Resources Limited

ABN 86 125 049 550

Annual Report and Financial Statements For the year ended 30 June 2012

CORPORATE DIRECTORY

Directors

Seamus Cornelius (Chairman) Anthony Maslin (Managing Director) Julian Stephens (Non-Executive Director) Liu Xing Zhou (Non-Executive Director)

Company Secretaries

Sam Wright Jodi Haslinger

Registered Office

Suite 1, First Floor 14 – 16 Rowland Street SUBIACO WA 6008

Principal Place of Business

Suite 1, First Floor 14 – 16 Rowland Street SUBIACO WA 6008 Telephone: +61 8 9380 6063 Facsimile: +61 8 9381 4056 ABN 86 125 049 550

Hong Kong Office

Room 13, Office 1006 – 07 Level 10, Tower 2 Silvercard Building 30 Canton Road Tsim Sha Tsui, Hong Kong Telephone: +852 249 66016

Postal Address

PO Box 9028 SUBIACO WA 6008

Solicitors

Norman Waterhouse Lawyers Level 15, 45 Pirie Street ADELAIDE SA 5000

Share Register

Computershare Investor Services Pty Ltd Level 2, 45 St George's Terrace PERTH WA 6000

Auditors

Rothsay Chartered Accountants Level 18, Central Park Building, 152-158 St Georges Terrace PERTH WA 6000

Website Address

www.buxtonresources.com.au

Stock Exchange

Buxton Resources Limited shares are listed on the Australian Securities Exchange and the Frankfurt Stock Exchange.

ASX code: BUX, BUXO Frankfurt: 3B4.F

Letter from the Chairman	4
Review of Operations	5
Directors' Report	12
Auditors' Independence Declaration	21
Corporate Governance Statement	22
Statement of Comprehensive Income	29
Statement of Financial Position	30
Statement of Changes in Equity	31
Statement of Cash Flows	32
Notes to the Financial Statements	33
Directors' Declaration	54
Independent Audit Report	55
ASX Additional Information	57

Letter from the Chairman

Dear Fellow Shareholder,

On behalf of the Board it is once again my pleasure to thank you for your support over the past year. The financial year ended 30 June 2012 was another volatile year in equity and commodity markets across the globe. Despite the volatility your company enters the 2012/2013 year in a strong position. The company has some very exciting exploration projects at Widowmaker and Yalbra which the Board expects will attract the majority of the company's exploration expenditure in the coming year.

The company is well funded and has a tight capital structure which should mean shareholders are well placed to increase their wealth should the company have exploration success. In addition to the exciting exploration potential at Widowmaker and Yalbra we also have the Zanthus magnetite project. The Board is working to realize value for shareholders from Zanthus. The capital raising and exclusive marketing arrangements for the Zanthus magnetite projects which the company entered into in August 2012 with NBH demonstrate that in spite of the recent fall in iron ore prices and a current lack of positive sentiment towards magnetite projects in the broader market, Zanthus is still an exciting project and has the potential to deliver further value to the company.

I suggest you read the Annual Report as it contains much useful information and detail on your company's activities over the financial year just ended.

Buxton is led by our managing director Anthony Maslin and the entire team including all directors, employees, consultants and advisors is working towards building shareholder wealth through successful exploration and project development. We work as a team and are conscious of the company's responsibilities to all stakeholders and the environment. That said, our focus is building shareholder wealth. As a small listed exploration company we are focussed on exploring for commercial mineral deposits. The majority of the company's time, effort and expenditure will be applied to this endeavour. Successful exploration leads to real wealth creation for shareholders and that after all is why we are all shareholders.

Seamus Cornelius Non-Executive Chairman

Corporate

On 1st September 2011 Mr Sam Wright resigned as Non-Executive Director (remaining as Joint Company Secretary), being replaced by Dr Julian Stephens – Non-Executive (Technical) Director.

On 12th September 2011 the Company announced it had received excellent drilling results which substantially upgraded the Zanthus Magnetite Project, located just 25km South of the trans Australian railway, 200km East of Kalgoorlie. Consistent, wide, high grade magnetite drill intercepts had been received and confirm a significant iron discovery at Cohen over >4km of strike. Additional Magnetite mineralisation had been discovered at the Joplin prospect.

On 3rd November, Buxton announced a 0.7 – 1.3 Billion Tonne Exploration Target at Zanthus Magnetite Project @ 22%-32% Fe*. Five major exploration target areas were identified:

Cohen: 140-210 Mt @ 26%-32% Fe*
Marley Line: 151-281 Mt @ 22%-32% Fe*
Zappa-Dylan Line: 227-421 Mt @ 22%-32% Fe*
Joplin-Hendrix Line: 151-281 Mt @ 22%-32% Fe*
Southern Targets: 76-140 Mt @ 22%-32% Fe*

On December 5 th the Company announced a maiden resource for the Zanthus Magnetite Project of 103.6 Million Tonnes at 26.5% Fe. Resource represents initial confirmation of potential for the Zanthus Project's 0.7 – 1.3 Billion Tonne Exploration Target*. Further metallurgical test-work was underway to optimize previously reported excellent results. Financing opportunities were under investigation.

On the 8th December, the Company announced it had confirmed Premium Metallurgical Characteristics at Zanthus. Cohen Deposit Davis Tube Testing confirms 66.4% average iron product delivered at 150(p80) micron grind size, with a very low silica content. This is considered to be amongst the best coarse grind magnetite results in Australia, which is a major factor in delivering low capital & operational costs.

In May 2012, the Company announced that it had acquired an option to purchase the high grade Yalbra Graphite Project, WA. High grade, wide, near-surface zones of graphite mineralisation had been identified over at least 4km strike length in historical trenches and drilling. Historical percussion drill results include:

PD 3 :	16.8m @ 13.2% C (from 15m)
	incl 6.1m @ 17.2% C
PD 9 :	23.5m @ 19.5% C (from 9m)
	incl 15.2m @ 25.2% C
PD 10 :	39.6m @ 10.0% C (from 3m)
	incl 12.2m @ 23.6% C
PD 13 :	24.4m @ 11.6% C (from 18m)
	incl 6.1m @ 23.5% C
PD 18 :	33.5m @ 8.8% C (from 18m)
	incl 9.2m @ 21.1% C
PD 23 :	30.5m @ 8.8% C (from 9m)
	incl 6.1m @ 17.7% C

Coarse flake graphite was identified in historical drill logs and basic metallurgical tests.

Also in May 2012, the Company announced a preliminary global exploration target* of 8 - 12 Million Tonnes @ 7 - 11% C*at the Yalbra Graphite Project. High grade, wide, near-surface zones of graphite mineralisation identified over at least 4km strike length in historical trenches and drilling. Most zones of graphite mineralisation open at depth and along strike. Coarse flake graphite identified in historical drill logs and basic metallurgical tests.

Historical percussion drill results include;

PD 3 : 16.8m @ 13.2% C (from 15m) incl 6.1m @ 17.2% C
PD 9 : 23.5m @ 19.5% C (from 9m) incl 15.2m @ 25.2% C
PD 10 : 39.6m @ 10.0% C (from 3m) incl 12.2m @ 23.6% C
PD 13 : 24.4m @ 11.6% C (from 18m) incl 6.1m @ 23.5% C
PD 18 : 33.5m @ 8.8% C (from 18m) incl 9.2m @ 21.1% C
PD 23 : 30.5m @ 8.8% C (from 9m) incl 6.1m @ 17.7% C

*The potential quality and grade of the Yalbra Exploration Target is conceptual in nature. There has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.

On the 21 June 2012, Buxton announced it had exercised its option to acquire 85% of the Yalbra Graphite Project from Montezuma Mining Ltd.

Figure 1: The Zanthus Project is located 200km east of Kalgoorlie, WA

PROJECT LOCATION

The Zanthus Project is located 200 kms East of Kalgoorlie, 25 kms South of the Trans Australian Railway (1), and 35 kms South South East of the existing Zanthus rail siding (2), (Figure 1).

The rail line from Zanthus to Kalgoorlie is the Trans Australian and is government owned. The rail from Kalgoorlie to Esperance is owned by a private infrastructure operator, as opposed to a competing mining company.

The Western Australian State Government has recently announced a planned expansion to the Esperance Port to facilitate an additional 20 MTpa export capacity. This will be undertaken in conjunction with private operators and submissions are currently being prepared. The State Government has a stated objective of allowing access to those who require it.

SCOPING STUDY COMPLETED

On December 12 2011, Buxton commissioned Runge Ltd to undertake a high level Scoping Study to investigate the potential economic viability of the Zanthus Magnetite Project. The scope of work includes design of a preliminary optimised pit shell, processing, infrastructure, transport and an initial economic model.

The study has provided encouraging results which Buxton believes enhance the potential for Zanthus to be a strongly viable large scale magnetite operation.

JOINT VENTURE DISCUSSIONS

Buxton continues to receive interest from several potential joint venture partners. Discussions are progressing at this point.

YILGARN IRON PRODUCERS ASSOCIATION (YIPA)

In April this year, Buxton joined the YIPA Association. The YIPA Association is a registered Not-for-Profit Association under the division of Consumer Protection, Department of Commerce, Western Australia. It promotes sustainable development in the Yilgarn Iron Province and works to promote cooperation on rail, ports and other infrastructure.

Membership of the association is another step forward for Buxton, as it will facilitate relationships with Esperance Port and provide infrastructure upgrade information that will in turn, help progress the company's Zanthus Magnetite Project in the future.

YALBRA PROJECT WA

E09/1985 85% Buxton

During the quarter Buxton exercised an option to acquire 85% of the Yalbra Graphite Project in the North West Gascoyne region of Western Australia from Montezuma Mining Ltd.

The Yalbra Graphite Project is located 250 km North West of Meekatharra and 280 km East of Carnarvon, Western Australia (Figure 2). The tenement E09/1985 is in the application stage and covers an area of approximately 37 square kilometres.

Figure 2: The Yalbra Graphite Project is located 280km east of Carnarvon, WA

HISTORICAL WORK

In June 1974, a percussion drilling program was undertaken by Carpentaria Exploration Company Pty Ltd. A total of 21 holes were drilled for 856 metres to down-hole depths generally in the order of 40m. Substantial grades and widths of graphite mineralisation were identified in most of the holes drilled (Figure 3).

Historical field observations indicated that the graphite occurs both in disseminated and veinlet styles. Coarse flake graphite was identified in both drilling logs and in a rudimentary metallurgical test of near-surface mineralisation. However, no estimates of the coarse, medium and fine flake ratios were made.

