CANNINDAH RESOURCES LIMITED — Annual Report 2021

Sep 30, 2021

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CANNINDAH RESOURCES LIMITED ABN 35 108 146 694

ANNUAL FINANCIAL REPORT for the year ended 30 June 2021

CANNINDAH RESOURCES LIMITED

DIRECTORS’ REPORT

The Directors present their report, together with the financial statements, on the Consolidated Entity (referred to hereafter as the 'Consolidated Entity' or Group) consisting of Cannindah Resources Limited (referred to hereafter as the 'Company', 'Parent Entity' or ‘Cannindah Resources’) and the entities it controlled for the year ended 30 June 2021.

Directors

The following persons were Directors of Cannindah Resources Limited during the whole of the financial year and up to the date of this report, unless otherwise stated:

Thomas J Pickett (Executive Chairman) Geoffrey J Missen (Independent Non-Executive Director) Simon Beams (Non-Executive Director)

Principal activities

During the financial year the principal activities of the Consolidated Entity consisted of mineral exploration, evaluation and progressing development of its various mineral projects.

Dividends

There were no dividends paid or declared during the current or previous financial year.

Operating and Financial review

The profit for the Consolidated Entity after providing for income tax amounted to $4,113,622 (2020: loss $1,373,642). The surplus arose from the calculation of the benefit received by the Group from the agreement with lender Aquis Finance Pty Ltd to settle the loan agreement before the due date by the issue of 190 million shares in the Company. The agreement to pay out the loan was approved by shareholders at the 16 April 2021 Extraordinary General Meeting. Further details are provided at Note 13 to the financial statements.

Corporate Strategy

The Company’s goal, like most other small capital exploration companies, is to preserve shareholder wealth and grow the value of the flagship asset with prudent exploration methods. In the 2021 financial year, the Company’s key focus was to reorganise its capital structure, attract investors to support the ongoing funding of the company and to expand its exploration activities at its Cannindah and Piccadilly projects to bring them to drill ready status as soon as soon as possible

The Company’s corporate activities include the review of opportunities for expansion through acquisitions and mergers and through potential diversification opportunities to take advantage of positive market sentiments. At the date of this report, no investments have been undertaken.

Operations Report

Exploration Projects

During the period, the Group expanded its exploration activities by:

• Gaining access to historical data on the Piccadilly project through the acquisition of PGMH

• • Conducting further desktop reviews and field work on the Piccadilly project to plan out additional exploration including trenching and sampling culminating in a new drilling program towards the end of the financial year aimed at consolidating the knowledge gained from the reviews.

• Successfully applied for the renewal of the existing EPM’s 18322 and 16198 and applying for new ground adjacent to the current tenements.

• Followed up a detailed analysis of the Mt Cannindah project conducted early in the second half of the financial year with the planning of a 1,450m diamond drill program which commenced in August 2021. Initial results from the drilling were released to the ASX on 28 September 2021.

Financial

At 30 June 2022, the Company had cash on hand of $1,291,780 (2020: $39,227). During the year the Group acquired and restructured PMH and also negotiated the early payout of the $5.8 million debt with Aquis Finance Pty Ltd. These actions left the company debt free with attractive assets with which to attract new investors. In this regard, the Company issued a further 46.4 million shares in placements to raise $2.375 million in cash before transaction costs from December 2020 to March 2021.

CANNINDAH RESOURCES LIMITED DIRECTORS’ REPORT

Future Strategy

The Cannindah Resources Board and Management will continue to focus on developing the exploration potential of both its Piccadilly Gold Mine and its surrounding EPM’s and its Mt Cannindah Project. It has commenced this process by undertaking drilling campaigns at both projects early in the 2022 financial year.

The Board will also continue to seek to take advantage of additional corporate opportunities that are evaluated from time to time.

Environmental Regulation

The Consolidated Entity’s operations are subject to significant environmental regulation under Commonwealth and State legislation in relation to the discharge of hazardous waste and minerals arising. The Consolidated Entity holds all necessary Environmental Authorities in accordance with the Environmental Protection Act 1994 and such other environmental approvals as may be stipulated under State laws to enable it to operate within its Mining Leases and the various exploration tenements it holds.

Information on Directors

Thomas J Pickett

LLB, Grad Cert App Fin Executive Ch airman .

Mr Pickett holds a Bachelor of Law and was admitted as a solicitor of the Supreme Court of Queensland in 1996. Mr Pickett has broad experience in the mining industry and has held a number of corporate roles in the mining and finance industries.

Mr Pickett was Chairman of Dynasty Resources Limited from 2011 to September 2015, was a NonExecutive Director of Discovery Resources Limited (ASX: DIS) which completed a transaction to become Aquis Entertainment Limited (ASX: AQS) in August 2015 and was a Non-Executive Director of Red Gum Resources Limited (ASX: RGX) from May 2015 until January 2016 when the Company completed a transaction to become MCS Services Limited (ASX: MSG). He was a director of CuDeco Ltd (ASX: CDU) from 2002 to 2005. He was a director of Piccadilly Gold Mine Holdings Limited and Diversified Mining Pty Ltd, which are privately held exploration entities, resigning in 2015.

Geoffrey J Missen

FCA, GAICD

Non-Executive Director and Chairman of the Audit and Risk Committee

Mr Missen is a Chartered Accountant with over 25 years’ experience providing clients with tax, accounting and business advice. He has been a Partner of The MBA Partnership since its inception in 2001. His client base is diverse and centres on small to medium enterprises. Mr Missen has an interest in providing specialist advice to his clients and enjoys developing strategies to help clients meet their goals. He is an active board member, currently serving on a number of boards in the public, private and not-for-profit sectors.

Mr Missen is a graduate of Victoria University, the Wharton School of Business at the University of Pennsylvania, Cambridge University, Harvard Business School and the Chicago Booth Business School. He is a Fellow of the Chartered Accountants in Australia and New Zealand and a Graduate Member of The Australian Institute of Company Directors (GAICD).

Dr. Simon D Beams (appointed 2 September 2019)

PhD (Geology) BSc Hons (First Class)

Non-Executive Director

Dr Beams has been a Geologist since 1975. For the past 32 years he has been Managing Director and Principal Geologist of Terra Search Pty Ltd where he has been directly involved in many mineral exploration and evaluation programs across Northern Australia, leading to mineral discoveries and some mines, primarily base metals and gold but including uranium, phosphate, magnetite & oil shale amongst others. In 2016, Simon was awarded the John Campbell Miles Medal by the Queensland Divisions of the Geological Society of Australia and the Australian Institute of Geosciences for contributions to economic geology, exploration technology and mineral discovery in Queensland.

CANNINDAH RESOURCES LIMITED DIRECTORS’ REPORT

Dr Beams is also an active member in a number of geological societies.

• Geological Society Australia, (GSA)

• Australasian Institute Mining & Metallurgy (AusIMM)

• Australian Institute of Geosciences (AIG)

• Society Economic Geologists (SEG)

• Association of Applied Geochemists

Dr Beams has been a member of the Advisory Board to the Economic Geology Research Centre (EGRU) at James Cook University, Townsville for over two decades. He is also a Member of the Queensland Exploration Committee for AMEC (Association of Mining and Exploration Companies) one of the Peak Industry Exploration Groups.

Dr Beams has produced several key publications in the areas of mineral deposit geology and geochemistry, exploration data management, regolith relations, petrology and granite genesis and regional geology of North Queensland.

Company Secretary

The Company Secretary in office at the end of the financial year was Garry Gill. Mr Gill has more than 30 years’ experience in all facets of corporate financial and administrative functions and has served in Chief Financial Officer and Company Secretarial positions at a number of listed and unlisted public companies, private companies and statutory authorities.

Directors’ Interests in the Company

At the date of this report, the interests of the Directors in the shares and options of the Company were:

	Ordinary	Options
	Shares
T J Pickett (Executive Chairman)	23,614,573		-
G J Missen (Non-Executive Director)	2,556,249		-
S D Beams (Non-Executive Director)	2,500,000		-

Meetings of Directors

The number of meetings of the Company's Board of Directors held during the year ended 30 June 2021 and the number of meetings attended by each Director were:

	Held	Attended
T J Pickett	5	5
G J Missen	5	5
S D Beams	5	5

“Held” represents the number of meetings held during the time the Director held office or was a member of the relevant committee.

The Audit Committee did not meet during the year. All matters usually considered by the Committee were determined by the full Board.

Remuneration Report (Audited)

The remuneration report, which has been audited, outlines the Director and executive remuneration arrangements for the Consolidated Entity and the Company, in accordance with the requirements of the Corporations Act 2001 and its Regulations.

