractual Cash flows < 6 mths 6- 12 mths 1-3 years > 3 years

Consolidated31 Dec 2010 $ $ $ $ $ $CurrentTrade and other payables 43,839 43,839 43,839 - - - Other liabilities 9,950 9,950 9,950 - - - Non-currentTrade and other payables 200,000 200,000 - - - 200,000 Total financial liaibilities 253,789 253,789 53,789 - - 200,000

Carrying Amount

Contractual Cash flows < 6 mths 6- 12 mths 1-3 years > 3 years

Consolidated 30 April 2010 $ $ $ $ $ $CurrentTrade and other payables 18,500 18,500 18,500 - - - Other liabilities 49,512 49,512 - 49,512 - - Non-currentTrade and other payables - - - - - - Total financial liaibilities 68,012 68,012 18,500 49,512 - -

Maturity Analysis of financial liabilities

Carrying Amount


Parent Entity 31 Dec 2010 $ $ $ $ $ $CurrentTrade and other payables 43,839 43,839 43,839 - - - Other liaibilities 9,950 9,950 9,950 - - - Non-currentOther liabilities - - - - - - Total financial liaibilities 53,789 53,789 53,789 - - -

Carrying Amount


Parent Entity30 April 2010 $ $ $ $ $ $CurrentTrade and other payables 18,500 18,500 18,500 - - - Other liaibilities 49,512 49,512 - 49,512 - - Non-currentOther liabilities - - - - - - Total financial liaibilities 68,012 68,012 18,500 49,512 - -

For

per

sona

l use

onl

y



d. Market Risk

Market risk arises from the use of interest bearing, tradable and foreign currency financial instruments. It is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in interest rates (interest rate risk), foreign exchange rates (currency risk) or other market factors (other price risk).

(i) Interest rate risk The Group does not apply hedge accounting.

The Group is constantly monitoring its exposure to trends and fluctuations in interest rates in order to manage interest rate risk.

The consolidated entity’s exposure to market interest rates relates primarily to the consolidated entity’s short term deposits held.

Sensitivity Analysis The following tables demonstrate the sensitivity to a reasonably possible changes in interest rates, with all other variables held constant, of the Group’s profit after tax (through the impact on floating rate borrowings). There is no impact on the Group’s equity.

Carry Amount +1% of AUD -1% of AUD

AUD Interest Rate Interest RateConsolidated - 31 Dec 2010 $ $ $Cash equivalents 242,712 2,427 (2,427) Tax charge of 30% - (728) 728 After tax increase/(decrease) 242,712 1,699 (1,699)

Consolidated - 30 April 2010Cash equivalents 505,590 5,055 (5,055) Tax charge of 30% - (1,516) 1,516 After tax increase/(decrease) 505,590 3,539 (3,539)

(ii) Currency risk The consolidated entity and parent entity were not exposed to foreign currency risk.

(iii) Other price risk The Group takes advice from professional advisers as to when to sell shares quoted at market value.

10% -10%Consolidated -31 Dec 2010 Carrying amount Profit & Loss Profit & Loss

$ $ $

Shares in other entities at fair value 8,084,425 808,443 (808,443) Tax charge (30%) - (242,533) 242,533 After tax increase/(decrease) 8,084,425 565,910 (565,910)

Consolidated - 30 April 2010 Carrying amount Profit & Loss Profit & Loss$ $ $


For

per

sona

l use

onl

y



10% -10%Parent Entity - 31 Dec 2010 Carrying amount Profit & Loss Profit & Loss

$ $ $


Parent Entity - 30 April 2010 Carrying amount Profit & Loss Profit & Loss$ $ $


There is no concentration of risk.

e. Capital Risk Management

In managing its capital, the Group’s primary objectives are to pay dividends and maintain liquidity. These objectives dictate any adjustments to capital structure. Rather than set policies, advice is taken from professional advisors as to how to achieve these objectives. There has been no change in either these objectives, or what is considered capital in the year.

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets.

Consistently with others in the industry, the Group and the parent entity monitor capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including 'Financial liabilities' and 'trade and other payables' as shown in the Statement of Financial Position) less cash and cash equivalents. Total capital is calculated as 'equity' as shown in the Statement of Financial Position (including minority interest) plus net debt.