Figure 3: Yalbra Graphite Project – simplified plan of historical drill results and geology and six main zones of graphite mineralisation.

EXPLORATION TARGET

The availability of historical drilling information allowed Buxton's geological team to define a preliminary Exploration Target at the Yalbra Graphite Project of;

8-12 Million Tonnes @ 7-11% C*

* The potential quality and grade of the Yalbra Exploration Target is conceptual in nature. There has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.

Historical drilling results indicate the six discreet zones of graphite mineralisation occur in a broad zone that extends over a strike length of at least 4km. All of the zones are open at depth, and in most cases, are also open along strike. For the purposes of the Exploration Target estimation, Buxton has assumed mineralisation extends to a depth of 150m below surface.

E63/1525 (100% Buxton)

No field activity was conducted on the Dempster Project during the financial year.

Competent Person's Statement

Competent Person: The information in this report that relates to Exploration Results and Exploration Targets is based on information compiled by Dr Julian Stephens, Member of the Australian Institute of Geoscientists and Non-Executive Director for Buxton Resources Limited. Dr Stephens has sufficient experience which is relevant to the activity being undertaken to qualify as a "Competent Person", as defined in the 2004 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves and consents to the inclusion in this report of the matters reviewed by him in the form and context in which they appear.

Buxton Resources Limited

Directors' Report

Your directors submit their report for the year ended 30 June 2012.

DIRECTORS

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

Mr Seamus Cornelius - Non-Executive Chairman Mr Anthony Maslin - Managing Director Dr Julian Stephens -Technical Director (appointed 1st September 2011) Mr Sam Wright - Non-Executive Director (resigned 1st September 2011) Mr Liu Xing Zhou - Non Executive Director (appointed 12th September 2012)

COMPANY SECRETARIES

Mr Sam Wright Miss Jodi Haslinger

INFORMATION ON DIRECTORS

Mr Seamus Cornelius - Non-Executive Chairman

Qualifications: B.Juris, LLB, LLM

Mr Cornelius brings to the Board 21 years of corporate experience in both legal and commercial negotiations. Mr Cornelius has been living and working as a corporate lawyer in China for 17 years. He has been based in Shanghai and Beijing since 1993. From 2000 to 2010 he was an international partner with one of Australia's leading law firms and specialized in dealing with cross border investments, particularly in energy and resources. Mr Cornelius has for many years advised large international companies on their investments in China and in recent years has advised Chinese state owned entities on their investments in natural resource projects outside of China including in Australia. As well as Buxton Resources Limited, Mr Cornelius is also currently the Chairman of ASX listed Montezuma Mining Limited (ASX: MZM).

Mr Anthony Maslin - Managing Director

Qualifications: B.Bus (Finance and Enterprise)

Mr Maslin brings to the Board 20 years of corporate experience in both management and promotion, along with an extensive understanding of financial markets.

In his 6 years as a stockbroker at Hartley Poynton Stockbrokers in Perth, Mr Maslin was instrumental in the capital raisings and promotion of several resource development companies. In the subsequent 7 years in his role as founding Managing Director of Solar Energy Systems Ltd (Now Solco Ltd (ASX Code: SOO)) he had significant experience in capital raisings and management of both people and projects. Mr Maslin has also worked as a corporate promotion consultant to a number of listed companies. Mr Maslin is also currently a Non-Executive Director of ASX listed Pancontinental Oil & Gas NL (ASX: PCL).

Dr Julian Stephens - Non-Executive Director (appointed 1st September 2011) Qualifications: BSc (Hons) Applied Geology, PhD, MAIG

Dr Stephens has extensive experience in the resources sector having spent in excess of 16 years in board, executive management, senior operational, and economic geology research roles for private and public companies. Most recently, Dr Stephens held the position of Chief Executive Officer of Dampier Gold Limited (ASX: DAU). Dr Stephens holds a PhD from James Cook University, Queensland and is a member of the Australian Institute of Geoscientists (MAIG), and the Society of Economic Geologists.

Directorships held: Globe Metals and Mining Ltd 24 Dec 2008 – 26 June 2012. Tate Minerals Limited 12 September 2011 - present

Mr Liu Xing Zhou - Non-Executive Director (appointed 12th September 2012)

Buxton welcomes Mr Liu (Leo) Xing Zhou who joins the board of Buxton as a Non-Executive Director. Mr Liu has significant experience in senior financial positions with both businesses in China and multinational companies based in Hong Kong and the United States. He holds an MBA from University of Chicago and CPA qualifications.

Mr Sam Wright - Non-Executive Director & Joint Company Secretary (resigned as director 1st September 2011)

Mr Wright is experienced in the administration of ASX listed companies, corporate governance and corporate finance. He is a member of the Australian Institute of Company Directors, the Financial Services Institute of Australasia, and the Chartered Secretaries of Australia.

Mr Wright is currently a Non-Executive Director and Company Secretary of ASX listed company, PharmAust Limited. He is also Company Secretary for ASX listed companies, Buxton Resources Limited, Cove Resources Limited and Structural Monitoring Systems plc. Mr Wright has also filled the role of Director and Company Secretary with a number of unlisted companies.

Mr Wright is the Managing Director of Perth-based corporate advisory firm Straight Lines Consultancy, specialising in the provision of corporate services to public companies

Interests in the shares and options of the Company and related bodies corporate

As at the date of this report, the interests of the directors in the shares and options of Buxton Resources Limited were:

	Ordinary Shares	Options over Ordinary Shares
Anthony Maslin*	392,897	130,198
Seamus Cornelius*	930,397	183,948
Julian Stephens*	-	-
Liu Xing Zhou	-	-

* The above Directors also hold performance shares, the details of which are disclosed under note 18.

PRINCIPAL ACTIVITIES

The principal activities of the Company during the year were the acquisition of mining tenements, and the exploration and evaluation of these tenements with the objective of identifying economic mineral deposits.

DIVIDENDS

No dividends were paid or declared during the year. No recommendation for payment of dividends has been made.

OPERATING AND FINANCIAL REVIEW

Finance Review

The Company began the year with cash assets available of \$2,620,917. Funds are being used to actively pursue the Company's exploration projects.

During the year total exploration expenditure incurred by the Company amounted to \$732,550 (2011: \$606,686). In line with the Company's accounting policies, all exploration expenditure is written off as incurred. The Company received no revenue (2011: \$70,000) from the sale of tenement interests. The operating loss after income tax for the year ended 30 June 2012 was \$1,223,156 (2011: \$1,613,344).

At 30 June 2012 cash balances totalled \$1,231,766.

Operating Results for the Year

Summarised operating results are as follows:

	2012
	Revenues	Results
	\$	\$
Revenues and loss from ordinary activities before income tax expense	142,556	(1,223,156)
Shareholder Returns	2012	2011
Basic loss per share (cents)	(3.04)	(2.9)

Risk Management

The board is responsible for ensuring that risks, and also opportunities, are identified on a timely basis and that activities are aligned with the risks and opportunities identified by the board.

The Company believes that it is crucial for all board members to be a part of this process, and as such the board has not established a separate risk management committee.

The board has a number of mechanisms in place to ensure that management's objectives and activities are aligned with the risks identified by the board. These include the following:

• Board approval of a strategic plan, which encompasses strategy statements designed to meet stakeholders needs and manage business risk.

• Implementation of board approved operating plans and budgets and board monitoring of progress against these budgets.

SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

Other than as disclosed in this Annual Report, no significant changes in the state of affairs of the Company occurred during the financial year.

SIGNIFICANT EVENTS AFTER THE BALANCE DATE

On 7 August 2012, the Company announced Priority Nickel Targets were identified at Buxton's Widowmaker Project, Along Strike from Nova Nickel Discovery. Multiple Ni, Cu and PGE soil anomalies had been identified. Available aeromagnetic data highlights the host rocks at Nova trending into Buxton's tenure. The Widowmaker Project is located along strike from Sirius' Nova discovery where substantial Nickel and Copper hits have been recorded. Exploration licence E28/2201 is due to be granted by the end of 2012, allowing rapid commencement of field programs. Fieldwork to commence immediately, including infill calcrete geochemical sampling and EM surveys over selected target areas.

On 7 September 2012, the Company announced the raising of \$1,254,432 through the placement of 5,017,728 shares at an issue price of 25 cents per share to National Business Holdings (NBH), a privately owned company. Subject to shareholder approval the Company will issue an additional 1,150,000 shares at an issue price of 25 cents per share to raise an additional \$287,500. The shares issued will be subject to escrow for a period of 6 months from the date of the agreement.

The Company will also receive a \$600,000 licencing fee from NBH for the exclusive right to market Zanthus Magnetite Project for the next 15 months. Mr Liu Xing Zhou joined the board as a Non-Executive Director. The funds will be used to facilitate exploration programs at Widowmaker Nickel Copper Project and Yalbra Graphite Project.

LIKELY DEVELOPMENTS AND EXPECTED RESULTS

The Company expects to maintain the present status and level of operations and hence there are no likely developments in the entity's operations.

ENVIRONMENTAL REGULATION AND PERFORMANCE

The Company is subject to significant environmental regulation in respect to its exploration activities. The Company aims to ensure the appropriate standard of environmental care is achieved, and in doing so, that it is aware of and is in compliance with all environmental legislation. The directors of the Company are not aware of any breach of environmental legislation for the year under review.

The directors have considered the National Greenhouse and Energy Reporting Act 2007 (the NGER Act) which introduces a single national reporting framework for the reporting and dissemination of information about greenhouse gas emissions, greenhouse gas projects, and energy use and production of corporations. At the current stage of development, the directors have determined that the NGER Act will have no effect on the Company for the current, nor subsequent, financial year. The directors will reassess this position as and when the need arises.

REMUNERATION REPORT (Audited)

The information provided in this remuneration report has been audited as required by section 308(3C) of the Corporations Act 2001.

Principles used to determine the nature and amount of remuneration

Remuneration Policy

The remuneration policy of Buxton Resources Limited has been designed to align director and executive objectives with shareholder and business objectives by providing a fixed remuneration component and offering specific long-term incentives. The board of Buxton Resources Limited believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best executives and directors to run and manage the Company.

The remuneration policy, setting the terms and conditions for the executive directors and other senior executives, was developed by the board. All executives receive a base salary (which is based on factors such as length of service and experience) and superannuation. The board reviews executive packages annually by reference to the Company's performance, executive performance and comparable information from industry sectors and other listed companies in similar industries.

