2021

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CORPORATE DIRECTORY ..................................................3 MANAGING DIRECTOR’S LETTER ....................................4 REVIEW OF OPERATIONS ..................................................5 DIRECTOR’S REPORT ....................................................... 18 REMUNERATION REPORT (AUDITED) ......................... 24 AUDITOR’S INDEPENDENT DECLARATION ............... 30 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME .................. 31 CONSOLIDATED STATEMENT OF FINANCIAL POSITION ............................................................................. 32 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ................................................................................. 33 CONSOLIDATED STATEMENT OF CASH FLOWS ..... 34 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ...................................................................... 35 DIRECTORS’ DECLARATION .......................................... 57 INDEPENDENT AUDIT REPORT ..................................... 58 SHAREHOLDER INFORMATION .................................... 62 SCHEDULE OF MINERAL TENEMENT INTERESTS .. 64

Corporate Directory

Directors

Mr Richard Lockwood Non-Executive Chairman

Dr Matthew Greentree Chief Executive Officer and Managing Director

Share Registry

Automic Group Level 2, 267 St Georges Terrace Perth WA 6000 Telephone: 1300 288 664

Mr Denis Rakich

Auditors

Executive Director

Mr Neil Fearis

Non-Executive Director

Mr Geoffrey Jones Non-Executive Director

BDO Audit (WA) Pty Ltd 38 Station Street Subiaco WA 6008 Telephone: (08) 6382 4600 Facsimile: (08) 6382 4601

Mr Timothy Kestell Non-Executive Director

Company Secretary

Bankers

Westpac Banking Corporation Level 8, 10 St Georges Terrace Perth WA 6000

Mr Denis Rakich

Solicitors

Registered Office

Level 16, AMP Building 140 St Georges Terrace PERTH WA 6000 Telephone: (08) 9220 9890 Facsimile: (08) 9220 9820 Web: www.ausgoldlimited.com Email: [email protected]

Securities Exchange

Australian Securities Exchange (ASX) Level 40 Central Park 152-158 St Georges Terrace Perth WA 6000

Squire Patton Boggs (AU) Level 21, 300 Murray Street Perth WA 6000

HopgoodGanim Lawyers Level 27, 77 St Georges Terrace Perth WA 6000

All Mining Legal Suite 2, 257 York Street Subiaco WA 6008

Australian Business Number

ABN 67 140 164 496

ASX Code: AUC FRA: AU4

Managing Director’s Letter

Dear fellow shareholders,

The 2021 Financial Year was a transformational year for the Company as we continued to expand our flagship Katanning Gold Project (KGP), located in south-west Western Australia. Our vision for Katanning is clear, which is to realise its multi-million ounce potential enabling Ausgold to become a significant gold producer in the near term.

Building a Critical Mass

Ausgold completed over 40,000m of drilling targeting the Central Zone of the KGP’s 17km mineralised strike length. Our improved geological modelling and estimation methodology enabled more precise identification of high-grade targets which ultimately delivered an outstanding outcome of a 28% increase to the Mineral Resource. The JORC 2012 Mineral Resource estimate for the KGP now stands at 38.18 Mt at 1.25 g/t for 1.54 million ounces of gold.

Alongside this achievement, we also saw gold grade improve by 14% to 1.25 g/t, the reporting of a new high-grade underground Resource, >1 Moz now in the Measured and Indicated categories, all underpinned by best-in-class discovery economics of less than $15 per ounce.

We have identified a large Resource, which provides a meaningful foundation that most companies aspire to as their end goal, but we know that this represents a small portion of a much larger mineralised system. Ausgold is perfectly placed to realise its ambition to become a large-scale gold producer.

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Potential for Larger Scale

Following exploration success and subsequent Resource growth in the Central Zone, the Company augmented the balance sheet raising $17.6M in capital to enable its growth ambitions. Being well funded to pursue further Resource growth, Ausgold turned its attention to the potential for large-scale expansion of the project, commencing activities in the Southern Zone of the KGP. The prospective Southern Zone extends for 8km of strike length, which is almost double the size of the Central Zone. An improved geological model has enabled targeting of near-surface and underground gold mineralisation with further repeats and extensions to the existing Resource.

The initial drill program completed for 5,250m focused on previously untested areas, with first results delivering extensive zones of high-grade gold mineralisation, and supports the Company’s thesis that there is significant potential to further expand the existing 1.54Moz Resource to the south.

Follow-up drill programs are underway which will support metallurgical test work and geotechnical studies, as the Company plans to accelerate its exploration activities ahead of its highly active summer period.

Optionality

Ausgold’s asset portfolio also includes a number of projects in its portfolio that have the potential to realise value alongside the Company’s flagship Katanning Gold Project. For example, initial results at Woodanilling demonstrated high-grade copper-silver mineralisation, and elevated Platinum and Palladium grades which offer meaningful potential in the context of other discoveries in the Southwest Yilgarn.

Overall, we are entering an exciting phase where substantial value can be recognised, rewarding all stakeholders. I would like to acknowledge Ausgold’s dedicated team for their commitment, and drive, in delivering an array of results this year that have been the envy of our peers. I would also like to thank shareholders for your ongoing support. I believe there is substantially more value to unlock as we continue on a rewarding journey. The achievements this year have begun to be recognised by investors and I believe that FY22 is shaping up to be another pivotal year for Ausgold, on our way to becoming a significant gold producer.

Matthew Greentree

Managing Director

Review Of Operations FY2021

Review of Operations FY2021

Highlights:

Upgraded JORC Resource of 38.18 Mt at 1.25 g/t for 1,539,700 oz gold:

28% increase to Resource;
Improved gold grade by 14%;
1 Moz of Resource in Measured and Indicated categories;
First reported high-grade underground Resource; and
Best-in-class discovery economics at $15 per ounce

The Company’s portfolio projects offer optionality for additional value to be recognised:

Ausgold’s asset portfolio includes the Woodanilling Project, Lake Magenta Gold Project, Doolgunna Station Cu-Au Project, Yamarna Ni-Cu-Co Project, and the Cracow Au Project;
Initial drilling at Woodanilling intersected high-grade coppersilver mineralisation (Mine Hill), and elevated Platinum and Palladium grades (Red Hill – Martling trend); and
This style of mineralization has not been previously reported in the area and has meaningful potential in the context of other discoveries in the area.

40,000m drilling campaign completed in the Central Zone which delivered the upgraded Resource, along with potential for further Resource growth, including:

A total of AU$17.6M raised during the year with the Company well-funded to accelerate its growth plans to in scale of the Katanning Gold Project

0.54 Mt at 3.01 g/t Au for 52,240 ounces in Jinkas Underground Resource, reported below 150mRL at a higher 1.8 g/t cut-off grade now shows untested potential at depth;
Improved geological modelling and estimation methodology enabled better estimating for the high-grade (>3.5 g/t Au) proportions of the Jinkas deposit within the Jinkas, Jinkas South and White Dam lodes;
New high-grade targets identified within and outside of Resource areas, with 46 advanced gold targets in underexplored greenstone belt;
Continuity of mineralisation along strike has now been used to delineate three laterally extensive mineralised systems defined from west to east, being - Jinkas, White Dam and Jackson; and
High-grade Jinkas South gold mineralisation extended to over 1.3km strike length

Focus on Resource growth with exploration commenced in the Southern Zone, including:

A highly prospective 8km strike length comprising of the Rifle Range, Dingo and Lukin areas – almost double the size of the Central Zone
The improved geological model being used for targeted nearsurface and underground exploration;
Initial RC drill program of 5,250m completed within the Rifle Range area which contains over 2.5km of previously untested strike length. First results delivered extensive zones of highgrade gold mineralisation;
Early work supports the Company’s thesis that there is significant potential to further expand the existing 1.54Moz Resource to the south; and
Follow-up drill programs in train to support metallurgical test work and geotechnical studies

Review Of Operations continued

Katanning Gold Project

WESTERN AUSTRALIA (AUC 100%)

Ausgold Limited (ASX:AUC) is an ASX listed exploration company which holds a dominant tenure position over the entire Katanning Greenstone Belt, controlling >4,000km2 of ground in the historically under-explored and highly prospective south west portion of the Yilgarn Craton.

The Katanning Gold Project (KGP) lies within the Katanning Greenstone Belt and is located approximately 35km from the township of Katanning situated 275 km south of Perth in the South West Yilgarn Craton of Western Australia. The KGP lies within a major mineralised structural corridor, with exploration to date having outlined a 17km belt hosting multi-lode gold mineralisation across three key zones including the following gold deposits and prospects (Figure 1):

Central Zone – Jackson, Olympia, Jinkas, and Jinkas South
Southern Zone – Rifle Range, Dingo, and Lukin
Northern Zone – Datatine

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Figure 1 - Katanning Gold Project Resource Block Model

Review Of Operations continued

Upgraded 2021 JORC Resource Mineral Resource

During the year Ausgold engaged independent geological consultants to undertake an update of the KGP geological model to provide an upgrade of the KGP JORC resource, the estimate was completed and announced to ASX in April 2021.

The new Resource which totals 1.54 million ounces of gold (Table 1) is a 28% increase in total contained ounces and a 14% increase in grade, from the previous 2019 Resource estimate (ASX Announcement 1 November 2019).

Completed in accordance with the 2012 JORC Code, assessment has been undertaken of the Central Zone Resource area which extends along a 4.5km strike length. The total Resource includes the Dingo and Datatine deposits which remain unchanged from the 2019 estimation (Figure 1). The Katanning Gold Project is now one of the larger undeveloped gold projects in Western Australia.

Resource Upgrade Key Points:

An increase of 338,670 ounces, 28% increase , at a low discovery cost of $15 per ounce
Higher overall grade of 1.25 g/t Au , 14% increase from the 2019 estimate
1 Moz in Measured and Indicated categories , a 72% increase from 2019
Jinkas – White Dam for a continuous lode with combined Resources of 950,000 ounces
0.54 Mt at 3.01 g/t Au for 52,240 ounces in Jinkas Underground Resource, reported below 150mRL at a higher 1.8 g/t cut-off grade now shows untested potential at depth
Independent review of Resource by SRK Consulting (Australasia) Pty Ltd
Addition of over 31,000m of new RC and diamond drilling
Improved geological modelling and estimation methodology to enable a better estimate for the high-grade (>3.5 g/t Au) proportions of the Jinkas deposit within the Jinkas, Jinkas South and White Dam lodes.
Mineral Resource is reported at a 0.6 g/t Au cut-off grade for
open pit and 1.8 g/t Au cut-off grade for underground Resource
Open Pit Resources are reported above 150mRL, to an approximate maximum depth of 220m
Continuity of mineralisation along strike has now been used to delineate three laterally extensive mineralised systems defined from west to east, these are Jinkas, White Dam and Jackson (Figure 1 & 2)
Jinkas White Dam Resource extends down dip and coalesces with the Jinkas lode within the high-grade Jinkas South Lode
Olympia extends southward and is the likely strike extension from Jinkas, but currently there is insufficient drilling to directly link the geological models between the two Resource areas
Jackson Resource extends towards the north where it coalesces with the Olympia – Jinkas mineralisation

This Resource upgrade provides critical mass to the KGP and supports Ausgolds strategy to develop a standalone mining operation focused on the Central Zone. Importantly, it also shows the exploration potential within the Resource areas and regionally to significantly increase the scale of the Katanning Gold Project with targeted exploration.

2021 Mineral Resource Summary

The Mineral Resource estimate for the KGP now reports at 38.18Mt @ 1.25 g/t Au for 1.54 million ounces of contained gold (Table 1)

Table 1 - Summary Gold Resources for the KGP

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Tonnes Grade Contained
Resource category
Mt (g/t au) gold (oz)
Measured 6.40 1.48 303,300
Indicated 18.74 1.19 718,000
Inferred 13.04 1.24 518,400
Total Resource 38.18 1.25 1,539,700
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Notes to Table 1:

Resource is reported at a lower cut-off grade of 0.6 g/t Au and above 150m RL (approximately 220m depth), the underground Resource is reported at 1.8 g/t Au beneath 150m RL.

Project Infrastructure

The project is located 275 km from Perth and close to high-quality infrastructure which supports the near-term development of the project. Project infrastructure includes:

Granted mining licences
Grid power
Sealed roads
Water
Town of Katanning 35 kms from site
Accommodation
Airstrip

KGP Central Zone

The Central Zone contains the majority of the current JORC Resource of 1.54 Moz, identified within a 4.5km strike length (Figure 1 and Table 1).

During the year Ausgold completed an extensive 34,587m drilling program at KGP focusing on the Central Zone and in particular the Jinkas South lode, a new discovery which is proving to be a significant addition to the project extending over a strike length of more than 1.3km with mineralisation open to the north and south. The Jinkas South discovery also provides validation of our geological model and targeting techniques for high-grade mineralisation within the KGP.

Recent exploration and Resource drilling has targeted areas of highgrade mineralisation within the Central Zone, using the improved geological model combined with geophysical techniques. Ausgold has refined the exploration targeting methods including the extensive use of Down Hole Electromagnetic techniques to detect and located extensive zones of pyrrhotite – magnetite alteration, which are characteristic of high-grade gold mineralisation. This improved deposit knowledge and exploration targeting methods have enabled Ausgold to further expand the KGP Resource at the relatively low discovery cost of $15 per Resource ounce.

Following the Resource upgrade RC and diamond drilling continued in the Central Zone with a total of 6,964m of drilling completed which extended areas of interpreted gold mineralisation beyond the current 1.54 Moz KGP Resource.

Review Of Operations continued

Jinkas South

The Jinkas South lode has a total strike length of 1.3 kms and remains open to the north and south.

Significant recent results from the Jinkas South lode include:

26m @ 6.60 g/t Au from 117m including 4m @ 37.2 g/t Au
16m @ 6.21 g/t Au from 114m including 4m @ 22.4 g/t Au
15m @ 3.66 g/t Au from 117m including 5m @ 10.4 g/t Au
12m @ 3.52 g/t Au from 120m including 3m @ 9.64 g/t Au
9m @ 3.52 g/t Au from 213m including 3m@ 9.43 g/t Au
28m @ 1.35 g/t Au from 131m
14m @ 1.45 g/t Au from 100m including 2m @ 8.28 g/t Au

Jinkas North

Three diamond and four RC holes have been completed with partial funding from a $150,000 grant under the Western Australian Government’s Exploration Incentive Scheme (EIS). The program has tested 1,750m along strike from the Jinkas deposit and extending north past the Olympia Resource. New drilling has been targeted using coincident VTEM and gravity anomalies (Figure 2).

Three diamond drill holes have intersected disseminated to semimassive pyrrhotite-magnetite-chalcopyrite mineralisation at depths between 150-220m which is consistent with mineralisation in the Jinkas lode. All three diamond holes have a strong off-hole electromagnetic response to be tested in future drill programs. Assays results from this drilling are pending. Gold mineralisation encountered in this area will further extend Resource potential north of the current limits of the existing Resource.