It is the Group’s policy to maintain its gearing ratio at a healthy and manageable level. The Group’s gearing ratio at the Statement of Financial Position date is nil (2009: nil)

There have been no other significant changes to the Group’s capital management objectives, policies and processes in the year nor has there been any change in what the Group considers to be its capital.

4. Revenue





$ $ $ $

Revenue from continuing operationsInterest Income 16,156 217,812 16,156 217,812

16,156 217,812 16,156 217,812

Other income Gain on disposal of equity investment 11,475 - 11,475 - Sundry income 83 65,994 83 59,383

11,558 65,994 11,558 59,383


For

per

sona

l use

onl

y



5. Expenses





$ $ $ $Profit/(loss) before income tax is arrived after (charging)/crediting the following specific expenses:

Bad and doubtful debts - (6,000) - (6,000)Legal Fees - (86,405) - (86,405)

Parent entityConsolidated

6. Income Tax





$ $ $ $(a) Income tax expense/(Benefit) Current tax/(benefit) - - - - Overprovision for income tax in prior years - - - - Deferred tax expense - - - -

- - - -

(b) Numerical reconciliation of income tax expense to primar facie tax payable Deferred income tax (revenue) expense included in income tax expense comprises of:

(Increase) in deferred tax assets - - - - Increase in deferred tax liabilities - - - -

- - - -

Profit from continuing operations before income tax

expense (77,665) (77,014) (69,742) (83,477)

Tax expense at the Australian tax rate of 30% (2009 - 30%) (23,300) (23,104) (20,923) (25,043) Tax effect of amounts which are not deductible (taxable) in calculating taxable income: Legal expenditure - 17,554 - 19,493 Interest income - - - - Sundry items 29,392 5,550 27,015 5,550 6,092 - 6,092 -


For

per

sona

l use

onl

y



(c) Tax consolidation legislation

consolidation legislation with effect from 1 May 2004. The accounting policy in relation to this legislation is Raffles Capital Limited and its wholly-owned Australian subsidiaries have decided to implement the tax

(see note 14).

legislation and limits the joint and several liability of the wholly-owned entities in the case of a default by Raffles Capital Limited.

set out in note 2(f).

owned entities reimburse Raffles Capital Limtied for any current income tax payable by Raffles Capital Limited arising in respect of their activities. The reimbursements are payable at the same time as the associated income tax liability falls due and have been recognised as a current tax-related payable by Raffles Capital Limited

In the opinion of the directors, the tax sharing agreement is also a valid agreement under the tax consolidation

The entities have entered into a tax sharing agreement. Under the terms of this agreement, the wholly-

7. Cash and cash equivalents

31 Dec 2010 30 April 2010 31 Dec 2010 30 April 2010

$ $ $ $

41,436 255,590 41,436 255,590201,276 250,000 201,276 250,000

242,712 505,590 242,712 505,590

4.78% 4.79% 4.78% 4.79%

The Group's and the parent entity's exposure to interest rate risk is discussed in Note 3.


Cash at bank and on handDeposits at bank

Weighted average interest rate

Interest risk exposure

8. Trade and other receivables


$ $ $ $

- 530,000 - 530,000 30,000 - 10,000 - 34,596 25,048 34,596 25,048

64,596 555,048 44,596 555,048

CurrentDeposit paidTenement depositsOther Receivable


Non-CurrentAdvances to controlled entities - - 26,923 -

- - 26,923 -

Further information relating to advances to controlled entities is set out in note 25.

(a) Impaired receivables and receivables past due

None of the current or non-current receivables are impaired or past due but not impaired.

For

per

sona

l use

onl

y



(b) Other receivables These amounts relating to receivables for GST paid and deposits paid (c) Interest rate risk Information about the Group’s and the parent entity’s exposure to interest rate risk in relation to trade and other receivables is provided in Note 3. (d) Fair value and credit risk Current trade and other receivables 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. Non-current trade and other receivables The fair values and carrying values of non-current receivables are as follows:

Carry Amount

Fair ValueCarrying Amount

Fair Value

Group $ $ $ $Advances to related entities - - - -

ParentAdvances controlled entities 26,923 26,923 - -

31 Dec 2010 30 April 2010

All non-current receivables are interest free and are repayable on demand. The fair value is approximately equivalent to the carrying value.

(e) Bad and doubtful debtsThe Group has recognised a loss of $6,000 in respect of bad and doubtful trade receivables during the year ended 30 April 2010. $6,000 has been included in ‘Bad and doubtful debts’ in the statement of comprehensive income.