The board may exercise discretion in relation to approving incentives, bonuses and options. The policy is designed to attract the highest calibre of executives and reward them for performance that results in long-term growth in shareholder wealth.

Executives are also entitled to participate in the employee share and option arrangements.

The executive directors and executives receive a superannuation guarantee contribution required by the government, which is currently 9%, and do not receive any other retirement benefits.

All remuneration paid to directors and executives is valued at the cost to the Company and expensed. Options are valued using the Black-Scholes methodology.

The board policy is to remunerate non-executive directors at market rates for comparable companies for time, commitment and responsibilities. The board determines payments to the non-executive directors and reviews their remuneration annually, based on market practice, duties and accountability. Independent external advice is sought when required. The maximum aggregate amount of fees that can be paid to non-executive directors is subject to approval by shareholders at the Annual General Meeting (currently \$300,000). Fees for non-executive directors are not linked to the performance of the Company. However, to align directors' interests with shareholder interests, the directors are encouraged to hold shares in the Company and are able to participate in the employee option plan.

Performance based remuneration

The Company currently has no performance based remuneration component built into director and executive remuneration packages.

Company performance, shareholder wealth and directors' and executives' remuneration

No relationship exists between shareholder wealth, director and executive remuneration and Company performance.

Details of remuneration

Details of the remuneration of the directors, the key management personnel (as defined in AASB 124 Related Party Disclosures) and specified executives of Buxton Resources Limited are set out in the following table. The key management personnel of Buxton Resources Limited include the directors as per page 3 above. Given the size and nature of operations of Buxton Resources Limited, there are no other employees who are required to have their remuneration disclosed in accordance with the Corporations Act 2001.

Key management personnel compensation

	Short-Term		Post Employment		Equity	Total
	Salary & Fees	Non Monetary	Superannuation	Retirement benefits	Share Options
	\$	\$	\$	\$	\$	\$
Directors
Anthony Maslin
2012	150,000	-	13,500	-	-	163,500
2011	87,500		7,875			95,375
Seamus Cornelius
2012	50,000	-	-	-	-	50,000
2011	29,167		-			29,167
Sam Wright*
2012	5,000	-	-	-	-	5,000
2011	15,000	-	-	-	-	15,000
Julian Stephens**
2012	25,000	-	-	-	-	25,000
2011	-	-	-	-	-	-
Total key management personnel compensation
2012	230,000	-	13,500	-	-	243,500
2011	131,667	-	7,875	-	-	139,542

* Mr Sam Wright appointed 31 December 2010, resigned 1 September 2011

**Dr Julian Stephens appointed 1 September 2011

Service agreements

The Company has an Executive Service Agreement with Mr Anthony Maslin.

Under the Agreement, Mr Maslin is engaged by the Company to provide services to the Company in the capacity of Managing Director. Mr Maslin is paid a salary of \$150,000, plus statutory superannuation.

The Agreement continues until terminated by either Mr Maslin or the Company. Both parties are entitled to a minimum notice period of three months.

Share-based compensation

There was no share-based compensation paid to key management personnel during the year. (2011: \$24,552).

DIRECTORS' MEETINGS

During the year the Company held 7 meetings of directors. The attendance of directors at meetings of the board were:

	Directors Meetings
	A	B
Anthony Maslin	7	7
Seamus Cornelius	7	7
Julian Stephens	7	7
Sam Wright	-	-
Liu Xing Zhou	-	-

Notes

A – Number of meetings attended.

B – Number of meetings held during the time the director held office during the year.

SHARES UNDER OPTION

At the date of this report there are 4,004,983 listed and 3,750,000 unlisted unissued ordinary shares in respect of which options are outstanding.

Listed		Number of options
Balance at the beginning of the year		4,004,983
Issued during the year		-
Total number of options outstanding as at 30 June 2012 and the date of this
report		4,004,983
The balance is comprised of the following:
Expiry date	Exercise price (cents)	Number of options
31 January 2016	30	4,004,983
Total number of listed options outstanding at the date of this report		4,004,983
Unlisted Balance at the beginning of the year Expired during the year		12,500,000 (8,750,000)
Issued during the year		-
Total number of options outstanding as at 30 June 2012 and the date of this
report		3,750,000
The balance is comprised of the following:
Expiry date	Exercise price (cents)	Number of options
31 January 2016	35	3,750,000
Total number of unlisted	options outstanding at the date of this report	3,750,000

No person entitled to exercise any option referred to above has or had, by virtue of the option, a right to participate in any share issue of any other body corporate.

INSURANCE OF DIRECTORS AND OFFICERS

During or since the financial year, the Company has paid premiums insuring all the directors of Buxton Resources Limited against costs incurred in defending proceedings for conduct involving:

(a) a wilful breach of duty; or
(b) a contravention of sections 182 or 183 of the Corporations Act 2001,

as permitted by section 199B of the Corporations Act 2001.

The total amount of insurance contract premiums paid is \$7,250.

NON-AUDIT SERVICES

There were no non-audit services provided by the entity's auditor, Rothsay Chartered Accountants, or associated entities during the year.

PROCEEDINGS ON BEHALF OF THE COMPANY

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

No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section 237 of the Corporations Act 2001.

AUDITOR'S INDEPENDENCE DECLARATION

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 21.

Signed in accordance with a resolution of the directors.

Anthony Maslin Managing Director Perth, 28 September 2012

Corporate Governance Statement

The Board of Directors

The Company's constitution provides that the number of directors shall not be less than three and not more than nine. There is no requirement for any shareholding qualification.

As and if the Company's activities increase in size, nature and scope the size of the board will be reviewed periodically, and as circumstances demand. The optimum number of directors required to supervise adequately the Company's constitution will be determined within the limitations imposed by the constitution.

The membership of the board, its activities and composition, is subject to periodic review. The criteria for determining the identification and appointment of a suitable candidate for the board shall include quality of the individual, background of experience and achievement, compatibility with other board members, credibility within the Company's scope of activities, intellectual ability to contribute to board's duties and physical ability to undertake board's duties and responsibilities.

Directors are initially appointed by the full board subject to election by shareholders at the next general meeting. Under the Company's constitution the tenure of a director (other than managing director, and only one managing director where the position is jointly held) is subject to reappointment by shareholders not later than the third anniversary following his or her last appointment. Subject to the requirements of the Corporations Act 2001, the board does not subscribe to the principle of retirement age and there is no maximum period of service as a director. A managing director may be appointed for any period and on any terms the directors think fit and, subject to the terms of any agreement entered into, may revoke any appointment.

The board considers that the Company is not currently of a size, nor are its affairs of such complexity to justify the formation of separate or special committees (other than an Audit Committee) at this time. The board as a whole is able to address the governance aspects of the full scope of the Company's activities and to ensure that it adheres to appropriate ethical standards.

Role of the Board

The board's primary role is the protection and enhancement of long-term shareholder value.

To fulfil this role, the board is responsible for oversight of management and the overall corporate governance of the Company including its strategic direction, establishing goals for management and monitoring the achievement of these goals.

Appointments to Other Boards

Directors are required to take into consideration any potential conflicts of interest when accepting appointments to other boards.

Independent Professional Advice

The board has determined that individual directors have the right in connection with their duties and responsibilities as directors, to seek independent professional advice at the Company's expense. With the exception of expenses for legal advice in relation to director's rights and duties, the engagement of an outside adviser is subject to prior approval of the Chairman and this will not be withheld unreasonably.

Trading Policy

Under the Company's securities trading policy, an executive or director must not trade in any securities of the Company at any time when they are in possession of unpublished, price-sensitive information in relation to those securities.

Before commencing to trade, an executive must contact the Chairman or in his absence, the Managing Director and notify them of their intention to do so and the Chairman or Managing Director indicates that there is no impediment to them doing so. Where the Chairman wishes to deal in securities, he has contacted the Managing Director, or in his absence, the Company Secretary and notified them of their intention to do so and the Managing Director or Company Secretary indicates that there is no impediment to them doing so.

The Chairman will generally not allow Personnel to deal in the Company's Securities or in financial products issued or created over or in respect of the Company's Securities in the following periods ("Closed Periods") :

(a) within the period of 5 days prior to the release of annual, half yearly or quarterly results;
(b) within the period of 5 days prior to the Annual General Meeting; and
(c) if there is in existence price sensitive information that has not been disclosed because of an ASX Listing Rule exception.

This obligation operates at all times and applies to dealings in the Company's Securities by family members and other associates of Personnel as well as to personal dealings by Personnel.

Continuous Review of Corporate Governance

Directors consider, on an ongoing basis, how management information is presented to them and whether such information is sufficient to enable them to discharge their duties as directors of the Company. Such information must be sufficient to enable the directors to determine appropriate operating and financial strategies from time to time in light of changing circumstances and economic conditions. The directors recognise that mining exploration is an inherently risky business and that operational strategies adopted should, notwithstanding, be directed towards improving or maintaining the net worth of the Company.

ASX Principles of Good Corporate Governance

The board has reviewed its current practices in light of the revised ASX Corporate Governance Principles and Recommendations with a view to making amendments where applicable after considering the company's size and the resources it has available.

As the company's activities develop in size, nature and scope, the size of the board and the implementation of any additional formal corporate governance committees will be given further consideration.

The board has adopted the revised Recommendations and the following table sets out the company's present position in relation to each of the revised Principles.

	ASX Principle	Status	Reference/comment
Principle 1:	Lay solid foundations for management and oversight
1.1	Companies should establish the functions reserved to the board and those delegated to senior executives and disclose those functions	A	Matters reserved for the Board are included on the Company website in the Corporate Governance Section.
1.2	Companies should disclose the process for evaluating the	A	The remuneration of management and employees is reviewed by the Managing Director and approved by the Board.
	performance of senior executives		Acting in its ordinary capacity the Board from time to time carries
			out the process of considering and determining performance issues.
1.3	Companies should provide the information indicated in the Guide to reporting on Principle 1	A	Satisfied. The Board Charter is available at www.buxtonresources.com.au in the Corporate Governance Statement.
			Whilst the performance of management is appraised on an ongoing basis. During the year no formal appraisal of management was conducted.
Principle 2:	Structure the board to add value
2.1	A majority of the board should be independent directors	A	Satisfied. Mr Cornelius, Dr Stephens and Mr Zhou are independent
2.2	The chair should be an independent director	A	Satisfied.
2.3	The roles of chair and chief executive officer should not be exercised by the same individual	A	Satisfied. Mr Cornelius is the Chairman and Mr Maslin is the Managing Director.
2.4	The board should establish a nomination committee	N/A	The full Board is the Nomination Committee. Acting in its ordinary capacity from time to time as required, the Board carries out the process of determining the need for screening and appointing new Directors. In view of the size and resources available to the Company it is not considered that a separate Nomination Committee would add any substance to this process.
2.5	Companies should disclose the process for evaluating the performance of the board, its committees and individual directors	N/A	Given the size and nature of the Company a formal process for performance evaluation has not been developed.
2.6	Companies should provide the information indicated in the Guide to reporting on Principle 2	A	The skills and experience of the Directors are set out in the Company's Annual Report and on the website.

