marmota limited

MarmotaLimited

ABN38119270816

ConsolidatedEntity

ConsolidatedFinancialStatementsfortheyearended30June2017

CORPORATEDIRECTORY

MarmotaLimited

ABN38119270816IncorporatedinSA

RegisteredOfficeUnit6,79-81BrightonRoadGlenelgSA5045Telephone:(08)82940899Facsimile:(08)83768633

Email:[email protected]

ShareRegistrar

LinkMarketServicesLimitedLockedBagA14SydneySouthNSW1235Telephone:+611300554474Facsimile:+61292870303Email: [email protected]:www.linkmarketservices.com.au

Auditor

GrantThorntonCharteredAccountantsLevel3,170FromeStreetAdelaideSA5000Australia

MarmotaLimitedandControlledEntities

Directors’Report

2

TheDirectorspresenttheirreportonMarmotaLimited–consolidatedentity(‘Group’)forthefinancialyearended30June2017andtheauditor’sreportthereon.

DirectorsTheDirectorsofMarmotaLimited(‘theCompany’)atanytimeduringorsincetheendofthefinancialyearareassetoutbelow.DetailsofDirectors’qualifications,experienceandspecialresponsibilitiesareasfollows:

DrColinRose ExecutiveChairman PhD(Economics)ExperienceandexpertiseDrRosehasbeennon-executiveChairmanofMarmotasince1May2015andExecutiveChairmansince5June2017.DrRoseholdsaPhDinEconomicsfromtheUniversityofSydney.Heisalong-termfundamentalsinvestorintheminingandexplorationsector,withparticularexposuretogoldandcopper.Hehasextensivebusinessexperienceasthefounderanddirectorofatechnologycompanywhosesoftwareisusedinover55countries.HehasbeeninvitedtospeaktotheReserveBankofAustralia,theBankofEngland,theNationalBureauofEconomicResearch(USA),andtheLondonSchoolofEconomics(FinancialMarketsGroup).

Responsibilities

SpecialresponsibilitiesincludemembershipoftheAudit,GovernanceandRemunerationCommittee.

InterestsinSharesandOptions(asat25September2017): •65,873,242ordinaryshares

MrPeterThompsonNon-ExecutiveDirector BScHons(Geology),MSc(MineralExplorationandMiningGeology)

ExperienceandexpertiseMrThompsonhasbeenaBoardmembersince26May2015.HeisaGeologistwithsignificantindustryexperienceinbothExplorationandMiningroles.EducatedatTrinityCollegeDublin(BScHons–Geology)andLeicesterUniversity(MSc–MineralExplorationandMiningGeology),hehasworkedinexplorationforgold,copper,nickelandplatinoids,andinopenpitandundergroundgoldmines.Overacareerof27years,MrThompsonhasworkedforBCDResourcesNLasCEO,atStBarbaraMinesLimitedasGeneralManagerExploration,aswellasholdingseniorexplorationandprojectdevelopmentroleswithJubileeMinesNL,AnacondaNickelLtdandWesternMiningCorporation.AtStBarbaraMines,MrThompson’sresponsibilityincludedmanagingateamof22geoscientists.Inadditiontobeingresponsibleforthediscoveryofseveralnickelandgolddeposits,hehasextensiveminingandcorporatedevelopmentexperience.

Responsibilities

SpecialresponsibilitiesincludedChairoftheAudit,GovernanceandRemunerationCommittee.

Currentandformerdirectorshipsinthelast3years

MrThompsonwasCEOandManagingDirectorofCentralAsiaResourcesNL(ASX:CVR)from4July2014to8February2016andaNonExecutiveDirectorfromthattimeuntil5September2016.PeterwasCEOandManagingDirectorofCapricornMetalsLtd(ASX:CMM)from3February2016until14March2017.InterestsinSharesandOptions(asat25September2017) •2,948,334ordinaryshares •3,000,000unlisted3centOptions(expiring9November2021)issuedundertheDirector&Employee ShareOptionPlan(DESOP)


Directors’Report

3

DrKevinWillsExecutiveDirector–Exploration BSc,PhD,ARSM,FAusIMM

Experienceandexpertise

DrWillswasactingManagingDirectorfortheperiod14November2016to30January2017,andExecutiveDirector(Exploration)since5June2017.Heisageologistwithsignificantexperienceinmulti-commoditymineralexplorationincludingfeasibilitystudies,mineoperationsandcorporateactivitiesinAustralasia.Hehasbeencloselyinvolvedinthediscoveryandevaluationofeconomicmineraldepositsof:diamonds(Argyle,WA),basemetals(Thalanga&WaterlooQLD),gold(MurchisonWAandChallengerSA),mineralsands(Burekup,WA)andironore(BlacksmithWA).DrWillswasManagingDirectorofFlindersMinesLimitedforovertenyears.HeisanAssociateoftheRoyalSchoolofMines,pastChairmanoftheAdelaideBranchandaFellowoftheAustralianInstituteofMiningandMetallurgy.Between2010and2015,hewasanAdjunctAssociateProfessorattheUniversityofAdelaideengaginginteachingeconomicgeologyandmineralexploration.HefoundedtheSAExplorationandMiningConferencein2004andhassincebeenChairmanoftheorganisingcommittee.In2016,hewasawardedtheGSA’sJoeHarmsMedalforexcellenceinmineralexploration,andin2017,theAusIMM’sInstituteServiceAward.

ResponsibilitiesDrWillsalsoactsasChiefGeologistandasacompetentpersononJORCresourcereportingmatters.

Currentandformerdirectorshipsinthelast3years

DrWillsisalsoaDirectorofTycheanResourcesLimited. InterestsinSharesandOptions(asat25September2017): •930,061fullypaidordinaryShares •2,000,000unlisted3centOptionsexpiring9November2021issuedundertheDirector&Employee ShareOptionPlan(DESOP).

MrLindsayDavidWilliams ManagingDirector (ceased13November2016) LLB,BComm,MAICDExperienceandexpertise

MrWilliamswasManagingDirectorfrom9September2014to13November2016.MrWilliamshasheldthepositionofManagingDirectorofanumberofASXlistedandunlistedcompaniesinvarioussectorsandbrings20yearsofexperienceintheenergyandresourceindustry.Thishasincludedmineralscompaniesinexploration,production,developingnewminesandreviewingcommercialityofexistingoperations.Energysectorexperiencehasrangedfromoperationandexpansionofgastransportinfrastructure,buyingandsellinggas,explorationandproductionofoilandgas.Hehasdemonstratedabilitytodevelopandimplementmajorstrategicdirectionalchangesincludingcapitalraisings,acquisitionsandmergers,costandlabourreductions.MrWilliamswaspreviouslyChairmanofLithexResourcesLimited(ASX:LTX),agraphiteandnickelexplorer,andPresidentofHeathgateResourcesPtyLtd,theownerandoperatoroftheBeverleyuraniummineinSouthAustralia.ResponsibilitiesMrWilliamswasalsoCompanySecretaryfrom1July2015to13November2016.Currentandformerdirectorshipsinthelast3years

MrWilliamsiscurrentlyaDirectorofEndeavourDiscoveriesLimitedandWilgenaResourcesLimited.InterestsinSharesandOptions:nil


Directors’Report

4

MrIanWarland ManagingDirector(30Januaryto2June2017) BASc(Hons)Experienceandexpertise

ManagingDirectorfrom30January2017andceasedon2June2017.IanWarlandisaGeologistwithover25years domestic and international experience in exploration and mining. He has worked in open pit andunderground basemetalsmining, aswell as exploration for a range of commodities including copper, gold,uranium,basemetalsandindustrialmineralsinAustraliaandoverseas.MrWarlandhasheldarangeofrolesfor Pancontinental Mining, RGC Exploration, Iluka Resources and Musgrave Minerals. He has a first classhonoursdegreeingeology(universitymedal)fromtheUniversityofTechnologyinSydney.

InterestsinSharesandOptions:nil

Directors’meetingsThenumberofDirectors’meetingsandnumberofmeetingsattendedbyeachoftheDirectorsoftheCompany(includingcommitteesofDirectors)duringthefinancialyearwereasfollows:

Directors’Meetings

Audit,GovernanceandRemuneration

CommitteeMeetings

NumberEligibletoattend

Numberattended

NumberEligibletoattend

Numberattended

Director

DrColinRose 10 10 2 2

PeterThompson 10 10 2 2

DrKevinWills 2 2 - -

DavidWilliams 4 4 1 1IanWarland 4 3 1 1

CompanySecretary VictoriaAllinson(FCCA,AGAI)wasappointedCompanySecretary,effective14November2016.MsAllinsonisaFellowoftheAssociationofCertifiedCharteredAccountantsandamemberoftheGovernanceInstituteofAustralia.Shehasover25yearsofaccountingandauditingexperience,includingsenioraccountingpositionsinanumberoflistedcompaniesandauditmanagerforDeloitteToucheTohmatsu.

MsAllinsoniscurrentChiefFinancialOfficer(CFO)forafurthertwolistedcompanies:AssetResolutionLimited(NSX:ASS)andKangarooIslandPlantationTimberLtd(ASX:KPT).HerpreviousexperiencehasincludedbeingCompanySecretaryandCFOforanumberofASXlistedcompaniesincluding:SafetyMedicalProductsLtd,CentrexMetalsLtd,AdelaideEnergyLtd,EnterpriseEnergyNL,andIslandSkyAustraliaLtdaswellasunlistedcompanies.Inherroleascompanysecretary,MsAllinsonhasalsoassistedanumberofcompaniestolistontheASX.

From1July2015to13November2016,MrWilliamsheldthepositionofCompanySecretaryinadditiontohisroleasManagingDirector.

PrincipalactivitiesTheGroup’sprincipalactivityismineralsexploration.

ReviewandresultsofoperationsDuringtheFinancialYear,MarmotafocuseditsexplorationeffortsonitshighlyprospectivegoldtenementsintheGawlerCratonwhicharealreadyyieldingexcellentresults.


Directors’Report

5

CorporateThecompanycontinuestobenefitsignificantlyfromthemajorcostsavingmeasuresimplementedoverthelast2years,whichhaveledtoannualsavingsestimatedtobearound$700,000perannumwhencomparedtotheyeartoJune2015.Thosesamefundssavedarenowtargetedintoactiveexploration,andthatexplorationisalreadyyieldingnewdiscoveries,includingoutstandinggoldgradesatAuroraTank(ASX:MEU4Sept2017).Overthefinancialyear,over$1.8millionincapitalwasraised(beforecosts)throughacombinationofaSharePurchasePlan(inAugust2016at1.5cwhichwassignificantlyoversubscribed),andaplacementat2cpersharetosophisticatedinvestorsinFebruary2017(supportedbybothofMarmota’scornerstoneinvestors,namelyYandalInvestments,theinvestmentvehicleofMrMarkCreasy,andSouthernCrossCapital).TheCompanyisverygratefulfortheirsupport.

InJune2017,MarmotaannouncedanewmanagementandBoardstructurewhichfurthersimplifytheCompany’sstructureandtakethecostsavingmeasurestoanewlevel,effectivelysplittingtheMDroleintotwopre-existingpositions:DrRosemovedfromnon-executiveChairtoExecutiveChairman(lookingafterthecorporateside)andDrWillsjoinedtheBoardasExecutiveDirector–Exploration(lookingaftertheexplorationside).ThesechangesprovideasimpleandelegantBoardstructurethatareanticipatedtofurthersavethecompanyaroundanother$100,000perannum:fundsthatagainwillbetargetedintoactiveexploration.

MarmotaisalsoverypleasedtohaveagainsuccessfullyparticipatedintheAustralianGovernment’sExplorationDevelopmentIncentive(EDI)schemeunderwhichMarmotadistributed$220,000ofTaxationCreditsbacktoourshareholders.MarmotaexpectstoparticipateintheEDIschemeagainintheforthcomingfinancialyear,forthebenefitofourshareholders.TheEDItaxationcreditsareverypopular,especiallywiththecompany’slargershareholders.

GoldDiscoveryatAuroraTankInJuly2016,MarmotaassumedfullcontroloftheAuroraTanktenementbycashacquisition,increasingitsstaketo100%ownership(seeASX:MEU4July2016).InSeptember2016,MarmotacommenceditsfirstevergolddrillingprogramatAuroraTank,attheGoshawkgoldprospect.Theprogramhasbeenenormouslysuccessful,withfollow-updrillinginDecember2016andJune/July2017.TheresultshavealreadyexceededtheCompany’sbestexpectationswithoutstandingintersectionsincluding4m@40g/t,multipleintersectionsgreaterthan10g/t,andover117intersectionsover1g/t,withmostdrillingwithin50mofsurface.Subsequenttotheendofthefinancialyear,MarmotahascommissionedaJORCcompliantestimateofgoldresourceswithinthefirst50mfromsurface,overthe500mlongmineralisedzone(seeASX:MEU2Aug2017and

4Sept2017):thisisexpectedtobeMarmota’smaidengoldJORCresource,andprovideabasefromwhichtogrow.

MeltonCopperProject(CopperCoast–YorkePeninsula)InDecember2016,pursuanttoanapplicationbytheCompanyunders9AAoftheMiningAct1971,MarmotawasgrantedawaivertocarryoutitsdesignatedexplorationprogramonitsChampioncopperprospect,atWestMeltonontheCopperCoast(YorkePeninsula).Ata0.3%Cucutoff,the2017drillingresultsdefinedanextensivelow-gradezoneofsecondaryCumineralisationwithelevatedAu,approximately1kminstrikelength.TheCompanyismonitoringtherisingcopperprice,andboththepotentialforaprimarysourceatdepthandtheunexploredpotentialofthetenement.