9. Other financial assets


Current$ $ $ $

Listed securities 866,335 229,075 866,335 229,075

866,335 229,075 866,335 229,075

Non-CurrentInvestment in Hudson Investment Group Limited 7,218,090 7,200,000 7,218,090 7,200,000 Investment in controlled entities - - 1,000 -

7,218,090 7,200,000 7,219,090 7,200,000


For

per

sona

l use

onl

y



10. Deferred tax asset


$ $ $ $Deferred tax asset comprises temporary differences attributable to:Accrued audit fees 7,850 - - - Accrued directors fees - - - - Accrued legal fees 2,100 17,554 - 19,493 Accrued accounting fees - 5,550 - 5,550 Accrued superannuation - - - - Sundry creditors - - - - Unrealised foreign exchange losses - - - - Total deferred tax assets 9,950 23,104 - 25,043

Deferred tax asset not brought to account (9,950) (23,104) - (25,043)

Net deferred tax asset - - - -

Deferred tax liability comprises temporary differences attributable to:Accrued interest income - - - - Net deferred tax asset/(liability) - - - -


The deferred tax asset is recognised only to the extent of the deferred tax liability where it is not probable that future taxable amounts will be available to utilise the temporary differences in excess of the deferred tax liabilities.

The group has generated sufficient taxable income in the current and prior periods. However, if a significant new investment is undertaken by the company (refer to the Directors’ report) current levels of taxable income may not be sustained in immediate future periods. As a result, a deferred tax asset balance greater than the deferred tax liability balance has not been recognised.

11. Mining tenements

31 Dec 2010 30 April 2010 31 Dec 2010 30 April 2010$ $ $ $

Interest in mining tenements 200,250 - - -200,250 - - -


12. Trade and Other Payables


$ $ $ $CurrentTrade payables 546 - 546 -Other payables and accruals 53,243 68,012 53,243 68,012

53,789 68,012 53,789 68,012 Non-currentOther payable - profit payable on disposal of tenements 200,000 - - -

200,000 - - -


For

per

sona

l use

onl

y



13. Provisions

31 Dec 2010 30 April 2010

31 Dec 2010 30 April 2010

$ $ $ $CurrentStaff annual leave entitlements - - - -


14. Contributed equity

31 Dec 2010 30 April 2010

31 Dec 2010 30 April 2010

Shares Shares $ $Share capital paid to $1 20,700,359 20,700,359 10,395,502 10,395,502

At 31 December 2010 there were 20,700,359 ordinary shares paid to $1.

Consolidated and Parent entity

Consolidated and Parent entity

Ordinary Shares Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of and amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote.

15. Retained Profits/(Accumulated Losses)

31 Dec 2010 30 April 31 Dec 2010 30 April Movements in retained profits/(accumulated losses) were as follows:

$ $ $ $

Accumulated losses at the beginning of the year (1,973,801) (1,586,282) (1,973,801) (1,579,674)Net profit/(loss) for the year (83,757) (77,014) (75,834) (83,622)Dividends - (310,505) - (310,505)Accumulated losses at the end of the year (2,057,558) (1,973,801) (2,049,635) (1,973,801)


16. Dividends

31 Dec 2010 30 April 2010$ $

- 310,505

- 310,505

- 310,505

(b) Dividends not recognised at year end2010: Nil: (2009 – 1.5 cents fully franked based on the tax paid at 30%). The aggregate amount of the proposed dividend expected to be paid out of prior year period profits but not recognised as a liability at year end.

Fully franked based on tax paid @ 30% - 1.5

Final dividend for the year ended 30 April 2009 of 1.5 cents per share.

Dividend for period ended 31 Dec 2010: Nil(a) Ordinary shares

Parent entity

For

per

sona

l use

onl

y



31 Dec 2010

30 April 2010

31 Dec 2010

30 April 2010

$ $ $ $

543,460 - 226,067

Franking credits available for subsequent financial years based on a tax rate of 30% (2010 – 30%)

The consolidated amounts include franking credits that would be available to the parent entity if distributable profits of subsidiaries were paid as dividends.

(d) franking credits that may be prevented from being distributed in subsequent financial years.