The remuneration report is set out under the following main headings:

• A Principles used to determine the nature and amount of remuneration

• B Details of remuneration

• C Service agreements D Share-based compensation

• E Equity instruments

CANNINDAH RESOURCES LIMITED

DIRECTORS’ REPORT

A Principles used to determine the nature and amount of remuneration

Non-Executive Directors Remuneration

The Company’s constitution provides that the Non-Executive Directors may be paid, as remuneration for their services, a sum determined from time to time by the Company’s Shareholders in a general meeting, with that sum to be divided amongst the Directors in such manner as they agree. The aggregate remuneration ceiling for Non-Executive Directors is currently $300,000 per annum. Additionally, Non-Executive Directors are entitled to be reimbursed for properly incurred expenses.

Non-Executive Directors are remunerated through a combination of fees and may also be granted options over the Company’s shares. The Board does not consider it appropriate to include a short- term incentive, or cash bonus element in the remuneration of Non-Executive Directors.

Executive Remuneration

The Consolidated Entity and Company aim to reward executives with a level and mix of remuneration based on their position and responsibility, which is both fixed and variable.

The executive remuneration and reward framework has three components:

• base pay and non-monetary benefits

• share-based payments and cash bonuses

• other remuneration such as superannuation and long service leave.

The combination of these comprises the executive's total remuneration.

Fixed remuneration, consisting of base salary, superannuation and non-monetary benefits, are reviewed annually by the Board of Directors, based on individual and business unit performance, the overall performance of the Consolidated Entity and comparable market remunerations.

Consolidated Entity performance and link to remuneration

Because the Consolidated Entity is in exploration and not production, there is no direct relationship between the Consolidated Entity's financial performance and the level of remuneration paid to key management personnel.

Use of remuneration consultants

The Company did not engage remuneration consultants during the financial year ended 30 June 2021.

B Details of remuneration

Amounts of remuneration

Details of the remuneration of the Directors and other key management personnel (defined as those who have the authority and responsibility for planning, directing and controlling the major activities of the Consolidated Entity) of Cannindah Resources Limited paid and payable are set out in the following tables.

The key management personnel (KMP) of the Consolidated Entity consisted of the following Directors of Cannindah Resources Limited:

T J Pickett G J Missen S D Beams

And the following executive:

G C Gill - Chief Financial Officer / Company Secretary

CANNINDAH RESOURCES LIMITED

DIRECTORS’ REPORT

Key Management Personnel	Short-term Benefits Long- term Benefits Post - Employment Benefits Fees and/or Salary Annual Leave Long Service Leave Super - annuation Share Based Payments Total Performance based remuneration At risk remuneration $ $ $ $ $ % % % 250,000 21,535 13,908 23,750 - 309,193 - - 18,300 - - 1,739 - 20,039 - - 40,000 - - - - 40,000 - - 72,000 - - - - 72,000 - - 380,300 21,535 13,908 25,489 - 441,232 - - 250,000 14,143 48,661 23,750 - 336,554 - - 6,100 - - 580 - 6,680 - - 18,300 - - 1,739 - 20,039 - - 33,333 - - - - 33,333 - - 75,850 - - - - 75,850 - - 383,583 14,143 48,661 26,069 - 472,456 - -
2021 T J Pickett G J Missen S D Beams G C Gill
Totals
2020 T J Pickett L G Johnson G J Missen SD Beams* G C Gill
Totals

• Retired 2 September 2019 .

** Appointed 2 September 2019 .

At the Annual General Meeting held on 17 December 2020 shareholders voted to issue shares at $0.02 each to Directors and executives in payment or part payment of outstanding fees as at 30 June 2020. The outstanding fees for which the shares were used as payment were disclosed in the 2020 and 2019 financial year remuneration tables. Shares issued to KMP were as follows:

	No of Shares	$
T J Pickett	13,802,546	276,051
G J Missen	2,306,249	46,125
S D Beams	2,500,000	50,000
G C Gill	1,000,000	20,000
Totals	19,608,795	392,176

C Service agreements

Remuneration and other terms of employment for key management personnel are formalised in Service Agreements. Details of these Agreements are as follows:

Executive Chairman:

Effective from 1 July 2021, the Company has entered into a new Employment Services Agreement with Mr Thomas Pickett the Executive Chairman. Remuneration payable pursuant to the package is as follows:

• Term of the contract is 2 years.

• Base salary of $280,000 plus superannuation at statutory rates.

• Short term incentives under the contract include:

• Annual bonus at the discretion of the Board

CANNINDAH RESOURCES LIMITED

DIRECTORS’ REPORT

• Cash bonus of $100,000 should the market capitalisation of the company at any time during the term exceed $60 million AUD and remain above this amount for a period of 30 days

• Further cash bonus of $100,000 should the market capitalisation exceed $100 million AUD and remain there for a period of 30 days

• The contract may be terminated by the Company giving of six months’ written notice or by Mr Pickett giving 3 months’ written notice.

• Termination payment is up to six months of annual base salary.

• Remuneration under the contract is to be reviewed annually by the Board of Directors.

Chief Financial Officer and Company Secretary

The Company has entered into an Agreement with Garry Gill and his company to provide services as Company Secretary and Chief Financial Officer. Services are to be provided on a part-time basis and at a rate of $1,200 per day (pro rata) plus GST, plus expenses. The Agreement may be terminated by either party on 1 months’ notice.

KMP have no entitlement to termination payments in the event of removal for misconduct.

D Share-based compensation

Issue of shares

There were no shares issued to Directors and other Key Management Personnel as part of compensation during the year ended 30 June 2021. However, in accordance with the resolution passed at the Annual General Meeting held on 17 December 2020, KMP were issued shares to pay or part - pay salary and fees owing to them as at 30 June 2020.

Issue of options

There were no options over ordinary shares issued to Directors and other Key Management Personnel as part of compensation during the year ended 30 June 2021.

E Equity instruments

a) Movements in shares

The movement during the year in the number of ordinary shares in Cannindah Resources Limited held directly, indirectly or beneficially by each key management person, including their related parties, is as follows:

Name Balance at beginning of year 2021	Balance at Date of Appoint- ment (refer notes below)	Acquired	Acquired	Disposals	Balance at Date of Resignati on (refer notes below)	Balance at end of the year
		Payment for outstanding fees	Other
T J Pickett 10,582,503 G J Missen 250,000 S D Beams - G C Gill -	n/a n/a n/a n/a	13,802,546 2,306,249 2,500,000 1,000,000	596,435 - - -	(1,366,911) - - -	n/a n/a n/a n/a	23,614,573 4,862,498 5,000,000 2,000,000
2020
T J Pickett 10,000,000 L G Johnson 100,000 G J Missen 250,000 S D Beams n/a G C Gill -	n/a n/a n/a - n/a	- - - - -	582,503 - - - -	- - - - -	n/a 100,000 n/a n/a n/a	10,582,503 n/a 250,000 - -

Note: LG Johnson – resigned 2 September 2019

SD Beams – appointed 2 September 2019

CANNINDAH RESOURCES LIMITED DIRECTORS’ REPORT

As noted in Sections B & D above KMP were issued shares to pay or part pay salaries and fees outstanding as at 30 June 2020. The share issues are treated as “Other” acquisitions in the 2021 year in the table above.

All on market purchases and sales complied with the Board’s Securities Trading Policy which permits trading by Directors and executives during certain periods in the absence of knowledge of pricesensitive information.

b) Movement in options

No options over ordinary shares in the parent entity were held by any Director or other member of key management personnel of the Consolidated Entity during the financial years ended 30 June 2021 or 30 June 2020.

End of audited remuneration report

Share options

At the date of this report there were no unissued ordinary shares under option (nil at 30 June 2021 and nil at 30 June 2020). No options have been exercised since year end to the date of this report.

Indemnity and insurance of officers

The Company has indemnified the Directors of the Company for costs incurred, in their capacity as a director, for which they may be held personally liable, except where there is a lack of good faith.

During the financial year, the Company paid a premium in respect of a contract to insure the Directors of the Company against a liability to the extent permitted by the Corporations Act 2001. The amount of the premium is not disclosed as it is considered confidential.

Indemnity and insurance of auditor

The Company has not, during or since the financial year, indemnified or agreed to indemnify the auditor of the company or any related entity against a liability incurred by the auditor.

During the financial year, the Company has not paid a premium in respect of a contract to insure the auditor of the company or any related entity.

Proceedings on behalf of the Company

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

Subsequent Events

No other matters or circumstances have arisen since 30 June 2021, which significantly affect, or may significantly affect, the operations of the Company, the results of those operations, or the state of affairs of the Company in subsequent financial years.