Welookforwardtotheyearahead!CompetentpersonstatementTheinformationinthisreportthatrelatestoExplorationResultsandMineralResourcesisbasedoninformationcompiledbyDrKevin

WillswhoisaFellowoftheAustralasianInstituteofMiningandMetallurgy.Hehassufficientexperiencewhichisrelevanttothestylesof

mineralisationandtypesofdepositsunderconsiderationandtotheactivitiesbeingundertakentoqualifyasaCompetentPersonas

definedinthe2012Editionofthe“AustralasianCodeforReportingofExplorationResults,MineralResourcesandOreReserves”.DrWills

consentstotheinclusioninthereportofthemattersbasedonhisinformationintheformandcontextinwhichtheyappear.

Whereresultsfrompreviousannouncementsarequoted,Marmotaconfirmsthatitisnotawareofanynewinformationordatathat

materiallyaffectstheinformationincludedintherelevantmarketannouncementand,inthecaseofestimatesofMineralResources,that

allmaterialassumptionsandtechnicalparametersunderpinningtheestimatesintherelevantmarketannouncementcontinuetoapplyand

havenotmateriallychanged.


Directors’Report

6

ResultsDuringtheyear,theGroupcontinuedexplorationactivitiesatitstenements.Totalcashexpenditureonexplorationandevaluationactivitiestotalled$1,509,106.

ThenetlossoftheGroupafterincometaxwas$389,655(2016:loss$445,750).

ThenetassetsoftheGrouphaveincreasedby$1,473,757duringthefinancialyearfrom$4,321,702at30June2016to$5,795,459at30June2017.

DividendsNodividendshavebeenpaidorprovidedbytheGroupsincetheendofthepreviousfinancialyear(2016:nil).

ExplorationDevelopmentIncentive(EDI)CreditsMarmotadistributed$220,000ofEDITaxationCreditsbacktoourshareholdersinJune2017(2016:$170,000).

StateofaffairsTherehavebeennosignificantchangesinthestateofaffairsoftheGroupduringtheyear.

EventssubsequenttoreportingdateOn8September2017,Marmotaissued29,411,765fullypaidordinaryshares,at1.7centspershare,bywayofplacementtosophisticatedandprofessionalinvestors,raising$500,000.

On2August2017,Marmotaannouncedexcellenthighgradegoldintersections,including4mat40g/tfrom32minhole17AT021(seeASX:MEU2Aug2017and4Sept2017).

Otherthantheabove,therehasnotarisenanymattersorcircumstances,sincetheendofthefinancialyear,whichsignificantlyaffectedorcouldsignificantlyaffecttheoperationsoftheGroup,theresultsofthoseoperations,orthestateoftheGroupinfutureyears.

LikelydevelopmentsTheGroup’sstrategyistoexploreforgold,highgradebasemetalsanduraniumwithintheCompany’shighlyprospectiveportfolioofprojects.TheBoardofMarmotaLimitedispursuingabalanceofdirectself-fundedexplorationandexplorationviastrategicpartnershipsandfundingarrangements.TheprimaryfocusofexplorationisdirectedatprogressingtheCompany’sGawlerCratongoldprojectwhichisalreadyyieldingexcellentresults.

EnvironmentalregulationandperformancestatementTheGroup’soperationsaresubjecttosignificantenvironmentalregulationsunderbothCommonwealthandSouthAustralianlegislationinrelationtodischargeofhazardouswasteandmaterialsarisingfromanyminingactivitiesanddevelopmentconductedbytheGrouponanyofitstenements.TodatetheGrouphasonlycarriedoutexplorationactivitiesandtherehavebeennoknownbreachesofanyenvironmentalobligations.

Indemnificationandinsuranceofofficers

Indemnification

TheCompanyisrequiredtoindemnifytheDirectorsandotherOfficersoftheCompanyagainstanyliabilitiesincurredbytheDirectorsandOfficersthatmayarisefromtheirpositionasDirectorsandOfficersoftheCompany.Nocostswereincurredduringtheyearpursuanttothisindemnity.

TheCompanyhasenteredintodeedsofindemnitywitheachDirectorwhereby,totheextentpermittedbytheCorporationsAct2001,theCompanyagreedtoindemnifyeachDirectoragainstalllossandliabilityincurredasanofficeroftheCompany,includingallliabilityindefendinganyrelevantproceedings.


Directors’Report

7

Insurancepremiums

Sincetheendofthepreviousyear,theCompanyhaspaidinsurancepremiumsinrespectofDirectors’andOfficers’liabilityandlegalexpenses’insurancecontracts.

Thetermsofthepoliciesprohibitdisclosureofdetailsoftheamountoftheinsurancecover,thenaturethereofandthepremiumpaid.

OptionsAtthedateofthisreport,unissuedordinarysharesofMarmotaLimitedunderoptionare:

Expirydate* Exerciseprice NumberofOptions Vested Unvested Amountpaid/payable

byrecipient($)

16/12/2019 $0.018 550,000 550,000 - -06/10/2021 $0.03 1,000,000 1,000,000 - -09/11/2021 $0.03 5,000,000 5,000,000 - -

*Alloptionsmaybeexercisedatanytimebeforeexpirysubjecttoescrowrestrictions.OptionholderswillreceiveoneordinaryshareinthecapitaloftheCompanyforeachoptionexercised.

TheseoptionsdonotentitletheholdertoparticipateinanyshareissueoftheCompanyoranyotherbodycorporate.Duringthefinancialyear,noordinaryshareswereissuedbytheCompanyasaresultoftheexerciseofoptions(2016:9,360,817).Therewerenoamountsunpaidonsharesissued.

ProceedingsonbehalfoftheCompanyNopersonhasappliedtotheCourtforleavetobringproceedingsonbehalfoftheCompanyortointerveneinanyproceedingstowhichtheCompanyisapartyforthepurposeoftakingresponsibilityonbehalfoftheCompanyforallorpartofthoseproceedings.TheCompanywasnotapartytoanysuchproceedingsduringtheyear.

CorporateGovernanceStatementTheCompany’sCorporateGovernanceStatementfortheyearended30June2017maybeaccessedfromtheCompany’swebsiteat:www.marmota.com.au/site/corporate/policies

Non-auditservicesTherewerenonon-auditservicesprovidedbytheexternalauditorsoftheParentoritsrelatedentitiesduringtheyearended30June2017.

AuditoroftheCompanyTheauditoroftheCompanyforthefinancialyearwasGrantThorntonAuditPtyLtd.

Auditor’sindependencedeclarationTheauditor’sindependencedeclarationasrequiredbysection307CoftheCorporationsAct2001fortheyearended30June2017issetoutimmediatelyfollowingtheendoftheDirectors’report.


Directors’Report(continued)

RemunerationReport–Audited

8

RemunerationReport

RemunerationpolicyTheremunerationpolicyofMarmotaLimitedhasbeendesignedtoalignkeymanagementpersonnelobjectiveswithshareholderandbusinessobjectivesbyprovidingafixedremunerationcomponentandofferingotherincentivesbasedonperformanceinachievingkeyobjectivesasapprovedbytheBoard.TheBoardofMarmotaLimitedbelievestheremunerationpolicytobeappropriateandeffectiveinitsabilitytoattractandretainthebestkeymanagementpersonneltorunandmanagetheCompany,aswellascreategoalcongruencebetweendirectors,executivesandshareholders.

TheCompany’spolicyfordeterminingthenatureandamountsofemolumentsofBoardmembersandotherkeymanagementpersonneloftheCompanyisasfollows.

RemunerationandNomination

TheAudit,GovernanceandRemunerationCommitteeoverseesremunerationmattersandmakesrecommendationstotheBoardonremunerationpolicy,feesandremunerationpackagesfornon-executivedirectorsandseniorexecutives.Detailsofthecommittee’smembersanditsresponsibilitiesaresetoutintheCorporateGovernanceStatement.

Non-executiveRemunerationPolicies

TheCompany’sConstitutionspecifiesthatthetotalamountofremunerationofNon-executiveDirectorsshallbefixedfromtimetotimebyageneralmeeting.ThecurrentmaximumaggregateremunerationofNon-executiveDirectorshasbeensetat$400,000perannum.DirectorsmayapportionanyamountuptothismaximumamountamongsttheNon-executiveDirectorsastheydetermine.Directorsarealsoentitledtobepaidreasonabletravelling,accommodationandotherexpensesincurredinperformingtheirdutiesasDirectors.ThefeespaidtoNon-executiveDirectorsarenotincentiveorperformancebasedbutarefixedamountsthataredeterminedbyreferencetothenatureoftherole,responsibilityandtimecommitmentrequiredfortheperformanceoftheroleincludingmembershipofboardcommittees.ThefeesaresetbytheAudit,GovernanceandRemunerationCommitteewhichconsultsindependentadvicefromtimetotime.

Non-executiveDirectorsdonotreceivebonuspaymentsandarenotprovidedwithretirementbenefitsotherthansalarysacrificeandstatutorysuperannuation.

ExecutiveRemunerationPolicies

TheremunerationoftheManagingDirectorisdeterminedbytheNon-executiveDirectorsontheAudit,GovernanceandRemunerationCommitteeandapprovedbytheBoardaspartofthetermsandconditionsofhisemploymentwhicharesubjecttoreviewfromtimetotime.TheremunerationofotherexecutiveofficersandemployeesisdeterminedbytheManagingDirectorsubjecttotheapprovaloftheBoard.

TheCompany’sremunerationstructureisbasedonanumberoffactorsincludingtheparticularexperienceandperformanceoftheindividualinmeetingkeyobjectivesoftheCompany.TheAudit,GovernanceandRemunerationCommitteeisresponsibleforassessingrelevantemploymentmarketconditionsandachievingtheoverall,longtermobjectiveofmaximisingshareholderbenefits,throughtheretentionofhighqualitypersonnel.

Theremunerationstructureandpackagesofferedtoexecutivesaresummarisedbelow:

- Short-termincentive-TheCompanydoesnotpresentlyemphasisepaymentforresultsthroughtheprovisionofcashbonusschemesorotherincentivepaymentsbasedonkeyperformanceindicatorsofMarmotaLimitedgiventhenatureoftheCompany’sbusinessasamineralexplorationentityandthecurrentstatusofitsactivities.However,theBoardmayapprovethepaymentofcashbonusesfromtimetotimeinordertorewardindividualexecutiveperformanceinachievingkeyobjectivesasconsideredappropriatebytheBoard.




9

- Long-termincentive–equitygrants,whichmaybegrantedannuallyatthediscretionoftheBoard.Fromtimetotime,theCompanymaygrantretentionrightsasconsideredappropriatebytheAudit,GovernanceandRemunerationCommitteeandtheBoard,asalong-termincentiveforkeymanagementpersonnel.TheserightsaresubjecttoshareholderapprovalattheAnnualGeneralMeetingintheyearofgrant.Theintentionofthisremunerationistofacilitatetheretentionofkeymanagementpersonnelinorderthatthegoalsofthebusinessandshareholderscanbemet.Underthetermsoftheissueoftheretentionrights,therightswillvestoveraperiodoftime,withaproportionoftherightsvestingeachyear.

TheCompanyalsohasaDirector&EmployeeShareOptionPlanapprovedbyshareholdersthatwillenabletheBoardtooffereligibleemployeesoptionstoacquireordinaryfullypaidsharesintheCompany.UnderthetermsofthePlan,optionsforordinaryfullypaidsharesmaybeofferedtotheCompany’seligibleemployeesatnocostunlessotherwisedeterminedbytheBoardinaccordancewiththetermsandconditionsofthePlan.TheobjectiveofthePlanistoaligntheinterestsofemployeesandshareholdersbyprovidingemployeesoftheCompanywiththeopportunitytoparticipateintheequityoftheCompanyasanincentivetoachievegreatersuccessandprofitabilityfortheCompanyandtomaximisethelong-termperformanceoftheCompany.

Atthistime,thereisnorelationshipbetweenremunerationofKeyManagementPersonnelandtheCompany’sperformanceoverthelastfiveyears.

RemunerationConsultants

Thecompanydidnotuseanyremunerationconsultantsduringtheyear.

Sharesissuedonexerciseofremunerationoptions

NoshareswereissuedtoDirectorsasaresultoftheexerciseofremunerationoptionsduringthefinancialyear.

RemunerationofDirectorsandkeymanagementpersonnel

Thisreportdetailsthenatureandamountofremunerationforeachkeymanagementpersonneloftheconsolidatedentityandfortheexecutivesreceivingthehighestremuneration.

(a)Directorsandkeymanagementpersonnel

ThenamesandpositionsheldbyDirectorsandkeymanagementpersonneloftheconsolidatedentityduringthewholeofthefinancialyearare:

Directors Position

DrCRose Chairman Non-executive from1May2015to4June2017

ExecutiveChairmanExecutive from5June2017

MrPThompson Director Non-executive from26May2015

DrKWills ChiefGeologist from8March2016ExecutiveDirectorActingMD from14November2016to30January2017

ExecutiveDirector from5June2017

MrLDWilliams ManagingDirector Executive from9September2014to13November2016

MrIWarland ManagingDirectorExecutive from30January2017to2June2017

KeyManagementPersonnel

MsVAllinson CompanySecretary from14November2016




10

(b)Directors’remuneration

ShortTermEmployee

Benefits

Post-Employee

Benefits

LongTerm

Employee

Benefits

Share-based

payments

2017primarybenefits

Directors’

fees

$

Fixed

Remuneration

$

Non-

Monetary

Benefits

$

Super

contributions

$

Changein

LSL

Provision

$

Option

based

benefits

$

Share

based

payments

$

Total

$

Directors

DrCRose 1 5,207 - 847 - - - 6,055

MrPThompson* 17,000 - - - - 9,687 17,000 43,687

DrKWills** - 29,417 - - - - - 29,417

MrLWilliams - 74,753 5,100 5,907 - - - 85,579

MrIWarland - 54,541 - 5,181 - - - 59,722

17,001 163,918 5,100 11,935 - 9,687 17,000 224,641

2016primarybenefits

Directors’

fees

$

Fixed

Remuneration

$

Non-

Monetary

Benefits

$

Relatesto

2015FY

$

Super

contributions

$

Changein

LSL

Provision

$

Shares

$

Total

$

Directors

DrCRose 1 - - - - - 1

MrPThompson* 17,000 - - - - 17,000 34,000

MrLWilliams - 164,523 23,526 16,118 1,237 - 205,404

Relatingto2015FY

MrGSDavis*** - ***16,000 - - - 16,000 17,001 164,523 23,526 16,000 16,118 1,237 17,000 255,405

Therewerenocashbonusespaidin2017or2016.