Principle 3: Promote ethical and responsible

decision-making

3.1 Companies should establish a code

of conduct and disclose the code or a

summary of the code as to:
the practices necessary to maintain confidence in the company's integrity
the practices necessary to take into account their legal obligations and the reasonable expectations of their stakeholders
the responsibility and accountability of individuals for reporting and investigating reports of unethical practices
3.2 Companies should establish a policy concerning diversity and disclose the policy or a summary of that policy. The policy should include requirements for the board to establish measurable objectives for achieving gender diversity for the board to assess annually both the objectives and progress in achieving them.
3.3 Companies should disclose in each annual report the measurable objectives for achieving gender diversity set by the board in accordance with the diversity policy and progress towards achieving them.
3.4 Companies should disclose in each annual report the proportion of women employees in the whole organisation, women in senior executive positions and women on the board.
3.5 Companies should provide the information indicated in the Guide to reporting on Principle 3. A

A The Company has established a Code of Conduct which can be viewed on its website.

A Not Satisfied. Due to the current size of the Board and expected workforce, the Board does not consider it necessary to have a gender diversity policy, but will consider adopting a policy in the future.

A The Company has not yet set the measurable objectives however these will be considered by the Board and disclosed in the annual report. In addition, the Board will review progress against any objectives identified on an annual basis.
All four board members are male. There is one male, one female company secretary and a female employee. As at the date of this report, the Company's workforce profile includes:

Level	Male	Female
Directors	4	0
Senior Executives	1	0
Employees	1	2
Total	6	2

The Company's diversity policy does not include any measurable objectives, if any, set by the Board;

progress against those objectives; and
the proportion of women employees in the whole organisation, at senior management level and at Board level.

Principle 4: Safeguard integrity in financial reporting 4.1 The board should establish an audit committee N/A Not satisfied. The Board consider given the current size of the board (4), this function is efficiently achieved with full board participation. Accordingly, the Board has not established an audit committee. 4.2 The audit committee should be structured so that it: N/A Not satisfied. The full Board fulfils the role of the audit committee and accordingly the Company has adopted a policy which includes executive directors acting as audit committee members. • consists only of non-executive directors • consists of a majority of independent directors • is chaired by an independent chair, who is not chair of the board • has at least three members 4.3 The audit committee should have a formal charter A Satisfied 4.4 Companies should provide the information indicated in the Guide to reporting on Principle 4 A Satisfied Principle 5: Make timely and balanced disclosure 5.1 Companies should establish written policies designed to ensure compliance with ASX Listing Rule disclosure requirements and to ensure accountability at a senior executive level for that compliance and disclose those policies or a summary of those policies A Directors must obtain the approval of the Chairman of the Board and notify the Company Secretary before they buy or sell shares in the Company, and it is subject to Board veto. Directors must provide the information required by the Company to ensure Compliance with Listing Rule 3.19A. 5.2 Companies should provide the information indicated in the Guide to reporting on Principle 5 A The Board receives monthly reports on the status of the Company's activities and any new proposed activities. Disclosure is reviewed as a routine agenda item at each Board Meeting. Principle 6: Respect the rights of shareholders

6.1 Companies should design a communications policy for promoting effective communication with shareholders and encouraging their participation at general meetings and disclose their policy or a summary of that policy
6.2 Companies should provide the information indicated in the Guide to reporting on Principle 6
A In line with adherence to continuous disclosure requirements of the ASX all shareholders are kept informed of major developments affecting the Company. This disclosure is through regular shareholder communications including the Annual report, Quarterly Reports, the Company Website and the distributions of specific releases covering major transactions and events.
A The Company has formulated a Communication Policy which is included in its Corporate Governance Statement on the Company Website.
Principle 7: Recognise and manage risk
7.1 Companies should establish policies for the oversight and management of material business risks and disclose a summary of those policies
N/A While the Company does not have formalised policies on risk management the Board recognises its responsibility for identifying areas of significant business risk and for ensuring that arrangements are in place for adequately managing these risks. This issue is regularly reviewed at Board meetings and risk management culture is encouraged amongst employees and contractors.

Determined areas of risk which are regularly considered include:

performance and funding of exploration activities
budget control and asset protection
status of mineral tenements
compliance with government laws and regulations
safety and the environment
continuous disclosure obligations

7.2 The board should require management to design and implement the risk management and internal control system to manage the company's material business risks and report to it on whether those risks are being managed effectively. The board should disclose that management has reported to it as to the effectiveness of the company's management of its material business risks

N/A While the Company does not have formalised risk management policies it recognises its responsibility for identifying areas of significant business risk and ensuring that arrangements are in place to adequately manage these risks. This issue is regularly reviewed at Board meetings and a risk management culture is encouraged amongst employees and contractors.

A Assurances received from CEO and CFO (or equivalent) each year.

7.3 The board should disclose whether it has received assurance from the chief executive officer (or equivalent) and the chief financial officer (or equivalent) that the declaration provided in accordance with section 295A of the Corporations Act is founded on a sound system of risk management and internal control and that the system is operating effectively in all material respects in relation to financial reporting risks

7.4 Companies should provide the information indicated in the Guide to reporting on Principle 7

A Satisfied

Principle 8:	Remunerate fairly and responsibly
8.1	The board should establish a	A	Satisfied.
	remuneration committee

8.2	The remuneration committee should	A	Satisfied.
	be structured so that it:
	• consists of a majority of
	independent directors
	• is chaired by an independent chair
	• has at least three members.

8.3	Companies should clearly distinguish	A	The structure of directors' remuneration is disclosed in the
	the structure of non-executive
	directors' remuneration from that of		remuneration report of the annual report.
	executive directors and senior
	executives.

8.4	Companies should provide the information indicated in the Guide to	A	Remuneration committee charter is available at www.buxtonresources.com.au in the Corporate Governance
			statement.
	reporting on Principle 8.
A = Adopted
N/A = Not adopted

Other Information

The Board wishes to acknowledge that nothing has come to its attention that would lead it to conclude that its current practices and procedures are not appropriate for an organisation of the size and maturity of the Company. Further information relating to the Company's corporate governance practices and policies has been made publicly available on the Company's web site at www.buxtonresources.com.au.

Statement of Comprehensive Income

YEAR ENDED 30 JUNE 2012	Notes	The Company
		2012	2011
		\$	\$
REVENUE	4	142,556	158,126
EXPENDITURE
Depreciation expense		(9,403)	(16,811)
Employee benefits expense		(396,612)	(297,381)
Exploration expenses		(732,550)	(606,686)
Corporate expenses		(146,084)	(149,598)
Financial expenses		(246)	-
Option issue expenses		-	(613,809)
Administration costs		(80,818)	(87,185)
LOSS BEFORE INCOME TAX		(1,223,156)	(1,613,344)
INCOME TAX BENEFIT / (EXPENSE)	6	-	-
TOTAL COMPREHENSIVE LOSS FOR THE YEAR ATTRIBUTABLE TO OWNERS OF BUXTON RESOURCES
LIMITED		(1,223,156)	(1,613,344)
Basic and diluted loss per share for loss attributable to the ordinary equity holders of the Company (cents per share)	21	(3.04)	(4.6)

The above Statement of Comprehensive Income should be read in conjunction with the Notes to the Financial Statements.

Statement of Financial Position

AT 30 JUNE 2012	Notes	The Company
		2012	2011
		\$	\$
CURRENT ASSETS
Cash and cash equivalents	7	1,231,766	2,620,917
Trade and other receivables	8	87,893	65,106
Other current assets	9	2,808	12,121
TOTAL CURRENT ASSETS		1,322,467	2,698,144
NON-CURRENT ASSETS
Exploration Asset	10	135,000
Plant and equipment	11	18,190	13,052
TOTAL NON-CURRENT ASSETS		153,190	13,052
TOTAL ASSETS		1,475,657	2,711,196
CURRENT LIABILITIES
Trade and other payables	12	77,762	223,374
Provisions	13	8,454	5,225
TOTAL CURRENT LIABILITIES		86,216	228,599
TOTAL LIABILITIES		86,216	228,599
NET ASSETS		1,389,441	2,482,597
EQUITY
Issued capital	14	5,418,800	5,288,800
Reserve	15	613,809	613,809
Accumulated losses	16	(4,643,168)	(3,420,012)
TOTAL EQUITY		1,389,441	2,482,597

The above Statement of Financial Position should be read in conjunction with the Notes to the Financial Statements.

Statement of Changes in Equity

YEAR ENDED 30 JUNE 2012	Notes	Issued Capital	Accumulated Losses	Share based payment Reserve	Total
The Company		\$	\$		\$
BALANCE AT 1 JULY 2010		3,652,447	(1,806,668)	-	1,845,779
Loss for the year		-	(1,613,344)	613,809	(999,535)
TOTAL COMPREHENSIVE LOSS		-	(1,613,344)	-	(64,329)
Shares issued for cash		1,777,200	-	-	1,777,200
Share issue costs		(140,847)	-	-	(140,187)
BALANCE AT 30 JUNE 2011		5,288,800	(3,420,012)	613,809	2,482,595

BALANCE AT 1 JULY 2011		5,288,800	(3,420,012)	613,809	2,482,595
Loss for the year	17	-	(1,223,156)		-(1,223,156)
TOTAL COMPREHENSIVE LOSS		-	(1,223,156)		-(1,223,156)
Shares issued for option on tenement		130,000	-	-	130,000
BALANCE AT 30 JUNE 2012		5,418,800	(4,643,168)	613,809	1,389,441

The above Statement of Changes in Equity should be read in conjunction with the Notes to the Financial Statements.

