DREADNOUGHT RESOURCES LTD — Annual Report 2016

Aug 2, 2016

Tychean Resources Ltd

Financial Statements

For the Year Ended 30 June 2016

	Page
Financial Statements
Directors' Report	3
Auditor’s Independence Declaration	15
Statement of Profit or Loss and Other Comprehensive Income	16
Statement of Financial Position	17
Statement of Changes in Equity	18
Statement of Cash Flows	19
Notes to the Financial Statements	20
Directors' Declaration	54
Independent Audit Report	55

TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

Your directors present their report on the consolidated entity (referred to hereafter as the Group) consisting of Tychean Resources Limited (referred to hereafter as the Parent Entity or the Company) and the entities it controlled at the end of, or during, the year ended 30 June 2016.

DIRECTORS

The following persons were directors of the Parent Entity during the whole of the financial year and up to the date of this report, unless otherwise stated:

Robert Michael Kennedy

(Non-executive Chairman)

Joseph Fred Houldsworth

(Managing Director) Resigned 1 September 2015

Ewan John Vickery

(Non-executive Director)

Ian Witton

(Alternate director for R M Kennedy and E J Vickery)

Dr. Kevin John Anson Wills

(Non-executive Director) Appointed 1 September 2015

PRINCIPAL ACTIVITIES

The principal activities of the Group during the financial year were natural resources exploration and development. There were no significant changes in the nature of activities of the Group during the year.

DIVIDENDS

No dividends have been declared or paid during the year (2015: Nil).

OPERATING RESULTS AND FINANCIAL POSITION

The net result of operations for the financial year was a loss of $3,677,163 (2015: $681,148).

The net assets of the Group have decreased by $3,394,364 during the financial year from $3,857,137 at 30 June 2015 to $462,773 at 30 June 2016.

Review of operations

CORPORATE Activities

During the Reporting Period, the Company carried out the following Capital Raisings:

• On 15th December 2015, Tychean announced a placement to sophisticated and professional investors totalling $135,000 for working capital and due diligence on new opportunities.

• A Research & Development claim for the sum of $48,478 was received by Tychean on 23 September 2015.

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

PROJECTS

The 2016 financial year has seen the Company’s major efforts focused on exploring its Spargoville Gold Project located in the eastern goldfields of Western Australia.

Spargoville Gold Project (WA)

In early July 2015, Tychean completed the Redback RC/Diamond Drilling program which consisted of 9 drill holes for a total of 1,931.80 metres, at the Spargoville Gold Project in the Eastern Goldfields of Western Australia.

On 6th July 2015, Tychean issued 75,000,000 new shares to Blue Spec Drilling as part consideration for those drilling activities.

On 5th August 2015, Tychean secured an agreement with Maximus Resources Limited (ASX: MXR, ‘Maximus’) via which Maximus would fund up to $1.2 million in exploration and development of the Spargoville Gold Project. Terms of the JV agreement were as follows:

• Tychean to receive $200,000 in cash followed by a further equivalent value in Maximus shares upon transfer of 25% interest in the Project; and

• Maximus to earn up to 90% equity by spending a further $800,000 in exploration activities within 3 years.

On 17 November 2015, Maximus achieved its Spargoville Gold project expenditure milestone and earned a 51% equity interest by meeting Stage 1 of the earn-in commitment.

On the 17 February 2016, the Company signed a Sale and Purchase agreement with Maximus Resources Limited under the following terms and conditions:

• Transfer of the previously agreed shares equivalent to the value of $200,000 immediately upon execution, which was received on 18 February 2016

• Transfer of additional shares equivalent to the value $50,000 upon conditions being met in accordance with the agreement

• Expenditure commitment of A$800,000 in ground to earn 90% equity over the Spargoville gold rights was removed; and

• Cancellation of the Tychean gold royalty.

Tanami Project (NT)

In October 2015, Joint Venturer Ramelius Resources (ASX: RMS, ‘Ramelius’) conducted 1,346 metres of drilling over the priority Suplejack tenement North of NT based Callie Gold mine.

Ramelius received notice of intention to grant three key exploration licenses within the Tanami Joint Venture Project from the Department of Mines and Energy Northern Territory

Ramelius advised Tychean that it had met its earn-in expenditure commitment and had acquired an 85% interest in the Tanami Joint Venture. Tychean retains free carried 15% interest in the Joint Venture through to decision to mine.

Follow-up drilling is planned to commence as soon as is possible in the next field season.

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR

There are no matters or circumstances that have arisen since 30 June 2016 that has significantly affected, or may significantly affect:

• (a) the Group’s operations in future financial years, or

• (b) the results of those operations in future financial years, or

• (c) the Group’s state of affairs in future financial years.

FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGY

The Board of Tychean Resources Limited considers that, in the current environment of constrained capital, the best interests of shareholders in the Company will be served by seeking a balanced approach by the Group in joint venture/alliances with other parties and sourcing new opportunities in both exploration and other sectors.

The primary future development focus will be directed at detailed due diligence on new opportunities.

ENVIRONMENTAL REGULATION

The Group’s operations are subject to significant environmental regulation under both Commonwealth and relevant State legislation in relation to discharge of hazardous waste and materials arising from any exploration or mining activities and development conducted by the Group on any of its tenements. The Group considers it has complied with all environmental obligations.

Apart from the above, there has not risen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the directors, to affect significantly the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial years.

INFORMATION ON DIRECTORS

ROBERT MICHAEL KENNEDY KSJ, ASAIT, Grad Dip (Systems Analysis), Dip Financial Planning, Dip Financial Services, FCA, AGIA, Life Member AIM, FAICD, FTI

Independent Non-Executive Chairman

Experience and Expertise

Mr Kennedy, a Chartered Accountant, has been a non-executive chairman of Tychean Resources Ltd since 2006.

Mr Kennedy brings to the Board his expertise and extensive experience as Chairman and non-executive director of a range of listed public companies in the resources sector.

Apart from his attendance at Board and Committee meetings, Mr Kennedy leads the development of strategies for the development and future growth of the Company. Mr Kennedy leads the Board’s external engagement of the Company meeting with Government, investors and is engaged with the media. He is a regular attendee of Audit Committee functions of the major accounting firms. He conducts the review of the Board including the Managing Director in his executive role.

Independence

Whilst Mr Kennedy has been appointed to a number of Resource Industry Boards, due to his knowledge of the industry and the companies all operating domestically, the time required across these companies in no way impedes on his dedication to his role as Chairman of the Board. In taking all of these issues into account, the Board (excluding Mr Kennedy), were unanimous in

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

declaring Mr Kennedy as independent.

Other current directorships in the last 3 years

Mr Kennedy is a director of ASX listed companies, Flinders Mines Limited (since December 2001), Ramelius Resources Limited (since listing in March 2003), Monax Mining Limited since 2004, and Maximus Resources Limited (since December 2004).

Former directorships in the last 3 years

Formerly he was a director of Crestal Petroleum Limited (formerly Tellus Resources Ltd from 2013 to 2015) and Marmota Energy Limited (from April 2006 to April 2015).

Special Responsibilities

Chairman of the Board.

Member of the Audit Committee.

Interests in shares and options

20,000,002 ordinary shares in Tychean Resources Ltd.

JOSEPH HOULDSWORTH

Managing Director (resigned 1 September 2015)

Experience and expertise

Mr. Houldsworth joined Tychean Resources Limited as Managing Director in May 2013. He has over 30 years’ experience in the resources industry at both operational and management levels primarily in the Western Australian Goldfields. He is the former Managing Director of Ramelius Resources Limited and was instrumental in turning the Company into a highly profitable gold miner. He is a former consultant for 10 years to insolvency specialists on both mining and exploration and has had considerable experience in asset management for various mining entities. Mr. Houldsworth resigned from Directorship on 1 September 2015.

Other current directorships

None.

Former directorships in the last 3 years

None.

Interests in shares, options and rights

1,047,620 ordinary shares in the Company.

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

EWAN JOHN VICKERY LL.B.

Non-executive Director

Experience and expertise

A director since May 2013, Mr Vickery is a corporate and business lawyer with over 40 years’ experience in private practice in Adelaide. He has acted as an advisor to companies on a variety of corporate and business issues including capital and corporate restructuring, native title and land access issues, and as lead native title advisor and negotiator for numerous mining and petroleum companies.

He is a member of the Exploration Committee of the South Australian Chamber of Mines and Energy Inc, the International Bar Association Energy and Resources Law Section, the Australian Institute of Company Directors and is a past national president and Life Member of Australian Mining and Petroleum Law Association (AMPLA Limited).

Other current directorships

Mr Vickery is also a Non-Executive Director of ASX listed company Maximus Resources Limited (since 2004), Flinders Mines Limited (since 2001) and he re-joined the Board of Tychean Resources Limited (formerly ERO Mining Limited) in May 2013.

Former directorships in the last 3 years

None.

Special Responsibilities

Chairman of the Audit Committee.

Interests in shares, options and rights

4,250,002 ordinary shares in the Company.