*DirectorsfeesforMrThompsonarepaidtoarelatedentityoftheDirector.**DrWillswasappointedActingManagingDirectorintheperiodfrom14November2016to30January2017andas

ExecutiveDirector–Explorationfrom5June2017.See(c)belowforDrWills’remunerationasChiefGeologist.HisremunerationispaidtoarelatedentityoftheDirector.

***DirectorFeesforMrDaviswerepaidtoarelatedentityoftheDirector.Theamountshownabovein2016relatesto

feesforthemonthsofFebruarytoJune2015.MrDavisceasedtobeaDirectoron23June2015.




11

(c)Keymanagementpersonnelremuneration

Shorttermemployee

benefits Longtermemployeebenefits

2017primarybenefits

Invoiced

$

Optionbased

benefits

$

Sharebased

Payments

$

Total

$

Proportionof

remunerationrelated

toperformance

KeymanagementpersonnelexcludingDirectors -

DrKWills* 51,276 6,458 12,248 69,982

VAllinson** 20,430 - 0 20,430 -

71,706 6,458 12,248 90,412 -

2016primarybenefits

Invoiced

$

Optionbased

benefits

$

Sharebased

Payments

$

Total

$

Proportionof

remunerationrelated

toperformance

KeymanagementpersonnelexcludingDirectors

N/A - - - - -

Therewerenocashbonusespaidin2017or2016.* DrWillswasChiefGeologistfrom1July2016to12November2016(thenActingMDintheperiod13November2016

to30January2017,see(b)above)andthenresumedasChiefGeologistfrom1February2017to4June2017(andthenExecutiveDirectorfrom5June2017).Hisremunerationispaidtoarelatedentity.

**MsAllinsonwasappointedasCompanySecretaryon14November2016andChiefFinancialOfficeron14January2017.MsAllinsonandherteamprovidedoutsourcedaccountingservicesviaacompanyshecontrols,AllinsonAccountingSolutionsPtyLtd,since14January2017.

(d)Securitybasedpayments Share-basedpaymentsareinlinewiththeMarmotaLimitedDirector&EmployeeShareOptionPlan.Listedbelowaresummariesofoptionsgranted:

(i) Optionsissuedtodirectorsandkeymanagementpersonnel

2017 2016

Numberof

options

Weighted

average

exerciseprice

Numberof

options

Weighted

average

exercise

price

Granted–9November2016 5,000,000 $0.03 - -

KeymanagementpersonnelOptionbasedpaymentsinthecurrentyear:

• On9November2016,5,000,000shareoptionsweregrantedtodirectorsandemployeesundertheMarmotaLimitedDirector&EmployeeShareOptionPlantotakeupordinarysharesatanexercisepriceof$0.03each.Theseoptionsareexercisableonorbefore9November2021,withBlackScholesvaluation:

o MrPThompson$9,686

o DrKWills $6,458




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Theoptionsarenon-transferableexceptasallowedundertheDirector&EmployeeShareOptionPlanandarenotquotedsecurities.Atreportingdate,otherthanasdisclosedinthetableabove,noshareoptionshadbeenexercised.AlloptionsgrantedtokeymanagementpersonnelareoverordinarysharesinMarmotaLimited,whichconferarightofoneordinaryshareforeveryoptionheld.

ThefairvalueoftheoptionsgrantedwascalculatedbyusingtheBlack-Scholesoptionpricingmodelapplyingthefollowinginputs:

Nov2016issue

Weightedaveragefairvalue $0.003 Weightedaverageexerciseprice $0.03Weightedaveragelifeoftheoption 1,825Underlyingshareprice $0.016Expectedsharepricevolatility 41.8%Riskfreeinterestrate 1.8%

Thelifeoftheoptionisbasedonthedaysremaininguntilexpiry.Volatilityisbasedonhistoricalshareprices.

Theoptionsholdnovotingordividendsrightsandareunlisted.Theoptionslapse6monthssubsequenttothecessationofemploymentwiththeGroup.Therearenovestingconditionsattachedtotheoptions.(i) Sharebasedpaymentstokeymanagementpersonnel

Duringtheyear,930,061ShareswereissuedtoDrKWillsinlieuofChiefGeologistfeesamountingto$12,248.DrWillswasnotakeymanagementpersonnelintheprioryear.(e)Serviceagreements

MrWilliamswasappointedManagingDirectoron9September2014andresignedon13November2016.Thesalaryunderthetermsofhisemploymentwassetat$250,000perannuminclusiveofsuperannuationguaranteecontributionsandincludedathree-monthnoticeperiod.HewasalsoappointedasCompanySecretaryon1July2015.Effective1August2015,MrWilliamsagreedtochangehistermsofemploymentsuchthatremunerationwasreducedto$200,000perannumandthenoticeperiodreducedtoonemonth.

MrWarlandwasappointedManagingDirectoron30January2017andresignedon2June2017.Thesalaryunderthetermsofhisemploymentwassetat$175,000perannuminclusiveofsuperannuationguaranteecontributionsandincludedaone-monthnoticeperiod.Inaddition,MrWarlandwasentitledtoupto3millionPerformanceRightssubjecttoobtainingshareholderapproval:nosuchshareholderapprovalwaseithersoughtnorgrantedpriortohisdeparture,andaccordinglynoPerformanceRightswereissuedorgranted.

DrRosemovedfromtheroleofnon-executiveChairmantoExecutiveChairmanon5June2017.Thesalaryunderthetermsofhisemploymentwassetat$85,000perannuminclusiveofsuperannuationguaranteecontributionsandincludedaone-monthnoticeperiod.DrWillswasappointedChiefGeologiston8March2016foraninitial6monthsterm,whichcontinuesaftertheinitialperiodunlessterminatedbyeitherpartybygivingonemonthsnotice.Inaccordancewithhisserviceagreement,DrWillswasremuneratedasfollows:• intheperiodfrom8March2016to19September2016,remunerationamountedtotheequivalentof

$24,000perannumexcludingGSTasChiefGeologist;• intheperiodfrom20September201613November2016,remunerationamountedtotheequivalent

of$59,000perannumexcludingGSTasChiefGeologist,ofwhich25%waspaidinshares;• intheperiodfrom14November2016to30January2017,remunerationamountedtotheequivalent

of$66,000perannumexcludingGSTasActingMD;




13

• intheperiodfrom1February2017to3June2017,remunerationamountedtotheequivalentof$59,000perannumexcludingGSTasChiefGeologist,ofwhich25%waspaidinshares;

Inaddition,2millionunlisted3centOptionsexpiring9November2021wereissuedtoDrWillsundertheDirector&EmployeeShareOptionPlan(DESOP)on9November2016.

On2June2017,anewserviceagreementwassignedasaresultofDrWills’appointmentasExecutiveDirectoron5June2017.Inaccordancewiththisagreement,DrWillsisremuneratedasfollows:• From5June2017,DrWills’remunerationamountsto$7,335permonth(excludingGST)asExecutive

Director.TheamountmayvaryifDrWillsisrequiredtoworkadditionaldays.

Therewerenopost-employment,retirementorterminationbenefitspreviouslyapprovedbymembersoftheCompanyinageneralmeeting,noranysuchbenefitspaidtoDirectorsoftheCompany.(f)Directorrelatedentities

InformationofamountspaidtodirectorrelatedentitiesissetoutinNote23tothefinancialstatements.

(g)Post-employment/retirementandterminationbenefitsOtherthansuperannuationcontributions,therewerenopost-employmentretirementandterminationbenefitspaidorpayabletodirectorsandkeymanagementpersonnel.(h)Directorsandkeymanagementpersonnelequityremuneration,holdingsandtransactions(i) ShareholdingsThenumberofsharesinthecompanyheldduringthefinancialyearbyeachdirectorofMarmotaLimitedandotherkeymanagementpersonnelofthegroup,includingtheirpersonalrelatedparties,aresetoutbelow.Therewerenosharesgrantedtodirectorsorkeymanagementpersonnelduringthefinancialyear.

(1) Netchangesrepresentsecuritiespurchasedduringthefinancialyear.

(2) DrWillsreceived930,061sharesasperpaymentforhisfeesasChiefGeologist.

(ii) OptionholdingsThenumberofoptionsoverordinarysharesinthecompanyheldduringthefinancialyearbyeachdirectorofMarmotaLimitedandanyotherkeymanagementpersonnelofthegroup,includingtheirpersonalrelatedparties,aresetoutbelow.

Shares

Balance

1/07/16

Received

as

remuneration

Options

exercised

Netchange

Other(1)

Balance

30/06/17

Totalheldin

escrow

30/06/17

HeldbyDirectorsinownname

DrCRose 53,912,844 - - 8,479,138 62,391,982 -MrPThompson - - - - - -DrKWills - - - - - -MrLWilliams - - - - - -MrIWarland - - - - - -

HeldbyDirectors’personallyrelatedentities

DrCRose 851,316 - - - 851,316 -MrPThompson 1,700,000 915,000 - 333,334 2,948,334 -DrKWills(2) - 930,061 - - 930,061 -MrLWilliams - - - - - -MrIWarland - - - - - -

TotalheldbyDirectors 56,464,160 1,845,061 - 8,812,472 67,121,693 -




14

Options

Balance

1/07/16

Received

as

remuneration

Options

exercised

Netchange

other1

Balance

30/06/17

Totalvested

30/06/17

Total

exercisable

30/06/17

HeldbyDirectorsinown

name

DrCRose - - - - - - -MrPThompson - - - - - - -DrKWills - - - - - - -MrLWilliams - - - - - - -MrIWarland - - - - - - -

- - - - - - -

Directors’personallyrelatedentities

DrCRose - - - - - - -MrPThompson(1) - 3,000,000 - - - - 3,000,000DrKWills(1)(2) - 2,000,000 - - - - 2,000,000MrLWilliams - - - - - - -MrIWarland - - - - - - -

TotalheldbyDirectors - 5,000,000 - - - - 5,000,000

(1) 3millionunlisted3centOptionsexpiring9November2021wereissuedtoMrThompsonundertheDirector&

EmployeeShareOptionPlan(DESOP)on9November2016,and2millionofthesameoptionstoDrWills.

(2) ReceivedaspartofChiefGeologistremuneration.

(iii) SharerightsholdingsNorightsoverordinarysharesinthecompanywereheldduringthefinancialyearbyanydirectorofMarmotaLimitedorbyanyotherkeymanagementpersonnelofthegroup,includingtheirpersonalrelatedparties.Nosharerightsweregrantedtodirectorsorkeymanagementpersonnelduringthefinancialyear.

NooptionspreviouslygrantedtoDirectorsorDirectorrelatedentitieswereexercisedduringtheyear.

EndofRemunerationReport

TheReportofDirectors,incorporatingtheRemunerationReport,issignedinaccordancewitharesolutionoftheBoardofDirectors:

DrColinRoseChairmanDatedatSydneythis25thdayofSeptember2017.

Grant Thornton House Level 3 170 Frome Street Adelaide, SA 5000 Correspondence to: GPO Box 1270 Adelaide SA 5001 T 61 8 8372 6666 F 61 8 8372 6677 E [email protected] W www.grantthornton.com.au

Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389 ‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited. Liability limited by a scheme approved under Professional Standards Legislation.

Auditor’s Independence Declaration To the Directors of Marmota Limited In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Marmota Limited for the year ended 30 June 2017, I declare that, to the best of my knowledge and belief, there have been: a no contraventions of the auditor independence requirements of the Corporations Act 2001 in

relation to the audit; and

b no contraventions of any applicable code of professional conduct in relation to the audit.

GRANT THORNTON AUDIT PTY LTD Chartered Accountants

S K Edwards Partner - Audit & Assurance Adelaide, 25 September 2017


ConsolidatedStatementofProfitandLossandOtherComprehensiveIncome

Fortheyearended30June2017

16

Consolidated Note 2017

$2016$

Otherrevenues 2 49,915 56,834Totalrevenue 49,915 56,834 Administrationexpenses 3 129,950 132,643Consultingexpenses 3 20,930 13,398Depreciationexpense 3 4,090 17,485Employmentexpenses 3 218,371 301,697Occupancyexpenses 3 5,435 6,537Impairmentofassets 3 39,684 21,400(Loss)/profitbeforeincometaxexpense (368,545) (436,326)Incometax(expense)/benefit 4 (21,110) (9,424)(Loss)/profitfortheyear (389,655) (445,750) Lossattributabletomembersoftheparententity (389,655) (445,750)

Othercomprehensiveincome - - Totalcomprehensiveincomefortheyear (389,655) (445,750)

Basicearningspershare(cents) 6 (0.084) (0.12)

Dilutedearningspershare(cents) 6 (0.084) (0.12)

Theaccompanyingnotesformpartofthesefinancialstatements.