Non-audit services

No non-audit services were provided by a related entity of the Group’s auditor, Grant Thornton. The Directors are satisfied that where provided the non-audit services are compatible with the general standard of independence for auditors imposed by the Corporations Act 2001 . The nature and scope of non-audit service provided means that auditor independence was not compromised.

Officers of the company who are former audit partners of Grant Thornton Audit Pty Ltd

There are no officers of the company who are former audit partners of Grant Thornton Audit Pty Ltd.

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 the following page.

This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act 2001.

CANNINDAH RESOURCES LIMITED DIRECTORS’ REPORT

On behalf of the Directors

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_______ Thomas J Pickett Executive Chairman 1 October 2021 Gold Coast

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Level 18

King George Central 145 Ann Street Brisbane QLD 4000

Correspondence to: GPO Box 1008 Brisbane QLD 4001 T +61 7 3222 0200 F +61 7 3222 0444 E info.qld@au.gt.com W www.grantthornton.com.au

Auditor’s Independence Declaration

To the Directors of Cannindah Resources Limited

In accordance with the requirements of section 307C of the Corporations Act 2001 , as lead auditor for the audit of Cannindah Resources Limited for the year ended 30 June 2021, I declare that, to the best of my knowledge and belief, there have been:

a no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and

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

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Grant Thornton Audit Pty Ltd

Chartered Accountants

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M C Bragg Partner – Audit & Assurance Brisbane, 1 October 2021

www.grantthornton.com.au

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

Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

Liability limited by a scheme approved under Professional Standards Legislation.

CANNINDAH RESOURCES LIMITED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME for the year ended 30 June 2021

	Note	Consolidated 2021 2020 $ $
Income Other income Total income Expenses Employee benefits expense Exploration and evaluation expenditure written off Finance costs Administration Benefit from loan extinguishment Profit / (loss) before income tax expense from continuing operations Income tax (expense) / benefit Profit/(loss) after income tax expense for the year attributable to the owners of the Company Other comprehensive income for the year, net of tax Total comprehensive income for the year attributable to the members of the Company Basic and diluted earnings per share (cents per share)	4 5 5 13 6 26	67,012 10,666
		67,012 10,666
		(286,943) (386,643) (600) (689) (244,255) (800,896) (284,022) (196,080) 4,862,430 -
		4,113,622 (1,373,642) - -
		4,113,622 (1,373,642) - -
		4,113,622 (1,373,642)
		1.33 (0.72)

The accompanying notes form part of these financial statements

CANNINDAH RESOURCES LIMITED STATEMENT OF FINANCIAL POSITION as at 30 June 2021

as at 30 June 2021
Note	Consolidated 2021 2020 $ $
Current assets Cash and cash equivalents 7 Trade and other receivables 8 Total current assets Non-current assets Other assets 9 Exploration and evaluation asset 10 Total non-current assets Total assets Liabilities Current liabilities Trade and other payables 11 Employee benefits 12 Borrowings 13 Total current liabilities Non-current liabilities Borrowings 13 Total non-current liabilities Total liabilities Net assets Equity Issued capital 14 Reserves 15 Accumulated losses Total equity	1,291,780 39,227 64,272 32,468
	1,356,052 71,695
	105,837 83,337 6,993,850 4,754,881
	7,099,687 4,838,218
	8,455,739 4,909,913
	460,395 727,659 153,537 118,093 - 157,500
	613,932 1,003,252
	- 4,978,551
	- 4,978,551
	613,932 5,981,803
	7,841,807 (1,071,890)
	53,125,082 48,325,007 395,614 395,614 (45,678,889) (49,792,511)
	7,841,807 (1,071,890)

The accompanying notes form part of these financial statements

CANNINDAH RESOURCES LIMITED STATEMENT OF CHANGES IN EQUITY for the year ended 30 June 2021

Consolidated	Note Issued Capital Reserve Accumulated Losses Total $ $ $ $
2020 Balance at 1 July 2019 Transactions with owners: Shares issued during the period Share issue costs Total transactions with owners Loss attributable to members of the Company Balance at 30 June 2020 2021 Balance at 1 July 2020 Transactions with owners: Shares issued during the period Share issue costs Total transactions with owners Profit attributable to members of the Company Balance at 30 June 2021	48,229,514 395,614 (48,418,869) 206,259 14 145,041 - - 145,041 14 (49,548) - - (49,548)
	95,493 - - 95,493 - - (1,373,642) (1,373,642)
	48,325,007 395,614 (49,792,511) (1,071,890)
	48,325,007 395,614 (49,792,511) (1,071,890) 14 5,017,812 - - 5,017,812 14 (217,737) - - (217,737)
	4,800,075 - - 4,800,075 - -4,113,622 4,113,622
	53,125,082 395,614 (45,678,889) 7,841,807

The accompanying notes form part of these financial statements

CANNINDAH RESOURCES LIMITED STATEMENT OF CASH FLOWS for the year ended 30 June 2021

	Consolidated 2021 2020 $ $
Cash flows from operating activities Receipts from ATO – Cashflow Boost Program Payments to suppliers and employees Interest received Interest and finance costs paid Net cash provided by (used in) operating activities 25 Cash flows from investing activities Exploration expenditure Net cash provided by (used in) investing activities Cash flows from financing activities Net proceeds from issue of shares Proceeds from borrowings - secured Proceeds from borrowings - other Repayment of borrowings - other Net cash provided by (used in) financing activities Net increase (decrease) in cash held Cash at beginning of year Cash at end of year 7	66,949 - (559,471) (298,658) 63 10,666 (15,970) (49,681)
	(508,429) (337,673)
	(755,541) (124,161)
	(755,541) (124,161)
	2,174,023 95,493 500,000 391,367 - 178,080 (157,500) (179,977)
	2,516,523 484,963
	1,252,553 23,129 39,227 16,098
	1,291,780 39,227

The accompanying notes form part of these financial statements

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 1 Statement of Significant Accounting Policies

The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

New, revised or amending Accounting Standards and Interpretations adopted

The Consolidated Entity has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period. None of the new standards and amendments to standards affected any of the amounts recognised in the current period or any prior period and are not likely to affect future periods.

The following Accounting Standards and Interpretations are most relevant to the consolidated entity:

Basis of preparation

These general-purpose financial statements have been prepared on a going concern basis in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board ('IASB').

Historical cost convention

The financial statements have been prepared under the historical cost convention, except for, where applicable, financial assets and liabilities at fair value through profit or loss.

Functional and Presentation Currency

The Company’s functional and presentation currency is Australian dollars.

Critical accounting estimates

The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Consolidated Entity's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in note 2.

Parent entity information

In accordance with the Corporations Act 2001, these financial statements present the results of the Consolidated Entity only. Supplementary information about the parent entity is disclosed in note 21.

Principles of consolidation

The consolidated financial statements incorporate the assets and liabilities of subsidiaries of Cannindah Resources Limited ('Company' or 'Parent Entity') as at 30 June 2021 and the results of all subsidiaries for the year then ended. Cannindah Resources Limited and its subsidiaries together are referred to in these financial statements as the 'Consolidated Entity'.

A subsidiary is any entity controlled by the Company. Control exists where the parent entity is exposed, or has rights, to variable returns from its involvement with the subsidiary and has the ability to affect those returns through its power over the subsidiary.

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

Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are recognised from the effective date of acquisition or up to the effective date of disposal as applicable.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 1 Statement of Significant Accounting Policies (continued)

Principles of consolidation (continued)

Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss and net assets that is not held by the Group. The Group attributes total comprehensive income or loss of subsidiaries between the owners of the parent and the non-controlling interests based on their respective ownership interests.

Revenue recognition

Revenue from contracts with customers is measured and recognised in accordance with the five-step model prescribed by AASB 15 “Revenue from Contracts with Customers”. First contracts with customers within the scope of AASB 15 are identified. Distinct promises within the contract are identified as performance obligations. The transaction price of the contract is measured based on the amount of consideration the Group expects to be entitled from the customer in exchange for goods or services. Factors such as requirements around variable consideration, significant financing components, noncash consideration or amounts payable to customers also determine the transaction price.

Revenue is recognised when or as performance obligations are satisfied which is when control of the promised goods or services is transferred to the customer. The Group does not currently have any material contracts with customers.

All revenue is stated net of the amount of goods and services tax (GST).

Other income

The Group may also receive other income comprised of interest income, government grants and research and development tax incentives. Other revenue is recognised when it is received or when the right to receive payment is established.

Government grants

Government grants relating to costs are deferred and recognised in profit or loss over the period necessary to match them with the costs that they are intended to compensate. During the period the Group received grants under the Government Cashflow Boost program. The payments were recognised as other income in the period in which they were received.