Buxton Resources Limited

Statement of Cash Flows

YEAR ENDED 30 JUNE 2012 Notes The Company 2012 2011 \$ \$ CASH FLOWS FROM OPERATING ACTIVITIES Payments to suppliers and employees (582,139) (557,996) Expenditure on mining interests (883,118) (451,008) Interest paid (246) - Interest received 95,684 72,720 Receipts from customers 209 345 NET CASH OUTFLOW FROM OPERATING ACTIVITIES 20 (1,369,610) (935,939) CASH FLOWS FROM INVESTING ACTIVITIES Payments for plant and equipment (14,541) (13,868) Payment for acquisition of option agreement (5,000) - Proceeds from sale of exploration assets - 70,000 Proceeds from sale of financial assets at fair value through profit or loss - - NET CASH INFLOW/(OUTFLOW) FROM INVESTING ACTIVITIES (19,541) 56,132 CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares - 1,777,200 Payment of share issue costs - (140,847) NET CASH INFLOW FROM FINANCING ACTIVITIES - 1,636,353 NET DECREASE IN CASH AND CASH EQUIVALENTS (1,389,151) 756,546 Cash and cash equivalents at the beginning of the financial year 2,620,917 1,864,371 CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 7 1,231,766 2,620,917

The above Statement of Cash Flows should be read in conjunction with the Notes to the Financial Statements.

30 JUNE 2012

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of the financial statements are set out below. The financial statements are for Buxton Resources Limited as an individual entity. The financial statements are presented in the Australian currency. Buxton Resources Limited is a company limited by shares, domiciled and incorporated in Australia. The financial statements were authorised for issue by the directors on 26 September 2012. The directors have the power to amend and reissue the financial statements.

(a) Basis of preparation

These general purpose financial statements have been prepared in accordance with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards Board, Australian Accounting Interpretations and the Corporations Act 2001.

Compliance with IFRS

The financial statements of Buxton Resources Limited also comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

Historical cost convention

These financial statements have been prepared under the historical cost convention, as modified by the revaluation of available-for-sale financial assets, financial assets and liabilities (including derivative instruments) at fair value through profit or loss, certain classes of property, plant and equipment and investment property.

(b) Segment reporting

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

(c) Revenue recognition

Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the financial assets.

(d) Income tax

The income tax expense or revenue for the year is the tax payable on the current year'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.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the Company's subsidiaries and associated operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the reporting date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

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

Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of the

temporary differences and it is probable that the differences will not reverse in the foreseeable future.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

(e) Leases

Leases of property, plant and equipment where the Company, as lessee, has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease's inception at the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding rental obligations, net of finance charges, are included in other short-term and long-term payables. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The property, plant and equipment acquired under finance leases is depreciated over the shorter of the asset's useful life and the lease term.

Leases where a significant portion of the risks and rewards of ownership are not transferred to the Company as lessee are classified as operating leases (note 18). Payments made under operating leases (net of any incentives received from the lessor) are charged to profit or loss on a straight-line basis over the period of the lease.

(f) Impairment of assets

Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.

(g) Cash and cash equivalents

For statement of cash flows presentation purposes, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the statement of financial position.

(h) Investments and other financial assets

Classification

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

(i) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term. Derivatives are classified as held for trading unless they are designated as hedges. Assets in this category are classified as current assets.

(ii) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for those with maturities greater than 12 months after the

reporting date which are classified as non-current assets. Loans and receivables are included in trade and other receivables in the statement of financial position.

(iii) Held-to-maturity investments

Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Company's management has the positive intention and ability to hold to maturity. If the Company were to sell other than an insignificant amount of held-to-maturity financial assets, the whole category would be tainted and reclassified as available-for-sale. Held-to-maturity financial assets are included in non-current assets, except for those with maturities less than 12 months from the reporting date, which are classified as current assets.

(iv) Available-for-sale financial assets

Available-for-sale financial assets, comprising principally marketable equity securities, are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within 12 months of the reporting date. Investments are designated available-for-sale if they do not have fixed maturities and fixed or determinable payments and management intends to hold them for the medium to long term.

Financial assets - reclassification

The Company may choose to reclassify a non-derivative trading financial asset out of the held-for-trading category if the financial asset is no longer held for the purpose of selling it in the near term. Financial assets other than loans and receivables are permitted to be reclassified out of the held-for-trading category only in rare circumstances arising from a single event that is unusual and highly unlikely to recur in the near term. In addition, the Company may choose to reclassify financial assets that would meet the definition of loans and receivables out of the held-for-trading or availablefor-sale categories if the Company has the intention and ability to hold these financial assets for the foreseeable future or until maturity at the date of reclassification.

Reclassifications are made at fair value as of the reclassification date. Fair value becomes the new cost or amortised cost as applicable, and no reversals of fair value gains or losses recorded before reclassification date are subsequently made. Effective interest rates for financial assets reclassified to loans and receivables and held-to-maturity categories are determined at the reclassification date. Further increases in estimates of cash flows adjust effective interest rates prospectively.

Recognition and derecognition

Regular purchases and sales of financial assets are recognised on trade-date – the date on which the Company commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets carried at fair value through profit or loss are initially recognised at fair value and transaction costs are expensed to the statement of comprehensive income. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.

When securities classified as available-for-sale are sold, the accumulated fair value adjustments recognised in equity are included in the statement of comprehensive income as gains and losses from investment securities.

Subsequent measurement

Loans and receivables and held-to-maturity investments are carried at amortised cost using the effective interest method.

Available-for-sale financial assets and financial assets at fair value through profit or loss are subsequently carried at fair value. Gains or losses arising from changes in the fair value of the 'financial assets at fair value through profit or loss' category are presented in the statement of comprehensive income within other income or other expenses in the period in which they arise. Dividend income from financial assets at fair value through profit or loss is recognised in the statement of comprehensive income as part of revenue from continuing operations when the Company's right to receive payments is established.

Changes in the fair value of monetary securities denominated in a foreign currency and classified as available-for-sale are analysed between translation differences resulting from changes in amortised cost of the security and other changes in the carrying amount of the security. The translation differences related to changes in the amortised cost are recognised in profit or loss, and other changes in carrying amount are recognised in equity. Changes in the fair value of other monetary and non-monetary securities classified as available-for-sale are recognised in equity.

Details on how the fair value of financial investments is determined are disclosed in note 2.

Impairment

The Company assesses at each balance date whether there is objective evidence that a financial asset or group of financial assets is impaired. In the case of equity securities classified as available-for-sale, a significant or prolonged decline in the fair value of a security below its cost is considered as an indicator that the securities are impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss – is removed from equity and recognised in the statement of comprehensive income. Impairment losses recognised in the statement of comprehensive income on equity instruments classified as available-for-sale are not reversed through the statement of comprehensive income.

If there is evidence of impairment for any of the Company's financial assets carried at amortised cost, the loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows, excluding future credit losses that have not been incurred. The cash flows are discounted at the financial asset's original effective interest rate. The loss is recognised in the statement of comprehensive income.

(i) Plant and equipment

All plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the statement of comprehensive income during the reporting period in which they are incurred.

Depreciation of plant and equipment is calculated using the reducing balance method to allocate their cost or revalued amounts, net of their residual values, over their estimated useful lives or, in the case of leasehold improvements and certain leased plant and equipment, the shorter lease term. The rates vary between 20% and 40% per annum.

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.

An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount (note 1(f)).

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the statement of comprehensive income. When revalued assets are sold, it is Company policy to transfer the amounts included in other reserves in respect of those assets to retained earnings.

(j) Exploration and evaluation costs

Exploration and evaluation costs are expensed as incurred.

(k) Trade and other payables

These amounts represent liabilities for goods and services provided to the Company prior to the end of the financial year which are unpaid. The amounts are unsecured, non-interest bearing and are paid on normal commercial terms.

(l) Issued capital

Ordinary shares are classified as equity.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options for the acquisition of a business are not included in the cost of the acquisition as part of the purchase consideration.

(m) Earnings per share

(i) Basic earnings per share

Basic earnings per share is calculated by dividing the profit attributable to owners of the company, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.

(ii) Diluted earnings per share

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

(n) Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense.

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

Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flows.

(o) New accounting standards and interpretations

The following standards, amendments to standards and interpretations have been identified as those which may impact the entity in the period of initial application. They are available for early adoption at 30 June 2012, but have not been applied in preparing this financial report.

Australian Accounting Standard	Title	Mandatory Application Date	Possible Impact
AASB 2011-9	Amendments to Australian Accounting Standards – Presentation of Items of Other Comprehensive Income	1 July 2012	These amendments make a number of changes to the presentation of other comprehensive income including presenting separately those items that would be reclassified to profit or loss in future and those that would never be reclassified to profit or loss and the impact of tax on those items.
AASB 9	Financial Instruments (December 2010) (Includes financial assets and financial liability requirements)	1 January 2013	In AASB 9 (December 2010), the AASB added requirements for the classification and measurement of financial liabilities that are generally consistent with the equivalent requirements in AASB 139 except in respect of the fair value option; and certain
AASB 2010-7	Amendments to Australian Accounting Standards arising from AASB 9 (December 2010)		derivatives linked to unquoted equity instruments. The AASB also added the requirements in AASB 139 in relation to the derecognition of financial assets and financial liabilities to
AASB 9	Financial Instruments (December 2009)		AASB 9.

AASB 2009-11	(Financial asset requirements only) Amendments to Australian Accounting Standards arising from AASB 9		AASB 9 retains but simplifies the mixed measurement model and establishes two primary measurement categories for financial assets: amortised cost and fair value. The basis of classification depends on the entity's business model and contractual cash flow characteristics of the financial asset.
			The guidance in AASB 139 on impairment of financial asset and on hedge accounting continues to apply.
			The IASB has deferred the application date of IFRS 9 until 1 January 2015, however the AASB has yet to issue a corresponding amendment to AASB 9(2010) and AASB 9 (2009).
AASB 10	Consolidated Financial Statements	1 January 2013	AASB 10 introduces a new approach to determining which investee should be consolidated. An investor controls an investee when the investor is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.
AASB 127	Separate Financial Statements (2011)	1 January 2013	AASB 127 (2011) carries forward the existing accounting and disclosure requirements for separate financial statements with some minor clarifications.
AASB 11	Joint Arrangements	1 January 2013	If the parties have rights to and obligations for underlying assets and liabilities, the joint arrangement is considered a joint operation and partial consolidation is applied. Otherwise the joint arrangement is considered a joint venture and they must use the equity method to account for their interest.
AASB 128	Investment in Associates and Joint Ventures (2011)	1 January 2013	Limited amendments have been made to AASB 128 including the application of AASB 5 Non-current Assets held for Sale and Discontinued Operations to interests in associates and joint ventures and how to account for changes in interests in joint ventures and associates.