37m @ 0.86 g/t Au from 150m including 6m @ 2.86 g/t Au
15m @ 1.01g/t Au from 117m including 2m @ 3.09 g/t Au
7m @ 1.62g/t Au from 83m including 2m @ 3.6 g/t Au
19m @ 2.92 g/t Au from 121m including 1m@ 35.4 g/t Au
29m @ 1.84 g/t Au from 104m including 18m @ 2.72 g/t Au
38m @ 1.12 g/t Au from 113m including 1m @ 8.30 g/t Au and 5m @ 2.10 g/t Au
9m @ 2.34 g/t Au from 89m including 5m @ 3.95 g/t Au
39m @ 1.32 g/t Au from 96m including 8m @ 4.10 g/t Au
7m @ 4.09 g/t Au from 111m including 1m @ 24.90 g/t Au
30m @ 0.95 g/t Au from 132m including 9m @ 1.56 g/t Au
19m @ 1.02 g/t Au from 114m including 5m @ 2.65 g/t Au
16m @ 1.04 g/t Au from 129m

Recent drilling has focused on areas where the geological model and geophysical response have highlighted areas which are likely to host high-grade gold mineralisation within the Jinkas, White Dam and Jinkas South high-grade lodes, targeting host rock associations and the accompanying of pyrrhotite – magnetite alteration zones within broad zones of gold mineralisation.

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Figure 2 - Long section (view towards west) through the Jinkas Resource area showing extensions of the Jinkas South lode

Review Of Operations continued

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Figure 2a – Recent drilling within Central Zone shown on gram-metre plots (intercept width in metres x grade)

Review Of Operations continued

KGP Southern Zone

During the year the Company submitted an application to Department of Agriculture, Water and the Environment (DAWES) under the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act) to access the Rifle Range Reserve for exploration purposes. Following consultation DAWES provided a recommendation for a non-controlled action. An Exploration Environmental Management Plan (EEMP) has been prepared to be consistent with the Commonwealth’s Environmental Management Plan Guidelines and is designed to ensure that activities will have negligible impact on vegetation, fauna or recreational activities within the area.

Following the receipt of key regulatory approvals, Ausgold completed an RC drill program to test the extensions to KGP gold mineralisation within the Southern Zone including the Rifle Range Reserve. A total of 8,379m were drilled in the Southern Zone which is located on a structural repeat of the same mineralised structure identified within the Central Zone (Figure 1). The drilling program included the Rifle Range, Dingo and Lukin areas along a total strike length of 8km. These areas have demonstrated promising early results which include high-grade gold mineralisation with potential to expand the scale of the total gold Resource at Katanning (Figure 1).

Positive results were received from this programme with high-grade gold mineralisation intersected beyond the current Resource areas. Equally encouraging, was the extensive zone of sulphidic alteration encountered along the full 2.5km strike length in the Rifle Range area, highlighting the presence of a larger mineralised system within the KGP Southern Zone as predicted by Ausgold’s updated geological model. Further work is planned to target gold mineralisation within the large mineralised system associated with the large alteration system encountered in a number of drill holes.

New significant results include:

10m @ 2.89 g/t Au from 84m including 3m @ 8.35 g/t Au in BSRC1231
6m @ 4.5 g/t Au from 32m including 2m @ 12.75 g/t Au in BSRC1168
9m @ 2.52 g/t Au from 85m including 5m @ 4.09 g/t Au in BSRC1200
18m @ 1.23 g/t Au from 83m in BSRC1230
10m @ 2.01 g/t Au from 66m in BSRC1226
35m @ 0.52 g/t Au from 28m in BSRC1173
2m @ 7.98 g/t Au from 25m in BSRC1195
19m @ 0.81 g/t Au from 77m in BSRC1199
4m @ 3.32 g/t Au from 84m in BSRC1171
4m @ 3.17 g/t Au from 120m in BSRC1169
13m @ 0.96 g/t Au from 30m in BSRC1197
12m @ 1.00 g/t Au from 125m in BSRC1120
14m @ 0.84 g/t Au from 60m in BSRC1204
11m @ 0.99 g/t Au from 56m in BSRC1169
4m @ 2.72 g/t Au from 100m in BSRC1231
9m @ 1.16 g/t Au from 105m in BSRC1170
8m @ 1.3 g/t Au from 22m in BSRC1133

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Figure 3 - Long section through Southern Zone Dingo – Rifle Range area with grade as gram-metres (intercept width in metres x grade)

Review Of Operations continued

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Figure 4 - Picture of Dingo Pit looking south

Dingo Resource

The Dingo Mineral Resource is currently 4.2Mt grading 1.08g/t Au, containing 147,470 ounces Au.

Mineralisation has a modest dip to the east of 45[o] and a shallow south east plunge. The depth to the base of complete oxidation averages 20m and the depth to the top of fresh rock averages 40m. Drilling to date confirms the continuation of gold mineralisation over a strike length 1.2 kilometres to a vertical depth of around 150m. The gold mineralisation remains open along strike and also at depth. Furthermore, past drilling highlights potential extentions of the Dingo mineralisation indicating that this deposit may extend a further 500m to the south, where it is plunging shallowly at depth. Ausgold is planning an extensive drill programme commencing late 2021, with the aim to add to the Dingo Resource.

Southern KGP - Lukin area

Historical AC drilling has delineated a trend of gold mineralisation (> 0.1 g/t) which extends along the eastern side of a significant gravity high marking a large thrust fault (Figure 5). This thrust fault is a fundamental control on gold mineralisation regionally along the entire strike length of the KGP and across the Southwest Yilgarn Craton. Primary mineralisation intersected in recent RC drilling suggests the southern KGP represents a significant target which to date has received relatively limited exploration. A new RC program will commence in late 2021

KGP Northern Zone

The KGP Northern Zone extends for a strike length of 6 kms and contains the Datatine deposit which contains a gold resource of 671,900m/t at 1.20 g/t for 25,890 ounces.

Datatine differs from the more southern portions of the KGP in that the host rocks and mineralisation strike in an easterly direction with a southern dip as opposed to north-westerly strike with an easterly dip.

Drilling delineated the prospective contact between the mafic granulite and the granite footwall a further 600m west. Drilling has also highlighted a second parallel mineralised trend to the south. Follow-up RC drilling is planned at Datatine to test the strike extents of mineralisation.

Review Of Operations continued

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Figure 5 - Drill results Southern Zone KGP

Review Of Operations continued

Regional Exploration

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Figure 6 - Regional gold exploration targets within Figure 6 - Regional gold exploration targets within Ausgold’s > 4,100 km2 tenure

Ausgold holds exploration rights over a landholding of more than 4,000km2 along a significant geological boundary separating the Boddington and Lake Grace Terranes. Faults along this boundary are the same as those that host the gold mineralisation within the KGP. A new geological interpretation of the region based on field mapping has provided a framework under which to conduct exploration. Combined with the significant geochemical database collected by Ausgold and historical data, this has enabled the identification of 46 new regional target areas (Figure 6). The Company continues targeted work programs, including surface sampling, to prioritise the new targets for follow-up assessment, priority targets for drilling commencing late November 2021.

Burong

Burong is located along a NE-striking thrust fault, which cross-cuts a NNW-striking thrust fault which controls the Central Zone. Gold mineralisation intersected in drilling has a moderate northerly dip and is closely associated with quartz veining in sulphidic mafic and ultramafic granulites.

New drilling at the Burong prospect confirms the regional potential surrounding the KGP. Burong is located along a regionally significant NNW-striking thrust fault, which also hosts the Datatine deposit 10 km to the east. This new mineralised trend is open along strike and is parallel to a major NE striking regional fault, which extends eastward towards Datatine and is perpendicular to the main KGP structure. Further soil sampling is planned to target gold mineralisation along this newly defined mineralised trend, with air-core and RC drilling planned to recommence in the coming summer months.

Review Of Operations continued

Nanicup Bridge

This prospect is 30km east of the KGP, where gold mineralisation is identified over a strike length of 20km. Past exploration drilling intersected a large geochemical anomaly centred around a large structure parallel to the one controlling the KGP. Past drilling intersected potassic alteration zone with variable sulphide contents including pyrite, chalcopyrite, bismuthinite and molybdenite.

Significant RC drill intercepts include:

15m @ 1.03g/t Au from 51m in 01NBRC008
4m @ 2.28g/t Au from 10m and 5.7m @ 1.85g/t Au from 25.7 m in 04NBDH004
3m @ 2.44g/t Au from 87m and 9m @ 0.79 g/t Au from 102m in 03NBRC009

Bullock Pool

This prospect is located 10km southwest of the KGP with gold mineralisation (>0.1 g/t Au) identified over a strike length of 25km in past AC and RAB drilling (Figure 7). The area has received less exploration than the KGP or Nanicup Bridge, however gold mineralisation has been intersected in mafic-ultramafic and felsic bedrock (Figure 7).

Historical RC Intercepts include:
12m @ 1.55g/t from 30m in 00BPRC013
4m @ 2.34g/t from 36m in 00BPRC002
3m @ 2.02g/t from 00BPRC021

Ausgold plans to re-commence exploration at Bullock Pool in early 2022 with RC drilling.

Ausgold plans to re-commence exploration at Nanicup Bridge in early 2022 with further RC drilling.

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Figure 7 - Regional view of KGP and regional targets showing trend of mineralisation over aeromagnetic image

Review Of Operations continued

Lake Magenta Gold Project

WESTERN AUSTRALIA (AUC 100%)

The Lake Magenta Gold Project is located near the town of Jerramungup in the South West Yilgarn region of Western Australia. The project comprises E70/5044 and E70/5285 covering an area of 165km2.

Previous exploration by Dominion Mining Limited in the early 2000s has outlined a large gold-in-soil anomaly with a strike length of over 17kms which is coincident with a major arcuate structure identified in detailed airborne magnetics and regional gravity (Figure 8). This regional scale fold, which is interpreted as a control on gold mineralisation, is truncated by the Yandina Shear Zone. This deepseated structure is known to host several significant gold deposits, including Tampia (Ramelius) and Griffins Find.

Past drilling and soils sampling completed at Lake Magenta identified significant gold mineralisation over 17km of strike length along the Yandina Shear. During the past year Ausgold has furthered work on the project with landholder engagement and the design of exploration programs to test the primary gold and potentially copper mineralisation. Ausgold was awarded an Exploration Incentive Scheme Grant in Round 23 to co-fund drilling of up to $150,000 which is designed to test new geological concepts related to this large gold mineralised system. Drilling planned to be completed in H1 2022.

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Figure 8 - Lake Magenta Project showing contoured gold in-soil anomaly and drilling extent over TMI magnetic image

Review Of Operations continued

Woodanilling Project

WESTERN AUSTRALIA (AUC 100%)

The Woodanilling Project (“Woodanilling”) lies 20km north of Katanning, located 240km southeast of Perth, Western Australia. The project comprises a total area of 1,532 km².

Woodanilling is a layered mafic intrusion complex with extensive past exploration including soil sampling and drilling to test vanadium and PGEs within the project area. The project includes the Mine Hill (E70/4863), Red Hill (E70/5142), Kalang (E70/5142) and Martling (E70/5142) prospects. Past exploration includes 108 RC and six diamond drill holes which have intersected significant widths of vanadium (V[2] O[5] ) mineralisation from surface, with thicknesses of up to 60m and multiple zones of mineralisation identified (Figure 9).

In light of the recent Julimar discovery by Chalice Mining Limited, a review of previous work has identified four priority areas of anomalous copper – chrome – gold - PGE (up to 0.04 – 0.07 ppm Pd and 0.03 – 0.05 ppm Pt in 08KTR077).

Mine Hill copper-silver-gold mineralisation

Diamond hole RHDD001 drilled for 180.6m at Mine Hill, near to historical gold workings intersected a high-grade zone of coppersilver-gold mineralisation. Mineralisation occurs in two near surface zones with semi-massive sulphides including pyrrhotite, chalcopyrite, pyrite and rare trace molybdenite.

Significant intercepts include:

1.95m @ 6.65 g/t Ag and 0.70% Cu, including 0.45m @ 12.2 g/t Ag, 1.37 % Cu and 0.14 g/t Au from 56.05m
4m @ 1.8 g/t Ag and 0.11 g/t Au from 0m

High-grade Ag-Cu intercepts occur within a broad zone of lower grade mineralisation which extends for over 34.75m and is associated with disseminated sulphides, including pyrrhotite, pyrite and molybdenite with elevated values for Cu, Ag, Au, Bi, Ca, Co, Mo, Rh, Ti and Zn. Mineralisation is hosted within a gabbro with the highest grades being along the contact with a granite. Within these gabbros elevated V[2] O[5] and TiO2 was intercepted with 24.1m @ 0.22% V2O5 and 4.23% TiO2 from 131.5m, including 3.3m 0.71% V2O5 and 12.37% TiO2 from 145.8m.

This new drilling has demonstrated a new style of mineralisation which may have more regional implications. Ausgold is currently reviewing the recent drill results and ground-based geophysics to develop and prioritise new drill targets.

Regional Ni-PGE targets

New drilling by Ausgold (16 holes for 2,581m) has tested three targets identified from anomalous nickel, copper and chromium in surface geochemistry, showing the presence of layered mafic intrusive rocks and elevated PGEs in past drilling. The enrichment of Cr-Ni and Cu in soils was used to identify ultramafic portions of the Woodanilling layered intrusion, which are the likely hosts for potential Ni-PGE mineralisation. A broad zone over 6km of strike length with anomalous Pt-Pd is enriched in Cr, Cu and Mo, with magmatic chalcopyrite and pyrrhotite noted within a coarse-grained gabbroic rock at Red Hill.

Martling

Nine RC holes for 1,117m were drilled to target anomalous Cu, Ni and Cr values in historical auger soils and to test an area with strongly anomalous platinum (up to 45 ppb Pt) and palladium (up to 50 ppb Pd) over 56m down hole in historical drilling (drill hole 08KTR077 – ASX Release 13 December 2018). New RC drill hole RHRC009 has intersected this same zone of enriched PGE-Cu with disseminated sulphides including pyrrhotite and pyrite over a total depth of 73m and elevated Pt (up to 48 ppb) and Pd (up to 62 ppb), Ni, Cr (800-980ppm).

Red Hill

Eight RC holes at the Red Hill (RHRC011 - 16) drilled for 1,335m and one 70.2 m diamond tail (RHR016D). Ausgold’s drilling has targeted areas with potential ultramafic rocks, focusing on areas with high Cr values (800-980ppm) identified in historical auger sampling. New drilling intersected biotite-garnet gneiss, gabbro and minor granites with the gneissic unit contained relatively high levels of chromium up to 571 ppm.

Hole RHRC014 diamond tail was drilled from 180 to 250.2m which intersected coarse grained ferro-gabbro. Sulphides were intersected in the diamond tail between 129-135m and at 179.9m, with a 2cm wide sulphide bands which include chalcopyrite and pyrrhotite intersected within a coarse-grained gabbro.