Interest income

Interest income is recognised when it becomes receivable on a proportional basis taking into account the interest rates applicable to the financial assets.

Income tax

The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and unused tax losses and the adjustment recognised for prior periods, where applicable.

Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for:

• When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits; or

• When the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures, and the timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future.

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.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 1 Statement of Significant Accounting Policies (continued)

Income tax (continued)

The carrying amount of recognised and unrecognised deferred tax assets are reviewed each reporting date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to recover the asset.

Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on either the same taxable entity or different taxable entity's which intend to settle simultaneously.

Cannindah Resources Limited (the 'head entity') and its wholly-owned Australian controlled entities have formed an income tax consolidated group under the tax consolidation regime. The head entity and the controlled entities in the tax consolidated group continue to account for their own current and deferred tax amounts. The tax consolidated group has applied the group allocation approach in determining the appropriate amount of taxes to allocate to members of the tax consolidated group.

In addition to its own current and deferred tax amounts, the head entity also recognises the current tax liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused tax credits assumed from controlled entities in the tax consolidated group.

Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts receivable from or payable to other entities in the tax consolidated group. The tax funding arrangement ensures that the intercompany charge equals the current tax liability or benefit of each tax consolidated group member, resulting in neither a contribution by the head entity to the subsidiaries nor a distribution by the subsidiaries to the head entity.

Research and Development Tax Refunds and refunds receivable are recognised as a tax credit.

Cash and cash equivalents

Cash and cash equivalents include 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 an insignificant risk of changes in value.

Financial instruments

Recognition, initial measurement and derecognition

Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the financial instrument, and are measured initially at fair value adjusted by transactions costs, except for those carried at fair value through profit or loss, which are measured initially at fair value. Subsequent measurement of financial assets and financial liabilities are described below.

Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when the financial asset and all substantial risks and rewards are transferred. A financial liability is derecognised when it is extinguished, discharged, cancelled or expires.

Classification and subsequent measurement of financial assets

Except for those trade receivables that do not contain a significant financing component and are measured at the transaction price in accordance with AASB 15, all financial assets are initially measured at fair value adjusted for transaction costs (where applicable).

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 1 Statement of Significant Accounting Policies (continued)

Financial instruments (continued)

Classification and subsequent measurement of financial assets (continued)

For the purpose of subsequent measurement, financial assets other than those designated and effective as hedging instruments are classified into the following categories upon initial recognition:

• amortised cost

• fair value through profit or loss (FVPL)

• equity instruments at fair value through other comprehensive income (FVOCI)

• debt instruments at fair value through other comprehensive income (FVOCI)

All income and expenses relating to financial assets that are recognised in profit or loss are presented within finance costs, finance income or other financial items, except for impairment of trade receivables which is presented within other expenses.

Classifications are determined by both:

• The entity’s business model for managing the financial asset

• The contractual cash flow characteristics of the financial assets

Subsequent measurement financial assets

Financial assets at amortised cost

Financial assets are measured at amortised cost if the assets meet the following conditions (and are not designated as FVPL):

• they are held within a business model whose objective is to hold the financial assets and collect its contractual cash flows

• the contractual terms of the financial assets give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding

After initial recognition, these are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial. The Group’s cash and cash equivalents, trade and most other receivables fall into this category of financial instruments.

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

Financial assets that are held within a different business model other than ‘hold to collect’ or ‘hold to collect and sell’ are categorised at fair value through profit and loss. Further, irrespective of business model financial assets whose contractual cash flows are not solely payments of principal and interest are accounted for at FVPL. All derivative financial instruments fall into this category, except for those designated and effective as hedging instruments, for which the hedge accounting requirements apply (see below).

Impairment of Financial assets

AASB 9’s impairment requirements use more forward looking information to recognise expected credit losses – the ‘expected credit losses (ECL) model’. Instruments within the scope of the new requirements included loans and other debt-type financial assets measured at amortised cost and FVOCI, trade receivables, contract assets recognised and measured under AASB 15 and loan commitments and some financial guarantee contracts (for the issuer) that are not measured at fair value through profit or loss.

The Group considers a broader range of information when assessing credit risk and measuring expected credit losses, including past events, current conditions, reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.

In applying this forward-looking approach, a distinction is made between:

• financial instruments that have not deteriorated significantly in credit quality since initial recognition or that have low credit risk (‘Stage 1’) and

• financial instruments that have deteriorated significantly in credit quality since initial recognition and whose credit risk is not low (‘Stage 2’).

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 1 Statement of Significant Accounting Policies (continued)

Subsequent measurement financial assets (continued)

Impairment of Financial assets (continued)

‘Stage 3’ would cover financial assets that have objective evidence of impairment at the reporting date. ‘12-month expected credit losses’ are recognised for the first category while ‘lifetime expected credit losses’ are recognised for the second category.

Measurement of the expected credit losses is determined by a probability-weighted estimate of credit losses over the expected life of the financial instrument.

Trade and other receivables and contract assets

The Group makes use of a simplified approach in accounting for trade and other receivables as well as contract assets and records the loss allowance at the amount equal to the expected lifetime credit losses. In using this practical expedient, the Group uses its historical experience, external indicators and forward-looking information to calculate the expected credit losses using a provision matrix.

The Group assess impairment of trade receivables on a collective basis as they possess credit risk characteristics based on the days past due.

Classification and measurement of financial liabilities

The Group’s financial liabilities include borrowings, trade and other payables and derivative financial instruments.

Financial liabilities are initially measured at fair value, and, where applicable, adjusted for transaction costs unless the Group designated a financial liability at fair value through profit or loss.

Subsequently, financial liabilities are measured at amortised cost using the effective interest method except for derivatives and financial liabilities designated at FVPL, which are carried subsequently at fair value with gains or losses recognised in profit or loss (other than derivative financial instruments that are designated and effective as hedging instruments).

All interest-related charges and, if applicable, changes in an instrument’s fair value that are reported in profit or loss are included within finance costs or finance income.

Borrowings

Borrowings are measured at amortised cost using the effective interest method

Joint operations

The consolidated group’s share of the assets, liabilities, revenue and expenses of joint venture operations are included in the appropriate items of the consolidated financial statements

Exploration and evaluation assets

Exploration and evaluation expenditure in relation to separate areas of interest for which rights of tenure are current is carried forward as an asset in the statement of financial position where it is expected that the expenditure will be recovered through the successful development and exploitation of an area of interest, or by its sale; or exploration activities are continuing in an area and activities have not reached a stage which permits a reasonable estimate of the existence or otherwise of economically recoverable reserves. Where a project or an area of interest has been abandoned, the expenditure incurred thereon is written off in the year in which the decision is made.

Impairment of non-financial assets

Goodwill and other 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 non-financial 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.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 1 Statement of Significant Accounting Policies (continued)

Impairment of non-financial assets (continued)

Recoverable amount is the higher of an asset’s fair value less costs to sell and value-in-use. The valuein-use is the present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a cash-generating unit.

Finance costs

Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in the period in which they are incurred.

Provisions

Provisions are recognised when the Consolidated Entity has a present (legal or constructive) obligation as a result of a past event, it is probable the Consolidated Entity will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. If the time value of money is material, provisions are discounted using a current pre-tax rate specific to the liability. The increase in the provision resulting from the passage of time is recognised as a finance cost.

Employee benefits

Wages and salaries, annual leave and sick leave

Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave expected to be settled within 12 months of the reporting date are recognised in current liabilities in respect of employees' services up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled. Non-accumulating sick leave is expensed to profit or loss when incurred.

Share-based payments

Equity-settled and cash-settled share-based compensation benefits are provided to employees.

Equity-settled transactions are awards of shares, or options over shares that are provided to employees in exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash is determined by reference to the share price.

The cost of equity-settled transactions is measured at fair value on grant date. Fair value is independently determined using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the Consolidated Entity receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions.

The cost of equity-settled transactions is recognised as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous periods.

The cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either the Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows:

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 1 Statement of Significant Accounting Policies (continued)

Employee benefits (continued)

• during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied by the expired portion of the vesting period.

• from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at the reporting date.

All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to settle the liability.

Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions are considered to vest irrespective of whether or not that market condition has been met provided all other conditions are satisfied.

If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit as at the date of modification.

If the non-vesting condition is within the control of the Consolidated Entity or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the Consolidated Entity or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.

If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a modification.

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.

Other equity

Convertible notes which are settled for a fixed amount of cash; may only be converted into a fixed number of shares and may not be redeemed for cash or other financial asset, are treated as other equity.