AASB 12	Disclosures of Interests in Other Entities	1 January 2013	AASB 12 contains the disclosure requirements for entities that have interest in subsidiaries, joint arrangements, associates and/or unconsolidated structured entities.
AASB 2011-7	Amendments to Australian Accounting Standards arising from the Consolidation and Joint Arrangements Standards	1 January 2013	This standard gives effect to many consequential changes to a number of standards arising from the issuance of the new consolidation and joint arrangements standard.
AASB 13	Fair value Measurement	1 January 2013	AASB 13 explains how to measure fair value when required to by other AASBs. It does not introduce new fair value measurements,
AASB 2011-8	Amendments to Australian Accounting Standards arising from AASB 13		nor does it eliminate the practicability exceptions to fair value that currently exists in certain standards.
AASB Interpretation 20	Stripping Costs in the Production Phase of a Surface Mine (November 2011)	1 January 2013	This interpretation clarifies that surface mining companies will capitalise production stripping costs that benefit future periods if certain criteria are met.
AASB 2012-5	Amendments to Australian Accounting Standards arising from Annual Improvements 2009 – 2011 Cycle	1 January 2013	A collection of non-current but necessary improvements to the following accounting standards: AASB 1, AASB 101, AASB 116, AASB 132, AASB 134 and AASB Interpretation 2.
AASB 2012-2	Amendments to Australian Accounting Standards – Disclosures – Offsetting Financial Assets and Financial Liabilities (June 2012)	1 January 2013	AASB 7 is amended to increase the disclosures about offset positions, including the gross position and the nature of the arrangements.
AASB 2011-4	Amendments to Australian Accounting Standards to Remove Individual Key management Personnel Disclosure Requirements	1 July 2013	Removes the requirements to include individual key management personnel disclosures in the notes to the financial statements. Companies will still need to provide these disclosures in the Remuneration Report under section 300A of the Corporations Act 2001.
AASB 2012-3	Amendments to Australian Accounting Standards – Offsetting Financial Assets and	1 January 2014	The amendments to AASB 132 clarify when an entity has a legally enforceable right to set-off financial assets and financial liabilities permitting entities to present balances net

		on the balance sheet.
IFRSs & IFRICs	Mandatory	Possible Impact
	Application Date
Change in mandatory effective date for IFRS 9	1 January 2015	The IASB has deferred the mandatory effective date of IFRS 9 from 1 January 2013 to 1 January 2015. IFRS 9 is still available for early adoption.
Transition Guidance for IFRS 10, IFRS 11 and IFRS 12	1 January 2013	The IASB have issued these amendments to IFRS 10 and IFRS 11 to simplify transition and provide relief from the disclosures in respect of unconsolidated structured entities on transition to the suite of consolidation standards.

In the year ended 30 June 2012, the Company has reviewed all of the new and revised Standards and Interpretations issued by the AASB that are relevant to its operations and effective for the current annual reporting period.

It has been determined by the Company that there is no impact, material or otherwise, of the new and revised Standards and Interpretations on its business and, therefore, no change is necessary to Group accounting policies.

(p) Critical accounting judgements, estimates and assumptions

The directors evaluate estimates and judgements incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Company.

2. FINANCIAL RISK MANAGEMENT

The Company's activities expose it to a variety of financial risks: market risk (including currency risk, interest rate risk and price risk), credit risk and liquidity risk. The Company's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Company.

Risk management is carried out by the full Board of Directors as the Company believes that it is crucial for all board members to be involved in this process. The Managing Director, with the assistance of senior management as required, has responsibility for identifying, assessing, treating and monitoring risks and reporting to the board on risk management.

(a) Market risk

(i) Foreign exchange risk

As all operations are currently within Australia the Company is not exposed to foreign exchange risk.

(ii) Price risk

Given the current level of operations the Company is not exposed to price risk.

(iii) Interest rate risk

The Company is exposed to movements in market interest rates on cash and cash equivalents. The Company policy is to monitor the interest rate yield curve out to six months to ensure a balance is maintained between the liquidity of cash assets and the interest rate return. The entire balance of cash and cash equivalents for the Company \$1,231,766 (2011: \$2,620,917) is subject to interest rate risk. The proportional mix of floating interest rates and fixed rates to a maximum of six months fluctuate during the year depending on current working capital requirements. The weighted average interest rate received on cash and cash equivalents by the Company was 4.25% (2011: 4.70%).

2. FINANCIAL RISK MANAGEMENT (cont'd)

Sensitivity analysis

At 30 June 2012, if interest rates had changed by -/+ 100 basis points from the weighted average rate for the year with all other variables held constant, post-tax loss for the Company would have been \$12,318 lower/higher (2011: \$18,719 -/+ 100 basis points) as a result of lower/higher interest income from cash and cash equivalents.

(b) Credit risk

The Company has no significant concentrations of credit risk. The maximum exposure to credit risk at balance date is the carrying amount (net of provision for impairment) of those assets as disclosed in the statement of financial position and notes to the financial statements.

As the Company does not presently have any debtors, lending, significant stock levels or any other credit risk, a formal credit risk management policy is not maintained.

(c) Liquidity risk

The Company manages liquidity risk by continuously monitoring forecast and actual cash flows and ensuring sufficient cash and marketable securities are available to meet the current and future commitments of the Company. Due to the nature of the Company's activities, being mineral exploration, the Company does not have ready access to credit facilities, with the primary source of funding being equity raisings. The Board of Directors constantly monitor the state of equity markets in conjunction with the Company's current and future funding requirements, with a view to initiating appropriate capital raisings as required.

The financial liabilities of the Company are confined to trade and other payables as disclosed in the Statement of financial position. All trade and other payables are non-interest bearing and due within 12 months of the reporting date.

(d) Fair value estimation

The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. All financial assets and financial liabilities of the Company at the balance date are recorded at amounts approximating their carrying amount.

The fair value of financial instruments traded in active markets is based on quoted market prices at the reporting date. The quoted market price used for financial assets held by the Company is the current bid price.

The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values due to their short-term nature.

3. SEGMENT INFORMATION

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

The Company's operating segments have been determined with reference to the monthly management accounts used by the chief operating decision maker to make decisions regarding the Company's operations and allocation of working capital.

Due to the size and nature of the Company, the Board as a whole has been determined as the chief operating decision maker.

The Company operates in one business segment and one geographical segment, namely mineral exploration industry in Australia only. AASB 8: Operating Segments states that similar operating segments can be aggregated to form one reportable segment. Also, based on the quantitative thresholds included in AASB 8, there is only one reportable segment, namely mineral exploration industry. However, none of the other operating segments currently meet any of the prescribed quantitative thresholds, and as such do not have to be reported separately. The Company has therefore decided to aggregate all their segments into one reportable operating segment.

The revenues and results of this segment are those of the Company as a whole and are set out in the statement of comprehensive income. The segment assets and liabilities of this segment are those of the Company and are set out in the statement of financial position.

Segment performance is evaluated based on the operating profit and loss and cash flows and is measured in accordance with the Company's accounting policies.

		The Company
	2012	2011
	\$	\$
Exploration segment
Segment revenue	55,099	70,000
Reconciliation of segment revenue to total revenue before tax:
Other revenue	-	345
Interest revenue	87,457	87,781
Total revenue	142,556	158,126
Segment results	(677,451)	(536,686)
Reconciliation of segment result to net loss before tax:
Other corporate and administration	(545,705)	(1,076,658)
Net loss before tax	(1,223,156)	(1,613,344)

30 JUNE 2012		The Company
	2012	2011
	\$	\$
Segment operating assets	144,688	10,753
Reconciliation of segment operating assets to total assets:
Other coporate and administration assets	1,330,969	2,700,443
Total assets	1,475,657	2,711,196
4. REVENUE
From continuing operations Other revenue
Interest	87,457	87,781
Net gain on sale of tenements	-	70,000
Research and development tax offset	55,099	-
Other revenue	- 142,556	345 158,126
5. EXPENSES
Loss before income tax includes the following specific expenses:
Minimum lease payments relating to operating leases	-	21,292
Defined contribution superannuation expense	25,392	23,787
6. INCOME TAX
(a) Income tax expense
Current tax	-	-
Deferred tax	-	-
	-	-
(b) Numerical reconciliation of income tax expense to prima facie tax payable
Loss from continuing operations before income tax expense	(1,223,156)	(1,613,344)
Prima facie tax benefit at the Australian tax rate of 30%	(366,947)	(484,003)
Tax effect of amounts which are not deductible (taxable) in calculating taxable income	277	192

30 JUNE 2012	The Company
	2012	2011
	\$	\$
Movements in unrecognised temporary differences	(18,777)	21,354
Tax effect of current year tax losses for which no deferred
tax asset has been recognised	385,447	462,457
Income tax expense	-	-
(c) Unrecognised temporary differences
Deferred Tax Assets (at 30%)
On Income Tax Account
Capital raising costs	31,136	65,849
Other	15,926	50,396
Carry forward tax losses	1,395,588	1,010,141
	1,442,650	1,126,386
Deferred Tax Liabilities (at 30%)	-	-
7. CURRENT ASSETS - CASH AND CASH EQUIVALENTS
Cash at bank and in hand	231,766	420,917
Short-term deposits	1,000,000	2,200,000
Cash and cash equivalents as shown in the statement of
financial position and the statement of cash flows	1,231,766	2,620,917

Cash at bank and in hand earns interest at floating rates based on daily bank deposit rates.

Short-term deposits are made for varying periods of between one day and three months depending on the immediate cash requirements of the Company, and earn interest at the respective short-term deposit rates.

8. CURRENT ASSETS - TRADE AND OTHER RECEIVABLES

Sundry Debtor	55,338	-
Accrued Interest	13,188	21,415
GST Receivable	19,367	43,691
	87,893	65,106

9. OTHER CURRENT ASSETS

Prepayments	2,808	7,798
Security deposit	-	4,323
	2,808	12,121

30 JUNE 2012	The Company
	2012	2011
	\$	\$
10. NON-CURRENT ASSETS – EXPLORATION ASSETS
Tenement acquisition costs carried forward in respect of mining areas of interest
Opening net book amount	-	-
Capitalised tenement acquisition costs	135,000	-
Closing net book amount	135,000	-

The ultimate recoupment of costs carried forward for tenement acquisition is dependent on the successful development and commercial exploitation or sale of the respective mining areas. Amortisation of the costs carried forward for the development phase is not being charged pending the commencement of production.