(c) franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date; and

(b) franking debits that will arise from the payment of dividends recognised as a liability at the reporting date

(a) franking credits that will arise from the payment of the amount of the provision for income taxThe above amounts represent the balance of the franking account as at the end of the financial year,

(c) Franked DividendsConsolidated Parent entity

17. Key Management personnel disclosure

a. Directors The following persons were Directors of the Company during the whole financial year unless otherwise stated: Tan Sri Ibrahim Menudin Non-Executive Chairman Appointed 16 December 2009 Vincent Tan Executive Director Appointed 16 December 2009 Richard Yap Non-Executive Director Appointed 8 January 2010 Benjamin Amzalak Non-Executive Director Appointed 5 February 2010 b. Other key management personnel The following persons were other key management personnel of the Group during the financial year:

David Hughes (Joint Company Secretary) Henry Kinstlinger (Joint Company Secretary) Francis Choy (Chief Financial Officer)

c. Directors and key management personnel compensation The company has taken advantage of the relief provided by Corporations Regulation 2M.6.04 and has detailed disclosed in the Directors’ report. The relevant information can be found in the remuneration report on page 13-14.

(i) Details of remuneration Details of the remuneration of each Director of the Company and its subsidiaries are set out in the following tables. All elements of remuneration are not directly related to performance.

For

per

sona

l use

onl

y



31 Dec 2010 Consolidated

Share based payments


Cash bonus


Super-annuation

Retirement benefits

Options Total

Directors $ $ $ $ $ $ $Tan Sri Ibrahim Menudin - - - - - - -Vincent Tan - - - - - - -Richard Yap - - - - - - -Benjamin Amzalak - - - - - - -Directors - Total - - - - - - -

Other Key Management

PersonnelHenry Kinstlinger 2,500 - - - - - 2,500David Hughes - - - - - - -Francis Choy - - - - - - -KMP - Total 2,500 - - - - - 2,500


The amounts reported represent the total remuneration paid by entities in the Raffles Capital Group of companies in relation to managing the affairs of all the entites within the Raffles Capital Group.

30 April 2010 Consolidated



Cash bonus


Super-annuation

Retirement benefits

Options Total

$ $ $ $ $ $ $Tan Sri Ibrahim Menudin - - - - - - -Vincent Tan - - - - - - -Richard Yap - - - - - - -Benjamin Amzalak - - - - - - -Ian Levy* - - - - - - -Eric Khua Kian Keong 13,863 - - - - - 13,863Thomas Woo Sai Meng 22,123 - - - - - 22,123Henry Chua Tiong Hock 27,712 - - - - - 27,712Peter Phillips 24,357 - - 766 - - 25,123Captain Shaw Pao Sze 24,357 - - 766 - - 25,123Alan Keith Bennel 3,260 - - - 3,260

Total 115,672 - - 1,532 - - 117,204


Alan Keith Bennell is a director of Freight Links Express Logistics (Australia) Pty Ltd but not of Freight Links Express

* Ian Levy resigned as a Director on 5 February 2010

For

per

sona

l use

onl

y



31 Dec 2010 Parent Entity



Cash bonus


Super-annuation

Retirement benefits

Options Total

Directors $ $ $ $ $ $ $Tan Sri Ibrahim Menudin - - - - - - -Vincent Tan - - - - - - -Richard Yap - - - - - - -Benjamin Amzalak - - - - - - -Directors - Total - - - - - - -

Other Key Management PersonnelHenry Kinstlinger 2,500 - - - - - 2,500David Hughes - - - - - - 0Francis Choy - - - - - - 0KMP - Total 2,500 - - - - - 2,500


30 April 2010 Parent Entity



Cash bonus


Super-annuation

Retirement benefits

Options Total

$ $ $ $ $ $ $Tan Sri Ibrahim Menudin - - - - - - -Vincent Tan - - - - - - -Richard Yap - - - - - - -Benjamin Amzalak - - - - - - -Ian Levy* - - - - - - -Eric Khua Kian Keong 13,863 - - - - - 13,863Thomas Woo Sai Meng 22,123 - - - - - 22,123Henry Chua Tiong Hock 27,712 - - - - - 27,712Peter Phillips 24,357 - - 766 - - 25,123Captain Shaw Pao Sze 24,357 - - 766 - - 25,123Alan Keith Bennel 3,260 - - - 3,260Total 115,672 - - 1,532 - - 117,204

* Ian Levy resigned on 5 February 2010


For

per

sona

l use

onl

y



d. Equity instrument disclosures relating to director and key management personnel

(i) Share holdings The numbers of shares in the company held during the financial year by each Director of the Company are set out below. There were no shares granted during the reporting period as remuneration.