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Figure 9 – Geological overview map of the Woodanilling Project

Review Of Operations continued

Doolgunna Station

WESTERN AUSTRALIA (AUC 100%)

The Doolgunna Station Project, located 150km north-east of Meekatharra in Western Australia’s Bryah Basin comprises E52/3031 covering 176km2 and is located approximately 13km to the west and along trend from the DeGrussa copper-gold operations of Sandfire Resources Limited.

The project is the subject of a Farm-in Agreement with AIC Mines Limited (“AIC”) (ASX:A1M), under the terms of the Agreement AIC has the right to earn a 70% interest in the project by spending a minimum of $2,150,000 over a period of four years. After the spending commitment is met, Ausgold can either retain a 30% contributing interest or reduce to a 20% interest free-carried to a decision to mine.

Yamarna

WESTERN AUSTRALIA (AUC 25%)

The Yamarna Project (“Project”) is the subject of a Joint Venture Agreement with Great Boulder Resources Limited (ASX:GBR) (“Great Boulder”) in which Ausgold has retained a 25% free-carried interest in the Project until a decision to mine. The Project includes the highly prospective Winchester nickel-copper prospect, located 125 km northeast of Laverton in Western Australia.

The Project, which is located 40km north along strike from Great Boulder’s Mt Venn Project, comprises exploration licence E38/2129 located in the northern Mt Venn Greenstone Belt.

Great Boulder reported that it planned an upcoming nickel exploration program with a combination of extensional exploration at the Winchester Prospect plus regional reconnaissance on other nearby prospects.

Cracow

QUEENSLAND (AUC 100%)

Ausgold holds exploration licence EPM 17054 covering approximately 202km2 in the Cracow region, 375km north-west of Brisbane, Queensland. The tenement covers extensive areas of the Camboon volcanics which host the multi-million ounce Cracow epithermal gold deposit. No significant fieldwork was undertaken on this project during the year, Ausgold is actively seeking a joint partner to fund future exploration.

Competent Person’s Statements

The information in this report that relates to the Mineral Resource Estimates is based on work done by Dr Michael Cunningham of Sonny Consulting Pty Ltd, Daniel Guibal of Condor Consulting Pty Ltd and Mr Michael Lowry of SRK Consulting (Australasia) Pty Ltd and Dr Matthew Greentree of Ausgold Limited in 2021.

Dr Greentree is Managing Director and is a Shareholder in Ausgold Limited. Dr Greentree takes responsibility for the integrity of the Exploration Results including sampling, assaying, QA/QC, the preparation of the geological interpretations and Exploration Targets. Dr Michael Cunningham is an option holder in Ausgold takes responsibility for the Mineral resource Estimate for the Jackson and Olympia deposits and Mr Daniel Guibal takes responsibility for the Jinkas and White Dam Resources. Mr Michael Lowry takes responsibility for the Mineral Resource Estimates for Dingo and Datatine deposits.

Dr Cunningham, Mr Guibal, Mr Lowry and Dr Greentree are Members of The Australasian Institute of Mining and Metallurgy and have sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration, and to the activity they are undertaking, to qualify as Competent Persons in terms of The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code, 2012 edition).

The Competent Persons consent to the inclusion of such information in this report in the form and context in which it appears.

Forward-Looking Statements

This report includes “forward-looking statements” as that term within the meaning of securities laws of applicable jurisdictions. Forwardlooking statements involve known and unknown risks, uncertainties and other factors that are in some cases beyond Ausgold Limited’s control. These forward-looking statements include, but are not limited to, all statements other than statements of historical facts contained in this presentation, including, without limitation, those regarding Ausgold Limited’s future expectations. Readers can identify forwardlooking statements by terminology such as “aim,” “anticipate,” “assume,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “risk,” “should,” “will” or “would” and other similar expressions. Risks, uncertainties and other factors may cause Ausgold Limited’s actual results, performance, production or achievements to differ materially from those expressed or implied by the forward-looking statements (and from past results, performance or achievements). These factors include, but are not limited to, the failure to complete and commission the mine facilities, processing plant and related infrastructure in the time frame and within estimated costs currently planned; variations in global demand and price for coal and base metal materials; fluctuations in exchange rates between the U.S. Dollar, and the Australian dollar; the failure of Ausgold Limited’s suppliers, service providers and partners to fulfil their obligations under construction, supply and other agreements; unforeseen geological, physical or meteorological conditions, natural disasters or cyclones; changes in the regulatory environment, industrial disputes, labour shortages, political and other factors; the inability to obtain additional financing, if required, on commercially suitable terms; and global and regional economic conditions. Readers are cautioned not to place undue reliance on forward-looking statements. The information concerning possible production in this announcement is not intended to be a forecast. They are internally generated goals set by the board of directors of Ausgold Limited. The ability of the company to achieve any targets will be largely determined by the company’s ability to secure adequate funding, implement mining plans, resolve logistical issues associated with mining and enter into any necessary off take arrangements with reputable third parties. Although Ausgold Limited believes that its expectations reflected in these forwardlooking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements

Director’s Report

The Directors present their report together with the financial statements, on the consolidated entity consisting of Ausgold Limited and the entity it controlled for the financial year ended 30 June 2021. Ausgold Limited (“Ausgold” or “the Company”) and its controlled entity (collectively known as ”the Group” or “consolidated entity”) are domiciled in Australia.

Principal Activities

The consolidated entity’s principal activities during the financial year were the exploration for gold and other precious and base metals.

Directors and Company Secretary

The Directors and Company Secretary of the Company during or since the end of the financial year are:

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Richard Lockwood, Non-Executive Chairman
Non-executive Director since 12 November 2010 and Non-Executive Chairman since 2 September 2012
Investment professional with 45 years’ experience in mining, funds management
Experience and expertise
and resource investment.
None
Qualifications
Other directorships None
Chairman of the Board
Special responsibilities Member of Audit and Risk Committee
Chairman of Remuneration and Nominations Committee
Ordinary shares – 56,000,000
Interests in securities
Performance Rights – 8,000,000
Neil Fearis, Non-Executive Director
Since 15 April 2016
Corporate lawyer with 40 years’ experience in commercial law, M&A, capital raisings
Experience and expertise
and corporate reconstructions with a focus on the mining and resource sectors.
Qualifications LL.B (Hons) FAICD, F FIN
Jacka Resources Limited (resigned 30 November2020)
Other directorships
Golden Cross Resources Limited (resigned 21 January 2019)
Member of the Board
Special responsibilities Chairman of Audit and Risk Committee
Member of Remuneration and Nominations Committee
Ordinary shares – 10,000,000
Interests in securities
Performance Rights – 6,000,000
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Directors Report continued

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Geoffrey Jones, Non-Executive Director
Since 29 July 2016
Civil engineer with over 30 years’ experience in construction, engineering, mineral
Experience and expertise
processing and project development in Australia and overseas.
Qualifications BE (Civil), FIEAust, CPEng
Firefly Resources Limited
GR Engineering Services Limited
Other directorships
Blackham Resources Limited (resigned 24 December 2018)
Azumah Resources Limited (resigned 18 July 2018)
Member of the Board
Special responsibilities Member of Audit and Risk Committee
Member of Remuneration and Nominations Committee
Ordinary shares – 9,250,000
Interests in securities
Performance Rights – 6,000,000
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Timothy Kestell , Non-Executive Director
Appointed 12 August 2021
Broker with over 25 years of Capital Markets experience including working for
Experience and expertise
HSBC, Paterson Securities Limited and Euroz Securities Limited.
BCom
Qualifications
Other directorships Capricorn Metals Limited (resigned 13 September 2019)
Special responsibilities Member of the Board
Ordinary shares – 98,500,000
Interests in securities
Matthew Greentree, Chief Executive Officer and Managing Director
Chief Executive Officer since 10 April 2017 and Managing Director since 19 April 2018
Geologist with 20 years’ experience in mineral exploration across Australia and
Experience and expertise overseas. Providing a strong technical focus on the Group’s operations and able to
draw on experience from working on more than 60 mineral projects.
Qualifications PhD, BSc Geology (Hons), MAusIMM, MAIG, MAICD
Other directorships None
Member of the Board
Special responsibilities Member of Audit and Risk Committee
Member of Remuneration and Nominations Committee
Ordinary shares – 15,500,000
Interests in securities
Performance Rights – 20,000,000
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Directors Report continued

Denis Rakich, Executive Director and Company Secretary Since 31 January 2013

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Accountant with 35 years’ experience in resource sector, legal, financial and
Experience and expertise
corporate management.
BBus
Qualifications
Other directorships Samson Oil and Gas Limited (resigned 23 July 2019)
Member of the Board
Special responsibilities Member of Audit and Risk Committee
Member of Remuneration and Nominations Committee
Ordinary shares – 28,998,681
Interests in securities
Performance Rights – 12,000,000
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Directors’ Meetings

The number of meetings of the board of directors held during the financial year ended 30 june 2021 and the number attended by each director are as follows:

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Nominations and
Board of Directors Remuneration Audit and Risk Committee
Committee
Director Held Attended Held Attended Held Attended
R Lockwood 6 6 - - 1 1
N Fearis 6 6 - - 1 1
G Jones 6 6 - - 1 -
M Greentree 6 6 - - 1 -
D Rakich 6 6 - - 1 1
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In addition to these meetings, during the year the directors considered and passed two circular resolutions pursuant to clause 72 of the Company’s constitution.

Dividends

No dividends have been declared or paid since the end of the previous financial year.

Significant Changes in the State of Affairs

There were no significant changes in the state of affairs of the consolidated entity during the financial year.

Likely Developments and Expected Results of Operations

The company’s objective is to continue to explore for gold at the Katanning Gold Project (“KGP”) in Western Australia, with a view to increasing the overall size of the geological resource and to commence feasibility studies for the future development of the project, whilst at the same time exploring for gold and other metals in other parts of Australia.

Environmental Regulations

The Group’s exploration activities are governed by a range of environmental legislation. To the best of the Directors’ knowledge, the Group has adequate systems in place to ensure compliance with the requirements of the applicable environmental legislation and is not aware of any material breach of those requirements during the financial year up to the date of this report.

Directors Report continued

Review of Operations

Exploration

Information On The Group’s Operations At Its Katanning Gold Project And Other Projects Is Set Out In The Operations Review on pages 5 – 17 of this report.

Financial

The Group recorded a consolidated loss of $3,513,319 (2020: $1,823,335) for the financial year ended 30 June 2021. At 30 June 2021, the Group had $7,451,103 (2020: $1,025,802) in cash and cash equivalents.

Convertible Securities

Options

Total options on issue at the date of this report

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Exercise Opening Closing
Grant date Expiry date Granted Exercised Lapsed
price balance balance
11 Nov 2016 30 Nov 2020 $0.08 16,000,000 - - (16,000,000) -
10 Apr 2017 31 Jul 2020 $0.06 5,000,000 - - (5,000,000) -
10 Apr 2017 31 Jul 2020 $0.08 5,000,000 - - (5,000,000) -
9 Jan 2018 31 Dec 2021 $0.06 3,700,000 - - - 3,700,000
23 Mar 2021 1 Apr 2024 $0.08 - 10,000,000 - - 10,000,000
4 May 2021 3 May 2024 $0.06 - 16,000,000 - - 16,000,000
5 Jul 20211 30 Jun 2024 $0.06 - 4,000,000 - - 4,000,000
5 Jul 20211 30 Jun 2024 $0.08 - 3,000,000 - - 3,000,000
29,700,000 33,000,000 - (26,000,000) 36,700,000
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1 Grant date is the date of employee acceptance which was between July 2021 and September 2021.

Performance Rights

Total ordinary shares which are subject to performance rights at the date of this report

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Opening Closing
Grant date Vesting date Exercise price Granted Vested
balance balance
8 Nov 2019 30 Apr 2021 $0.00 35,000,000 - (35,000,000) -
20 Nov 2020 30 Jun 2022 $0.00 - 52,000,000 - 52,000,000
1 Feb 2021 30 Jun 2022 $0.00 - 6,250,000 - 6,250,000
35,000,000 58,250,000 (35,000,000) 58,250,000
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Directors Report continued

Events subsequent to reporting date

On 13 August 2021, Ausgold announced that Mr Timothy Kestell has joined the Board as a Non-Executive Director.

The COVID-19 pandemic has developed rapidly in 2020, with a significant number of cases worldwide. Measures taken by various governments to contain the virus have affected economic activity. The Company has taken a number of measures to monitor and mitigate the effects of COVID-19, such as safety and health measures for its staff (such as social distancing and working from home) and securing the supply of materials that are essential to its activities.

At this stage, the impact on the Company’s activities has not been significant and based on their experience to date the Directors expect this to remain the case. The Company will continue to follow the various government policies and advice and, in parallel, will do its utmost to continue its operations in the best and safest way possible without jeopardising the health of its staff.

Other than the above, no matter or circumstance has arisen as at the date of this report that has significantly affected, or may have significantly affected, the consolidated entity’s operations, the results of those operations, or the consolidated entity’s state of affairs in future financial years.

Indemnification of Directors

Indemnification

The Company has agreed to indemnify the current Directors and Officers of the Company against all liabilities to another person (other than the company or a related body corporate) that may arise from their designated position in the Company, except where the liability arises out of conduct involving a lack of good faith or breach of duty.

The agreement stipulates that the Company will meet the maximum extent permitted by law, the amount of any such liabilities, including costs and expenses.

Insurance premiums

The Company paid a premium during the year in respect of a Director and Officer liability insurance policy, insuring the Directors of the Company, the Company Secretary, and all executives of the Company against a liability incurred in that capacity to the extent permitted by the Corporations Act 2001.

Indemnity and insurance of auditor

The Company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the Company or any related entity against a liability incurred by the auditor. During the financial year, the Company has not paid a premium in respect of a contract to insure the auditor of the Company or any related entity.

Proceedings on behalf of the Company

As far as the Directors are aware, no person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party, for the purpose of taking responsibility on behalf of the Company for the conduct of all or part of those proceedings.

Corporate Governance

The 2021 Corporate Governance Statement is available on the Company’s website at www.ausgoldlimited.com.

Directors Report continued

Non-Audit Services

During the year, BDO Audit (WA) Pty Ltd, the Company’s auditor, has performed other services in addition to the audit and review of the financial statements.

Details of the amount paid to the auditor and its related practices for other assurance services are set out below:

	2021	2020
Other	services – Valuation of performance rights and options 1,925	3,500
Total	1,925	3,500

The Board of Directors is satisfied that the provision of the non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services by the auditor did not compromise the auditor independence requirements of the Corporations Act 2001.

The Auditor’s Independence Declaration

The Auditor’s Independence Declaration is included on page 30 of the financial report.

Remuneration Report

The Remuneration Report which has been audited is set out on pages 24 to 29 and forms part of the Directors Report.