11. NON-CURRENT ASSETS - PLANT AND EQUIPMENT

Plant and equipment
Cost	84,979	70,438
Accumulated depreciation	(66,789)	(57,386)
Net book amount	18,190	13,052
Plant and equipment
Opening net book amount	13,052	15,995
Additions	14,541	13,868
Depreciation charge	(9,403)	(16,811)
Closing net book amount	18,190	13,052

12. CURRENT LIABILITIES - TRADE AND OTHER PAYABLES
Trade payables	19,421	20,393
Other payables and accruals	58,341	202,981
	77,762	223,374

13. PROVISIONS
Employee leave entitlements	8,454	5,225

14. ISSUED CAPITAL

(a) Share capital

			2012	2011
	Notes	Number of shares	\$	Number of shares	\$
	13(b),
Ordinary shares fully paid	13(d)	41,118,194	5,418,800	40,118,194	5,288,800
Total issued capital		41,118,194	5,418,800	40,118,194	5,288,800

(b) Movements in ordinary share capital
Beginning of the financial year		40,118,194	5,288,800	32,040,010	3,652,447
Issued for tenement option during the
year		1,000,000	130,000	8,078,184	1,777,200
Share issue costs				-	(140,847)
End of the financial year		41,118,194	5,418,800	40,118,194	5,288,800

(c) Movements in options on issue

	Number of options
Unlisted	2012	2011
Beginning of the year	12,500,000	8,750,000
Issued during the year	-	3,750,000
Expired during the year	(8,750,000)	-
End of the year	3,750,000	12,500,000
Listed
Beginning of the year	4,004,983	-
Issued during the year	-	4,004,983
End of the year	4,004,983	4,004,983

(d) Ordinary shares

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

On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote.

Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.

(e) Capital risk management

The Company's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it may continue to provide returns for shareholders and benefits for other stakeholders.

Due to the nature of the Company's activities, being mineral exploration, the Company does not have ready access to credit facilities, with the primary source of funding being equity raisings. Therefore, the focus of the Company's capital risk management is the current working capital position against the requirements of the Company to meet exploration programmes and corporate overheads. The Company's strategy is to ensure appropriate liquidity is maintained to meet anticipated operating requirements, with a view to initiating appropriate capital raisings as required. The working capital position of the Company at 30 June 2012 and 30 June 2011 is as follows:

		The Company
	2012	2011
	\$	\$
Cash and cash equivalents	1,231,766	2,620,917
Trade and other receivables	87,893	65,106
Trade and other payables	(77,762)	(223,374)
Working capital position	1,241,897	2,462,649

15. RESERVES
Share-based payment reserve
Balance at beginning of year	613,809	-
Issue of unlisted options during the year	-	613,809

Option reserve

The share-based payment reserve is used to record the value of options issued by the Company.

Balance at end of year 613,809 613,809

16. ACCUMULATED LOSSES

Accumulated losses
Balance at beginning of year	(3,420,012)	(1,806,668)
Net loss for the year	(1,223,156)	(1,613,344)
Balance at end of year	(4,643,168)	(3,420,012)

17. DIVIDENDS

No dividends were paid during the financial year. No recommendation for payment of dividends has been made.

18. KEY MANAGEMENT PERSONNEL DISCLOSURES

The following were key management personnel of the Company at any time during the year and unless otherwise indicated were key management personnel for the entire year.

Non-executive directors

Mr S Cornelius (Chairman)

Mr S Wright (Non-executive Director appointed 1/1/11 & Company Secretary appointed 31/12/2010, resigned as Non-executive Director on 1/9/11)

Dr J Stephens (Non-executive Director, appointed 1/9/11)

Executive directors

Mr A Maslin (Managing Director)

(a) Key management personnel compensation

2012	2011
	131,667
	7,875
	139,542
	230,000 13,500 243,500

Detailed remuneration disclosures are provided in the remuneration report on pages 17 to 18.

(b) Equity instrument disclosures relating to key management personnel

(i) Options provided as remuneration and shares issued on exercise of such options

There have been no options provided as remuneration to key management personnel during the year.

(ii) Option holdings

The numbers of options over ordinary shares in the Company held during the financial year by each director of Buxton Resources Limited and other key management personnel of the Company, including their personally related parties, are set out below:

2012	Balance at start of the year	Granted as compensation	Other changes	Balance at end of the year	Vested and exercisable	Unvested
Directors of Buxton Resources Limited
Anthony Maslin	130,198	-	-	- 130,198	130,198	-
Seamus Cornelius	183,948	-	-	- 183,948	183,948	-
Julian Stephens	-	-	-	- -	-	-
Executive
Sam Wright*	56,819	-	-	- 56,819	56,819	-

18. KEY MANAGEMENT PERSONNEL DISCLOSURES (cont'd)

2011	Balance at start of the	Granted as		Other	Balance at end of the	Vested and
	year	compensation	Exercised	changes	year	exercisable	Unvested
Directors of Buxton Resources Limited
Anthony Maslin	-	-	-	130,198	130,198	130,198	-
Seamus Cornelius	-	-	-	183,948	183,948	183,948	-
Sam Wright	-	-	-	56,819	56,819	56,819	-
Michael Ivey	-	-	-	-	-	-	-
Ron Smit*	2,000,000	-	-	(2,000,000)	-	-	-
Graeme Smith**	500,000	-	-	(500,000)	-	-	-

* Resigned 31st December 2010

** Resigned 29th November 2010

All vested options are exercisable at the end of the year.

(iii) Share holdings

The numbers of shares in the Company held during the year by each director of Buxton Resources Limited and other key management personnel of the Company, including their personally related parties, are set out below. There were no shares granted during the reporting period as compensation.

2012	Balance at start of the year	Received during the year on the exercise of options	Other changes during the year	Balance at end of the year
Directors of Buxton Resources Limited
Ordinary shares
Anthony Maslin	392,897	-	-	392,897
Seamus Cornelius	930,397	-	-	930,397
Julian Stephens	-	-	-	-
Liu Xing Zhou	-	-	-	-
2011	Balance at start of the year	Received during the year on the exercise of options	Other changes during the year	Balance at end of the year
Directors of Buxton Resources Limited
Ordinary shares
Anthony Maslin	-	-	392,897	392,897
Seamus Cornelius	-	-	930,397	930,397

Julian Stephens	-	-
Sam Wright	-	-	113,638	113,638
Michael Ivey	110,000	-	(110,000)	-
Ron Smit*	3,340,000	-	(3,340,000)	-

* Resigned 31/12/10

** Resigned 29/11/10

30 JUNE 2012

18. KEY MANAGEMENT PERSONNEL DISCLOSURES (cont'd)

(iv) Performance Rights

The numbers of Performance Rights in the Company held during the year by each director of Buxton Resources Limited and other key management personnel of the Company, including their personally related parties, are set out below. The Performance Rights lapse if the performance hurdle is not satisfied within 3 years of the issue of the Performance Rights. Shareholders approved the issue of Performance Rights to Mr Maslin, Mr Cornelius and Mr Wright at an EGM held on 26th May 2011. Shareholders approved the issue of Performance Rights to Dr Stephens at an AGM held on 28th November 2011.

Performance Milestone	Mr Maslin	Mr Cornelius	Dr Stephens
The Company's Shares trade at a volume	300,000	100,000	50,000
weighted average price of at least 40 cents per
Share for a consecutive period of at least 30
business days
The Company's Shares trade at a volume	400,000	100,000	100,000
weighted average price of at least 50 cents per
Share for a consecutive period of at least 30
business days
The Company's Shares trade at a volume	300,000	100,000	50,000
weighted average price of at least 60 cents per
Share for a consecutive period of at least 30
business days
Total performance rights	1,000,000	300,000	200,000

(c) Loans to key management personnel

There were no loans to key management personnel during the year.

19. REMUNERATION OF AUDITORS

The Company
2012	2011
\$	\$

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

Audit services

22,591	34,909
22,591	34,909

20. CONTINGENCIES

Contingent Remuneration

There are no material contingent liabilities or contingent assets of the Company at balance date.

21. COMMITMENTS

(a) Exploration commitments

The Company has certain commitments to meet minimum expenditure requirements on the mining exploration assets it has an interest in. Outstanding exploration commitments are as follows:

	2012	2011
	\$	\$
within one year	127,000	379,000
later than one year but not later than five years	508,000	1,516,000
	635,000	1,895,000

(b) Lease commitments: Company as lessee

The Company did not have any operating leases in operation during the year.

22. EVENTS OCCURRING AFTER THE BALANCE SHEET DATE

On 7 September 2012, the Company announced the raising of \$1,254,432 through the placement of 5,017,728 shares at an issue price of 25 cents per share with National Business Holdings (NBH), a privately owned company. Subject to shareholder approval the Company will issue an additional 1,150,000 shares at an issue price of 25 cents per share to raise an additional \$287,500. The shares issued will be subject to escrow for a period of 6 months from the date of the agreement.

The Company will also receive a \$600,000 licencing fee from NBH for the exclusive right to market Zanthus Magnetite Project for the next 15 months. Mr Liu Xing Zhou will join the board as a Non-Executive Director. The purpose of the funds will be to facilitate exploration programs at Widowmaker Nickel Copper Project and Yalbra Graphite Project.

	The Company
	2012	2011
	\$	\$
23. NOTE TO STATEMENT OF CASH FLOWS
Reconciliation of net loss after income tax to net cash outflow from operating activities
Net loss for the year	(1,223,156)	(1,613,344)
Non-Cash Items
Depreciation of non-current assets	9,403	16,811
Share-based payments	-	613,809
Proceeds from sale of exploration assets	-	(70,000)
Change in operating assets and liabilities
(Increase)/decrease in trade and other receivables	(22,787)	(49,063)
(Increase)/decrease in other assets	9,313	4,511
Increase/(decrease) in trade and other payables	(145,612)	179,379
Increase/(decrease) in provisions	3,229	(18,042)
Net cash outflow from operating activities	(1,369,610)	(935,939)

30 JUNE 2012	The Company
	2012	2011
	\$	\$
24. LOSS PER SHARE
(a) Reconciliation of earnings used in calculating loss per share
Loss attributable to the owners of the Company used in
calculating basic and diluted loss per share	(1,223,156)	(1,613,344)
		Number of shares
	2012	2011
(b) Weighted average number of shares used as the denominator
Weighted average number of ordinary shares used as the denominator in calculating basic and diluted loss per
share	40,257,861	34,783,632

(c) Information on the classification of options

As the Company has made a loss for the year ended 30 June 2012, all options on issue are considered antidilutive and have not been included in the calculation of diluted earnings per share. These options could potentially dilute basic earnings per share in the future.