31 Dec 2010

Tan Sri Ibrahim Menudin - - - -Vincent Tan - - - -Richard Yap - - - -Benjamin Amzalak - - - -

Ordinary shares - Indirect InterestTan Sri Ibrahim Menudin - - - -

Vincent Tan*1 12,933,084 - - 12,933,084

Richard Yap - - - -

Benjamin Amzalak*1 2,000,000 - - 2,000,000

*1 Ordinary shares are registered to a related company of the Director

NameDirectors of Raffles Capital LimitedOrdinary shares - Direct Interest

Balance at the start of the year

Received during the year on the

exercise of options

Other changes during the year

Balance at the end of the year

30 April 2010

Tan Sri Ibrahim Menudin - - - -Vincent Tan - - - -Richard Yap - - - -Benjamin Amzalak - - - -Ian Levy - - - -Thomas Woo Sai Meng * 4,000 - (4,000) -

Tan Sri Ibrahim Menudin - - - -

Vincent Tan*1 - - 12,933,084 12,933,084

Richard Yap - - - -

Benjamin Amzalak*1 - - 2,000,000 2,000,000

Ian Levy - - - - Eric Khua Kian Keong 1,051,038,591 - (1,051,038,591) - Thomas Woo Sai Meng 241,047 - (241,047) - Henry Chua Tiong Hock 3,106,500 - (3,106,500) -

*1 Ordinary shares are registered to a related company of the Director

Ordinary shares - Indirect Interest

* Thomas Woo Sai Meng resigned on 16 December 2009

NameDirectors of Raffles Capital LimitedOrdinary shares - Direct Interest

Balance at the start of the year

Received during the year on the

exercise of options

Other changes during the year

Balance at the end of the year

e. Loans to key management personnel There have been no loans to key management personnel in the 8 month period to 31 December 2010 f. Other transactions with key management personnel There have been no other transactions with key management personnel in the 8 month period to 31 December 2010.

For

per

sona

l use

onl

y



18. Remuneration of auditors

During the year the following fees were paid and payable for services provided by the auditor of the parent entity, its related practices and non-related audit firms:

31 Dec 2010 30 April 2010

31 Dec 2010 30 April 2010

$ $ $ $Audit services:Amounts paid or payable to auditors for audit and review of the financial report for the entity or any entity in the Group- Pricewaterhouse Coopers - 50,000 - 50,000 - K.S. Black & Co 16,400 16,400 16,400 16,400

16,400 66,400 16,400 66,400 Taxation and other advisory services:Amounts paid or payable to auditors for non audit taxation and advisory services for the entity or any entity in the Group.

Taxation - K.S Black & Co 7,200 7,200 7,200 7,200 Other advisory services - K.S. Black & Co 855 - 855 -

8,055 7,200 8,055 7,200


19. Earnings per share

31-Dec-10 30-Apr-10Cents Cents

Basic earnings/(loss) per share (0.40) (0.37)Diluted earnings/(loss) per share (0.40) (0.37)

Reconciliations of earnings used in calculating earnings per share

31-Dec-10 30-Apr-10$ $

Profit/(loss) from operations (83,757) (77,014)Profit/(loss) attributable to the ordinary equity holders of the company used in calculating basic earnings per share and diluted earnings per share (83,757) (77,014)

31-Dec-10 30-Apr-10Number Number

Weighted average number of ordinary shares used as the denominator in calculating basic earnings per share and diluted earnings per share 20,700,359 20,700,359

Consolidated

Earnings used to calculate basic earnings per share are equal to net profit, therefore no reconciliation is required.