ConsolidatedStatementofFinancialPosition

Asat30June2017

17

Consolidated

Note 2017$

2016$

Currentassets Cashandcashequivalents 7 530,706 635,121Tradeandotherreceivables 8 95,956 32,741Otherassets 9 11,649 11,538Totalcurrentassets 638,311 679,400 Non-currentassets Plantandequipment 10 66,008 90,087Investmentsinassociates 11 1 1Availableforsalefinancialassets 12 8,000 8,000Explorationandevaluationassets 15 5,289,305 3,661,339Totalnon-currentassets 5,363,315 3,759,427 Totalassets 6,001,626 4,438,827 Currentliabilities Tradeandotherpayables 16 201,297 99,744Provisions 17 4,747 16,144Totalcurrentliabilities 206,044 115,888 Non-currentliabilities Provisions 17 123 1,237Totalnon-currentliabilities 123 1,237 Totalliabilities 206,167 117,125 Netassets 5,795,459 4,321,702 Equity Issuedcapital 18 34,909,527 33,064,883Reserves 26 22,140 50,802Retainedlosses (29,136,208) (28,793,983) Totalequity 5,795,459 4,321,702



ConsolidatedStatementofChangesinEquity


18

Consolidated

Issuedcapital Reserves Retained Total

(Note18) (Note26) Earnings$ $ $ $

Balanceat1July2015 31,577,896 2,719,810 (31,060,144) 3,237,562

Lossattributabletothemembersoftheparententity

- - (445,750) (445,750)

Othercomprehensiveincome - - - -

Totalcomprehensiveincome - - (445,750) (445,750)

Transactionswithownersintheircapacityasowners: Sharesissuedduringtheyear 1,505,025 - - 1,505,025

Optionsissuedduringtheyear - 42,902 - 42,902

Optionsexpiredorexercised - (2,711,910) 2,711,910 -

Transactioncostsassociatedwiththeissueofsharesnetoftax

(18,037) - - (18,037)

1,486,988 (2,669,008) 2,711,910 1,529,890

Balanceat30June2016 33,064,884 50,802 (28,793,984) 4,321,702

Balanceat1July2016 33,064,884 50,802 (28,793,984) 4,321,702

Lossattributabletothemembersoftheparententity

- - (389,655) (389,655)

Othercomprehensiveincome - - - -

Totalcomprehensiveincome - - (389,655) (389,655)

Transactionswithownersintheircapacityasowners: Sharesissuedduringtheyear 1,900,921 - - 1,900,917

Optionsissuedduringtheyear - 18,769 - (18,769)

Optionsexpiredorexercised - (47,431) 47,431 - Transactioncostsassociatedwiththeissueofsharesnetoftax

(56,278) - - (56,274)

1,844,643 (28,662) 47,431 1,863,411

Balanceat30June2017 34,909,527 22,140 (29,136,208) 5,795,459



ConsolidatedStatementofCashFlows


19

Consolidated Note 2017

$2016$

Cashflowsfromoperatingactivities Cashreceiptsinthecourseofoperations 30,000 -Cashpaymentsinthecourseofoperations (420,218) (425,242)Interestreceived 10,915 9,393Netcash(usedin)operatingactivities 22(b) (379,303) (415,849) Cashflowsfrominvestingactivities Proceedsfromsaleofforplantandequipment 14,000 17,656Paymentsforplantandequipment (3,497) (7,489)Paymentsforexplorationandevaluationassets (1,509,106) (632,310)Loansfromrelatedentities - (628)Loansrepaidtorelatedentities - -Netcash(usedin)investingactivities (1,498,603) (622,771) Cashflowsfromfinancingactivities Proceedsfromissueofshares 1,850,867 1,463,916Paymentoftransactioncostsassociatedwithcapitalraisings (77,376) (51,375)Netcashprovidedbyfinancingactivities 1,773,491 1,412,541 Net(decrease)/increaseincashheld (104,415) 373,921 Cashatthebeginningofthefinancialyear 635,121 261,200 Cashattheendofthefinancialyear 22(a) 530,706 635,121



Notestothefinancialstatements


20

1 Statementofsignificantaccountingpolicies

ThefinancialreportincludestheconsolidatedfinancialstatementsandnotesofMarmotaLimitedandcontrolledentities(‘consolidatedgroup’or‘Group’).

(a) BasisofpreparationThisgeneralpurposefinancialreporthasbeenpreparedinaccordancewithAustralianAccountingStandards,AustralianAccountingInterpretations,otherauthoritativepronouncementsoftheAustralianAccountingStandardsBoard(AASB)andtheCorporationAct2001.CompliancewithAustralianAccountingStandardsresultsinfullcompliancewiththeInternationalFinancialReportingStandards(IFRS)asissuedbytheInternationalAccountingStandardsBoard(IASB).TheCompanyisafor-profitentityforthepurposesofpreparingfinancialstatements.

Thefollowingreportcoverstheconsolidatedentity,MarmotaLimited,alistedpubliccompany,incorporatedanddomiciledinAustralia.

AustralianAccountingStandardssetoutaccountingpoliciesthattheAASBhasconcludedwouldresultinafinancialreportcontainingrelevantandreliableinformationabouttransactions,eventsandconditions.CompliancewithAustralianAccountingStandardsensuresthatthefinancialstatementsandnotesalsocomplywithInternationalFinancialReportingStandards.Materialaccountingpoliciesadoptedinthepreparationofthisfinancialreportarepresentedbelowandhavebeenconsistentlyappliedunlessotherwisestated.

Thefinancialreporthasbeenpreparedonanaccrualsbasisandisbasedonhistoricalcosts,modifiedwhereapplicable,bythemeasurementatfairvalueofselectednon-currentassets,financialassetsandfinancialliabilities.

(b) CompliancewithIFRSThefinancialreportcomplieswithAustralianAccountingStandardsasissuedbytheAustralianAccountingStandards Board and International Financial Reporting Standards (“IFRS”) as issued by the InternationalAccountingStandardsBoard.Thereisnoimpactofnewaccountingstandardsandinterpretationsappliedduringtheyear.

(c) NewaccountingstandardsandinterpretationsAnumberofnewandrevisedstandardsbecameeffectiveforthefirsttimeforannualperiodsbeginningonorafter1July2016.Informationonthemoresignificantstandardsispresentedbelow.AASB2014-4AmendmentstoAustralianAccountingStandards–ClarificationofAcceptableMethodsofDepreciationandAmortisation

TheamendmentstoAASB116prohibittheuseofarevenue-baseddepreciationmethodforproperty,plantand equipment. Additionally, the amendments provide guidance in the application of the diminishingbalancemethodforproperty,plantandequipment.

The amendments to AASB 138 present a rebuttable presumption that a revenue-based amortisationmethodforintangibleassetsisinappropriate.Thisrebuttablepresumptioncanbeovercome(i.e.arevenue-basedamortisationmethodmightbeappropriate)onlyintwo(2)limitedcircumstances:

• the intangible asset is expressed as a measure of revenue, for example when the predominantlimitingfactorinherentinanintangibleassetistheachievementofarevenuethreshold(forinstance,therighttooperateatollroadcouldbebasedonafixedtotalamountofrevenuetobegeneratedfromcumulativetollscharged);or




21

• when it can be demonstrated that revenue and the consumption of the economic benefits of theintangibleassetarehighlycorrelated.

AASB2014-4isapplicabletoannualreportingperiodsbeginningonorafter1January2016.

AASB 2015-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments toAASB101

TheStandardmakesamendmentstoAASB101PresentationofFinancialStatementsarisingfromtheIASB’sDisclosureInitiativeproject.Theamendments:

• clarify themateriality requirements in AASB 101, including an emphasis on the potentiallydetrimentaleffectofobscuringusefulinformationwithimmaterialinformation

• clarify that AASB 101’s specified line items in the statement(s) of profit or loss and othercomprehensiveincomeandthestatementoffinancialpositioncanbedisaggregated

• addrequirementsforhowanentityshouldpresentsubtotalsinthestatement(s)ofprofitandlossandothercomprehensiveincomeandthestatementoffinancialposition

• clarify thatentitieshaveflexibilityas totheorder inwhichtheypresentthenotes,butalsoemphasisethatunderstandabilityandcomparabilityshouldbeconsideredbyanentitywhendecidingthatorder

• remove potentially unhelpful guidance in AASB 101 for identifying a significant accountingpolicy

AASB2015-2isapplicabletoannualreportingperiodsbeginningonorafter1January2016.

AccountingstandardsissuedbutnotyeteffectiveandnotbeenadoptedearlybytheCompany

New/revised

pronouncement

Superseded

pronouncement

Natureofchange Likely impact on

initialapplication

AASB9FinancialInstruments(December2014)

AASB139FinancialInstruments:RecognitionandMeasurement

AASB 9 introduces new requirements for theclassification and measurement of financialassets and liabilities and includes a forward-looking ‘expected loss’ impairmentmodelandasubstantially-changed approach to hedgeaccounting.

These requirements improve and simplify theapproach for classification andmeasurement offinancialassetscomparedwiththerequirementsofAASB139.Themainchangesare:

a Financialassetsthataredebtinstrumentswillbeclassifiedbasedon:(i)theobjectiveoftheentity’s business model for managing thefinancialassets;and (ii) thecharacteristicsofthecontractualcashflows.Allows an irrevocable election on initialrecognition to present gains and losses oninvestments in equity instruments that arenot held for trading in other comprehensiveincome (instead of in profit or loss).Dividends in respect of these investmentsthat are a return on investment can berecognised in profit or loss and there is noimpairment or recycling on disposal of theinstrument.

The entity has yetto undertake adetailedassessmentof the impact ofAASB 9. However,based on theentity’s preliminaryassessment, theStandard is notexpected to have amaterial impact onthe transactionsand balancesrecognised in thefinancialstatementswhen it is firstadopted for theyearending30June2019.

New/revised

pronouncement

Superseded

pronouncement


initialapplication




22

New/revised

pronouncement

Superseded

pronouncement


initialapplication

AASB9FinancialInstruments(December2014)continued

AASB139FinancialInstruments:RecognitionandMeasurement

b Introduces a ‘fair value through othercomprehensive income’ measurementcategory for particular simple debtinstruments.

c Financial assets can be designated andmeasured at fair value throughprofit or lossat initial recognition ifdoingsoeliminatesorsignificantly reduces a measurement orrecognition inconsistency that would arisefrom measuring assets or liabilities, orrecognisingthegainsand lossesonthem,ondifferentbases.

d Where the fair value option is used forfinancial liabilities the change in fair value istobeaccountedforasfollows:− the change attributable to changes in

credit risk are presented in OtherComprehensiveIncome(OCI)

− theremainingchangeispresentedinprofitorloss

If this approach creates or enlarges anaccountingmismatchintheprofitorloss,theeffect of the changes in credit risk are alsopresentedinprofitorloss.

Otherwise, the following requirements havegenerally been carried forward unchangedfromAASB139intoAASB9:

− classification and measurement offinancialliabilities;and

− derecognition requirements for financialassetsandliabilities.

AASB 9 requirements regarding hedgeaccounting represent a substantial overhaul ofhedge accounting that enable entities to betterreflect their risk management activities in thefinancialstatements.

Furthermore, AASB 9 introduces a newimpairment model based on expected creditlosses. Thismodelmakesuseofmore forward-looking information and applies to all financialinstruments that are subject to impairmentaccounting.

AASB15RevenuefromContractswithCustomers

AASB15Revenue

AASB118RevenueAASB111ConstructionContracts

Int.13CustomerLoyaltyProgrammes

Int.15AgreementsfortheConstructionofRealEstate

Int.18Transferof

AASB15:• replaces AASB 118 Revenue, AASB 111

Construction Contracts and some revenue-relatedInterpretations:- establishes a new revenue recognition

model- changes the basis for deciding whether

revenueistoberecognisedovertimeoratapointintime

- providesnewandmoredetailedguidanceon specific topics (e.g. multiple elementarrangements, variable pricing, rights ofreturn,warrantiesandlicensing)

- expands and improves disclosures about

The entity has yetto undertake adetailedassessmentof the impact ofAASB 15 as thecompany currentlyhas no contractswith customers.However, based onthe entity’spreliminaryassessment, theStandard is notexpected to have a




23

New/revised

pronouncement

Superseded

pronouncement


initialapplication

fromContractswithCustomers

AssetsfromCustomers

Int.131Revenue–BarterTransactionsInvolvingAdvertisingServices

Int.1042SubscriberAcquisitionCostsintheTelecommunicationsIndustry

revenue

InMay2015,theAASBissuedED260IncomeofNot-for-Profit Entities, proposing to replace theincome recognition requirements of AASB 1004Contributionsandprovideguidancetoassistnot-for-profitentitiestoapplytheprinciplesofAASB15. The ED was open for comment until 14August 2015 and the AASB is currently in theprocess of redeliberating its proposals with theaim of releasing the final amendments in late2016.

material impact onthe transactionsand balancesrecognised in thefinancialstatementswhen it is firstadopted for theyearending30June2019.

AASB16Leases AASB117Leases

Int.4DeterminingwhetheranArrangementcontainsaLease

Int.115OperatingLeases—LeaseIncentives

Int.127EvaluatingtheSubstanceofTransactionsInvolvingtheLegalFormofaLease

AASB16:

• replaces AASB 117 Leases and some lease-relatedInterpretations

• requires all leases to be accounted for ‘on-balance sheet’ by lessees, other than short-termandlowvalueassetleases

• provides new guidance on the application ofthedefinitionof lease andon sale and leasebackaccounting

• largely retains the existing lessor accountingrequirementsinAASB117

• requiresnewanddifferentdisclosures aboutleases

Theentity currentlyhasnoleasesandisnot expected tohave any materialimpact on thetransactions andbalancesrecognisedin the financialstatements when itis first adopted forthe year ending 30June2020.

AASB2014-5AmendmentstoAustralianAccountingStandardsarisingfromAASB15

None AASB 2014-5 incorporates the consequentialamendments arising from the issuance of AASB15.

RefertothesectiononAASB15above.

AASB2014-7AmendmentstoAustralianAccountingStandardsarisingfromAASB9(December2014)

None AASB 2014-7 incorporates the consequentialamendments arising from the issuance of AASB9.


AASB2014-10AmendmentstoAustralianAccountingStandards–SaleorContributionofAssetsbetweenanInvestoranditsAssociateorJointVenture

AASB2014-10Amendmentsto

None The amendments address a currentinconsistency between AASB 10 ConsolidatedFinancial StatementsandAASB128 InvestmentsinAssociatesandJointVentures.