This report is signed in accordance with a resolution of the Directors.

For and behalf of the Directors

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Denis Rakich Director

Perth, Western Australia

30 September 2021

Remuneration Report (Audited)

Remuneration Report

The Directors present this Remuneration Report prepared in accordance with the requirements of the Corporations Act 2001 on the consolidated entity for the financial year ended 30 June 2021. This Remuneration Report forms part of the Directors’ Report.

Key Management Personnel

Key management personnel are defined as those persons having authority and responsibility for planning, directing and controlling the major activities of the consolidated entity, directly or indirectly, including any Director (whether executive or otherwise) of the Company. The key management personnel of Ausgold comprise the Directors who are as follows:

Richard Lockwood (Non-Executive Chairman)
Neil Fearis (Non-Executive Director)
Geoffrey Jones (Non-Executive Director)
Matthew Greentree (Chief Executive Officer and Managing Director)
Denis Rakich (Executive Director)

Overview

The Board is responsible for determining and reviewing remuneration arrangements for its Directors and executives. The performance of the consolidated entity depends on the quality of its Directors and executives. The remuneration philosophy is to attract, motivate and retain high performance and high quality personnel.

The remuneration framework for the executives comprise a fixed cash component and where applicable, superannuation contributions and the issue of share options, performance rights or other share-based incentives which are intended to provide competitive rewards to attract high calibre executives. Any issuance of share options, performance rights or other share-based incentives to Directors will require the prior approval of shareholders.

The Company remunerates Non-Executive Directors for their time, commitment and responsibilities. The fees paid to Non-Executive Directors are set at levels which reflect both the responsibilities of, and the time commitments required from each Non-Executive Director to discharge his duties and are not linked to the performance of the Company. Non-Executive Directors’ fees are set by the Board within the maximum aggregate amount of fees approved by shareholders at a general meeting. The Non-Executive Directors’ maximum aggregate cash fee pool is currently $250,000 per annum.

Options and performance rights are also offered to employees (including Executive Directors and Non-Executive Directors) at the discretion of the Board. Performance criteria are one of the several elements utilised by the Board in assessing the issue of options and performance rights to employees. Length of service with the Company, past and potential contribution of the person to the Group is also considered when awarding options and performance rights to employees. The issuance of options is not linked to the performance of the Company. As an exploration company, the Board does not consider the Company’s trading result at year end as one of the performance indicators when determining whether to issue options to employees. There is no Board policy in relation to limiting the recipient exposure to risk in relation to securities.

The table below sets out summary information about the movements in shareholder wealth for the following financial periods:

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2021 2020 2019 2018 2017
Revenue ($’000) - - 4 80 100
Net loss before tax ($’000) (3,513) (1,823) (1,781) (1,137) (2,673)
Net loss after tax ($’000) (3,513) (1,823) (1,781) (1,137) (2,673)
Share price at the start of the year ($) $0.042 $0.014 $0.028 $0.025 $0.052
Share price at the end of the year ($) $0.043 $0.042 $0.014 $0.028 $0.025
- - - - -
Dividends ($)
Basic loss per share (cents) (0.26) (0.19) (0.26) (0.22) (0.78)
Diluted loss per share (cents) N/A N/A N/A N/A N/A
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Service Agreements

Non-Executive Directors

The Non-Executive Directors’ maximum fees payable in aggregate is $250,000. Set out below is the remuneration paid to Non-Executive Directors during the reporting period:

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Name Role Commencement date Fixed annual remuneration
Richard Lockwood Non-Executive Chairman 12 November 2010 $50,000
Neil Fearis Non-Executive Director 15 April 2016 $40,000
Geoffrey Jones Non-Executive Director 29 July 2016 $40,000 plus superannuation
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Remuneration Report (Audited) continued

Executive Directors

Remuneration and other terms of employment for the executives are formalised in service agreements. The principal provisions of the agreements relating to remuneration are set out below:

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Fixed annual
Commencement remuneration Termination
Name Role
date including notice period
superannuation
Matthew Greentree Chief Executive Officer and 10 April 2017 $292,084 6 months
Managing Director
Executive Director and
Denis Rakich 31 January 2013 $233,033 6 months
Company Secretary
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Use of Remuneration Consultants

Due to the size of the Company’s operations, the Company has not engaged remuneration consultants to review and measure its remuneration policy and strategy. However, the Board reviews remuneration strategy periodically and if required, will engage remuneration consultants in the future to assist with this process.

Voting and Comments Made at The Company’s 2020 Annual General Meeting

The Company received 99.59% of votes in favour of its remuneration report for the 2020 financial year at the 2020 AGM. The Company did not receive any specific feedback from shareholders at the annual general meeting or during the financial year regarding its remuneration practices.

Details Of Remuneration

The table below shows the fixed and variable remuneration for key management personnel for the financial year ended 30 June 2021:

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Post- Share-
Long-term
Short-term benefits employment based
benefits
benefits payments
2021 Total
Cash Long
Annual Other Options &
salary & service Superannuation
leave [1] fees [2] rights
fees leave [3]
Directors
R Lockwood $50,000 - $4,821 - - $220,850 $275,671
N Fearis $40,000 - $4,821 - - $155,486 $200,307
G Jones $40,000 - $4,821 - $3,800 $155,486 $204,107
M Greentree $267,000 $28,654 $4,821 $8,376 $25,085 $527,309 $861,245
D Rakich $213,083 $19,744 $4,821 $12,149 $19,950 $329,019 $598,766
Total $610,083 $48,398 $24,105 $20,525 $48,835 $1,388,150 $2,140,096
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1 Annual leave relates to movements in annual leave provision during the year and annual leave payment made.

2 Other fees include the attributable non-cash benefit applied by virtue of the Company’s Directors and Officers Liability policy.

3 Long service leave relates to movements in long service leave provision during the year.

Remuneration Report (Audited) continued

The table below shows the fixed and variable remuneration for key management personnel for the financial year ended 30 June 2020:

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Post- Share-
Long-term
Short-term benefits employment based
benefits
benefits payments
2020 Total
Cash Long
Annual Other Options &
salary & service Superannuation
leave [1] fees [2] rights
fees leave [3]
Directors
R Lockwood [4] - - $4,178 - - $46,538 $50,716
N Fearis $25,000 - $4,178 - - $19,945 $49,123
G Jones $20,000 - $4,178 - $1,900 $19,945 $46,023
M Greentree $192,400 $8,778 $4,178 $3,174 $18,050 $79,779 $306,359
D Rakich $144,000 $8,077 $4,178 $2,388 $13,300 $66,483 $238,426
Total $381,400 $16,855 $20,890 $5,562 $33,250 $232,690 $690,647
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1 Annual leave relates to movements in annual leave provision during the year and annual leave payment made.

2 Other fees include the attributable non-cash benefit applied by virtue of the Company’s Directors and Officers Liability policy.

3 Long service leave relates to movements in long service leave provision during the year.

4 Mr Lockwood did not receive any fees in his capacity as Chairman for the year ended 30 June 2020.

Options and performance rights are offered to key management personnel having regard, among other things, to the length of service with the Group, and the past and potential contribution of the person to the Group. The issuance of the options is not linked to the performance of the Company.

The percentage of fixed remuneration to total remuneration is as follows:

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Performance-based
Fixed remuneration % consisting of options & rights
Directors remuneration
2021 2020 2021 2020 2021 2020
R Lockwood 20% 92% 80% 8% 80% 8%
N Fearis 22% 40% 78% 60% 78% 60%
G Jones 24% 43% 76% 57% 76% 57%
M Greentree 39% 26% 61% 74% 61% 74%
D Rakich 45% 28% 55% 72% 55% 72%
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No key management personnel appointed during the period received a payment for agreeing to accept a position with the Group.

Performance Rights

The Performance Rights Plan is used to reward the Directors for their performance and to align their remuneration with the creation of shareholder wealth. The Performance Rights are issued for nil consideration and no consideration will be payable upon the vesting of the Performance Rights. Each Performance Right entitles the holder to be issued with one Ausgold share. The plan was approved by the shareholders on 20 November 2020.

The grant date of the Performance Rights was 20 November 2020 and, subject to satisfaction of the vesting conditions, the Performance Rights vest on 30 June 2022. The fair value per right is $0.056.

The vesting conditions for the Performance Rights are as follows:

Employment at the end of the measurement period (Employment Condition);
50% of Performance Rights vest based on a release on the Australian Securities Exchange (“ASX”) of a minimum of 1.6 million ounces of Inferred, Indicated and/or Measured Resources, at a minimum lower cut-off grade of 0.5 grams per tonne of gold reported in accordance with the JORC Code on the Katanning Gold Project tenements; and
50% of the Performance Rights vest based on the release on the ASX of a mining Pre-Feasibility Study (“PFS”) on the Katanning Gold Project which shows the potential to generate an Internal Rate of Return (“IRR”) of greater than 20% using consensus commodity prices and Board approved assumptions.

Remuneration Report (Audited) continued

In order to meet the Employment Condition, the relevant Related Party must be employed by the Company at the end of the measurement period.

Number of Performance Rights holdings of the Company held by key management personnel or their related entities as at 30 June 2021 are as follows:

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Granted Balance at Maximum
Balance at Redeemed as
Grant date Vesting start of year during the shares end of year value yet to
date year (unvested) vest
Number Number Number % Number $
Directors
8 Nov 19 30 Apr 21 7,000,000 - (7,000,000) 100 - -
20 Nov 20 30 Jun 22 - 8,000,000 - - 8,000,000 258,734
R Lockwood 7,000,000 8,000,000 (7,000,000) 100 8,000,000 258,734
8 Nov 19 30 Apr 21 3,000,000 - (3,000,000) 100 - -
20 Nov 20 30 Jun 22 - 6,000,000 - - 6,000,000 194,051
N Fearis [1] 3,000,000 6,000,000 (3,000,000) 100 6,000,000 194,051
8 Nov 19 30 Apr 21 3,000,000 - (3,000,000) 100 - -
20 Nov 20 30 Jun 22 - 6,000,000 - - 6,000,000 194,051
G Jones [2] 3,000,000 6,000,000 (3,000,000) 100 6,000,000 194,051
8 Nov 19 30 Apr 21 12,000,000 - (12,000,000) 100 - -
20 Nov 20 30 Jun 22 - 20,000,000 - - 20,000,000 646,835
M Greentree [3] 12,000,000 20,000,000 (12,000,000) 100 20,000,000 646,835
8 Nov 19 30 Apr 21 10,000,000 - (10,000,000) 100 - -
20 Nov 20 30 Jun 22 - 12,000,000 - - 12,000,000 388,101
D Rakich [4] 10,000,000 12,000,000 (10,000,000) 100 12,000,000 388,101
Total rights 35,000,000 52,000,000 (35,000,000) 52,000,000 1,681,772
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The maximum value of the deferred shares yet to vest has been determined as the amount of the grant date fair value of the rights yet to be expensed.
1 Relevant interest held through Pendomer Investments Pty Ltd
2 Relevant interest held as trustee of The Lee Jones Superannuation Fund
3 Relevant interest held through M&J Greentree Nominees Pty Ltd
4 Relevant interest held as trustee of the Rakich Retirement Fund

Terms and conditions of the share-based payment arrangement

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Vesting & Exercise Value per right at grant
Grant date Expiry Date % vested
exercise date Price date
20 November 2020 30 June 2022 30 June 2022 $0.00 $0.056 0%
8 November 2019 30 April 2021 30 April 2021 $0.00 $0.008 100%
2021 2020
Directors Performance Rights Performance Rights
Value granted Value expensed Value granted Value expensed
R Lockwood $448,000 $189,266 $56,000 $24,416
N Fearis $336,000 $141,949 $24,000 $10,464
G Jones $336,000 $141,949 $24,000 $10,464
M Greentree $1,120,000 $473,165 $96,000 $41,855
D Rakich $672,000 $283,899 $80,000 $34,879
Total $2,912,000 $1,230,228 $280,000 $122,078
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Remuneration Report (Audited) continued

Option Holdings

Number of options held by key management personnel or their related entities as at 30 June 2021 is set out below:

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Opening Closing Vested &
Name Granted Exercised Lapsed Unvested
balance balance exercisable
R Lockwood 4,000,000 - - (4,000,000) - - -
N Fearis [1] 4,000,000 - - (4,000,000) - - -
G Jones [2] 4,000,000 - - (4,000,000) - - -
M Greentree [3] 10,000,000 - - (10,000,000) - - -
D Rakich [4] 4,000,000 - - (4,000,000) - - -
Total 26,000,000 - - (26,000,000) - - -
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1 Relevant interest held through Pendomer Investments Pty Ltd

2 Relevant interest held as trustee of The Lee Jones Superannuation Fund

3 Relevant interest held through M&J Greentree Nominees Pty Ltd

4 Relevant interest held as trustee of the Rakich Retirement Fund

Share Holdings

Number of shares held by the Directors of the Company or their related entities as at 30 June 2021 is set out below:

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Redeemed
Revised on
Opening from Other Balance at Closing
Name Acquired exercise of
balance performance changes resignation balance
options
rights
R Lockwood 46,480,471 2,519,529 - 7,000,000 - - 56,000,000
N Fearis [1] 7,000,000 - - 3,000,000 - - 10,000,000
G Jones [2] 6,250,000 - - 3,000,000 - - 9,250,000
M Greentree [3] 3,500,000 - - 12,000,000 - - 15,500,000
D Rakich [4] 18,998,681 - - 10,000,000 - - 28,998,681
Total 82,229,152 2,519,529 - 35,000,000 - - 119,748,681
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1 Relevant interest held through Pendomer Investments Pty Ltd
2 Relevant interest held as trustee of The Lee Jones Superannuation Fund
3 Relevant interest held through M&J Greentree Nominees Pty Ltd
4 Relevant interest held as trustee of the Rakich Retirement Fund

Remuneration Report (Audited) continued

Key Management Personnel Transactions With the Company

Elstree Nominees Pty Ltd

Elstree Nominees Pty Ltd (“Elstree”) provides the Group with office premises and associated facilities. All services provided by Elstree to the Group are at cost. Mr Denis Rakich is a Director of Elstree and serves as Executive Director and Company Secretary at Ausgold. The total amount charged by Elstree during the financial year was $168,072 plus GST (2020: $126,425). There were no monies (2020: $20,625 plus GST) owing to Elstree as at 30 June 2021. Amounts were due and payable under normal commercial terms.

Loans to Key Management Personnel

No loans have been granted to key management personnel during the financial year ended 30 June 2021.

END OF REMUNERATION REPORT

This report is signed in accordance with a resolution of the Directors.