Earnings per share

Basic earnings per share

Basic earnings per share is calculated by dividing the profit attributable to the owners of Cannindah Resources Limited, 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 financial year.

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.

Goods and Services Tax ('GST') and other similar taxes

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

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 1 Statement of Significant Accounting Policies (continued)

Goods and Services Tax ('GST') and other similar taxes (continued)

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 tax authority is included in other receivables or other 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 tax authority, are presented as operating cash flows.

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

Rounding of Amounts

The company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and Investments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that Corporations Instrument to the nearest dollar.

New Accounting Standards and Interpretations not yet mandatory or early adopted

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the consolidated entity for the annual reporting period ended 30 June 2021. The consolidated entity has not yet assessed the impact of these new or amended Accounting Standards and Interpretations.

Note 2 Critical accounting judgements, estimates and assumptions

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events; management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

Going Concern

The Financial Statements have been prepared on the going concern basis, which contemplates continuity of normal business activities and the realisation of assets and discharge of liabilities in the normal course of business.

As disclosed in the financial statements, notwithstanding the Consolidated Entity recording a profit after tax of $4,113,622 as a result of a non- cash benefit from the extinguishment of the Aquis Finance loan, the Consolidated Entity incurred an underlying loss of $748,808, and had net cash outflows from operating activities of $508,429 for the year ended 30 June 2021.

During the year ended 30 June 2021, the Group restructured its financial position by conducting the

following transactions:

• On 1 September 2020, the Company announced that it had acquired 100% of the shares in its former earn-in partner, Piccadilly Gold Mine Holdings Limited (PGMH) in an all-script arrangement. The Company issued 48,318,170 ordinary shares in CAE to the various Piccadilly Gold Mine Holdings Limited shareholders to acquire 100% of the company and its project and was able to retire the existing farm in agreement with PGMH. This transaction is discussed further in note 24 below.

• Following the acquisition, the Directors commenced a corporate restructure of PGMH to repay secured and other substantial debts. This process was conducted by agreeing with PGMH’s lenders that the Company would issue 21,245,000 fully paid CAE Shares on 23 December 2020 at $0.02 per share ($424,900) in full and final satisfaction of loans totalling $2,124,437.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 2 Critical accounting judgements, estimates and assumptions (continued)

• On 17 December 2020, the Company announced that it had agreed with its major lender Aquis Finance Pty Ltd that subject to shareholder approval the Company would issue 190,000,000 fully paid CAE shares in full and final satisfaction of the loan provided by Aquis (“Transaction”). The Transaction was overwhelmingly approved by shareholders on 16 April 2021 which saw the Aquis debt extinguished. This transaction is discussed further in note 13 below.

• The Company issued 46,437,334 shares to sophisticated and professional investors to raise $2,375,280 (before costs) between December and March 2021.These funds were and are being used to fund exploration work including trenching at Piccadilly, and drilling programs at Piccadilly and Mt Cannindah as well for working capital.

At the conclusion of the restructuring activities the Group was debt free, had some $2 million of cash available to and was able to begin embarking on an expanded exploration programme to progress its corporate strategy.

In advancing this strategy, the Directors expect that additional funds will be required for the Company to operate and conduct exploration activities over the next 12 months. The Company is preparing a capital raising strategy including raising funds through share placements, capital raisings from existing shareholders and from short term loans. The Company has in the past been able to obtain short term loans from professional investors as an interim measure while capital raisings are being finalised. Based on their previous experience and success in raising capital and loan funds, the current market appetite for the commodities for which the Company is exploring and the recent results obtained from the new exploration program, the Directors are confident, these additional funds can be obtained.

While the Directors are satisfied that they will be able to secure the additional funds required, and that the going concern basis of preparation for the financial report is appropriate the Directors recognise that the vagaries of the market, and the events and conditions noted above indicate the existence of a material uncertainty related to going concern. If for any reason the Consolidated Entity is unable to continue as a going concern, it would impact on the Consolidated Entity’s ability to realise assets at their recognised values and to extinguish liabilities in the normal course of business at the amounts stated in the consolidated financial statements.

The financial report does not include any adjustments relating to the amounts or classification of recorded assets or liabilities that might be necessary if the Consolidated Entity does not continue as a going concern.

Coronavirus (COVID-19) pandemic

Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has had, or may have, on the consolidated entity based on known information. This consideration extends to the nature of the products and services offered, customers, supply chain, staffing and geographic regions in which the consolidated entity operates. Other than as addressed in specific notes, there does not currently appear to be either any significant impact upon the financial statements or any significant uncertainties with respect to events or conditions which may impact the consolidated entity unfavourably as at the reporting date or subsequently as a result of the Coronavirus (COVID-19) pandemic.

Exploration and Evaluation Assets

Estimates and judgements relating to the exploration and evaluation assets has been included within Note 10.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS

for the year ended 30 June 2021

Note 2 Critical accounting judgements, estimates and assumptions (continued)

Acquisition of Piccadilly Gold Mines Holdings Limited

Estimates and judgements relating to the acquisition of Piccadilly Gold Mine Holdings has been included within Note 24.

Determination of the benefit from the retirement of the Aquis Finance Loan

Estimates and judgements relating to the extinguishment of the Aquis Finance loan has been included within Note 13.

Note 3 Operating segments

Identification of reportable operating segments

The Consolidated Entity has determined its operating segments based on the internal reports that are reviewed and used by both management and the Board of Directors in assessing performance and allocation of resources. As the Consolidated Entity is still in the exploration phase, the chief operating decision makers review the operations as a whole and therefore consider one segment to be appropriate.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

	Consolidated 2021 2020 $ $
Note 4 Other Income Covid assistance payments from Government Other revenue Interest received from other persons Total other income Note 5 Expenses Loss before income tax from continuing operations includes the following specific expenses: Finance costs Interest and finance charges paid/payable Rental expense - office Minimum lease payments Employee benefit expense Amounts paid to employees Allocated to employee benefit provisions Superannuation expense Allocated to exploration and evaluation projects Amounts paid to non-executive Directors Total employee benefit expense Note 6 Income tax expense Numerical reconciliation of income tax expense and tax at the statutory rate Profit /(loss) before income tax expense from continuing operations Tax at the statutory tax rate of 26% (2020: 27.5%) Tax effect amounts which are not deductible/(taxable) in calculating taxable income: Non assessable income Other non-deductible / (allowable) expenses Current year tax losses not recognised Current year temporary differences not recognised Deductible capital raising costs Income tax expense – non assessable income Tax losses not recognised Unused tax losses for which no deferred tax asset has been recognised Net forgiven amount on Aquis debt extinguishment Carried forward tax losses on which no deferred tax loss has been recognised	66,949 - 63 10,666
	67,012 10,666
	244,255 800,896
	- 13,500
	254,913 267,900 35,444 62,804 21,770 27,769 (85,184) (29,578) 60,000 57,748
	286,943 386,643
	4,113,622 (1,373,642)
	1,069,542 (377,752) (1,264,232) - (667,967) 168,868
	(862,657) (208,884) 190,831 183,988 651,794 15,683 20,032 9,213
	- -
	22,285,810 21,474,800 (1,906,835) -
	20,378,975 21,474,800

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

	Consolidated 2021 2020 $ $
Note 6 Income tax expense (continued) Potential tax benefit @ 26% (2020: 27.5%)
	5,298,534 5,905,570

The above potential tax benefit for tax losses has not been recognised in the statement of financial position. These tax losses can only be utilised in the future if there are taxable profits and if the continuity of ownership test is passed, or failing that, the same business test is passed.

Deferred tax assets not recognised

Deferred tax assets not recognised comprises temporary differences attributable to:

Timing differences Total deferred tax assets not recognised Potential tax benefit @ 26% (2020: 27.5%) Note 7 Cash and cash equivalents Cash on hand and at bank Total cash and cash equivalents Note 8 Trade and other receivables Other receivables Total trade and other receivables Note 9 Other assets (non-current) Deposits and bonds Total financial assets Note 10 Exploration and evaluation Exploration and evaluation phase - at cost Movement in exploration and evaluation asset: Opening balance - at cost Exploration expenditure during the period Exploration expenditure – Piccadilly purchase (note 24) Current year expenditure written off Carrying amount at the end of the period	7,832,235 5,325,336
	7,832,235 5,325,336
	2,036,381 1,464,467
	1,291,780 39,227
	1,291,780 39,227
	64,272 32,468
	64,272 32,468
	105,837 83,337
	105,837 **83,337 **
	6,993,850 4,754,881
	4,754,881 4,628,540 850,383 127,030 1,389,186 - (600) (689)
	6,993,850 4,754,881

Estimates and judgements

The consolidated entity makes critical judgements in respect of carrying forward exploration and evaluation assets in the Statement of Financial Position, and in evaluating the existence of any impairment triggers. Exploration and evaluation expenditure may be capitalised in certain circumstances. Directors review the commercial arrangements in relation to the renewal of mining tenements to ensure that the relationships are managed and activities are conducted to support carrying forward expenditure.