Directors' Declaration

In the directors' opinion:

(a) the financial statements and notes set out on pages 29 to 53 are in accordance with the Corporations Act 2001, including:
(i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; and
(ii) giving a true and fair view of the Company's financial position as at 30 June 2012 and of it's performance for the financial year ended on that date;
(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; and
(c) a statement that the attached financial statements are in compliance with International Financial Reporting Standards has been included in the notes to the financial statements.

The directors have been given the declarations by the chief executive officer and chief financial officer required by section 295A of the Corporations Act 2001.

This declaration is made in accordance with a resolution of the directors.

Anthony Maslin Managing Director Perth, 28 September 2012

ASX Additional Information

Additional information required by Australian Stock Exchange Ltd and not shown elsewhere in this report is as follows. Unless otherwise stated, the information is current as at 26 September 2012

(a) Distribution of equity securities

Analysis of numbers of equity security holders by size of holding:

		Ordinary shares
	Number of holders	Number of shares
1 - 1,000	9	1,628
1,001 - 5,000	54	177,161
5,001 - 10,000	105	928,421
10,001 - 100,000	231	8,036,095
100,001 and over	64	36,992,617
	463	46,135,922
The number of shareholders holding less than a marketable parcel of shares are:	9	1628

Listed Options expiring 31/1/16
---------------------------------	--	--

	@ \$0.30 (as of 18/9/12)
	Number of	Number of
	holders	shares
- 1 1,000	20	10,750
- 1,001 5,000	101	205,849
- 5,001 10,000	23	176,873
- 10,001 100,000	44	1,603,882
100,001 and over	11	2,007,629
	199	4,004,983
The number of shareholders holding less than a marketable parcel
of shares are:	115	188,245

			@ \$0.35
			Number of	Number of
			holders	shares
1	-	1,000	0	0
1,001	-	5,000	0	0
5,001	-	10,000	0	0
10,001	-	100,000	2	200,000
100,001		and over	9	3,550,00
			11	3,750,000
The number of shareholders holding less than a marketable parcel
of shares are:			0	0

Unlisted Options expiring 31/1/16

(b) Twenty largest shareholders

(i)The names of the twenty largest holders of quoted ordinary shares are:

Rank	Name	Units	% of Units
1.	NATIONAL BUSINESS HOLDING (VU) LTD	5,017,728	10.88
2.	MONTEZUMA MINING COMPANY LTD	4,762,500	10.32
3.	ABN AMRO CLEARING SYDNEY NOMINEES PTY LTD <custodian A/C></custodian	2,107,157	4.57
4.	SOUTH BOULDER MINES LTD	1,700,000	3.68
5.	MR LIAM RAYMOND CORNELIUS	1,250,000	2.71
6.	TAO YUAN RESOURCES LIMITED	1,142,000	2.48
7.	ATOC INC	1,100,000	2.38
8.	CONG MING LIMITED	967,000	2.10
9.	MS YUFANG HU	909,400	1.97
10.	MR PAUL HARTLEY WATTS	890,508	1.93
11.	RANGUTA LIMITED	750,000	1.63
12.	HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED	710,013	1.54
13.	JP MORGAN NOMINEES AUSTRALIA LIMITED <cash incomeA/C>	681,769	1.48
14.	MS SHAO YUAN NICOLE ZHANG	650,000	1.41
15.	ARADIA VENTURES PTY LTD	625,000	1.35
16.	ARCHEM TRADING NZ LIMITED	625,000	1.35
17.	MR SEAMUS IAN CORNELIUS	625,000	1.35
18.	DUKETON CONSOLIDATED LIMITED	562,500	1.22
19.	DUKETON CONSOLIDATED LIMITED	552,385	1.20
20.	ZERO NOMINEES PTY LTD	495,513	1.07
		26,123,473	56.62

(ii) The names of the twenty largest holders of listed options are:

			Listed Options Expiring 31/1/16 @ \$0.30c Percentage
Rank	Name	No of Listed	of Listed
		Options	Options
1.	MONTEZUMA MINING COMPANY LTD	376,250	9.39
2.	MR JOHN ROBERT HECTOR RICHES + MRS LILLAS MARY RICHES	300,824	7.51
3.	M & K KORKIDAS PTY LTD	183,533	4.58
4.	SOUTH BOULDER MINES LTD	170,000	4.24
5.	MR HENRY WIECHECKI	162,500	4.06
6.	LINCH HOLDINGS PTY LTD	143,379	3.58
7.	MR FENGJIE CHEN	130,000	3.25
8.	MR LIAM RAYMOND CORNELIUS	125,000	3.12
9.	MR ANTHONY MASLIN + MS MARITE NORRIS	121,136	3.02
10.	MR WEST WALMSLEY	114,750	2.87
11.	MR SEAMUS CORNELIUS	113,636	2.84
12.	ATOC INC	110,000	2.75
13.	RANGUTA LIMITED	100,000	2.50
14.	ARADIA VENTURES PTY LTD	87,500	2.18
15.	ABN AMRO CLEARING SYDNEY NOMINEES PTY LTD <custodian A/C></custodian	82,772	2.07
16.	HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED	76,567	1.91
17.	ANPHIDAMA PTY LTD	65,240	1.63
18.	ARCHEM TRADING NZ LIMITED	62,500	1.56
19.	MR SEAMUS IAN CORNELIUS	62,500	1.56
20.	ETRADE AUSTRALIA NOMINEES PTY LIMITED	60,000	1.50
		2,648,087	66.12

(iii) The names of the largest holders of unlisted options (Expiry 31/01/2016, Ex Price 35c) are:

		Number of	Percentage of
		Unlisted Options	Unlisted Options

1 2	DONGARRA LIMITED CHO YONSU	2,000,000 200,000	53.33 5.33
3	ARADIA VENTURES PTY LTD	200,000	5.33
4	DRAGON GAS LTD	200,000	5.33
5	MICHAEL ASHLEY GILES	200,000	5.33
6	KLAAS POOL	200,000	5.33
7	RENAE WAINWRIGHT	200,000	5.33
8	TAO YUAN RESOURCES LIMITED	200,000	5.33
9	MISS JODI HASLINGER	150,000	4.00
10	MR TREVOR JAMES SAUL	100,000	2.67
11	MR HANNES HUSTER	100,000	2.67
		3,750,000	100.00

(c) Substantial shareholders

At the date of this report the following shareholders had lodged substantial shareholder notices with the Company, in accordance with section 671B of the Corporations Act 2001 are:

On 11 September 2012 an initial substantial shareholder notice was received by the Company notifying the Company that National Business Holdings (VU) Ltd had become a substantial shareholder.

(d) Voting rights

All ordinary shares (whether fully paid or not) carry one vote per share without restriction.

(e) Schedule of interests in mining tenements

Location	Tenement	Percentage Held/Earning	Status
Yalbra	E09/1985	85%	Pending
Yalbra	E09/1986	100	Pending
Zanthus	E28/1959	100	Granted
Widowmaker	E28/2201	100	Pending
Dempster	E63/1525	100	Pending

AI assistant

BUXTON RESOURCES LIMITED — Annual Report 2012

64585_rns_2012-09-27_87dcfc7f-f168-422e-a52a-ced105b78b78.pdf

Resources Limited

CORPORATE DIRECTORY

Directors

Company Secretaries

Registered Office

Principal Place of Business

Hong Kong Office

Postal Address

Solicitors

Share Register

Auditors

Website Address

Stock Exchange

CONTENTS

Letter from the Chairman

Dear Fellow Shareholder,

Corporate

PROJECT LOCATION

SCOPING STUDY COMPLETED

JOINT VENTURE DISCUSSIONS

YILGARN IRON PRODUCERS ASSOCIATION (YIPA)

YALBRA PROJECT WA

E09/1985 85% Buxton

HISTORICAL WORK

EXPLORATION TARGET

8-12 Million Tonnes @ 7-11% C*

E63/1525 (100% Buxton)

Competent Person's Statement

Buxton Resources Limited

Directors' Report

DIRECTORS

COMPANY SECRETARIES

INFORMATION ON DIRECTORS

Mr Seamus Cornelius - Non-Executive Chairman

Mr Anthony Maslin - Managing Director

Dr Julian Stephens - Non-Executive Director (appointed 1st September 2011) Qualifications: BSc (Hons) Applied Geology, PhD, MAIG

Mr Liu Xing Zhou - Non-Executive Director (appointed 12th September 2012)

Interests in the shares and options of the Company and related bodies corporate

PRINCIPAL ACTIVITIES

DIVIDENDS

OPERATING AND FINANCIAL REVIEW

Finance Review

Operating Results for the Year

Risk Management

SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

SIGNIFICANT EVENTS AFTER THE BALANCE DATE

LIKELY DEVELOPMENTS AND EXPECTED RESULTS

ENVIRONMENTAL REGULATION AND PERFORMANCE

REMUNERATION REPORT (Audited)

Principles used to determine the nature and amount of remuneration

Remuneration Policy

Performance based remuneration

Company performance, shareholder wealth and directors' and executives' remuneration

Details of remuneration

Key management personnel compensation

Service agreements

Share-based compensation

DIRECTORS' MEETINGS

Notes

SHARES UNDER OPTION

INSURANCE OF DIRECTORS AND OFFICERS

NON-AUDIT SERVICES

PROCEEDINGS ON BEHALF OF THE COMPANY

AUDITOR'S INDEPENDENCE DECLARATION

Corporate Governance Statement

The Board of Directors

Role of the Board

Appointments to Other Boards

Independent Professional Advice

Trading Policy

Continuous Review of Corporate Governance

ASX Principles of Good Corporate Governance

Principle 3: Promote ethical and responsible

decision-making

3.1 Companies should establish a code

Other Information

Statement of Comprehensive Income

BUXTON RESOURCES LIMITED Annual Report 2012