For and behalf of the Directors

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Denis Rakich Director

Perth, Western Australia

30 September 2021

Auditor’s Independence Declaration

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Tel: +61 8 6382 4600 38 Station Street Fax: +61 8 6382 4601 Subiaco, WA 6008 www.bdo.com.au PO Box 700 West Perth WA 6872 Australia

DECLARATION OF INDEPENDENCE BY ASHLEIGH WOODLEY TO THE DIRECTORS OF AUSGOLD LIMITED

As lead auditor of Ausgold Limited for the year ended 30 June 2021, I declare that, to the best of my knowledge and belief, there have been:

No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
No contraventions of any applicable code of professional conduct in relation to the audit.

This declaration is in respect of Ausgold Limited and the entity it controlled during the period.

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Ashleigh Woodley Director

BDO Audit (WA) Pty Ltd Perth, 30 September 2021

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation.

Consolidated Statement of Profit or Loss and Other Comprehensive Income

FOR THE YEAR ENDED 30 JUNE 2021

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2021 2020
Note
$ $
Revenue from continuing operations 1,149 611
Other Income 8 380,318 141,606
Net movement in financial assets 106,500 (39,000)
Impairment exploration expenses (554,675) (646,457)
Corporate and administration expenses 9 (1,122,348) (717,392)
Share-based payments expenses 20 (1,859,145) (232,690)
Occupancy expenses (68,377) (53,809)
Other expenses (124,096) (71,669)
Accounting expenses (64,094) (51,265)
Amortisation and depreciation expenses (160,870) (119,232)
Finance costs (16,651) (16,970)
Legal fees (31,030) (17,068)
Loss before income tax (3,513,319) (1,823,335)
Income tax benefit/ (expense) 10 - -
Net loss attributable to members (3,513,319) (1,823,335)
Other comprehensive income/ (loss)
Other comprehensive income/ (loss) - -
Total comprehensive income/ (loss) for the period (net of tax) (3,513,319) (1,823,335)
Loss per share for the period attributable to the members of Ausgold Limited
Basic loss per share (cents per share) 22 (0.26) (0.19)
Diluted loss per share (cents per share) N/A N/A
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The consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.

Consolidated Statement of Financial Position

AS AT 30 JUNE 2021

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2021 2020
Note $ $
ASSETS
Current assets
Cash and cash equivalents 11 7,451,103 1,025,802
Trade and other receivables 80,114 21,016
Security deposits 12 94,611 94,611
Financial assets at fair value 14 159,250 42,000
Total current assets 7,785,078 1,183,429
Non-current assets
Property, plant and equipment 15 220,510 58,423
Prepayment for exploration assets 13 32,612 1,362
Exploration and evaluation expenditure 13 51,681,303 43,657,287
Right-of-use assets 16 189,349 166,088
Total non-current assets 52,123,774 43,883,160
Total assets 59,908,852 45,066,589
LIABILITIES
Current liabilities
Trade and other payables 17 222,452 261,101
Lease liabilities 16 99,418 95,918
Provisions 18 214,903 105,320
Total current liabilities 536,773 462,339
Non-current liabilities
Lease liabilities 16 96,940 76,011
Provisions 18 1,173,969 1,157,439
Total non-current liabilities 1,270,909 1,233,450
Total liabilities 1,807,682 1,695,789
NET ASSETS 58,101,170 43,370,800
EQUITY
Contributed equity 85,708,185 69,043,641
Reserves 7,191,802 5,612,657
Accumulated losses (34,798,817) (31,285,498)
TOTAL EQUITY 58,101,170 43,370,800
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The Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.

Consolidated Statement of Changes in Equity FOR THE YEAR ENDED 30 JUNE 2021

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Contributed Accumulated
Equity Losses Reserves Total Equity
Notes $ $ $ $
Balance as at 1 July 2020 69,043,641 (31,285,498) 5,612,657 43,370,800
Loss for the year (3,513,319) (3,513,319)
Other Comprehensive income - -
Total comprehensive loss for the year - (3,513,319) - (3,513,319)
Transactions with owners, recorded directly in
equity:
Shares issued 17,598,705 - - 17,598,705
Share issue costs (1,214,161) - - (1,214,161)
Redeemed performance rights 280,000 - (280,000) -
Share-based payments 20 - - 1,859,145 1,859,145
Balance as at 30 June 2021 19 85,708,185 (34,798,817) 7,191,802 58,101,170
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Contributed Accumulated
Equity Losses Reserves Total Equity
Notes $ $ $ $
Balance as at 1 July 2019 64,828,889 (29,462,163) 5,379,967 40,746,693
Loss for the year (1,823,335) (1,823,335)
Other Comprehensive income - -
Total comprehensive income - (1,823,335) - (1,823,335)
Transactions with owners, recorded directly in
equity:
Shares issued 4,443,600 - - 4,443,600
Share issue costs (228,848) - - (228,848)
Share-based payments - - 232,690 232,690
Balance as at 30 June 2020 19 69,043,641 (31,285,498) 5,612,657 43,370,800
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Consolidated Statement of Cash Flows

FOR THE YEAR ENDED 30 JUNE 2021

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2021 2020
Note
$ $
Cash flows from operating activities
Interest received 1,149 611
Payments to suppliers and employees (1,450,250) (1,008,817)
Receipts from rebates and claims 380,318 141,606
Net cash flows used in operating activities 23 (1,068,783) (866,600)
Cash flows from investing activities
Payment for property plant and equipment (208,697) (14,861)
Payment for investments (10,750) -
Payment for exploration expenditure (8,613,013) (2,492,837)
Net cash flows used in investing activities (8,832,460) (2,507,698)
Cash flows from financing activities
Repayment of lease obligations (57,998) (113,133)
Proceeds from issue of share capital 17,598,705 4,443,602
Transaction costs related to issue of shares (1,214,163) (228,848)
Net cash flows generated from financing activities 16,326,544 4,101,621
Net increase in cash and cash equivalents 6,425,301 727,323
Cash and cash equivalents at the beginning of the period 1,025,802 298,479
Cash and cash equivalents at the end of the period 11 7,451,103 1,025,802
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The Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.

Notes to the Consolidated Financial Statements

FOR THE YEAR ENDED 30 JUNE 2021

1. Reporting Entity

Ausgold Limited (“Ausgold” or “parent entity” or “Company”) and its controlled entity (collectively known as “the Group” or “consolidated entity”) are domiciled in Australia.

The annual financial report of the Group for the financial year ended 30 June 2021 was authorised for issue in accordance with a resolution of the Directors on 30 September 2021.

The consolidated entity’s principal activities during the financial year were the exploration for gold and other precious metals.

2. Basis of Preparation

The consolidated annual financial report is a general purpose financial report which has been prepared in accordance with the requirements of the Corporations Act 2001, Australian Accounting Standards and authoritative pronouncements of the Australian Accounting Standards Board (AASB) and complies with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). The financial report has also been prepared on a historical cost basis except for assets and liabilities which are required to be measured at fair value.

The financial statements were authorised for issue by the Board of Directors on 30 September 2021.

The Group has adopted all the new, revised or amending Accounting Standards and Interpretations issued by the AASB that are mandatory for the current reporting period (see details below).

All new, revised or amending Accounting Standards or Interpretations that are not mandatory have not been early adopted.

New and revised Standards and amendments thereof and Interpretations effective for the current year that are relevant to the Group include:

AASB 2018-6 – Amendments to Australian Accounting Standards – Definition of a Business
AASB 2018-7 – Amendments to Australian Accounting Standards – Definition of Material
AASB 2019-5 – Amendments to Australian Accounting Standards – Disclosure of the Effect of New IFRS Standards Not Yet Issued in Australia

The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the Group.

3. Changes in Accounting Policies

The Group has adopted all of the new or amended Accounting Standards, amendments and interpretations issued by the Australian Accounting Standards Board (“AASB”) that are mandatory for the current reporting year.

4. Significant Accounting Judgments, Estimates and Assumptions

The preparation of the Group’s consolidated financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period.

Estimates and assumptions are continuously evaluated and are based on management’s experience and other factors, including expectations of future events, which are believed to be reasonable under the circumstances. However actual outcomes would differ from these estimates if different assumptions were used and different conditions existed.

The Group has identified the following area where significant judgements, estimates and assumptions are required, and where actual results

were to differ, may materially affect the financial position or financial results reported in future periods.

Share-based payments

The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined using an appropriate valuation technique that takes into account various inputs that represent the best estimates available at the time of performing the calculation but are subject to variability and may be materially different if hindsight was to be used. Details of share-based payments can be found in Note 20.

Notes to the Consolidated Financial Statements continued

4. Significant Accounting Judgments, Estimates And Assumptions (Cont’d)

Exploration And Evaluation Expenditure

The Group’s policy with regards to exploration and evaluation expenditure, including the costs of acquiring licences and permits, are capitalised as exploration and evaluation assets on an area of interest basis (Refer note 13).

Impairment Of Assets

At each reporting date, the Group assesses whether there is any indication that individual assets are impaired. Where impairment indicators exist, recoverable amount is determined and impairment losses are recognised in the statement of profit or loss and other comprehensive income where the asset’s carrying value exceeds its recoverable amount. Recoverable amount is the higher of an asset’s fair value less costs to sell and value in use.

Rehabilitation Provision

The Group assesses its rehabilitation provision at each reporting date. Significant judgment is required in determining the provision for rehabilitation as there are many factors that will affect the ultimate liability payable to rehabilitate the existing mine sites, including future disturbances caused by further development, changes in technology and changes in regulations. When these factors change or become known in the future, such differences will impact the mine rehabilitation provision in the period in which the change becomes known. Refer Note 18 for further details.

Incremental Borrowing Rate

Where the interest rate implicit in a lease cannot be readily determined, an incremental borrowing rate is estimated to discount future lease payments to measure the present value of the lease liability at the lease commencement date. Such a rate is based on what the entity estimates it would have to pay a third party to borrow the funds necessary to obtain in an asset of a similar value to the right-of-use asset, with similar terms, security and economic environment.

5. Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting to the Chief Operating Decision Maker, which has been

identified by the Group as the Board of Directors.

The Group has identified its operating segments based on the internal reports that are reviewed and used by the Board of Directors in assessing performance and determining the allocation of resources. Reportable segments disclosed are based on aggregating operating segments, where the segments have similar characteristics. The Group’s sole activity is mineral exploration and resource development wholly with Australia, therefore it has aggregated all operating segments into the one reportable segment being mineral exploration.

The reportable segment is represented by the primary statements forming this financial report.

Notes to the Consolidated Financial Statements continued

6. Parent Entity Information

The financial statements of the parent entity are set out below:

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Parent Entity Parent Entity
2021 2020
$ $
Current assets 7,680,741 1,059,912
Non-current assets 50,893,139 42,604,030
Total assets 58,573,879 43,663,942
Current liabilities 271,650 145,868
Non-current liabilities 201,059 147,274
Total liabilities 472,709 293,142
NET ASSETS 58,101,170 43,370,800
Contributed equity 92,592,627 75,928,083
Reserves 7,191,802 5,612,657
Accumulated losses (41,683,259) (38,169,940)
TOTAL EQUITY 58,101,170 43,370,800
Loss for the year (3,513,319) (1,823,335)
Other comprehensive income/(loss) - -
Total comprehensive loss for the year (3,513,319) (1,823,335)
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7. Financial Risk Management

Overview

The overall financial risk management strategy focuses on the unpredictability of the financial markets and seeks to minimise the potential adverse effects on financial performance and protect financial security.

The Group have exposure to the following risks from their use of financial instruments:

Credit risk
Liquidity risk
Market risk (including interest rate risk)

This note presents information about the consolidated entity’s exposure to each of the above risks, their objectives, policies and processes for measuring and managing risk and the management of capital.

Ausgold’s risk management framework is supported by the Board, management and the Audit and Risk Committee. The Board is responsible for approving and review the consolidated entity’s risk management strategy and policy. Management is responsible for monitoring that appropriate processes and controls are in place effectively and efficiently manage risk. The Audit and Risk Committee is responsible for identifying, monitoring and managing significant business risks faced by consolidated entity and considering the effectiveness of its internal control system. Due to the size of the Company’s operations, the Audit and Risk Committee comprises of the full Board.

Notes to the Consolidated Financial Statements continued

7. Financial Risk Management (Cont’d)

The consolidated entity holds the following financial instruments:

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2021 2020
$ $
Financial assets
Cash and cash equivalents 7,451,103 1,025,802
Trade and other receivables 80,114 21,016
Security deposits 94,611 94,611
Financial assets at fair value 159,250 42,000
7,785,078 1,183,429
Financial liabilities
Trade and other payables 222,452 261,101
Lease liabilities 196,358 171,929
418,810 433,030
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Credit Risk

Credit risk is the risk of financial loss to the consolidated entity if counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Group’s cash and cash equivalents, deposits with banks and financial institutions. For banks and financial institutions, only independently rated parties with a minimum rating of “A” are accepted.

The consolidated entity does not hold any credit derivatives to offset its credit exposure.

The credit quality of financial assets that are neither past due or impaired will be measured at fair value, with the gains or losses being recognised in profit or loss.

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2021 2020
$ $
Trade receivables
Counterparties without external credit rating
Group 1 [1] 174,725 115,627
Group 2 [2] - -
174,725 115,627
Deposits
AA 7,451,103 1,025,802
7,451,103 1,025,802
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1 Group 1 – Existing receivables (less than 6 months)

2 Group 2 – Existing receivables (more than 6 months) with no defaults in the past.

Notes to the Consolidated Financial Statements continued

7. Financial Risk Management (Cont’d)

Credit Risk (Cont’d)

Exposure to credit risk

The carrying amount of the consolidated entity’s financial assets represents the maximum credit exposure. The consolidated entity’s maximum exposure to credit risk at reporting date was:

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Liquidity Risk

Liquidity risk arises from the financial liabilities of the consolidated entity and the consolidated entity’s subsequent ability to meet their obligations to repay their financial liabilities as and when they fall due.

The following are the contractual maturities of financial liabilities on an undiscounted basis, including estimated interest payments. Cash flows for liabilities without fixed amount or timing are based on conditions existing at year end.

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2021 2020
$ $
Financial liabilities
Trade and other payables 222,452 261,101
Lease liabilities 196,358 171,929
418,810 433,030
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Ultimate responsibility for liquidity risk management lies with the Board of Directors. The Board has determined an appropriate liquidity risk management framework for the management of the Company’s short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves and regularly monitoring budgeted and actual cash flows and matching the maturity profiles of financial assets, expenditure commitments and liabilities.

The amounts disclosed in the table are the actual undiscounted cash flows.

	Less than 6 months 6 to 12 months Between 1 to 2 years Total Carrying amount
Contractual maturity of fnancial liabilities	$ $ $ $ $
Consolidated - 30 June 2021
Trade and other payables	222,452 - - 222,452 222,452
Lease liabilities	45,991 59,797 101,650 207,438 207,438
	268,443 59,797 101,650 429,890 429,890

Consolidated - 30 June 2020
Trade and other payables	261,101 - - 261,101 261,101
Lease liabilities	47,224 48,695 76,010 171,929 171,929
	308,325 48,695 76,010 433,030 433,030

Notes to the Consolidated Financial Statements continued

7. Financial Risk Management (Cont’d)

Market Risk

Market risk is the risk that changes in market prices, such as interest rates and foreign exchange rates that will affect the consolidated entity’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising return.