Recoverability of the carrying amount of exploration assets is dependent on the successful exploration and development of projects or alternatively through the sale of the areas of interest. Current year expenditure and prior year capitalised expenditure written-off represents expenditure on discontinued or surrendered mineral tenements.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

	Consolidated 2021 2020 $ $
Note 11 Trade and other payables Trade payables Other payables and accrued expenses Total trade and other payables Note 12 Employee benefits Annual leave Long Service Leave Total provisions Movements in employee benefits: Annual leave Opening balance Accrued Applied Closing balance Long Service Leave Opening balance Accrued Applied Closing balance Note 13 Borrowings Secured borrowings – Aquis Finance – Non-Current Borrowings – other – Current Total borrowings	290,377 263,808 170,018 463,851
	460,395 727,659
	90,967 69,432 62,570 48,661
	153,537 118,093
	69,432 55,289 28,643 22,000 (7,108) (7,857)
	90,967 69,432
	48,661 - 13,909 48,661 - -
	62,570 48,661
	- 4,978,551 - 157,500
	- 5,136,051

The loan from Aquis Finance Pty Ltd had an initial facility limit of $2 million and a term of 12 months commencing 10 March 2015, with variances changes made to this facility over the subsequent periods. On 31 January 2020, the Company announced that the parties had agreed to extend the current loan facility to 30 June 2022. The loan extension was subject to 5% p.a. interest (capitalised) and an immediate increase in the facility limit. Aquis Finance Pty Ltd also asked that they be able to convert the whole or part of the loan balance to shares in the Company during the loan term at an issue price of 2c per share (subject to shareholder approval if required), along with the possible appointment of two directors to the Board to represent their interests. On 1 September 2020, the Company announced that, contingent upon the satisfactory completion of the acquisition of Piccadilly Gold Mine Holdings Limited, the Lender would increase the current loan with immediate effect thereby increasing the facility limit to $6.1 million. On 7 September 2020, the Lender provided loan funds of $500,000 to the Company.

The facility conditions required no repayments until the expiration of the facility. The loan is secured by the assets of the Company. Other terms and conditions remain the same as the previous facility.

On 17 December 2020, the Company announced that it had agreed with its major lender Aquis Finance Pty Ltd that subject to shareholder approval the Company would issue 190,000,000 fully paid CAE shares in full and final satisfaction of the loan provided by Aquis (“Transaction”). The Transaction was overwhelmingly approved by shareholders on 16 April 2021 which saw the Aquis debt extinguished.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

		Consolidated 2021 2020 $ $
	Note 13 Borrowings (continued) The Directors have applied judgement to determine the impact of the repayment of the loan on the financial results of the Group for the year ended 30 June 2021. Key metrics used in the assessment were as follows: Loan balance at 16 April 2021 $5,706,835 Issue price per the Loan agreement with Aquis $0.02 No of shares that would have been issued to extinguish the debt at the issue price 285,341,771 Shares issued as approved by the shareholder 190,000,000 Benefit to CAE in shares 95,341,771 Share price at date of extinguishment 0.051 Loan extinguishment benefit 4,862,430

The Group were determined to have received a benefit from Aquis’ agreement for early repayment of $4,862,430 calculated as the number of shares which did not have to be issued multiplied by the share price at the date of the settlement ($0.051).

Short Term Loan

The additional loan comprised a short-term facility from a sophisticated investor. The loan was initially for a threemonth period which can be extended by mutual agreement at an interest rate of 25% per annum. The facility was repaid in full on 11 September 2020 and is now extinguished.

Note 14 Contributed Equity

(a) Fully paid ordinary share capital Movements in contributed equity during the year: Balance at the beginning of the reporting period Issued pursuant to share placements Issued to PGMH shareholders at $0.02 each to acquire PGMH Issued to Directors and consultants $0.02 each pursuant to Shareholder approval received at the AGM Issued to lenders to PGMH $0.02 each in full satisfaction of PGMH debts Issued to Aquis Finance in settlement of the loan from Aquis Total movements in issued capital during the year Less share issue costs Balance at reporting date Movements in the number of issued shares during the year: Balance at the beginning of the reporting period Issued pursuant to share placements Issued to PGMH shareholders at $0.02 each to acquire PGMH Issued to Directors and consultants $0.02 each pursuant to Shareholder approval received at the AGM Issued to lenders to PGMH $0.02 each in full satisfaction of PGMH debts Issued to Aquis Finance in settlement of the loan from Aquis Total movements in issued capital during the year Balance at reporting date	53,125,082 48,325,007
	48,325,007 48,229,514 2,389,968 145,041 966,363 - 392,176 - 424,900 - 844,405 -
	5,017,812 145,041 (217,737) (49,548)
	53,125,082 48,325,007
	2021 2020 No. No.
	193,272,682 181,185,946 46,437,334 12,086,736 48,318,170 - 19,608,795 - 21,245,000 - 190,000,000 -
	325,609,299 12,086,736
	518,881,981 193,272,682

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Consolidated
2021	2020
$	$

Note 14 Contributed Equity (continued)

Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion to the number of shares held. The fully paid ordinary shares have no par value. On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

Capital risk management

The Consolidated Entity's objectives when managing capital are to safeguard its ability to continue as a going concern and fund its operations. The Consolidated Entity's capital comprises borrowings, ordinary share capital, reserves and accumulated losses as disclosed in the statement of changes in equity. In common with many other exploration companies, the parent raises finance for the Consolidated Entity's exploration and appraisal activities in discrete tranches.

Management effectively manages the Consolidated Entity's capital by assessing the Consolidated Entity's financial risks and adjusting its capital structure in response to changes in these risks and in the market.

There are no externally imposed capital requirements.

The capital risk management policy remains unchanged from the 30 June 2020 Financial Report. The Consolidated Entity monitors capital on the basis of its working capital position (i.e. liquidity risk). The net working capital of the Consolidated Entity at 30 June 2021 was $742,120 (positive) (2020: $931,557 (negative) as a result of short term loans and other payables classified as current).

(b) Options

The Consolidated Entity had no options on issue during the financial years ended 30 June 2021 and 30 June 2020.

Note 15 Reserves

Share Option Reserve

The share option reserve records items recognised as expenses or issue costs on valuation of options. There were no movement or transactions during the year which impacted on the reserve.

Note 16 Financial Instruments

Financial risk management objectives

Risk management is carried out under policies set by the Board of Directors. The Board provides principles for overall risk management, as well as policies covering specific areas.

The Board monitors and manages the financial risk relating to the operations of the Consolidated Entity. The Consolidated Entity's activities expose it to a variety of financial risks: market risk (including foreign currency risk), price risk and interest rate risk, credit risk and liquidity risk. The Consolidated Entity'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 Consolidated Entity. The Consolidated Entity does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities denominated in a currency that is not the entity’s functional currency. The risk is measured using sensitivity analysis and cash flow forecasting.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 16 Financial Instruments (continued)

Market risk

Foreign currency risk

The Consolidated Entity may undertake certain transactions denominated in foreign currency and may become exposed to foreign currency risk through foreign exchange rate fluctuations.

Price risk

The Consolidated Entity is exposed to price risk through the movement of bullion prices. Under its Ore Purchase Agreement with Minjar Pty Ltd, the Company may receive revenue from gold ore sales based on the average gold price less haulage and processing costs incurred by Minjar. No gold sales were conducted during the year.

Interest rate risk

The economic entity’s exposure to interest rate risk is the risk that a financial instrument’s value will fluctuate as a result of changes in market interest rates.

As at the reporting date, the Consolidated Entity had the following variable rate investments:

, the Consolidated Entity had	the following	variable rate inves
	Weighted	Average Cash
	Average	Balance
	Interest	$
	Rate
2021
Cash and cash equivalents	0.01%	615,875
2020
Cash and cash equivalents	0.43%	77,016

Sensitivity Analysis

At 30 June 2021, if average interest rates had increased/decreased by 200 basis points with all other variables held constant, post-tax profit and total equity for the year would have been as follows:

	Consolidated	Consolidated
	2021	2020
	$	$
Change in profit and equity:
Increase in interest rate by 2%	12,317	1,540
Decrease in interest rate by 2%	(63)	(334)

Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Consolidated Entity. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial statements. The Consolidated Entity does not hold any collateral.