The amendments clarify that, on a sale orcontribution of assets to a joint venture orassociate or on a loss of control when jointcontrol or significant influence is retained in atransaction involving an associate or a jointventure,anygainor lossrecognisedwilldependonwhethertheassetsorsubsidiaryconstituteabusiness, as defined in AASB 3 BusinessCombinations. Full gain or loss is recognised

When theseamendments arefirstadoptedfortheyearending30June2019, there will beno material impacton the financialstatements.




24

New/revised

pronouncement

Superseded

pronouncement


initialapplication

AustralianAccountingStandards–SaleorContributionofAssetsbetweenanInvestoranditsAssociateorJointVenture(continued)

when the assets or subsidiary constitute abusiness, whereas gain or loss attributable tootherinvestors’interestsisrecognisedwhentheassetsorsubsidiarydonotconstituteabusiness.

This amendment effectively introduces anexceptiontothegeneralrequirementinAASB10to recognise full gain or loss on the loss ofcontrol over a subsidiary. The exception onlyapplies to the loss of control over a subsidiarythat does not contain a business, if the loss ofcontrolistheresultofatransactioninvolvinganassociateorajointventurethatisaccountedforusing the equity method. CorrespondingamendmentshavealsobeenmadetoAASB128.

AASB2015-8AmendmentstoAustralianAccountingStandards–EffectiveDateofAASB15

None AASB2015-8amendsthemandatoryapplicationdate of AASB15 Revenue from Contracts withCustomers so that AASB15 is required to beapplied for annual reporting periods beginningonorafter1 January2018 insteadof1 January2017. It also defers the consequentialamendmentsthatwereoriginallysetoutinAASB2014-5 Amendments to Australian AccountingStandardsarisingfromAASB15.


AASB2016-3AmendmentstoAustralianAccountingStandards–ClarificationstoAASB15

None TheamendmentsclarifytheapplicationofAASB15inthreespecificareastoreducetheextentofdiversity in practice thatmight otherwise resultfrom differing views on how to implement therequirements of the new standard. They willhelpcompanies:

1 Identifyperformanceobligations(byclarifyinghowtoapplytheconceptof‘distinct’);

2 Determinewhether a company is a principaloranagentinatransaction(byclarifyinghowtoapplythecontrolprinciple);

3 Determine whether a licence transfers to acustomerat apoint in timeorover time (byclarifying when a company’s activitiessignificantlyaffecttheintellectualpropertytowhichthecustomerhasrights).

The amendments also create two additionalpractical expedients available for use whenimplementingAASB15:

1 Forcontractsthathavebeenmodifiedbeforethe beginning of the earliest periodpresented,theamendmentsallowcompaniesto use hindsight when identifying theperformance obligations, determining thetransaction price, and allocating thetransaction price to the satisfied andunsatisfiedperformanceobligations.

2 Companies applying the full retrospectivemethod are permitted to ignore contractsalready complete at the beginning of theearliestperiodpresented.


TheGrouphasnotelectedtoearlyadoptanynewstandardsoramendmentsthatareissuedbutnotyeteffectiveandhasnotyetassessedtheimpactofthesestandards.




25

(d) PrinciplesofconsolidationTheGroupfinancialstatementsconsolidatethoseoftheParentandallofitssubsidiariesasof30June2017.TheParentcontrolsasubsidiaryifitisexposed,orhasrights,tovariablereturnsfromitsinvolvementwiththesubsidiaryandhastheabilitytoaffectthosereturnsthroughitspoweroverthesubsidiary.AlltransactionsandbalancesbetweenGroupcompaniesareeliminatedonconsolidation,includingunrealisedgainsandlossesontransactionsbetweenGroupcompanies.Whereunrealisedlossesonintra-groupassetsalesarereversedonconsolidation,theunderlyingassetisalsotestedforimpairmentfromagroupperspective.AmountsreportedinthefinancialstatementsofsubsidiarieshavebeenadjustedwherenecessarytoensureconsistencywiththeaccountingpoliciesadoptedbytheGroup.

Profitorlossandothercomprehensiveincomeofsubsidiariesacquiredordisposedofduringtheyeararerecognisedfromtheeffectivedateofacquisition,oruptotheeffectivedateofdisposal,asapplicable.

(e) IncometaxTheincometaxexpense/(benefit)fortheyearcomprisescurrentincometaxexpense/(income)anddeferredincometaxexpense/(income).

Currentincometaxexpensechargedtotheprofitorlossisthetaxpayableontaxableincomecalculatedusingapplicableincometaxratesenactedatreportingdate.

Deferredincometaxexpensereflectsmovementsindeferredtaxassetanddeferredtaxliabilitybalancesduringtheyearaswellasunusedtaxlosses.

Currentanddeferredincometax(expense)/benefitischargedorcrediteddirectlytoequityinsteadoftheprofitorlosswhenthetaxrelatestoitemsthatarecreditedorchargeddirectlytoequity.

Deferredtaxassetsandliabilitiesareascertainedbasedontemporarydifferencesarisingbetweenthetaxbasesofassetsandliabilitiesandtheircarryingamountsinthefinancialstatements.Deferredtaxassetsalsoresultwhereamountshavebeenfullyexpensedbutfuturetaxdeductionsareavailable.Nodeferredincometaxwillberecognisedfromtheinitialrecognitionofanassetorliability,excludingabusinesscombination,wherethereisnoeffectonaccountingortaxableprofitorloss.

Deferredtaxiscalculatedatthetaxratesthatareexpectedtoapplytotheperiodwhentheassetisrealisedorliabilityissettled.DeferredtaxiscreditedintheStatementofProfitorLossandOtherComprehensiveIncomeexceptwhereitrelatestoitemsthatmaybecrediteddirectlytoequity,inwhichcasethedeferredtaxisadjusteddirectlyagainstequity.

Deferredincometaxassetsarerecognisedtotheextentthatitisprobablethatfuturetaxprofitswillbeavailableagainstwhichdeductibletemporarydifferencescanbeutilised.

TheamountofbenefitsbroughttoaccountorwhichmayberealisedinthefutureisbasedontheassumptionthatnoadversechangewilloccurinincometaxationlegislationandtheanticipationthattheCompanywillderivesufficientfutureassessableincometoenablethebenefittoberealisedandcomplywiththeconditionsofdeductibilityimposedbythelaw.

(f) PlantandequipmentEachclassofplantandequipmentiscarriedatcostorfairvalueless,whereapplicable,anyaccumulateddepreciationandimpairmentlosses.

PlantandequipmentPlantandequipmentaremeasuredonthecostbasislessdepreciationandimpairmentlosses.

ThecarryingamountofplantandequipmentisreviewedannuallybyDirectorstoensureitisnotinexcessoftherecoverableamountfromtheseassets.Therecoverableamountisassessedonthebasisoftheexpectednetcashflowsthatwillbereceivedfromtheasset’semploymentandsubsequentdisposal.Theexpectednetcashflowshavebeendiscountedtotheirpresentvaluesindeterminingrecoverableamounts.




26

DepreciationAllfixedassetsaredepreciatedonastraight-linebasisovertheirusefullivestotheGroupcommencingfromthetimetheassetisheldreadyforuse.

Thedepreciationratesusedforeachclassofdepreciableassetsare:

Classoffixedasset

Depreciationrate

Plantandequipment 5%–33%

Theasset’sresidualvaluesandusefullivesarereviewed,andadjustedifappropriate,ateachreportingdate.

Anasset’scarryingamountiswrittendownimmediatelytoitsrecoverableamountiftheasset’scarryingamountisgreaterthanitsestimatedrecoverableamount.

Gainsandlossesondisposalsaredeterminedbycomparingproceedswiththecarryingamount.ThesegainsandlossesareincludedintheStatementofProfitorLossandOtherComprehensiveIncome.

(g) Explorationandevaluationexpenditure

Explorationandevaluationexpenditureincurredisaccumulatedinrespectofeachidentifiableareaofinterest.Thesecostsareonlycarriedforwardtotheextentthattheyareexpectedtoberecoupedthroughthesuccessfuldevelopmentoftheareaorwhereactivitiesintheareahavenotyetreachedastagethatpermitsreasonableassessmentoftheexistenceofeconomicallyrecoverablereserves.

Accumulatedcostsinrelationtoanabandonedareaarewrittenoffinfullagainstprofitintheyearinwhichthedecisiontoabandontheareaismade.

Whenproductioncommences,theaccumulatedcostsfortherelevantareaofinterestareamortisedoverthelifeoftheareaaccordingtotherateofdepletionoftheeconomicallyrecoverablereserves.

Aregularreviewisundertakenofeachareaofinteresttodeterminetheappropriatenessofcontinuingtocarryforwardcostsinrelationtothatareaofinterest.

Costsofsiterestorationareprovidedoverthelifeofthefacilityfromwhenexplorationcommencesandareincludedinthecostsofthatstage.Siterestorationcostsincludethedismantlingandremovalofminingplant,equipmentandbuildingstructures,wasteremovalandrehabilitationofthesiteinaccordancewithclausesoftheminingpermits.Suchcostsaredeterminedusingestimatesoffuturecosts,currentlegalrequirementsandtechnologyonanundiscountedbasis.

Anychangesintheestimatesforthecostsareaccountedonaprospectivebasis.Indeterminingthecostsofsiterestoration,thereisuncertaintyregardingthenatureandextentoftherestorationduetocommunityexpectationsandfuturelegislation.Accordingly,thecostsaredeterminedonthebasisthattherestorationwillbecompletedwithinoneyearofabandoningthesite.

(h) LeasesLeasepaymentsforoperatingleases,wheresubstantiallyalltherisksandbenefitsremainwiththelessor,arechargedasexpensesintheperiodsinwhichtheyareincurred.

(i) FinancialinstrumentsInitialrecognitionandmeasurementFinancialassetsandfinancialliabilitiesarerecognisedwhentheentitybecomesapartytotheprovisionstotheinstrument.Forfinancialassets,thisisequivalenttothedatethattheGroupcommitsitselftoeitherthepurchaseorsaleoftheasset.

Financialinstrumentsareinitiallymeasuredatfairvalueplustransactioncosts,exceptwheretheinstrumentisclassified‘atfairvaluethroughtheprofitorloss’,inwhichcasethecostsareexpensedtotheStatementofProfitorLossandOtherComprehensiveIncomeimmediately.




27

ClassificationandsubsequentmeasurementFinancialinstrumentsaresubsequentlymeasuredateitheroffairvalue,amortisedcostusingtheinterestratemethodorcost.Whereavailable,quotedpricesinanactivemarketareusedtodeterminefairvalue.

TheGroupdoesnotdesignateanyinterestsinsubsidiaries,associatesorjointventureentitiesasbeingsubjecttotherequirementsofaccountingstandardsspecificallyapplicabletofinancialinstruments:

(i) LoansandreceivablesLoansandreceivablesarenon-derivativefinancialassetswithfixedordeterminablepaymentsthatarenotquotedinanactivemarketandaresubsequentlymeasuredatamortisedcost.Loansandreceivablesareincludedincurrentassetsexceptforthosenotexpectedtomaturewithin12monthsaftertheendofthereportingperiod.

(ii) FinancialliabilitiesNon-derivativefinancialliabilitiesaresubsequentlymeasuredatamortisedcost.

(iii) AvailableforsalefinancialassetsAvailableforsalefinancialassetsarenon-derivativefinancialassetsthatareeithernotsuitabletobeclassifiedintoothercategoriesoffinancialassetsduetotheirnature,ortheyaredesignatedassuchbymanagement.Theycompromisetheinvestmentsintheequityofotherentitieswherethereisneitherafixedmaturitynordeterminablepayments.

ImpairmentAteachreportingdate,theGroupassesseswhetherthereisobjectiveevidencethatafinancialinstrumenthasbeenimpaired.

(j) Impairmentofnon-financialassetsAteachreportingdate,theGroupreviewsthecarryingvaluesofitstangibleandintangibleassetstodeterminewhetherthereisanyindicationthatthoseassetshavebeenimpaired.Ifsuchanindicationexists,therecoverableamountoftheasset,beingthehigheroftheasset’sfairvaluelesscoststosellandvalueinuse,iscomparedtotheasset’scarryingvalue.Anyexcessoftheasset’scarryingvalueoveritsrecoverableamountisexpensedtotheStatementofProfitorLossandOtherComprehensiveIncome.

(k) EmployeebenefitsProvisionismadefortheGroup’sliabilityforemployeebenefitsarisingfromservicesrenderedbyemployeestoreportingdate.Employeebenefitsthatareexpectedtobewhollysettledwithinoneyeararemeasuredattheamountsexpectedtobepaidwhentheliabilityissettled,plusrelatedon-costs.Employeebenefitspayablelaterthanoneyeararemeasuredatthepresentvalueoftheestimatedfuturecashoutflowstobemadeforthosebenefits.Indeterminingtheliability,considerationisgiventoemployeewageincreasesandtheprobabilitythattheemployeemaysatisfyvestingrequirements.Thosecashflowsarediscountedusingmarketyieldsonnationalgovernmentbondswithtermstomaturitythatmatchtheexpectedtimingofcashflows.EquitysettledcompensationTheGroupoperatesequitysettledshare-basedpaymentemployeeshareoptionschemes.ThefairvalueofoptionsisascertainedusingtheBlack-Scholespricingmodelwhichincorporatesallmarketvestingconditions.Thefairvalueofretentionrightsisascertainedusingthebinomialvaluationmodel.

(l) ProvisionsProvisionsarerecognisedwhentheGrouphasalegalorconstructiveobligation,asaresultofpastevents,forwhichitisprobablethatanoutflowofeconomicbenefitswillresultandthatoutflowcanbereliablymeasured.

(m) CashandcashequivalentsCashandcashequivalentsincludescashonhand,depositsheldatcallwithbanks,othershort-termhighlyliquidinvestmentswithoriginalmaturitiesofthreemonthsorless.