Interest rate risk

The consolidated entity’s exposure to interest rate primarily relates to the consolidate entity’s cash and cash equivalents. The consolidated entity manages market risk by monitoring levels of exposure to interest rate risk and assessing market forecasts for interest rates.

At reporting date, the interest rate profile of the Group’s interest bearing financial instruments was:

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2021 2020
$ $
Variable rate financial instruments
Financial assets 7,451,103 1,025,802
Financial liabilities 196,358 171,929
7,647,461 1,197,731
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The Group manages its interest rate risk by monitoring available interest rates while maintaining an overriding position of security whereby the majority of cash and cash equivalents are held in AA-rated bank accounts. The Group’s weighted average effective interest rate is 0.002% (2020: 0.06%).

Capital Risk Management

When managing capital, the Board’s objective is to ensure the consolidated entity continues as a going concern as well as to maintain optimal returns to shareholders and benefits for other stakeholders. The Board also aims to maintain a capital structure that ensures the lowest cost of capital available to the consolidated entity.

The Board is constantly adjusting the capital structure to take advantage of favourable costs of capital or high return on assets. As the market is constantly changing, management may issue new shares, sell assets to reduce the Company’s liability or consider entering joint venture agreements to further exploration of the tenements.

The Board seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowings and the advantages

and security afforded by a sound capital position although there is no formal policy regarding gearing levels.

There were no changes in the consolidated entity’s approach to capital management during the year. The consolidated entity is not subject to any externally imposed capital requirements.

Fair Value Measurements

The fair value of financial assets and liabilities are determined in accordance with generally accepted pricing models based on estimated

future cash flow and observable market prices.

8. Other Income

Other income is recognised when the amount can be reliably measured and control of the right to receive income is passed to the Group.

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2021 2020
$ $
ATO Cash Boost * 50,000 50,000
EIS Funding 268,623 -
Diesel Fuel Rebate 61,642 26,861
Reimbursement for water bores drilling - 62,245
Other income 53 2,500
380,318 141,606
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*The Government has provided temporary cash flow support to small and medium business entities that employ staff during the economic downturn associated with coronavirus. Through the Australian Taxation Office (ATO), the Company has in the last financial year received an initial tax-free cash boost of $50,000, delivered through credits in the activity statement system. An additional cash flow boost was received this year from June to September. These credits are equal to the total boost credited for March to June 2020.

Notes to the Consolidated Financial Statements continued

9. Corporate and Administration Expenses

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2021 2020
$ $
Directors' fees and salaries 658,918 414,650
Lisiting fees and statutory related costs 83,524 59,675
Investors relations 167,510 154,012
Other corporate and adminstration costs 212,396 89,055
Other income 1,122,347 717,392
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10. Income Tax Expense

The income tax expense or benefit (revenue) is the tax payable on the current period’s taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

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2021 2020
$ $
Reconciliation between tax expenses and pre-tax net loss
Loss before income tax (3,513,319) (1,823,335)
Income tax benefit calculated at 26% (2020: 27.5%) (913,463) (501,417)
Tax effects on amounts which are not tax deductible 351,552 62,374
Deferred tax asset not brought to account 561,911 439,043
Income tax benefit - -
Deferred tax assets not brought to account
Unused tax losses 73,479,315 63,439,123
Timing differences (51,253,892) (42,703,545)
Capital raising cost in equity 1,171,366 318,990
Tax at 25% (2020: 25%) 5,849,197 5,263,642
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Deferred tax assets and liabilities are recognised for temporary difference, between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax bases, at the tax rates expected to apply when then assets are recovered or liabilities settled, based on those tax rates which are enacted or substantively enacted for each jurisdiction. Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Notes to the Consolidated Financial Statements continued

11. Cash and Cash Equivalents

Cash and cash equivalents include cash at bank and in hand, deposits held at call with financial institutions, other short-term highly liquid deposits with an original maturity of three months or less that are readily convertible to known amounts of cash.

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2021 2020
$ $
Current assets
Cash at bank and in hand 7,451,103 1,025,802
7,451,103 1,025,802
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Reconciliation To Cash At The End Of The Financial Year

The above figures are reconciled to cash at the end of the financial year as shown on the consolidated statement of cash flows as follows:

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2021 2020
$ $
Current assets
Cash at bank and in hand 7,451,103 1,025,802
Balance as per Consolidated Statement of Cash Flows 7,451,103 1,025,802
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Risk Exposure

The consolidated entity’s exposure and a sensitivity analysis for financial assets and liabilities are discussed in Note 7. The maximum exposure to credit risk at the end of the reporting period is the carrying amount of each class of cash and cash equivalents mentioned above.

12. Security Deposits

Security deposits are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Group’s management has the positive intention and ability to hold to maturity.

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2021 2020
$ $
Current assets
Balance at the start of the period 94,611 94,611
Addiitons / (Reversals) - -
94,611 94,611
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13. Exploration and Evaluation Expenditure & Prepayment

Exploration and evaluation expenditure encompasses expenditure incurred in connection with the exploration for and evaluation of mineral resources before the technical feasibility and commercial viability of extracting a mineral resource are demonstrable. These costs are only carried forward to the extent that they are expected to be recouped through the successful development of the area or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves.

Exploration and evaluation expenditure incurred is accumulated for each area of interest and recorded as an asset if:

the right to tenure of the area of interest are current; and
at least one of the following conditions is also met:
the exploration and evaluation expenditure are expected to be recouped through successful development and exploitation of the area of interest, or alternatively, by its sales; and
Exploration and evaluation activities in the area of interest have not at the reporting date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the areas of interest are continuing.

For each area of interest, expenditure incurred on the exploration of tenements is capitalised and recognised as an exploration and evaluation asset. Exploration and evaluation assets are measured at cost at recognition.

The Group does not record any expenditure made by the farmee on it’s account. It also does not recognise any gain or loss on it’s exploration and evaluation farm-out arrangements, but re-designates any costs previously capitalised in relation to the whole interest as relating to the partial interest retained. Any cash consideration received directly from the farmee is credited against costs previously capitalised in relation to the whole interest with any excess accounted for by the farmor as a gain on disposal.

Notes to the Consolidated Financial Statements continued

13. Exploration and Evaluation Expenditure & Prepayment (Cont’d) Significant Estimates And Judgement

The Directors assesses whether there is any indication of impairment of an area of interest basis, bi-annually. If any such indication exists, the consolidated entity shall estimate the recoverable amount of the assets. For areas of interest that are not considered to have any commercial value, or where exploration rights are no longer current, the capitalised amounts are written off against the provision and any remaining amounts are charged against profit. Recoverability of the carrying amount of the exploration and evaluation assets is dependent on successful development and commercial exploitation, or alternatively, sale of the respective areas of interest.

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2021 2020
$ $
Non-current assets
Exploration, evaluation, prepayment and development costs carried forward in respect of
areas of interest (net of amounts written off)
Exploration and evaluation expenditure 51,681,303 43,608,219
Prepayment for exploration assets 32,612 1,362
Acquisition of tenements - Dumbleyung Project - 49,068
51,713,915 43,658,649
Reconciliation
Carrying amount at start of year 43,658,649 41,958,611
Exploration expenditure 8,578,691 2,345,133
Prepayment for exploration assets 31,250 1,362
Expenditure written off (554,675) (646,457)
Carrying amount at the end of the period 51,713,915 43,658,649
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The ultimate recoupment of exploration and evaluation expenditure is dependent upon the successful development and commercial exploitation, or alternatively, sale of the respective areas. The Directors have reviewed the impairment indicators as per AASB 6: Exploration and Evaluation of Mineral Resources and have concluded that due to the relinquishment of certain tenements, there is an impairment of $554,675 (2020: $646,457) which resulted in the expenditure being written off at the reporting date.

14. Financial Assets at Fair Value Through Profit or Loss

The Group classifies equity investments that are held for trading as financial assets at fair value through profit or loss. The financial assets consist of ordinary shares which have been valued at fair value and have no fixed maturity date or coupon rate. The value of these financial assets has been determined directly by reference to published price quotations in an active market. Changes in the value of the financial assets are recorded in net loss on financial assets in profit or loss.

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2021 2020
$ $
Current assets
Shares carried at fair value 159,250 42,000
159,250 42,000
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Notes to the Consolidated Financial Statements continued

15. Property, Plant And Equipment

Items of property, plant and equipment are initially recorded at cost, being the fair value of the consideration provided plus incidental costs directly attributable to the acquisition, and depreciated. Each class of property, plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation.

The carrying amount of plant and equipment is reviewed annually to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows which will be received from the assets employment and subsequent disposal.

Depreciation is provided on plant and equipment. Items of property, plant and equipment are depreciated using the diminishing value method over their estimated useful lives to the consolidated entity. The assets’ residual values and useful lives are reviewed and adjusted, if appropriate, at each of the statement of financial position date. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

The useful economic life for each class of depreciable asset is:

Vehicles 3 – 5 years

Furniture, fittings and equipment 3 – 5 years

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June 2021 June 2020
$ $
Non-current assets
Balance at the start of the period, net of accumulated depreciation 58,423 51,210
Additions 208,696 33,649
Depreciation charge (46,609) (26,436)
Balance net of accumulated depreciation 220,510 58,423
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2021 2020
$ $
Non-current assets
Cost 910,836 702,140
Accumulated depreciation (690,326) (643,717)
Net carrying amount 220,510 58,423
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Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the statement of profit or loss and other comprehensive income. When the re-valued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings.

Notes to the Consolidated Financial Statements continued

16. Right-Of-Use Asset And Lease Liability

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2021 2020
$ $
Right-of-use assets
Property - office lease
Opening balance 70,827 131,536
Amortisation (60,708) (60,709)
Closing balance 10,119 70,827
Motor vehicle
Opening balance 22,308 -
Addition 137,521 25,097
Amortisation (26,876) (2,789)
Closing balance 132,953 22,308
Hire purchase assets
Opening balance 72,953 123,863
Disposal - (21,612)
Amortisation (26,676) (29,298)
Closing balance 46,277 72,953
Total Right-of-use assets as at 30 June 189,349 166,088
Lease liability
Property - office lease
Opening balance 73,416 156,633
Lease payments (62,593) (83,217)
Closing balance 10,823 73,416
Motor vehicle
Opening balance 22,534 -
Addition 137,521 25,097
Lease payments (25,143) (2,563)
Closing balance 134,912 22,534
Hire purchase 50,623 75,979
Total lease liability as at 30 June 196,358 171,930
Lease liability
Current 99,418 95,918
Non-current 96,940 76,011
196,358 171,929
Amounts recognised in the consolidated statement of profit or loss
Amortisation of right-ot-use asset 114,261 92,796
114,261 92,796
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Notes to the Consolidated Financial Statements continued

17. Trade And Other Payables

Trade payables represent liabilities for goods or services received prior to the end of the reporting date which are unpaid. Trade accounts payable are normally settled within 60 days. Trade and other payables are presented as current liabilities unless payment is not due within 12 months from reporting date.

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2021 2020
$ $
Current liabilities
Trade creditors 144,122 216,117
Other creditors 78,330 44,984
222,452 261,101
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18. Provisions

Provisions are recognised when the consolidated entity has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount can be reliably estimated. Provisions are not recognised for future operating losses.

Provisions are measured at the present value of best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as interest expense.

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2021 2020
$ $
Current liabilities
Provision for employee benefits 214,903 105,320
214,903 105,320
2021 2020
$ $
Non-current liabilities
Provision for employee benefits 31,602 15,072
Provision for rehabilitation 1,142,367 1,142,367
1,173,969 1,157,439
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Employee Benefits

(i) Short-Term Obligations

Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be settled within 12 months of the reporting date are recognised in current liabilities in respect of employees’ services up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled.

(ii) Other Long-Term Obligations

The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are recognised in non-current liabilities, provided there is an unconditional right to defer settlement of the liability. The liability is measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on national Government bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.

Notes to the Consolidated Financial Statements continued

18. Provisions (Cont’d)

Provision For Rehabilitation

Rehabilitation costs include the dismantling and removal of mining plant, equipment and building structures, waste removal and rehabilitation of the site in accordance with the requirements of the mining permits. Such costs are determined using estimates of future costs, current legal requirements and technology.

Rehabilitation costs are recognised in full at present value as a non-current liability. An equivalent amount is capitalised as part of the cost of the asset when an obligation arises to decommission or restore a site to a certain condition after abandonment as a result of bringing the assets to its present location.

Any changes in the estimates for the costs or other assumptions against the cost of relevant assets are accounted for on a prospective basis. In determining the costs of site restoration there is uncertainty regarding the nature and extent of the restoration due to community expectations and future legislation.

Significant estimates and judgements

The ultimate rehabilitation costs are uncertain, and cost estimates can vary in response to many factors, including estimates of the extent and costs of rehabilitation activities, technological changes, regulatory changes, cost increases as compared to the inflation rates (1.73% (2020: 0.87%)), and changes in discount rates (0.2% (2020: 0.26%)). These uncertainties may result in future actual expenditure differing from the amounts currently provided. Therefore, significant estimates and assumptions are made in determining the provision for mine rehabilitation. As a result, there could be significant adjustments to the provisions established which would affect future financial result. The provision at reporting date represents management’s best estimate of the present value of the future rehabilitation costs required.

19. Contributed Equity

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

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2021 2020
$ $
Equity
Balance at the start of the period 69,043,641 64,828,889
Shares issued for capital raising purposes 17,598,705 4,443,600
Less share issue costs (1,214,161) (228,848)
Performance rights redeemed as shares 280,000 -
85,708,185 69,043,641
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1 The Company allotted the following shares to fund the Company’s continued exploration and working capital:

6 August 2020, Ausgold completed a placement of 194.15m shares at $0.0327

- 23 April 2021, Ausgold completed a placement of 250m shares at $0.045

Movement In Share Capital During The Year

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2021 2020
Number of Number of
shares shares
Movement in share capital
Balance at the start of the period 1,106,199,541 747,149,541
Shares issued for capital raising purposes 444,150,000 359,050,000
Redeemed from performance rights 35,000,000 -
1,585,349,541 1,106,199,541
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Ordinary shares have the right to receive dividends as declared and, in the event of winding up the Company, to participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up to the shares held. Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.