The Consolidated Entity does not have any significant exposure to credit risk from trade receivables. The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings assigned by international credit-rating agencies.

Liquidity risk

Vigilant liquidity risk management requires the Consolidated Entity to maintain sufficient liquid assets (mainly cash and cash equivalents) to be able to pay debts as and when they become due and payable.

The Consolidated Entity manages liquidity risk by continuously monitoring actual and forecast cash flows to ensure funds are available to meet liabilities.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 16 Financial Instruments (continued)

Maturity Analysis - 2021

Maturity Analysis - 2021
	Interest Rate	Carrying amount	< 6 months	6-12 months		1-3 years	> 3 years
		$	$	$		$	$
Financial Liabilities
Trade Creditors	0%	460,395	460,395		-	-		-
Total		460,395	460,395		-	-		-
Maturity Analysis - 2020
		Carrying amount	< 6 months	6-12 months		1-3 years	> 3 years
		$	$	$		$	$
Financial Liabilities
Trade Creditors	0%	727,659	727,659		-	-		-
Short term loan	25%	157,500	157,500		-	-		-
Loans and borrowings	2.3%	4,978,551	-		-	4,978,551		-
Total		5,863,710	885,159		-	4,978,551		-

Net fair values

The carrying amount of financial assets and financial liabilities recorded in the financial statements represents their respective net fair values, determined in accordance with the accounting policies disclosed in Note 1 to the financial statements.

Note 17 Key Management Personnel Disclosures

Transactions between related parties, other than those noted in the audited Remuneration Report are detailed at Note 20. Where transactions with related parties occur, they are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated.

Key management personnel remuneration includes the following expenses:

Short term employee benefits: Salaries Annual leave Long term benefits: Long service leave Post-employment benefits: Superannuation Total remuneration	Consolidated 2021 $ 2020 $
	380,300 383,583 21,535 14,143 13,908 48,661 25,489 26,068
	441,232 472,456

Note 18 Auditors’ Remuneration

During the financial year the following fees were paid or payable for services provided by Grant Thornton Audit Pty Ltd, the auditor of the Company:

Audit services

Audit or review of the financial statements

45,750 36,100

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 19 Commitments Committed at the reporting date but not recognised as liabilities: Lease commitments - mining leases: Within one year One to five years Mining exploration expenditure Within one year One to five years	Consolidated 2021 $ 2021 $
	83,553 58,491 357,565 252,047
	441,118 310,538
	1,845,500 928,000 5,755,500 1,763,000
	7,601,000 2,691,000

The Consolidated Entity has certain commitments imposed by the Queensland Department of Natural Resources and Mines to perform minimum exploration work on the tenements. These obligations, which may be varied from time to time, are subject to approval and are expected to be fulfilled in the normal course of operations of the Consolidated Entity. The exploration expenditure commitments are in line with those set in the Government approved work programs when tenements are approved or granted. Certain tenements held by the Consolidated Entity may be the subject of future Native Title claims. The Directors of the Company expect that existing operations will not be materially affected by any potential claims.

Note 20 Related Party Transactions

Parent entity

Cannindah Resources Limited is the parent entity.

Subsidiaries

Interests in subsidiaries are set out in note 22.

Interests in joint operations are set out in note 23.

Key management personnel

Disclosures relating to key management personnel are set out in note 17 and the remuneration report in the Directors' Report.

Transactions with related parties

At the Annual General Meeting of the Company, shareholders approved the issue of 19,608,795 shares at $0.02 each in repayment or partial repayment of fees outstanding at 30 June 2020.During the period fees totalling $30,700 to two Directors continued to be accrued. Of this amount $10,000 was repaid since the end of the year.

Terra Search, a company associated with non-executive Director, Dr Simon Beams provides geological services to the Company. Dr Beams was appointed as a director on 2 September 2019. During the year ended 30 June 2021, the Consolidated Entity paid $424,448 for these services. The services are contracted on an arm’s length basis. At 30 June 2021, $211,839 (2020: $124,374) was included in the Company’s trade creditors for services provided in respect of current and prior periods.

The Company rented office space until March 2020 and obtains IT services from entities associated with non-executive Director Mr Geoffrey Missen. During the year ended 30 June 2021, the Consolidated Entity paid $6,850 (2020: $32,087) for these services. The services are contracted on an arm’s length basis. At 30 June 2021, $1,593 (2020: $2,687) was included in the Company’s trade creditors for services provided during the period.

There were no loans to or from related parties at the current and previous reporting date.

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 21 Parent Entity Information

21 Parent Entity Information
Statement of Profit and Loss and Other Comprehensive Income Profit after income tax Total comprehensive income Statement of Financial Position Current assets Total assets Current liabilities Total liabilities Net assets Equity Issued capital Share option reserve Accumulated losses Total equity	2021 2020 $ $
	4,115,581 (1,371,858)
	4,115,581 (1,371,858)
	1,353,725 73,358
	10,451,326 6,904,414
	613,061 1,003,252
	613,061 5,981,804
	9,838,265 922,610
	53,125,082 48,325,007 395,614 395,614 (43,682,431) (47,798,011)
	9,838,265 922,610

Guarantees entered into by the parent entity in relation to the debts of its subsidiaries

The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2021 and 30 June 2020.

Contingent liabilities

The parent entity had no contingent liabilities at 30 June 2021 and 30 June 2020.

Capital commitments - Property, plant and equipment

The parent entity had no capital commitments for property, plant and equipment at 30 June 2021 and 30 June 2020.

Significant accounting policies

The accounting policies of the parent entity are consistent with those of the Consolidated Entity, as disclosed in note 1.

Note 22 Subsidiaries

The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 1:

Name	Principal Activity	Country of	Share	Ownership	Ownership
		Incorporation		Interest
				2021	2020
Mt Cannindah Mining Pty Ltd	Mineral exploration	Australia	Ordinary	100%	100%
Piccadilly Gold Mines Holding
Limited	Mineral exploration	Australia	Ordinary	100%	0%

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 23 Interests in Joint Operations

On 15 September 2017, the Company announced that it had signed an Earn-In Agreement with Piccadilly Gold Mine Holdings Limited to gain access to 174.35sq/km surrounding the mining lease at Piccadilly. The Agreement provided that EPMs 16198 and 18322 would be under the operational control of Cannindah Resources Limited. Key terms of the agreement were as follows:

• Phase 1 Earn-In - $400,000 to be spent on mining and exploration activities within ML 1442 and EPM’s 16198 and 18322 in the 6-month period commencing on the Effective Date to earn a 12.5% contractual interest in the Piccadilly Project. The Phase 1 Earn-in was completed in March 2020.

• Phase 2 Earn-In – a further $400,000 to be spent on mining and exploration activities within ML 1442 and EPM’s 16198 and 18322 in the 18-month period commencing on the Effective Date to earn an additional 12.5% contractual interest. The Phase 2 Earn-in must include at least 4 diamond drill holes on the EPM’s. If the Phase 2 Earn-In is not completed the Company will relinquish all interest in the project.

• At its option, the Company may enter into the Phase 3 Earn-In under which an additional $2.2 million must be spent within the 48-month period of the Effective Date on exploration and mining and a mineral resource of at least 250,000 ounces of gold or gold equivalent must be established to earn an additional 50% interest to bring the total interest to 75%.

All costs incurred under the Earn-In arrangement were capitalised on the Company’s balance sheet as exploration and evaluation expenditure.

On 1 September 2020, the Company announced that it had acquired 100% of the shares in its former earnin partner, Piccadilly Gold Mine Holdings Limited (PGMH) thereby bringing the Earn-in agreement to an end. This is outlined in note 24 below.

The Consolidated Entity has no other interests in joint ventures.

Note 24 Acquisition of Piccadilly Gold Mines Holdings Limited

On 1 September 2020, the Company announced that it had acquired 100% of the shares in its former earnin partner, Piccadilly Gold Mine Holdings Limited (PGMH). The acquisition is in line with the Company’s strategy set out in its recent quarterly and half-yearly reports to move to 100% control of the Piccadilly project owned by PGMH. The Piccadilly project comprises one mining lease ML 1442 and two EPM areas 18322 and 16198. The acquisition was also supported by the Company’s Lender, Aquis Finance, which agreed to increase the current loan to the company on the finalisation of the acquisition.

Consideration transferred .

The Company issued 48,318,170 ordinary shares in CAE to the various Piccadilly Gold Mine Holdings Limited shareholders to acquire 100% of the company and its project. The fair value of the ordinary shares issued of $966,363 was based on the listed share price of the Company at 31 August 2020 of $0.02 per share. The Company did not incur any direct costs as part of the acquisition.