28

(n) RevenueInterestrevenueisrecognisedusingtheeffectiveinterestratemethod,which,forfloatingratefinancialassets,istherateinherentintheinstrument.Allrevenueisstatednetofgoodsandservicestax(GST).

(o) GoodsandservicestaxRevenues,expensesandassetsarerecognisednetoftheamountofgoodsandservicestax(GST),exceptwheretheamountofGSTincurredisnotrecoverablefromtheAustralianTaxOffice(ATO).Inthesecircumstances,theGSTisrecognisedaspartofthecostofacquisitionoftheassetoraspartoftheexpense.

ReceivablesandpayablesarestatedintheStatementofFinancialPositioninclusiveofGST.

ThenetamountofGSTrecoverablefrom,orpayableto,theATOisincludedasacurrentassetorliabilityintheStatementofFinancialPosition.

CashflowsareincludedintheStatementofCashFlowsonagrossbasis.TheGSTcomponentsofcashflowsarisingfrominvestingandfinancingactivitieswhicharerecoverablefrom,orpayableto,theATOareclassifiedasoperatingcashflows.

(p) InterestsinjointoperationsAjointventureisanarrangementthattheGroupcontrolsjointlywithoneormoreotherinvestors,andoverwhichtheGrouphasrightstoashareofthearrangement’snetassetsratherthandirectrightstounderlyingassetsandobligationsforunderlyingliabilities.AjointarrangementinwhichtheGrouphasdirectrightstounderlyingassetsandobligationsforunderlyingliabilitiesisclassifiedasajointoperation.DetailsoftheGroup’sinterestsareshownatNote13.

(q) InvestmentsinassociatesAssociatecompaniesarecompaniesinwhichthegrouphassignificantinfluencethroughholding,directlyorindirectly,20%ormoreofthevotingpowerofthecompany.Investmentsinassociatecompaniesarerecognisedinthefinancialstatementsbyapplyingtheequitymethodofaccounting.TheequitymethodofaccountingrecognisestheinitialinvestmentatcostandadjustedthereafterfortheGroup’sshareofpost-acquisitionreservesandprofits/(losses)ofitsassociates.DetailsoftheGroup’sinterestsinassociatesisshownatNote11.

(r) TradeandotherpayablesTradeandotherpayablesrepresenttheliabilityoutstandingattheendofthereportingperiodforgoodsandservicesreceivedbythegroupduringtheperiodwhichremainsunpaid.Thebalanceisrecognisedasacurrentliabilitywiththeamountbeingnormallypaidwithin30daysofrecognitionoftheliability.

(s) Earningspershare(i) BasicearningspershareBasicearningspershareiscalculatedbydividingtheprofit/(loss)attributabletoequityholdersoftheGroup,excludinganycostsofservicingequityotherthanordinaryshares,bytheweightedaveragenumberofordinarysharesoutstandingduringthefinancialyear,adjustedforbonuselementsinordinarysharesissuedduringtheyear.(ii) DilutedearningspershareDilutedearningspershareadjuststhefiguresusedinthedeterminationofbasicearningspersharetotakeintoaccounttheafter-incometaxeffectandotherfinancingcostsassociatedwithdilutivepotentialordinarysharesandtheweightedaveragenumberofadditionalordinarysharesthatwouldhavebeenoutstandingassumingtheconversionofalldilutivepotentialordinaryshares.

(t) ComparativeFiguresWhenrequiredbyAccountingStandards,comparativefigureshavebeenadjustedtoconformtochangesinpresentationforthecurrentfinancialyear.




29

(u) CriticalaccountingestimatesandjudgementsTheDirectorsevaluateestimatesandjudgementsincorporatedintothefinancialreportbasedonhistoricalknowledgeandbestavailablecurrentinformation.Estimatesassumeareasonableexpectationoffutureeventsandarebasedoncurrenttrendsofeconomicdata,obtainedbothexternallyandwithintheGroup.Keyestimates–impairmentTheGroupassessesimpairmentateachreportingdatebyevaluatingconditionsspecifictotheGroupthatmayleadtoimpairmentofassets.Whereanimpairmenttriggerexists,therecoverableamountoftheassetisdetermined.Keyjudgements-explorationandevaluationexpenditureThegroupcapitalisesexpenditurerelatingtoexplorationandevaluationwhereitisconsideredlikelytoberecoverableorwheretheactivitieshavenotreachedastagewhichpermitsareasonableassessmentoftheexistenceofreserves.Whiletherearecertainareasofinterestfromwhichnoreserveshavebeenextracted,thedirectorsareofthecontinuedbeliefthatsuchexpenditureshouldnotbewrittenoffsincefeasibilitystudiesinsuchareashavenotyetconcluded.

(v) ParententityfinancialinformationThefinancialinformationfortheparententity,MarmotaLimited,disclosedinNote27hasbeenpreparedonthesamebasisastheconsolidatedfinancialstatements.

(w) Foreigncurrencytranslation Functionalandpresentationalcurrency

ItemsincludedinthefinancialstatementsofeachoftheGroup’sentitiesaremeasuredusingthecurrencyoftheprimaryeconomicenvironmentinwhichtheentityoperates(functionalcurrency).TheconsolidatedfinancialstatementsarepresentedinAustraliandollars,whichisMarmotaLimited’sfunctionalandpresentationalcurrency.

(x) GoingConcernThefinancialreporthasbeenpreparedonthebasisofgoingconcern.

ThecashflowprojectionsoftheGroupindicatethatitwillrequirepositivecashflowsfromadditionalcapitalforcontinuedoperations.TheGroupincurredalossof$389,655(2016:loss$445,750)andcashoutflowfromoperatingandinvestingactivitiesof$1,877,906.

TheGroup’sabilitytocontinueasagoingconcerniscontingentonobtainingadditionalcapital.Sincetheyearend,$500,000ofcapitalhasbeenraised.Ifadditionalcapitalisnotobtained,thegoingconcernbasismaynotbeappropriate,withtheresultsthattheconsolidatedentitymayhavetorealiseitsassetsandextinguishitsliabilities,otherthanintheordinarycourseofbusinessandatamountsdifferentfromthosestatedinthefinancialreport.Noallowanceforsuchcircumstanceshasbeenmadeinthefinancialreport.

(y) AuthorisationforissueoffinancialstatementsThefinancialstatementswereauthorisedforissuebytheBoardofDirectorson25September2017.




30

Consolidated 2017

$2016$

2 Revenue

Otherrevenues: Fromoperatingactivities

Interestreceivedfromotherparties 10,915 9,529Governmentgrants 25,000 47,305ProfitonSaleofAssets 14,000 -

Totalrevenues 49,915 56,834

3 (Loss)/profitbeforeincometaxexpensehasbeendeterminedafter

Expenses Administrationexpenses

ASXfees 30,354 12,989Shareregistryfees 28,813 34,620Insurance 14,042 23,327Auditandotherservices 27,000 26,837Travel 5,828 5,117Marketing 2,727 963SoftwarelicencesandITservices 2,351 11,298Other 18,835 17,492

129,950 132,643Consultingexpenses

Legalfees 1,200 2,431Corporateconsulting - 175Accountingandsecretarialservices 19,730 10,792

20,930 13,398Depreciationexpense

Plantandequipment 27,575 56,178Reallocationtoexplorationcosts (23,485) (38,693)Plantandequipment 4,090 17,485

Employmentexpenses Salariesandwages 320,512 444,574Directorsfees 17,000 *33,000Superannuation 26,825 39,268Provisions (12,548) (32,184)Share-basedpayments-directors 26,687 17,000Share-basedpayments-other 18,975 42,902Other 18,188 33,631Reallocationtoexplorationcosts (197,268) (276,494) 218,371 301,697

*includes$16,000feesrelatingtotheprevious2015year,butpaidinthe2016year

Occupancyexpenses 5,435 6,537

Impairmentexpenses Impairmentofexplorationassets 39,684 21,400




31

4 Incometax(expense)

Consolidated 2017

$2016$

Thecomponentsoftaxexpensecomprise: Currentincometax -Deferredtax -Taxportionofcapitalraisingcosts (21,110) (9,424)

Incometax(expense)reportedintheStatementofProfitorLossandOtherComprehensiveIncome (21,110) (9,424) Theprimafacietaxonprofitbeforeincometaxisreconciledtotheincometaxasfollows:

Primafacieincometax(expense)calculatedat27.50%onloss(2016:30%) (110,350) (130,897)

Taxeffectof:

Deferredtaxassetinrespectoftaxlossesnotbroughttoaccount 640,361 418,512Explorationexpenditures40-730 (500,295) (215,261)Taxeffectinamountsnotdeductable (41,621) (78,842)Impairmentexpensepreviouslybroughttoaccount 11,905 6,420Taxportionofcapitalraisingcosts 21,110 9,424

Incometax(expense)attributabletoloss (21,110) (9,424) Incometaxlosses Deferredtaxassetarisingfromcarriedforwardtaxlossesnotrecognisedatreportingdateastheassetisnotregardedasmeetingtheprobablecriteria

-taxlossesat27.5% 8,024,445 7,914,307

-taxlossesdistributedasEDIcredits (220,000) (170,000)Totaldeferredtaxasset 7,804,445 7,744,307 Temporarydifferences 6,017 9,655




32

Consolidated 2017

$2016$

5 Auditors’remuneration

Auditservices: AuditorsoftheGroup–GrantThornton

Auditandreviewofthefinancialreports 27,000 27,250 27,000 27,250

6 Earningspershare (a)Classificationofsecurities

Allordinaryshareshavebeenincludedinbasicearningspershare.

(b)Classificationofsecuritiesaspotentialordinaryshares

• nilunlistedoptions exercisableat$0.073 by29/07/2016 (2016:225,000)• nilunlistedoptions exercisableat$0.036 by24/07/2017 (2016:25,000)• 550,000unlistedoptions exercisableat$0.018 by16/12/2019 (2016:550,000)• nilunlistedoptions exercisableat$0.05 by12/01/2021 (2016:2,300,000)• 1,000,000unlistedoptions exercisableat$0.03 by6/10/2021 (2016:nil)• 5,000,000unlistedoptions exercisableat$0.03 by9/11/2021 (2016:nil)

OptionsgrantedtoemployeesundertheMarmotaLimitedDirector&EmployeeShareOptionPlanareconsideredtobepotentialordinarysharesandhavebeenincludedinthedeterminationofdilutedearningspersharetotheextenttowhichtheyaredilutive.

Consolidated 2017

$2016$

(c)Earningsusedinthecalculationofearningspershare (Loss)afterincometaxexpense (389,655) (445,750)

Weightedaveragenumberofsharesoutstandingduringtheyearincalculatingearningspershare

Numberforbasicanddilutedearningspershare

Ordinaryshares 464,433,208 412,798,354




33

Consolidated 2017

$2016$

7 Cashandcashequivalents

Cashatbank 493,206 619,621Depositsatcall 37,500 15,500 530,706 635,121

8 Tradeandotherreceivables

Current Otherreceivables 95,956 32,741 95,956 32,741

OtherreceivablesrepresentaccruedinterestreceivableandGSTrefunds.Receivablesarenotconsideredpastdue

and/orimpaired(2016:nil).

9 Othercurrentassets

Prepayments 11,649 11,538

10 Plantandequipment

Plantandequipment Atcost 732,398 758,905Accumulateddepreciation (666,389) (668,818) Netbookvalue 66,008 90,087

Reconciliations

Reconciliationsofthecarryingamountsforeachclassofplantandequipmentaresetoutbelow:Plantandequipment

Carryingamountatbeginningofyear 90,087 156,778Additions 3,497 7,489Disposals - (18,002)Depreciation (27,576) (56,178) Carryingamountatendofyear 66,008 90,087




34

11 Investmentsinassociates Interestsareheldinthefollowingassociatedcompanies:

Name Principalactivities Countryofincorporation

Shares Ownershipinterest

Carryingamountofinvestment

Unlisted 2017 2016 2017$

2016$

GroundhogServicesPtyLtd Administrationservices Australia Ord 50% 50% 1 1

(a) Movementsduringtheyearinequityaccountedinvestmentsinassociatedentities

Therehavebeennomovementsofequityaccountedinvestmentsinassociatedentitiesduringtheyear.

(b) Equityaccountedprofitsofassociatesarebrokendownasfollows:

Consolidated 2017

$2016$

Shareofassociate’sprofitbeforeincometax - -Shareofassociate’sincometaxexpense - -Shareofassociate’sprofitafterincometaxexpense - -

(c) Summarisedpresentationofaggregateassets,liabilitiesandperformanceassociates

TheGroup’sshareoftheresultsofitsprincipleassociatesanditsaggregatedassetsandliabilitiesareasfollows:

Currentassets 2 2Non-currentassets - -Totalassets 2 2Currentliabilities - -Non-currentliabilities - -Totalliabilities - - Netassets 2 2

12 Availableforsaleinvestments

Consolidated

2017$

2016$

Availableforsaleinvestments 8,000 8,000




35

13 Interestsinunincorporatedjointoperations MarmotaLimitedhasadirectinterestinanumberofunincorporatedjointoperationsasfollows:

No State Agreementname Parties Summary 1 SA JunctionDam

UraniumAgreement

TeckAustraliaPtyLtd,PlatSearchNLandEaglehawkGeologicalConsultingPtyLtd(TPE)andMarmotaLimited(MEU)

MEUhastherighttoexploreforuraniumintheareacoveredbyExplorationLicenceEL 5682 (formerly EL 45098). MEU hasachievedits100%earn-inandholds100%of the uranium rights under the terms oftheAgreement.TPEretainsaNSRof5%.

2 SA MeltonJoint

VentureMonaxMiningLimited(MOX)andMarmotaLimited(MEU)

MEU has the right to explore for allminerals in the area covered byExploration Licences EL 5209 andELA2017/00105 (formerly EL5122). MEUandMOXoperatea75:25jointventure.