Notes to the Consolidated Financial Statements continued

19. Contributed Equity (Cont’d)

Movement In Options During The Year

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2021 2020
Number of Number of
options options
Movement in options
Balance at the start of the period 29,700,000 61,779,235
Options issued 33,000,000 -
Options lapsed (26,000,000) (32,079,235)
36,700,000 29,700,000
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1 During the financial year, the Company issued the following options:

On 23 March 2021, Ausgold issued 7m options exercisable at $0.08 per option to IRX Advisors On 4 May 2021, Ausgold issued 16m options exercisable at $0.063 per option to Blue Ocean Equities Pty Ltd On 19 March 2021, Ausgold issued 3m options exercisable at $0.08 per option to staff

Movement In Performance Rights During The Year

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2021 2020
Number of Number of
performance performance
rights rights
Movement in performance rights
Balance at the start of the period 35,000,000 19,000,000
Performance rights issued [2] 58,250,000 35,000,000
Performance rights redeemed as shares (35,000,000) -
Performance rights lapsed - (19,000,000)
58,250,000 35,000,000
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2 During the financial year, the company granted the following performance rights:

On 10 December 2020, Ausgold granted 52m performance rights to the Directors On 1 February 2021, Ausgold granted 6.25m performance rights to staff

20. Share-Base Payments

Share-based compensation benefits are provided to employees and consultants of Ausgold Limited.

The fair value is measured at grant date and recognised over the period during which the holder become unconditionally entitled to the options/rights. The fair value of options/rights is determined by management using a Black Scholes option pricing model and the fair value of rights are estimated using a Monte Carlo simulation.

In valuing the equity-settled transactions, performance conditions are taken into account.

The cost of equity-settled transactions is recognised, together with corresponding increase in equity, over the period in which the vesting

conditions are fulfilled.

The fair value of the options granted excludes the impact of any non-market vesting conditions (for example, an increase in Resources). Nonmarket vesting conditions are included in assumptions about the number of options/rights that are expected to vest. At each reporting date, the entity revises its estimate of the number of options/rights that are expected to vest. The employee benefit expense recognised each period takes into account the most recent estimate.

The market value of shares issued to employees for no cash consideration is recognised as an employee benefits expense with a corresponding increase in equity when the employees become entitled to the shares. This reserve is used to record the value of equity settled share-based payments provided to employees and directors as part of their remuneration.

Notes to the Consolidated Financial Statements continued

20. Share-Based Payments (Cont’d)

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2021 2020
$ $
Equity
Balance at the start of period 5,612,657 5,379,968
Share-based payments reserve 1,579,145 232,689
7,191,802 5,612,657
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Performance Rights Plan for Directors

Performance Rights plans are used to reward the Directors for their performance and to align their remuneration with the creation of shareholder wealth. The Performance Rights are issued for nil consideration and no consideration will be payable upon the vesting of the Performance Rights. Each Performance Right entitles the holder to be issued with one Ausgold share.

The aggregate numbers of Performance Rights holdings of the Company held directly, indirectly or beneficially by Directors are as follows:

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Opening Redeemed Closing
Balance Granted as Shares Lapsed Balance
Directors Number Number Number Number Number
R Lockwood 7,000,000 8,000,000 (7,000,000) - 8,000,000
N Fearis 3,000,000 6,000,000 (3,000,000) - 6,000,000
G Jones 3,000,000 6,000,000 (3,000,000) - 6,000,000
M Greentree 12,000,000 20,000,000 (12,000,000) - 20,000,000
D Rakich 10,000,000 12,000,000 (10,000,000) - 12,000,000
Total 35,000,000 52,000,000 (35,000,000) - 52,000,000
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During the financial year, 52m Performance Rights were granted to Directors on 20 November 2020 and are subject to satisfaction of the vesting conditions and will expire on 30 June 2022. The Performance Rights plan was approved by shareholders on 20 November 2020.

The vesting conditions for the Performance Rights are as follows:

Holder’s continued service with the Company until the time of vesting;
50% of Performance Rights vest based on a release on the Australian Securities Exchange (“ASX”) of a minimum of 1.6 million ounces of Inferred, Indicated and/or Measured Resources, at a minimum lower cut-off grade of 0.5 grams per tonne of gold reported in accordance with the JORC Code on the Katanning Gold Project tenements; and
50% of the Performance Rights vest based on the release on the ASX of a mining Pre-Feasibility Study (“PFS”) on the Katanning Gold Project which shows the potential to generate an Internal Rate of Return (“IRR”) of greater than 20% using consensus commodity prices and Board approved assumptions.

As the rights have non-market based vesting conditions, they can be exercised at any time up to expiry date. The fair value per right of $0.056 reflects the market value of the underlying ordinary share at grant date.

The following inputs and assumptions were made impacting the share-based payment expense for the year ended 30 June 2021:

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Number issued 52,000,000
Grant date 20 November 2020
Expiry date 30 June 2022
Commencement of performance period 6 October 2020
Fair value at grant date $0.056
Total fair value $2,912,000
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As at initial recognition and reporting date, management have assessed the achievement of the performance right non-market milestones is probable. Therefore the fair value has been recognised over the expected vesting period commencing on 6 October 2020 to the expiry date.

Notes to the Consolidated Financial Statements continued

20. Share-Based Payments (Cont’d)

Performance Rights Plan for Directors (Cont’d)

During the financial year, 35m Performance Rights vested and redeemed as shares. The grant date of the Performance Rights was 8 November 2019 and, subject to satisfaction of the vesting conditions, the Performance Rights will vest on 30 April 2021. The fair value per right is $0.008.

The vesting conditions for the Performance Rights were as follows:

Employment at the end of measurement period (Employment Condition)
Performance of the Company relative to the performance of the S&P/ASX 300 Metals and Mining Index for the period based on Total Shareholder Return (“TSR”) (Performance Condition)

In order to meet the Employment Condition, the relevant Related Party must be employed by the Company at the end of the measurement period.

At the end of the measurement period, the Company’s performance was determined by reference to the Company’s TSR for the period, which was compared against the S&P/ASX Metals and Mining index.

The TSR calculation was based on the percentage change in the share price of the Company over the measurement period. The percentage change calculated was comparing the 20 day volume weighted average price in the 20 business day period immediately before the start and end of the measurement period.

The Company’s TSR compared against the S&P/ASX Metals and Mining Index determined the proportion of Performance Rights that vested, as set out below:

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Relative TSR over the Measurement Period Portion of Performance Rights Vested
Below the 50th percentile 0%
At the 50th percentile 50%
Between the 50th and 75th percentile Pro-rata between 50% and 100%
Above the 75th percentile 100%
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The model used for the calculations is Monte Carlo simulation using a hybrid option pricing model. The following key inputs were used to value

the equity instruments issued in the previous financial year:

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Number issued 35,000,000
Grant date 8 November 2019
Vesting date 30 April 2021
Commencement of performance period 1 October 2019
Risk free interest rate 0.89%
Volatility 86%
Fair value at grant date $0.008
Total fair value $280,000
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Notes to the Consolidated Financial Statements continued

20. Share-Based Payments (Cont’d)

Performance Rights Plan for Staff

Share-based compensation benefits are provided to employees of Ausgold Limited. During the financial year, 6.25m Performance Rights were granted to staff on 1 February 2021 and are subject to satisfaction of the vesting conditions and will expire on 30 June 2022.

The vesting conditions for the Performance Rights are as follows:

Holder’s continued service with the Company until the time of vesting;
50% of Performance Rights vest based on a release on the Australian Securities Exchange (“ASX”) of a minimum of 1.6 million ounces of Inferred, Indicated and/or Measured Resources, at a minimum lower cut-off grade of 0.5 grams per tonne of gold reported in accordance with the JORC Code on the Katanning Gold Project tenements; and
50% of the Performance Rights vest based on the release on the ASX of a mining Pre-Feasibility Study (“PFS”) on the Katanning Gold Project which shows the potential to generate an Internal Rate of Return (“IRR”) of greater than 20% using consensus commodity prices and Board approved assumptions.

As the rights have non-market based vesting conditions, they can be exercised at any time up to expiry date. The fair value per right of $0.054 reflects the market value of the underlying ordinary share at grant date.

The following inputs and assumptions were made impacting the share-based payment expense for the year ended 30 June 2021:

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Number issued 6,250,000
Grant date 1 February 2021
Expiry date 30 June 2022
Commencement of performance period 6 October 2020
Fair value at grant date $0.054
Total fair value $337,500
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As at initial recognition and reporting date, management have assessed the achievement of the performance right non-market milestones is probable. Therefore the fair value has been recognised over the vesting period commencing on 6 October 2020 to the expiry date.

Share-Based Payment Recognised

A share-based payment expense of $1,859,146 (2020: $232,690) was recorded for the financial year ended 30 June 2021 as follows:

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2021 2020
$ $
19,000,000 Performance Rights issued to Directors on 29 November 2018 - 110,612
35,000,000 Performance Rights issued to Directors on 8 November 2019 157,922 122,078
52,000,000 Performance Rights issued to Directors on 20 November 2020 1,230,228 -
6,250,000 Performance Rights issued to staff on 1 February 2021 97,836 -
7,000,000 Options issued to IRX Pty Ltd on 23 March 2021 14,970 -
3,000,000 Options issued to staff on 19 March 2021 6,190 -
16,000,000 Options issued to Blue Ocean Equity Pty Ltd on 4 May 2021 352,000 -
1,859,146 232,690
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The fair value of options at grant date is independently determined using an appropriate option valuation methodology that takes into account the exercise price. The options were issued for nil consideration. The volatility is calculated based upon the share price performance of the Company since listing on the ASX.

Notes to the Consolidated Financial Statements continued

20. Share-Based Payments (Cont’d)

Set out below are summaries of the options and performance rights issued and not exercised for the financial years ended 30 June 2021:

Options:

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Grant date / Opening Closing
Expiry Exercise Granted Exercised Lapsed Vested
Agreement balance balance
date Price (Number) (Number) (Number) (Number)
Date (Number) (Number)
11 Nov 16 30 Nov 20 $0.08 16,000,000 - - (16,000,000) - -
10 Apr 17 31 Jul 20 $0.06 5,000,000 - - (5,000,000) - -
10 Apr 17 31 Jul 20 $0.08 5,000,000 - - (5,000,000) - -
9 Jan 18 31 Dec 21 $0.06 3,700,000 - - - 3,700,000 3,700,000
23 Mar 21 1 Apr 24 $0.08 - 10,000,000 - - 10,000,000 -
4 May 21 3 May 24 $0.06 - 16,000,000 - - 16,000,000 16,000,000
Total 29,700,000 26,000,000 - (26,000,000) 29,700,000 19,700,000
Weighted Average
Exercise Price $0.07 $0.07 $0.06
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Performance Rights:

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The weighted average remaining contractual life of performance rights outstanding at the end of the financial year was 1 year (2020: 0.83 years).

21. Accumulated Losses

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2021 2020
$ $
Equity
Accumulated losses at the start of period (31,285,498) (29,462,163)
Loss after income tax attributable to owners (3,513,319) (1,823,335)
(34,798,817) (31,285,498)
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Notes to the Consolidated Financial Statements continued

22. Loss Per Share

Basic earnings or loss per share are calculated by dividing the net profit or loss attributable to members of the parent entity for the reporting period by the weighted average number of ordinary shares of Ausgold Limited.

Diluted earnings or loss per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of additional shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares.

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2021 2020
cents per share cents per share
From continuing operations:
Basic loss per share (0.26) (0.19)
Diluted loss per share N/A N/A
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The calculation of basic loss per share at 30 June 2021 was based on the loss attributable to ordinary shareholders of $3,513,319 (2020: $1,823,335) and a weighted average number of ordinary shares outstanding during the year of 1,331,214,473 (2020: 953,552,956).

Earnings used in calculating loss per share

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2021 2020
$ $
For basic and diluted loss per share
Loss after income tax for the year (3,513,319) (1,823,335)
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Weighted average number of shares used as denominator

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2021 2020
Weighted Average Number of Ordinary Shares (WANOS)
Weighted average number of ordinary shares 1,331,214,473 953,552,956
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Diluted loss per share must be calculated where potential ordinary shares on issue are dilutive. As the ordinary shares on issue would decrease the loss per share in the current period, they are not considered dilutive and not shown.

Notes to the Consolidated Financial Statements continued

23. Cash Flows From Operating Activities Reconciliation

(a) Reconciliation of cash flow from operating activities with the loss from continuing operations after income tax:

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2021 2020
$ $
Loss after income tax for the year (3,513,319) (1,823,335)
Adjustments for:
Non-current assets written off / disposed of - 2,825
Depreciation and amortisation expenses 160,870 119,232
Share-based payment expenses 1,859,145 232,690
Impairment exploration expenses 554,675 646,457
Fair value adjustments to financial assets at fair value (106,500) 39,000
(Increase) / Decrease in trade and other receivables (90,348) (2,111)
Increase / (Decrease) in trade and other payables (59,419) (9,373)
Increase / (Decrease) in provisions 126,113 (71,985)
Net cash flows used in operating activities (1,068,783) (866,600)
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The total cash outflows from operating and investing activities for the 2021 financial year was $9,901,243 (2020: $3,374,298).

(b) Non-cash investing and financing activities

Non-cash investing and financing activities disclosed in other notes are:

acquisition of right-of-use assets – Note 16

24. Auditor’s Remuneration

The following fees were paid or payable for services provided by the auditor of the consolidated entity:

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2021 2020
$ $
Auditors of the Group - BDO and related network firms
Audit and review of the financial statements
- Group 67,380 35,530
- Attendance at AGM 550
Total audit and review of financial statements 67,930 35,530
Non-audit services
- Valuation of performance rights for purpose of notice of meeting 1,925 3,500
Total non-audit services 1,925 3,500
Total services provided by BDO 69,855 39,030
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Notes to the Consolidated Financial Statements continued

25. Commitments

Remuneration commitments

Names and position held of key management personnel remuneration have been included in the Remuneration Report, which forms part of the Directors’ Report.

26. Related Party Disclosure

Subsidiary

Subsidiaries are entities controlled by the consolidated entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

The financial statements of the subsidiary are prepared for the same reporting period as the Company, using consistent accounting policies. In preparing the consolidated financial statements, all intercompany balances and transactions, income and expenses and profit or losses resulting from inter-entity transactions have been eliminated in full.

The investment in subsidiary held by Ausgold is accounted for at cost in the separate financial statements of the company less any impairment charges. The acquisition of subsidiaries is accounted for using the acquisition method of accounting. The acquisition method of accounting involves allocating the cost of the business combination to the fair value of the assets acquired and the liabilities assumed at the date of the acquisition.

The consolidated financial statements include the financial statements of Ausgold and its subsidiary as below:

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2021 2020
Equity interest Equity interest
Name Country of incorporation % %
Parent entity
Ausgold Limited Australia - -
Directly controlled by Ausgold Limited
Ausgold Exploration Pty Ltd Australia 100 100
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Loans made by Ausgold Limited to its wholly-owned subsidiary Ausgold Exploration Pty Ltd are made to meet required expenditure, the loans are payable on demand and are not interest bearing.

Key Management Personnel

Disclosures relating to key management personnel are included in Note 27.