Following the acquisition, the Directors commenced a corporate restructure of PGMH to repay secured and other substantial debts. This process was conducted by agreeing with PGMH’s lenders to issue 21,245,000 Shares at $0.02 per share ($424,900) in full and final satisfaction of loans and interest accrued totalling $2,146,810. This transaction was concluded on 23 December 2020.

The Directors have exercised judgement in determining that the PGMH acquisition did not meet the criteria for being treated as a business combination, and has been accounted for as an asset acquisition.

Relative fair value of the assets and liabilities acquired.

The Company has assessed that the relative fair values of the assets and liabilities acquired at the date of acquisition is represented by the fair value of the shares issued for their purchase. Thus, the fair values have been assessed as follows:

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 24 Acquisition of Piccadilly Gold Mines Holdings Limited (continued)

• Cash and other current assets are valued at the carrying amount of $2,077 at the date of acquisition;

• Loans ($2,124,437) and associated interest accrued ($22,372) are valued at the payout figure negotiated by Cannindah Resources Limited as the acquirer of the debt ($424,900) deemed to be the relative fair value; and

• The investment in the mining tenements represents the residual between the assets and liabilities acquired and the acquisition price i.e. $1,389,186 which is deemed to be its relative fair value as part of the asset purchase and has been recognised as exploration and evaluation expenditure

Cash and other current assets Exploration and evaluation expenditure Loans and borrowings Acquisition price	$ 2,077 1,389,186 (424,900)
	966,363

Note 25 Reconciliation of profit/(loss) after income tax to net cash used in operating activities

Profit/(loss) after income tax expense for the year Adjustments for: Benefit from loan extinguishment Write off of exploration and evaluation expenditure Financing expenses Creditors paid through issue of share capital Changes in operating assets/liabilities Decrease/(increase) in trade and other receivables Decrease/(increase) in other operating assets Increase/(decrease) in trade and other payables Increase/(decrease) in employee benefits Net cash used in operating activities Note 26 Earnings per share Basic and diluted earnings per share (cents per share) Weighted average number of ordinary shares outstanding during the period used in the calculation of basic and diluted EPS

Consolidated 2021 2020 $ $ 4,113,622 (1,373,642) (4,862,430) - 600 689 228,284 751,216 342,176 - (31,519) (5,666) (22,500) 500 (292,106) 226,426 35,444 62,804 (508,429) (337,673) 2021 2020 1.33 (0.72)

No. No. 308,724,235 191,079,371

CANNINDAH RESOURCES LIMITED NOTES TO THE FINANCIAL STATEMENTS for the year ended 30 June 2021

Note 27 Company Information

The registered office and principal place of business is as follows:

Level 3, 50 Marine Parade SOUTHPORT QLD 4215

Note 28 Authorisation of Financial Statements

The consolidated financial statements for the year ended 30 June 2021 (including comparatives) were approved and authorised for issue by the Board of Directors on 1 October 2021.

Note 29 Subsequent events

No other matters or circumstances have arisen since 30 June 2021, which significantly affect, or may significantly affect, the operations of the Company, the results of those operations, or the state of affairs of the Company in subsequent financial years.

CANNINDAH RESOURCES LIMITED DIRECTORS’ DECLARATION for the year ended 30 June 2021

In the Directors' opinion:

1. The attached financial statements and notes thereto comply with the Corporations Act 2001, the Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements;

2. The attached financial statements and notes thereto comply with International Financial Reporting Standards as issued by the International Accounting Standards Board as described in note 1 to the financial statements;

3. The attached financial statements and notes thereto give a true and fair view of the Consolidated Entity's financial position as at 30 June 2021 and of its performance for the financial year ended on that date; and

4. There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

5. The Directors have been given the declarations required by section 295A of the Corporations Act 2001.

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

On behalf of the Directors

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---

Thomas J Pickett Executive Chairman 1 October 2021 Gold Coast

Level 18 King George Central 145 Ann Street Brisbane QLD 4000

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Correspondence to: GPO Box 1008 Brisbane QLD 4001

T +61 7 3222 0200 F +61 7 3222 0444 E info.qld@au.gt.com W www.grantthornton.com.au

Independent Auditor’s Report

To the Members of Cannindah Resources Limited

Report on the audit of the financial report

Opinion

We have audited the financial report of Cannindah Resources Limited (the Company) and its subsidiaries (the Group), which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of profit or loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, notes to the consolidated financial statements, including a summary of significant accounting policies, and the Directors’ declaration.

In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001 , including:

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

• b complying with Australian Accounting Standards and the Corporations Regulations 2001 .

Basis for opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

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

Material uncertainty related to going concern

We draw attention to Note 1 in the financial statements, which indicates that while the Group realised a net profit of $4,113,622 during the year ended 30 June 2021. This included a non-cash gain on the extinguishment of the finance facility of $4,862,430. Operating cash outflows for the period were $508,429. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

www.grantthornton.com.au

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

Liability limited by a scheme approved under Professional Standards Legislation.

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Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

In addition to the matter described in the Material uncertainty related to going concern section, we have determined the matters described below to be the key audit matters to be communicated in our report.

Key audit matter	How our audit addressed the key audit matter
Exploration and evaluation assets - Notes 2 & 10
At 30 June 2021 the carrying value of Exploration and	Our procedures included, amongst others:
Evaluation Assets was $6,993,850.	�Obtaining the management prepared reconciliation of
In accordance with AASB 6_Exploration for and Evaluation of_	capitalised exploration and evaluation expenditure and
Mineral Resources, the company is required to assess at each	agreeing to the general ledger;
reporting date if there are any triggers for impairment which may suggest the carrying value is in excess of the recoverable value.	�Reviewing management’s area of interest considerations against AASB 6;
The process undertaken by management to assess whether	�Conducting a detailed review of management’s assessment of
there are any impairment triggers in each area of interest	trigger events prepared in accordance with AASB 6 including;
requires management judgement.	- Tracing projects to statutory registers and exploration
This area was a key audit matter due to the significant	licenses to determine whether a right of tenure existed;
judgement involved in assessing whether there are facts and
circumstances that exist that indicate Management should test	- Enquiring of management regarding their intentions to
the exploration and evaluation assets for impairment.	carry out exploration and evaluation activity in the relevant
	exploration area, including review of managements’
	budgeted expenditure;
	- Understanding whether any data exists to suggest that the
	carrying value of these exploration and evaluation assets
	are unlikely to be recovered through development or sale;
	�Evaluating the competence, capabilities and objectivity of
	management’s expert in the evaluation of potential impairment
	triggers; and
	�Assessing the appropriateness of the related disclosures within
	the financial statements.

Financial liability modification and extinguishment through issue of equity - Note 13

Financial liability modification and extinguishment through issue of equity - Note 13
In April 2021, the Group completed a debt for equity swap for	Our procedures included, amongst others:
the outstanding financial liability with the external financier, resulting in a total of 190 million fully paid ordinary shares being issued in order to satisfy the outstanding liability of $5.7	�Reviewing correspondence between the Group and their external financier in relation to the transaction;
million.	�Assessing management’s key estimates and judgements in
Particular consideration was given as to the accounting for	determining the appropriate recognition and measurement of
this transaction in line with AASB 132_Financial Instruments_.	the equity instruments issued in full satisfaction of the
Consideration of the accounting for this transaction is considered complex and multi-faceted. In particular, there was	outstanding debt owing for reasonableness and appropriateness;
significant judgement applied in determining the debt	�Evaluating the appropriateness of management’s conclusions
modification and extinguishment date, and resulting fair value	around the treatment of the debt extinguishment with reference
of the equity issued.	to AASB 132_Financial Instruments_; and
This was a key audit matter as the amount is material and the treatment, including the assessment of equity value and transaction with a significant shareholder, is complex.	� Assessing the adequacy of disclosures in the financial report in relation to this transaction in note 13.

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Information other than the financial report and auditor’s report thereon

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

Our opinion on the financial report does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors’ for the financial report

The Directors of the Group are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the Directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report.

A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar1_2020.pdf. This description forms part of our auditor’s report.

Report on the remuneration report

Opinion on the remuneration report

We have audited the Remuneration Report included in pages 3 to 7 of the Directors’ report for the year ended 30 June 2021.

In our opinion, the Remuneration Report of Cannindah Resources Limited, for the year ended 30 June 2021 complies with section 300A of the Corporations Act 2001 .

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Responsibilities

The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001 . Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.

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Grant Thornton Audit Pty Ltd Chartered Accountants

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M C Bragg Partner – Audit & Assurance Brisbane, 1 October 2021