Weighted average number of shares used as the denominator

Consolidated

Consolidated

For

per

sona

l use

onl

y



20. Investment in Controlled Entities

The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 2(b):

Name of entityCountry of

incorporation

Class of

Shares

31 Dec

2010

30 April

2010% %

Precious Metal Resources Limited Australia Ordinary 80 - PMR1 Pty Ltd Australia Ordinary 80 -

Equity holding

Precious Metal Resources Limited (PMR) was incorporated on 8 July 2010. Raffles currently holds 40,000,000 shares in PMR representing 80% of the issued capital of PMR with the balance of 10,000,000 shares (20%) held by parties associated with the previous owners of EL 5339 and EL 4474. On 14 July 2010 PMR incorporated a wholly owned subsidiary – PMR1 Pty Ltd. On 17 December 2010, PMR1 Pty Ltd acquired EL 5339 from Wildesign Pty Ltd and EL 4474 from Noel Norman Dennis. Consideration paid for the tenements was 10,000,000 shares in PMR. In addition $200,000 from after tax profits will be paid to the vendors of EL 5339 and EL 4474 by PMR. All the subsidiaries listed above have been granted relief from the necessity to prepare financial reports in accordance with Class Order 98/1418 issued by the Australian Securities and Investments Commission. The proportion of ownership interest is equal to the proportion of voting power held.

21. Deed of cross guarantee

There is no deed of cross guarantee in place at the date of this report.

22. Contingencies and Commitments

(a) Contingent assets and liabilities The parent entity and Group had no material contingent assets and liabilities at the reporting date.

Guarantees Cross guarantees by raffles Capital Limited and its wholly owned controlled entities. No deficiency of assets exists in the consolidated entity as a whole. No material losses are anticipated in respect of any of the above contingent liabilities.

(b) Exploration expenditure commitments The minimum exploration expenditure commitments and lease payments on the Company’s exploration

tenements totally $53,000 per annum. There are no other material commitments as at the date of the report.

For

per

sona

l use

onl

y



23. Events occurring after balance sheet date

18 February 2011 – Raffles lodged a prospectus with ASIC. Raffles is seeking through the public offering to raise $1,500,000 by the issue of 3 million new fully paid ordinary shares at $0.50 per share.

At the date of this report there are no other matters or circumstances, which have arisen since 31 December 2010 that have significantly affected or may significantly affect:

The operations, financial years subsequent to 31 December 2010 of the Group: The results of those operations: or The state of affairs, in financial years subsequent to 31 December 2010 of the Group.

24. Reconciliation of profit after income tax to net cash inflow from operating activities


$ $ $ $

Profit/(loss) from ordinary activities after related (83,757) (77,014) (75,834) (83,622)Change in operating assets and liabilitiesDecrease (increase) in receivables (9,548) 8,515 (9,548) 12,773 Decrease (increase) in accrued interest - - - - Increase (decrease) in trade creditors (14,223) (108,830) (14,223) (105,480)Increase (decrease) in income tax payable - (55,850) - (55,850)Net cash inflow/(outflow) from operating activities (107,528) (233,179) (99,605) (232,179)


25. Related parties

(a) Parent entities The ultimate parent entity is Pacific Portfolio Investment Pty Ltd which at 31 December 2010 owns 57.65% (April 2010 – 57.65%) of the issued ordinary shares in Raffles Capital Limited. (b) Subsidiaries Interests in subsidiaries are set out in note 20. (c) Key management personnel Disclosures relating to key management personnel are set out in note 17. (d) Transactions with related parties The following transactions occurred with related parties:

For

per

sona

l use

onl

y



31 Dec 2010 30 April 2010 31 Dec 2010 30 April 2010$ $ $ $

Loan repayments from: Controlled entities - - - -

Repayment to related parties - 66,933 - 66,933

Interest RevenueControlled entities - - - -

Interest ExpenseControlled entities - - - -

Other TransactionsManagement charges - - - -Corporate service fee - - - -Directors fee - 117,204 - 117,204Investment deposit paid - 530,000 - 530,000Investment deposit refund (530,000) - (530,000) -


(e) Outstanding balances The following balances are outstanding at the reporting date in relation to transactions with related parties:


$ $ $ $

Current receivables Controlled entities - - 26,923 -


(f) Loans to/from related parties

Loans to controlled entitiesBeginning of the year - - - -Loan advanced - - - -Provisions for doubtful debt - - - -Loan repayments received - - - -End of year - - - -

26. Segment Note The consolidated entity operates predominately in one business and one geographical segment being investment in mining and resources within Australia.