Elstree Nominees Pty Ltd

Elstree Nominees Pty Ltd (“Elstree”) provides the Group with office premises and associated facilities. All services provided by Elstree to the Group are at cost. Mr Denis Rakich is a Director of Elstree and serves as Executive Director and Company Secretary of Ausgold. The total amount charged by Elstree during the financial year was $168,072 plus GST (2020: $126,425). There were no monies (2020: $20,625 plus GST) owing to Elstree as at 30 June 2021. Amounts were due and payable under normal commercial terms.

Transactions With Other Related Parties

Transactions with other related parties are on normal commercial terms and conditions which are no more favourable to those parties than those available to other parties unless otherwise stated.

Notes to the Consolidated Financial Statements continued

27. Key Management Personnel

Key management personnel remuneration

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2021 2020
$ $
Short-term employment benefits 682,586 419,145
Post employment benefits 48,835 33,250
Long-term employment benefits 20,525 5,562
Share based payments 1,388,150 232,690
2,140,096 690,647
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Detailed remuneration disclosures are set out in the Remuneration Report, which forms part of the Directors’ Report.

Key management personnel received compensation in the form of short-term employee benefits, post-employment benefits and share-based payment awards.

No executive is entitled to any termination payments apart from the remuneration payable up and including the date of termination and all payments due by way of accrued leave.

Loans to key management personnel

No loans have been granted to key management personnel during the current financial year.

Other Key Management Personnel Transactions With The Company

There were no other key management personnel transactions with the Company other than the fees paid to Elstree Nominees Pty Ltd. Details of these fees can be found in Note 25.

28. Contingent Liabilities

The Group had contingent liabilities at 30 June 2021 in respect of bank guarantee as rental deposit for the lease of the premise at 140 St Georges Terrace to the amount of $74,111 (2020: $74,111). No other contingent liabilities existed as at reporting date.

29. Events Subsequent To Reporting Date

The COVID-19 pandemic continues to develop rapidly in 2020, with a significant number of cases worldwide. Measures taken by various governments to contain the virus have affected economic activity. The Company have taken a number of measures to monitor and mitigate the effects of COVID-19, such as safety and health measures for its staff (such as social distancing and working from home) and securing the supply of materials that are essential to its activities.

On 13 August 2021, Ausgold announced that Mr Timothy Kestell has joined the Board as a Non-Executive Director.

No other matters have arisen since the end of the reporting period which may affect the state of affairs of the Group.

Directors’ Declaration

In the Directors’ opinion,

there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable;
the attached consolidated financial statements and notes are in accordance with the Corporations Act 2001, including:
a. complying with Accounting Standards, the Corporations Regulations 2001, International Reporting Standards as issued by the International Accounting Standards Board and other mandatory professional reporting requirements; and
b. giving a true and fair view of the consolidated entity’s position as at 30 June 2021 and its performance for the financial year ended that date; and
the Directors have been given the declaration as required under s295A of the Corporations Act 2001.

Signed in accordance with a resolution of the Directors made pursuant to section 295(5) of the Corporations Act 2001.

For and on behalf of the Directors

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Denis Rakich Director

Perth, Western Australia

30 September 2021

Independent Auditor’s Report

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Tel: +61 8 6382 4600 Fax: +61 8 6382 4601 www.bdo.com.au

38 Station Street Subiaco, WA 6008 PO Box 700 West Perth WA 6872 Australia

INDEPENDENT AUDITOR'S REPORT

To the members of Ausgold Limited

Report on the Audit of the Financial Report

Opinion

We have audited the financial report of Ausgold Limited (the Company) and its subsidiary (the Group), which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial report, 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:

(i) Giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its financial performance for the year ended on that date; and

(ii) 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 Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (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 confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s report.

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

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.

Independent Auditor’s Report continued

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Carrying Value of Exploration and Evaluation Expenditure

Key audit matter As disclosed in Note 13, the carrying value of the exploration and evaluation asset represents a significant asset of the Group.

How the matter was addressed in our audit Our procedures included, but were not limited to:

Obtaining a schedule of the areas of interest
The Group’s accounting policies and significant held by the Group and assessing whether the judgements applied to capitalised exploration rights to tenure of those areas of interest and evaluation expenditure are detailed in notes remained current at balance date; 4 and 13 of the financial report.  Verifying, on a sample basis, exploration and In accordance with AASB 6 Exploration for and evaluation expenditure capitalised during Evaluation of Mineral Resources (‘AASB 6’), the the year for compliance with the recognition recoverability of exploration and evaluation criteria of AASB 6; expenditure requires significant judgement by  Considering the status of the ongoing management in determining whether there are exploration programmes in the respective
any facts and circumstances that exist to suggest areas of interest by holding discussions with
the carrying amount of this asset may exceed its management, and reviewing the Group’s
recoverable amount. As a result, this is exploration budgets, ASX announcements
considered a key audit matter. and director’s minutes;
Considering whether any such areas of interest had reached a stage where a reasonable assessment of economically recoverable reserves existed;
Considering whether any facts or circumstances existed to suggest impairment testing was required; and
Assessing the adequacy of the related disclosures in Notes 4 and 13 to the Financial Report.

Independent Auditor’s Report continued

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Other information

The directors are responsible for the other information. The other information comprises the information in the Group’s annual report for the year ended 30 June 2021, but does not include the financial report and the auditor’s report thereon.

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 ability of the group 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 has 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 (http://www.auasb.gov.au/Home.aspx) at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf

This description forms part of our auditor’s report.

Independent Auditor’s Report continued

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Report on the Remuneration Report

Opinion on the Remuneration Report

We have audited the Remuneration Report included in pages 24 to 29 of the directors’ report for the year ended 30 June 2021.

In our opinion, the Remuneration Report of Ausgold Limited, for the year ended 30 June 2021, 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.

BDO Audit (WA) Pty Ltd

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Ashleigh Woodley

Director

Perth, 30 September 2021

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4
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Shareholder Information

The shareholder information set out below was applicable as at 14 September 2021.

Distribution of Equity Securities

Analysis of numbers of ordinary shareholders by size of holding:

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Spread of Holdings Number of Holders Number of Shares
NIL Holding 0 0
1 - 1,000 116 31,397
1,001 - 5,000 96 266,450
5,001 - 10,000 121 1,117,826
10,001 - 100,000 1,120 47,915,348
Over 100,000 854 1,536,018,520
TOTAL ON REGISTER 2,307 1,585,349,541
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440 shareholders held less than a marketable parcel (<$500) or ordinary shares

Twenty Largest Shareholders

The names of the twenty largest holders of quoted shares are:

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Holder Name Number of Shares Percentage of shares
CITICORP NOMINEES PTY LIMITED 203,257,102 13%
OLD BLOOD AND GUTS PTY LTD 96,000,000 6%
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM 71,195,338 4%
MR RICHARD ARTHUR LOCKWOOD 56,000,000 4%
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 53,584,958 3%
BNP PARIBAS NOMINEES PTY LTD 44,481,963 3%
ALL STATES FINANCE PTY LIMITED 35,666,666 2%
BNP PARIBAS NOMS PTY LTD 30,051,573 2%
DENIS RAKICH 27,998,681 2%
BUYCO PTY LTD 22,000,000 1%
BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD 20,059,140 1%
THIRTY SIXTH VILMAR PTY LTD 19,362,355 1%
BERNE NO 132 NOMINEES PTY LTD <152417 A/C> 19,020,953 1%
AIC MINES LIMITED 17,665,000 1%
BATTERBURY HOLDINGS PTY LTD 16,080,000 1%
DOUGLAS FINANCIAL CONSULTANTS PTY LTD 15,000,000 1%
TREVOR PAVEY PTY LTD 14,876,482 1%
MOLATE PTY LIMITED 14,000,000 1%
M&J GREENTREE NOMINEES PTY LTD 13,950,000 1%
ALBERTUS MAGNUS RESOURCES PTY LTD 13,000,000 1%
Total 803,250,211 51%
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Shareholder Information continued

Voting Rights

All fully paid ordinary shares carry one vote per share.

Substantial holders

The Company has received the following notices of substantial shareholding:

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Relevant interest per notice received
Shareholders
Number of shares
Dundee Resources Limited 153,750,000
Old Blood and Guts Pty Ltd 90,000,000
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Options on Issue

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Number of
Option Details Expiry Dates
Options
Unlisted options exercisable at $0.06 per share 31-Dec-21 3,700,000
Unlisted options exercisable at $0.08 per share 01-Mar-24 10,000,000
Unlisted options exercisable at $0.063 per share 03-May-24 16,000,000
Unlisted options exercisable at $0.06 per share 30-Jun-24 4,000,000
Unlisted options exercisable at $0.08 per share 30-Jun-24 3,000,000
Total 36,700,000
Number of
Performance Rights Expiry Dates
Rights
Performance rights granted 20 Nov 2020 30-Jun-22 52,000,000
Performance rights granted 1 Feb 2021 30-Jun-22 6,250,000
Total 58,250,000
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Schedule of Mineral

Tenement Interests

Summary of mining and exploration tenements as at 30 June 2021

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State Tenement Tenement status Grant date Project Interest %
Western Australia Tenements
WA E38/2129 Granted 13 October 2008 Yamarna 25%
WA E38/3311 Application - Yamarna 100%
WA E52/3031 Granted 4 February 2014 Doolgunna 100%
WA E70/3952 Granted 18 January 2011 Katanning Regional 100%
WA E70/4392 Granted 25 March 2013 Katanning Regional 100%
WA E70/4566 Granted 12 August 2014 Katanning Regional 100%
WA E70/4604 Granted 13 January 2015 Katanning Regional 100%
WA E70/4605 Granted 13 January 2015 Katanning Regional 100%
WA E70/4682 Granted 28 July 2015 Katanning Regional 100%
WA E70/4728 Granted 8 January 2016 Katanning Regional 100%
WA E70/4865 Granted 10 January 2017 Katanning Regional 100%
WA E70/4866 Granted 10 January 2017 Katanning Regional 100%
WA E70/4896 Granted 9 March 2017 Katanning Regional 100%
WA E70/4907 Granted 11 April 2017 Katanning Regional 100%
WA E70/4908 Granted 3 May 2017 Katanning Regional 100%
WA E70/4942 Granted 21 August 2017 Katanning Regional 100%
WA E70/4947 Granted 6 November 2017 Katanning Regional 100%
WA E70/4958 Granted 18 April 2018 Katanning Regional 100%
WA E70/4959 Granted 11 April 2018 Katanning Regional 100%
WA E70/4968 Granted 4 January 2018 Katanning Regional 100%
WA E70/5040 Granted 14 June 2018 Katanning Regional 100%
WA E70/5042 Granted 14 June 2018 Katanning Regional 100%
WA E70/5043 Granted 14 June 2018 Katanning Regional 100%
WA G70/84 Granted 13 June 1989 Katanning Gold Project 100%
WA G70/85 Granted 13 June 1989 Katanning Gold Project 100%
WA L70/13 Granted 24 May 1989 Katanning Gold Project 100%
WA L70/32 Granted 11 December 1995 Katanning Gold Project 100%
WA L70/33 Granted 11 December 1995 Katanning Gold Project 100%
WA E70/2928 Granted 26 November 2008 Katanning Gold Project 100%
WA M70/210 Granted 28 March 1985 Katanning Gold Project 100%
WA M70/211 Granted 28 March 1985 Katanning Gold Project 100%
WA M70/488 Granted 19 April 1994 Katanning Gold Project 100%
WA E70/5044 Granted 14 June 2018 Lake Magenta 100%
WA E70/5285 Granted 29 October 2019 Lake Magenta 100%
WA E70/5688 Granted 27 April 2021 Lake Magenta 100%
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Tenement Schedule continued

Schedule of Mineral Tenement Interests (cont’d)

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State Tenement Tenement status Grant date Project Interest %
Western Australia Tenements
WA E70/5689 Granted 27 April 2021 Lake Magenta 100%
WA E70/4863 Granted 10 January 2017 Woodanilling 100%
WA E70/4864 Granted 10 January 2017 Woodanilling 100%
WA E70/5142 Granted 7 April 2019 Woodanilling 100%
WA E70/5223 Granted 5 July 2019 Woodanilling 100%
WA E70/5643 Granted 29 April 2021 Woodanilling 100%
WA E70/5644 Granted 29 April 2021 Woodanilling 100%
WA E70/5655 Granted 29 April 2021 Woodanilling 100%
WA E70/5656 Granted 5 May 2021 Woodanilling 100%
WA E70/5681 Granted 27 April 2021 Woodanilling 100%
Queensland Tenement
QLD EPM17054 Granted 26 November 2010 Cracow 100%
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AI assistant

AUSGOLD LIMITED — Annual Report 2021

64457_rns_2021-09-29_d9c43cb6-8c36-48a3-8f7f-f070a745f81a.pdf

2021

Table of Contents

Corporate Directory

Directors

Share Registry

Mr Denis Rakich

Auditors

Mr Neil Fearis

Company Secretary

Bankers

Mr Denis Rakich

Solicitors

Registered Office

Securities Exchange

Australian Business Number

Managing Director’s Letter

Building a Critical Mass

Potential for Larger Scale

Optionality

Review of Operations FY2021

Highlights:

The Company’s portfolio projects offer optionality for additional value to be recognised:

40,000m drilling campaign completed in the Central Zone which delivered the upgraded Resource, along with potential for further Resource growth, including:

Focus on Resource growth with exploration commenced in the Southern Zone, including:

Katanning Gold Project

WESTERN AUSTRALIA (AUC 100%)

Upgraded 2021 JORC Resource Mineral Resource

Resource Upgrade Key Points:

2021 Mineral Resource Summary

Project Infrastructure

KGP Central Zone

Jinkas South

Jinkas North

KGP Southern Zone

Dingo Resource

Southern KGP - Lukin area

KGP Northern Zone

Regional Exploration

Burong

Nanicup Bridge

Bullock Pool

Lake Magenta Gold Project

WESTERN AUSTRALIA (AUC 100%)

Woodanilling Project

WESTERN AUSTRALIA (AUC 100%)

Mine Hill copper-silver-gold mineralisation

Regional Ni-PGE targets

Martling

Red Hill

Doolgunna Station

WESTERN AUSTRALIA (AUC 100%)

Yamarna

WESTERN AUSTRALIA (AUC 25%)

Cracow

QUEENSLAND (AUC 100%)

Competent Person’s Statements

Forward-Looking Statements

Director’s Report

Principal Activities

Directors and Company Secretary

Denis Rakich, Executive Director and Company Secretary Since 31 January 2013

Directors’ Meetings

Dividends

Significant Changes in the State of Affairs

Likely Developments and Expected Results of Operations

Environmental Regulations

Review of Operations

Exploration

Financial

Convertible Securities

Options

Performance Rights

Events subsequent to reporting date

Indemnification of Directors

Indemnification

Insurance premiums

Indemnity and insurance of auditor

AUSGOLD LIMITED Annual Report 2021