14 Controlledentities

(a) Controlledentitiesconsolidated

Theconsolidatedfinancialstatementsincorporatetheassets,liabilitiesandresultsofthefollowingcontrolledentityinaccordancewiththeaccountingpolicydescribedinNote1(b):

Countryofincorporation

Percentageowned(%)

2017 2016Parententity: MarmotaLimited Australia SubsidiariesofMarmotaLimited: MarmosaPtyLtd Australia 100 100

15 Explorationandevaluationassets

Consolidated 2017

$2016$

Movement:

Carryingamountatbeginningofyear 3,661,339 2,948,901Additionalcostscapitalisedduringtheyear 1,667,650 733,838Impairment(1) (39,684) (21,400)Carryingamountatendofyear 5,289,305 3,661,339

Consolidated




36

2017$

2016$

Closingbalancecomprises:

Explorationandevaluation - 100%owned 3,164,509 1,527,142

Explorationandevaluationphase - JointVenture 2,124,796 2,134,197

5,289,305 3,661,339

(1) Theultimaterecoupmentofcostscarriedforwardforexplorationphaseisdependentonthesuccessfuldevelopmentandcommercialexploitationorsaleoftherespectiveareas.

TheimpairmentoftheexplorationassetrelatestoadjustmentorrelinquishmentoftenementsorpreviouslydroppedlandintheCurnamonaAreaofInterest.

16 Tradeandotherpayables

Tradepayables 58,351 71,263Otherpayablesandaccruals 140,438 26,980AmountspayabletoDirectorrelatedentities* 2,508 1,501 201,297 99,744

*DetailsofamountspayabletoDirectorrelatedentitiesaredetailedinNote23..

17 Provisions

Current Employeebenefits 4,747 16,144 Non-current Employeebenefits 123 1,237

Provisionforlongserviceleave

Aprovisionforlongserviceleavehasbeenrecognisedforemployeebenefits.Incalculatingthepresentvalueoffuturecashflowsinrespectoflongserviceleave,theprobabilityoflongserviceleavebeingtakenisbasedonhistoricaldata.ThemeasurementandrecognitioncriteriarelatingtoemployeebenefitshavebeenincludedinNote1tothisreport.

Provisions

Openingbalanceatbeginningofyear 17,381 49,566(Paymentsfrom)/additionstoprovisions (12,511) (32,185)Balanceatendofyear 4,870 17,381 Consolidated




37

2017$

2016$

18 Issuedcapital

Issuedandpaid-upsharecapital

517,257,703(2016:412,798,354)ordinaryshares,fullypaid

34,909,527

33,064,883 (a)Ordinaryshares Balanceatthebeginningofyear 33,064,883 31,577,895

Sharesissuedduringtheyear: 1,000,000shares: tenementacquisitionagreementat$0.018 18,000 -1,280,916shares: placement–non-cashconsiderationat$0.01629 20,866 -35,333,371shares: pursuanttoaSharePurchasePlanat$0.015 530,000 -388,160shares: inlieuofconsultant’sfeesat$0.01655 6,424 -915,000shares: inlieuofDirector’sfeesat$0.01858 17,000 -65,000,000shares: pursuanttoaplacementat$0.02 1,300,000 -541,902shares: inlieuofconsultantsfeesat$0.0159 8,632 Sharesissuedduringtheprioryear: 400,000sharesissuedtoemployeesonvestingofsharerights - 7,2008,960,817sharesissuedonexerciseoflistedoptions - 179,21647,473,750sharesissuedpursuanttoaSharePurchasePlan - 451,00117,250,000sharesissuedaspartofaplacementat$0.015 - 258,75015,750,000sharesissuedaspartofaplacementat$0.017 - 267,750493,197sharesissuedaspartofaplacementat$0.0183 - 9,02613,254,118sharesissuedaspartofaplacementat$0.02 - 265,0821,666,666sharesissuedaspartofaplacementat$0.03 - 50,0001,700,000sharesissuedinlieuofDirector’sFees - 17,000Lesstransactioncostsarisingfromissueofsharesnetoftax (56,278) (18,037)

Balanceatendofyear

34,909,527 33,064,883

Holdersofordinarysharesareentitledtoreceivedividendsasdeclaredfromtimetotimeandareentitledtoonevotepershareatshareholders’meetings.

OrdinaryshareshavenoparvalueandtheGroupdoesnothavealimitedamountofauthorisedcapital.

IntheeventofwindingupoftheGroupordinaryshareholdersrankafterallcreditorsandarefullyentitledtoanyproceedsofliquidation.

(b)Options/rights Therewerenoshareoptions/retentionrightsissuedtoExecutiveDirectorsduringthefinancialyear.ForinformationrelatingtotheMarmotaLimitedDirector&EmployeeShareOptionPlanincludingdetailsofanyoptionsissued,exercisedandlapsedduringthefinancialyear,refertoNote19.At30June2017,therewere6,875,000unissuedsharesforwhichthefollowingoptionswereoutstanding.

• 25,000unlistedoptions exercisableat$0.036 by24/07/2017• 550,000unlistedoptions exercisableat$0.018 by16/12/2019• 300,000unlistedoptions exercisableat$0.05 by12/01/2021• 1,000,000unlistedoptions exercisableat$0.03 by06/10/2021• 5,000,000unlistedoptions exercisableat$0.03 by09/11/2021




38

At30June2016,therewere3,100,000unissuedsharesforwhichthefollowingoptionswereoutstanding.

• 225,000unlistedoptions exercisableat$0.073 by29/07/2016• 25,000unlistedoptions exercisableat$0.036 by24/07/2017• 550,000unlistedoptions exercisableat$0.018 by16/12/2019• 2,300,000unlistedoptions exercisableat$0.05 by12/01/2021

(c) CapitalManagement ManagementeffectivelymanagestheGroup’scapitalbyassessingtheGroup’sfinancialrisksandadjustingitscapitalstructureaccordingly.Theseresponsesincludeshareissues.TherehavebeennochangesinthestrategyadoptedbymanagementtocontrolthecapitaloftheGroupsincetheprioryear.TheGroup’scapitalisshownasissuedcapitalintheStatementofFinancialPosition.

19 Share-basedpayments

Share-basedpaymentsareinlinewiththeMarmotaLimitedEmployeeShareOptionPlan,detailsofwhichareoutlinedintheDirectors’Report.Listedbelowaresummariesofoptionsgranted:

(ii) Options

2017 2016

MarmotaLimited Numberofoptions

Weightedaverageexerciseprice

Weightedaverageremainingcontractual

life

Numberofoptions

Weightedaverageexerciseprice

Weightedaverageremainingcontractual

life

Outstandingatthebeginningoftheyear

3,100,000 $0.046 1,595.000 $0.027

Granted - -

–7October2017 1,000,000 $0.03 - -

–9November2017 5,000,000 $0.03

–January2016 - - 2,300,000 $0.050

Forfeited (2,000,000) $0.005 (395,000) $0.021

Exercised - - (400,000) $0.018

Expired (225,000) $0.019 - -

Outstandingatyear-end 6,875,000 $0.021 1,458days 3,100,000 $0.046 1,458days

Exercisableatyear-end 6,875,000 3,100,000

On29July2011,250,000shareoptionsweregrantedtoemployeesundertheMarmotaLimitedEmployeeShareOptionPlantotakeupordinarysharesatanexercisepriceof$0.073each.Theseoptionsareexercisableonorbefore29July2016.Alloftheseoptionshavelapsed.

On24July2012,250,000shareoptionsweregrantedtoemployeesundertheMarmotaLimitedEmployeeShareOptionPlantotakeupordinarysharesatanexercisepriceof$0.036each.Theseoptionsareexercisableonorbefore24July2017.125,000oftheseoptionshavebeenexercisedinprioryearsandtheremainderhavelapsed.

On17December2014,1,270,000shareoptionsweregrantedtoemployeesundertheMarmotaLimitedEmployeeShareOptionPlantotakeupordinarysharesatanexercisepriceof$0.018each.Theseoptionsareexercisableonorbefore16December2019.400,000oftheseoptionshavebeenexercisedand320,000havelapsedintheprioryearleaving550,000at30June2017.




39

On13January2016,2,300,000shareoptionsweregrantedtoemployeesundertheMarmotaLimitedEmployeeShareOptionPlantotakeupordinarysharesatanexercisepriceof$0.05each.Theseoptionsareexercisableonorbefore12January2021.Alloptionshavelapsedduringtheyear.

On6October2016,1,000,000shareoptionsweregrantedtoemployeesundertheMarmotaLimitedEmployeeShareOptionPlantotakeupordinarysharesatanexercisepriceof$0.03each.Theseoptionsareexercisableonorbefore6October2021:BlackScholesvaluation$2,624.

On9November2016,5,000,000shareoptionsweregrantedtodirectorsandemployeesundertheMarmotaLimitedDirector&EmployeeShareOptionPlantotakeupordinarysharesatanexercisepriceof$0.03each.Theseoptionsareexercisableonorbefore9November2021:BlackScholesvaluation$16,144.50.

Theoptionsarenon-transferableexceptasallowedundertheDirector&EmployeeShareOptionPlanandarenotquotedsecurities.Atreportingdate,otherthanasdisclosedinthetableabove,noshareoptionshadbeenexercised.AlloptionsgrantedtokeymanagementpersonnelareoverordinarysharesinMarmotaLimited,whichconferarightofoneordinaryshareforeveryoptionheld.

ThefairvalueoftheoptionsgrantedwascalculatedbyusingtheBlack-Scholesoptionpricingmodelapplyingthefollowinginputs:

Nov2016

issue

Oct2016

issue

Jan2016

issue

Dec2014

issue

Jul2012

issue

Weightedaveragefairvalue $0.003 $0.003 $0.0187 $0.008 $0.035

Weightedaverageexerciseprice $0.03 $0.03 $0.05 $0.018 $0.036

Weightedaveragelifeoftheoption 1,825days 1,825days 1,827days 1,825days 1,826days

Underlyingshareprice $0.016 $0.016 $0.024 $0.01 $0.039

Expectedsharepricevolatility 41.8% 37.5% 124% 131% 136%

Riskfreeinterestrate 1.8% 1.8% 2.18% 2.50% 2.31%

Thelifeoftheoptionisbasedonthedaysremaininguntilexpiry.Volatilityisbasedonhistoricalshareprices.

Theoptionsholdnovotingordividendsrightsandareunlisted.Theoptionslapse6monthssubsequenttothecessationofemploymentwiththeGroup,otherthanincertainsituations.Therearenovestingconditionsattachedtotheoptions.

Expensearisingfromshare-basedpaymenttransactions

Totalexpensesarisingfromshare-basedpaymenttransactionsrecognisedduringtheperiodaspartofemployeebenefitsexpensewereasfollows: Consolidated 2017

$2016$

OptionsissuedunderEmployeeOptionplan–employees 9,081 42,902OptionsissuedunderEmployeeOptionplan–director 9,687 -SharesissuedtoMrPThompsoninlieuofdirector’sfees 17,000 17,000SharesissuedtoDrKWillsinlieuofChiefGeologistfees 12,248 2,799 48,016 62,701




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20 FinancialriskmanagementTheGroup’sfinancialinstrumentsconsistmainlyofdepositswithbanks,accountsreceivableandpayableandloanstoandfromsubsidiariesandrelatedentities.

Thetotalsforeachcategoryoffinancialinstruments,measuredinaccordancewithAASB139asdetailedintheaccountingpoliciestothesefinancialstatements,areasfollows:

Consolidated 2017

$2016$

Financialassets Cashandcashequivalents 530,706 635,121Loansandreceivables 95,956 32,741Availableforsaleinvestments 8,000 8,000 634,662 675,862 Financialliabilities Tradeandotherpayables 201,297 99,744 201,297 99,744

Financialriskmanagementpolicies

TheBoardofDirectorsareresponsibleformonitoringandmanagingfinancialriskexposuresofthegroup.

Specificfinancialriskexposuresandmanagement

Themainrisksthegroupisexposedtoincludesliquidityrisk,creditriskandinterestraterisk.

(a) LiquidityriskLiquidityriskarisesfromthepossibilitythattheGroupmightencounterdifficultyinsettlingitsdebtsorotherwisemeetingitsobligationsrelatedtofinancialliabilities.

TheGroupmanagesliquidityriskbymonitoringforecastcashflows,onlyinvestingsurpluscashwithmajorfinancialinstitutions;andcomparingthematurityprofileoffinancialliabilitieswiththerealisationprofileoffinancialassets.

TheBoardmeetsonaregularbasistoanalysefinancialriskexposureandevaluatetreasurymanagementstrategiesinthecontextofthemostrecenteconomicconditionsandforecasts.TheBoard’soverallriskmanagementstrategyseekstoassisttheconsolidatedgroupinmanagingitscashflows.

Financialliabilitiesareexpectedtobesettledwithin12months.

(b) CreditriskexposuresCreditriskrepresentsthelossthatwouldberecognisedifcounterpartiesfailedtoperformascontracted.

Themaximumexposuretocreditriskonfinancialassets,excludinginvestments,oftheentitywhichhavebeenrecognisedintheStatementofFinancialPosition,isthecarryingamount,netofanyprovisionfordoubtfuldebts.

Noreceivablesareconsideredpastdueorimpairedatreportingdate.




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(c) InterestrateriskExposuretointerestrateriskarisesonfinancialassetsandliabilitiesrecognisedatreportingdatewherebyafuturechangeininterestrateswillaffectfuturecashflowsorthefairvalueoffixedratefinancialinstruments.

TheGrouphasnolongtermfinancialliabilitiesuponwhichitpaysinterest.Cashisheldinaninterestyieldingchequeaccountandonshorttermcalldepositwheretheinterestrateisbothfixedandvariableaccordingtothefinancialasset.

Interestrateriskismanagedwithamixtureoffixedandfloatingratecashdeposits.