For

per

sona

l use

onl

y



Directors Declaration The Directors of the Company declare that: 1. The financial statements, comprising the statement of comprehensive income, statement of financial position,

statement of cash flow, statement of changes in equity, accompanying notes, are in accordance with the Corporation Act 2001 and:

a) comply with Accounting standards and the Corporations Regulation 2001; and b) give a true and fair view of the financial position as at 31 December 2010 and of the performance for

the year ended in that date of the company and the Consolidated Entity. 2. In the Directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. 3. The remuneration disclosure included on pages 13-14 of the Directors Report (as part of audited Remuneration

Report), for the year ended 31 December 2010, comply with Section 300A of the Corporation Act 2001. 4. The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer of the

corporation required by Section 295A. This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the Directors by: Vincent Tan Benjamin Amzalak Director Director 29 March 2011 Sydney

For

per

sona

l use

onl

y

For

per

sona

l use

onl

y

For

per

sona

l use

onl

y



Shareholder Information The shareholder information set out below was applicable as at 28 February 2011.

Shareholders No. of Shares % heldPacific Portfolio Investments Pty Ltd 11,933,084 57.65TA Ausfinance Limited 1,644,607 7.94

Holders Units

0 0 0

Rank Name Units % of Units

1 11,933,084 57.652 1,644,607 7.943 1,000,000 4.834 1,000,000 4.835 1,000,000 4.836 721,957 3.497 720,040 3.488 500,000 2.429 144,353 0.7

10 104,500 0.511 100,001 0.4812 100,000 0.4813 99,999 0.4814 80,250 0.3915 55,000 0.2716 52,100 0.25

17 48,000 0.2318 39,750 0.1919 37,500 0.1820 35,000 0.17

A. Substantial Shareholders as at 28 February 2011

B. Distribution of equity securities

C. Unmarketable Parcels

D. Twenty Largest Shareholders as at 28 February 2011

Minimum Parcel Size

Minimum $ 500.00 parcel at $ 0.00 per unit

5306,110

947,974148,180

Wagtail Pty Ltd <El & Kb Hancock S/F A/C>

Bell Superannuation Pty Ltd

Mr Geoffrey Clifford Morgan + Mrs Dorina Alayon Morgan <The Gcm Super Fund A/C>Mercantile Options Pty Ltd <The Mindisc Unit Fund A/C>Forbar Custodians Limited <Forsyth Barr Ltd-Nominee A/C>

Mr Justin DzauGoh Super Pty Ltd <The Goh Super Fund A/C>

Mercantile Options Pty Ltd <Mercantile Unit Fund A/C>Mrs Roslyn Jane Mccawley

Mr Peter Yong

Pacific Portfolio Investments Pty Ltd

341,674387,349848,854

18,019,688

14547

148

24119

1 - 100101 - 1,000

1,001 - 5,0005,001 - 10,000

10,001 - 50,00050,001 - 100,000

100,001 - 500,000500,001 - 99,999,999

312 20,700,359

0

Sing Capital Pty LtdMr Neville John Bertalli

4.1087.05

M M & R Pty LtdRaffles Equities Limited

TA Ausfinance Limited

100

Rounding

Total

0.000.03

Dos Equis Pty LtdMrs Renate Meta Lincoln

4.580.72

Bay Ching ChinLai Ting Kweh

1.651.87

Those shareholders who have lodge notice under the Corporations Act 2001 advising substantial shareholding under the Corporations Act 2001 are as follows:

% of Issued CapitalRange Total holders Units

For

per

sona

l use

onl

y



Voting rights

There are no restrictions on voting rights. On a show of hands every member present in person or by proxy shall have one vote and upon a poll each share shall have one vote. Where a member holds shares which are not fully paid, the number of votes to which that member is entitled on a poll in respect of those part paid shares shall be that fraction of one vote which the amount paid up bears to the total issued price thereof. Option holders have no voting rights until the options are exercised.

Escrowed Securities

There are no escrowed securities as of 28 February 2011. TENEMENT SCHEDULE Tenement

Location

Square km’s

Registered Owner

Percentage Interest

New South Wales

EL 4474

Chandler area, southeast of Armidale

96

PMR1 Pty Ltd

80-86.7%

EL 5339

Chandler area southeast of Armidale

15

PMR 1 Pty Ltd

80-86.7%

EL 7679

Chandler area southeast of Armidale

12

PMR 1 Pty Ltd

80-86.7%

For

per

sona

l use

onl

y



For

per

sona

l use

onl

y

Documents

For personal use only - Australian Securities Exchange · Business Development and Advisor to the Chairman of TA Enterprise Berhad, ... Annual Report – Period Ended 31 ... been