(d) SensitivityanalysisInterestrateTheGrouphasperformedasensitivityanalysisrelatingtoitsexposuretointerestrateriskatreportingdate.Thissensitivityanalysisdemonstratestheeffectonthecurrentyearresultsandequitywhichcouldresultfromachangeintheserisks.ItshouldbenotedthattheGroupdoesnothaveborrowingsandanyimpactswouldbeinrelationtodeposityieldsoncashinvestments.

InterestratesensitivityanalysisAtreportingdate,theeffectonprofit/(loss)andequityasaresultofchangesintheinterestrate,withallothervariablesremainingconstantwouldbeasfollows:

Consolidated 2017

$2016$

Changeinloss Increaseininterestratesby2% 10,614 12,678Decreaseininterestratesby2% (10,614) (12,678)

Changeinequity Increaseininterestratesby2% 10,614 12,678Decreaseininterestratesby2% (10,614) (12,678)

21 Commitments&contingentliabilities

(a) Explorationexpenditurecommitments

Inordertomaintaincurrentrightsoftenuretoexplorationtenements,theGroupwillberequiredtooutlayintheyearending30June2018amountsofapproximately$1,385,000(2016:$1,565,000)tomeetminimumexpenditurerequirementspursuanttovariousjointventurerequirementsandthosespecifiedbytheStateGovernmentofSouthAustralia.Theseobligationsaresubjecttorenegotiationwhenapplicationforaminingleaseismadeandatothertimes.Theseobligationsarenotprovidedforinthefinancialreport.(b) Operatingleasesaslessee

TheGroupleasesaslesseeanofficeandwarehousefacilityunderanoperatinglease.Thefutureminimumleasepaymentsareasfollows:

Minimumleasepaymentsdue Within1year 1to5years After5years Total $ $ $ $June2017 35,632 32,166 67,798June2016 32,819 22,773 - 55,592




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(c) Guarantees

TheGrouphasnegotiatedanumberofbankguaranteesinfavourofvariousgovernmentauthoritiesandserviceproviders.Thetotalnominalamountoftheseguaranteesatthereportingdateis$37,500(2016:$15,500).Thesebankguaranteesarefullysecuredbycashontermdeposit.

(d) Contingentliabilities

Asat30June2017,therewasacontingentliabilityof$66,434:• $47,915fortheGroundhogServicesPartnership(beingMarmota50%share)assessmentreceived

fromRevenueSAforpayrolltaxrelatingto2010–2015financialyearsinrespectofadisputedchangeingrouping.

• $18,519forMarmotaLtd’sassessmentfromRevenueSAforpayrolltaxrelatingto2012-2015financialyearsinrespectofthedisputedchangeingrouping.

Theseassessmentsarecurrentlybeingdisputed.Formoredetail,refertoNote25(2016:$47,915). Consolidated Note 2017

$2016$

22 Notestothestatementsofcashflows

(a) Cashattheendofthefinancialyearconsistsofthefollowing:

Cashatbankandatcall 7 530,706 635,121 530,706 635,121

(b) Reconciliationof(loss)afterincometaxtonetcashoutflowfromoperatingactivities

(Loss)afterincometax (389,655) (445,750)Add/(less)non-cashitems

Depreciation 27,576 17,485Share-basedpayments (28,663) 42,902Share-basedpayments 17,001

Profitonsaleofassets (14,000) -Impairmentofassets 39,684 21,400Incometaxexpense 21,110 9,424

Changesinoperatingassetsandliabilities (Increase)/decreaseinotherassets - 9,123(Increase)/decreaseintradeandotherreceivables (63,332) 6,412(Decrease)/increaseintradeandotherpayables 23,488 (44,660)(Decrease)/increaseinprovisions (12,512) (32,184)

Netcash(usedin)operatingactivities (379,303) (415,848)

23 Relatedparties

Directors’transactionswiththeCompany

AnumberofDirectorsoftheCompany,ortheirDirectorrelatedentities,heldpositionsinotherentitiesduringthefinancialyearthatresultinthemhavingcontrolorsignificantinfluenceoverthefinancialoroperatingpoliciesofthoseentities.

ThetermsandconditionsofthetransactionswithDirectorsandtheirDirectorrelatedentitieswerenomorefavourabletotheDirectorsandtheirDirectorrelatedentitiesthanthoseavailable,orwhichmightreasonablybeexpectedtobeavailable,onsimilartransactionstoNon-directorrelatedentitiesonanarm’slengthbasis.




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Therearenoamountsrecognisedduringtheyear(excludingremunerationandre-imbursementofexpensesincurredonbehalfoftheCompany)relatingtoDirectorsandtheirDirectorrelatedentities.Intheprioryear,$7,175creditwasreceivedforamountpaidinFY2015toarelatedpartyofGSDavis.

AmountsreceivablefromandpayabletoDirectorsandtheirDirectorrelatedentitiesatreportingdatearisingfromthesetransactionswereasfollows: Consolidated 2017

$ 2016 $

Currentreceivables Loantodirectorrelatedentity - -Loantoassociate - - - -

Currentpayables Amountspayabletodirectorrelatedentities(1) 2,508 1,501Accrueddirectorsfees 9,987 - 12,495 1,501

(1)FY17amountisamountinvoicedforDirector’sfeesbyarelatedentityof:

• MrPThompson$2,508(FY16$1,501);and• DrKWills$9,987(FY16$nil).

RefertotheRemunerationReportcontainedintheDirectors’ReportfordetailsoftheremunerationpaidorpayabletoeachmemberoftheCompany’skeymanagementpersonnelfortheyearended30June2017.

Thetotalsofremunerationpaidtodirectorsandkeymanagementpersonnelduringtheyearareasfollows:

Consolidated 2017

$ 2016 $

Shorttermemployeebenefits 252,625 187,524Postemploymentbenefits 11,935 16,118Otherlongtermbenefits - 1,237Otherbenefits 5,100 23,526Share-basedpayments 45,393 17,000 315,053 255,405

24 Operatingsegments

TheDirectorshaveconsideredtherequirementsofAASB8–OperatingSegmentsandtheinternalreportsthat are reviewed by the chief operating decision maker (the Board) in allocating resources and haveconcludedthatatthistimetherearenoseparatelyidentifiablesegments.

25 Eventssubsequenttoreportingdate

InSeptember2017,Marmotaannounceda$500,000placementtosophisticatedinvestorsat$0.017pershare.

TherehavebeennoothermattersorcircumstancesarisingsincetheendofthefinancialyearwhichsignificantlyaffectedorcouldsignificantlyaffecttheoperationsoftheGroup,theresultsofthoseoperations,orthestateoftheGroupinfutureyears.




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26 ReservesShareoptionsreserve

Theshareoptionsreserverecordsitemsrecognisedasexpensesonvaluationofemployeeshareoptionsandretentionrights.

Availableforsalereserve

Theavailableforsalereservecomprisesgainsandlossesrelatingtothesetypesoffinancialinstruments. Consolidated 2017

$2016$

Reserves

Shareoptionreserve Openingbalanceatbeginningofyear 58,302 2,727,310Fairvalueofoptionsissuedtoemployees 18,768 42,902Optionsexercisedorexpired (47,431) (2,711,910)Balanceatendofyear 29,639 58,302

Availableforsalereserve Openingbalanceatbeginningofyear (7,500) (7,500)Revaluationofavailableforsaleasset - -Balanceatendofyear (7,500) (7,500) TotalReserves 22,139 50,802

27 MarmotaLimitedcompanyinformation

2017 2016 $ $Parententity

Assets Currentassets 704,350 775,438Non-currentassets 5,296,510 3,662,623

Totalassets 6,000,860 4,438,061Liabilities

Currentliabilities 206,044 115,888Non-currentliabilities 123 1,237

Totalliabilities 206,167 117,125

Equity

Issuedcapital 34,909,536 33,064,883Retainedlosses (29,136,973) (28,794,749)Shareoptionreserve 29,630 58,302

Availableforsalereserve (7,500) (7,500)Totalequity 5,794,693 4,320,936

Financialperformance

(Loss)fortheyear (389,655) (446,515)Othercomprehensiveincome - -

Totalcomprehensiveincome (389,655) (446,515)

Guaranteesinrelationtothedebtsofsubsidiaries: -Contingentliabilities 66,434 47,915Contractualcommitments 62,578 55,592




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28 Fairvaluemeasurementofassetsandliabilities

Fairvaluehierarchy AASB13requiresdisclosureoffairvaluemeasurementsbylevelofthefollowingfairvaluehierarchy:Quotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilities(level1)Inputsotherthanquotedpricesincludedwithinlevel1thatareobservablefortheassetorliability,eitherdirectlyorindirectly(level2),and

Inputsfortheassetorliabilitythatarenotbasedonobservablemarketdata(unobservableinputs)(level3)Allfinancialinstrumentswerevaluedusinglevel1valuationtechniques.Therewerenochangesinvaluationtechniquesforfinancialinstrumentsintheperiod.

AvailableforsalefinancialassetsaremeasuredatfairvalueusingtheclosingpriceonthereportingdatesaslistedontheAustralianSecuritiesExchangelimited(ASX).Thecarryingvalueoftradereceivablesandpayablesareassumedtoapproximatetheirfairvaluesduetotheirshort-termnature.

29 Companydetails TheregisteredofficeandprincipalplaceofbusinessoftheCompanyis:

MarmotaLimited Unit6,79–81BrightonRoad GlenelgSA5045

MarmotaLimited

Directors’declaration


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Directors’declaration

TheDirectorsofMarmotaLimiteddeclarethat

(a) thefinancialstatementsandnotesareinaccordancewiththeCorporationsAct2001,and:

(i) giveatrueandfairviewofthefinancialpositionasat30June2017andoftheperformancefortheyearendedonthatdateoftheconsolidatedentity;and

(ii) complywithAccountingStandards;and

(iii) MarmotaLimitedcomplieswithInternationalFinancialReportingStandardsasdisclosedinNote1.

(b) ThepersonholdingtheChiefExecutiveOfficerandtheChiefFinancialOfficerfunctionshasdeclaredthat:

(i) ThefinancialrecordsoftheCompanyforthefinancialyearhavebeenproperlymaintainedinaccordancewiths286oftheCorporationsAct2001;

(ii) Thefinancialstatementsandnotesforthefinancialyearcomplywiththeaccountingstandards;and

(iii) Thefinancialstatementandnotesforthefinancialyeargiveatrueandfairview;

(c) Inthedirectors’opinion,therearereasonablegroundstobelievethattheCompanywillbeabletopayitsdebtsasandwhentheybecomedueandpayable.

ThisdeclarationismadeinaccordancewitharesolutionoftheBoardofDirectors.

DatedatSydneythis25thdayofSeptember2017.

DrColinRoseChairman

Grant Thornton House Level 3 170 Frome Street Adelaide, SA 5000 Correspondence to: GPO Box 1270 Adelaide SA 5001 T 61 8 8372 6666 F 61 8 8372 6677 E [email protected] W www.grantthornton.com.au

Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389 ‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited. Liability limited by a scheme approved under Professional Standards Legislation.

Independent Auditor’s Report To the Members of Marmota Limited Report on the audit of the financial report Opinion We have audited the financial report of Marmota Limited (the Company) and its subsidiaries (the Group), which comprises the consolidated statement of financial position as at 30 June 2017, the consolidated statement of profit or loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies, and the directors’ declaration. In our opinion, the accompanying financial report of the Group, is in accordance with the Corporations Act 2001, including: a Giving a true and fair view of the Group’s financial position as at 30 June 2017 and of its

performance for the year ended on that date; and

b Complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Group in accordance with the independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material Uncertainty Related to Going Concern We draw attention to Note 1(x) in the financial statements, which indicates that the Group incurred a net loss of $389,655 during the year ended 30 June 2017 and incurred net cash outflows from operating and investing activities totalling $1,877,906. These conditions, along with other matters as set forth in Note 1(x), indicate that a material uncertainty exists that may cast doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Related to Going Concern section, we have determined the matters described below to be the key audit matters to be communicated in our report.

Key audit matter How our audit addressed the key audit matter Exploration and Evaluation Assets – valuation Note 15

At 30 June 2017 the carrying value of Exploration and Evaluation Assets was $5,289,305. In accordance with AASB 6 Exploration for and Evaluation of Mineral Resources, the company is required to assess at each reporting date if there are any triggers for impairment which may suggest the carrying value is in excess of the recoverable value. The process undertaken by management to assess whether there are any impairment triggers in each area of interest involves an element of management judgement. This area is a key audit matter due to the valuation of exploration and evaluation assets being a significant risk.

Our procedures included, amongst others: x Obtaining the management reconciliation of

capitalised exploration and evaluation expenditure and agreeing to the general ledger;

x Reviewing management’s area of interest considerations against AASB 6;

x Conducting a detailed review of management’s assessment of trigger events prepared in accordance with AASB 6 including; - Tracing projects to statutory registers,

exploration licenses and third party confirmations to determine whether a right of tenure existed;

- Enquiry of management regarding their intentions to carry out exploration and evaluation activity in the relevant exploration area, including review of managements’ budgeted expenditure;

- Understanding whether any data exists to suggest that the carrying value of these exploration and evaluation assets are unlikely to be recovered through development or sale;

x Assessing the accuracy of impairment recorded for the year as it pertained to exploration interests that were relinquished; and

x Reviewing the appropriateness of the related disclosures within the financial statements.

Information Other than the Financial Report and Auditor’s Report Thereon The Directors are responsible for the other information. Our opinion on the financial report does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors’ for the Financial Report The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the Directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf. This description forms part of our auditor’s report. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included the directors’ report for the year ended 30 June 2017. In our opinion, the Remuneration Report of Marmota Limited, for the year ended 30 June 2017, complies with section 300A of the Corporations Act 2001. Responsibilities The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. GRANT THORNTON AUDIT PTY LTD Chartered Accountants S K Edwards Partner - Audit & Assurance Adelaide, 25 September 2017

http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf

marmota limited

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