IAN ROY WITTON Snr Assoc Dip Accy (SAIT), FCPA, FAICD Alternate Director for Mr R M Kennedy and Mr E W Vickery

Experience and expertise

Mr Witton has been a company director on various boards for over 26 years. Originally qualified as a CPA he worked as an auditor and taxation agent and was subsequently appointed CEO and later Managing Director for over 27 years of a Licensed Investment Dealer developing and managing superannuation and investment funds, savings, loans and a retirement village. His principal experience is in funds and investment management, strategic development, risk management and corporate governance.

Other current directorships

Mr Witton is also a director of a pharmacy and optical company, a public charitable trust fund and he is an alternate director for ASX listed company Monax Mining limited.

Former directorships in the last 3 years

None.

Interests in shares, options and rights

246,889 ordinary shares in the Company.

DR. KEVIN JOHN ANSON WILLS BSc, Ph.D., ARSM, FAusIMM

Non-executive Director

Experience and expertise

Dr. Wills is a geologist with 40 years global experience in multi commodity exploration, feasibility studies, mine operations and corporate management. He has been closely involved in the discovery and evaluation of six economic mineral deposits including: diamonds (Argyle WA), base metals (Thalanga & Waterloo QLD), gold (Murchison and Challenger SA), mineral sands (Burekup WA) and iron ore (Blacksmith WA). Dr. Wills was Managing Director of Flinders Mines Limited for over ten

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

years from conception until August 2010. During this period at Flinders Mines located significant iron Ore resources at the Blacksmith Project in the Pilbara Region of Western Australia. In November 2010, he was appointed an Adjunct Associate Professor at the University of Adelaide to engage in teaching economic and mine geology. He is an associate of the Royal School of Mines, past Chairman of the SA Division of the Geological Society of Australia and past Chairman of the Adelaide Branch and Fellow of the Australiasian Institute of Mining and Metallurgy.

Other current directorships

To be confirmed

Former directorships in the last 3 years

To be confirmed

Interests in shares, options and rights

133,195 ordinary shares in the Company

COMPANY SECRETARY

Justin Paul Nelson LL.B., B.A.(Jur)

Experience and expertise

Mr Nelson was appointed Company Secretary on 1 August 2012. He is a Principal of DMAW Lawyers. He is a former South Australian State Manager of ASX and is experienced in the listed company environment. He has excellent knowledge of the ASX Listing Rules, governance and all other aspects of ASX related matters. Mr. Nelson resigned as Company Secretary on 1 September 2015.

Kaitlin Louise Smith B.Com (Acc) CA

Experience and expertise

Ms Smith was appointed Company Secretary on 1 September 2015. Ms Smith provides the Company Secretarial and Accounting role to various public and proprietary companies. She holds a Bachelor of Commerce (Accounting) and is a Chartered Accountant.

Interests in shares, options and rights

nil

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

Meetings of directors

The numbers of meetings of the Company's board of directors and of each board committee held during the year ended 30 June 2016, and the numbers of meetings attended by each director were:

	Full	meetings		Audit	Remuneration	Remuneration
	of directors		committee		committee
			meetings		meetings
	A	B	A	B	A	B
Robert Michael Kennedy	15	15	3	3	1	1
Joseph Fred Houldsworth	5	5	1	1	0	0
Kevin John Anson Wills	15	15	3	3	1	1
Ewan John Vickery	11	11	0	0	0	0
Ian Roy Witton	2	2	0	0	0	0

A = Number of meetings attended

B = Number of meetings held during the time the director held office or was a member of the committee during the year and was eligible to attend.

Indemnification and insurance of officers

The Group is required to indemnify the directors and other officers of the Company and its Australian-based controlled entities against any liabilities incurred by the directors and officers that may arise from their position as directors and officers of the Group. No costs were incurred during the year pursuant to this indemnity.

The companies within the Group have entered into deeds of indemnity with each director whereby, to the extent permitted by the Corporations Act 2001 , the Group agreed to indemnify each director against all loss and liability incurred as an officer of the relevant company, including all liability in defending any relevant proceedings.

Insurance premiums

Since the end of the previous year the Group has paid insurance premiums of $17,770 to insure the directors and officers in respect of directors' and officers' liability and legal expenses insurance contracts.

Proceedings on behalf of the Group

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

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

Non-audit services

The Board of Directors, in accordance with advice from the Audit Committee, is satisfied that the provision of non-audit services during the year is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001 . The directors are satisfied that the services disclosed below did not compromise the external auditor’s independence for the following reasons:

• all non-audit services are reviewed and approved by the Audit Committee prior to commencement to ensure they do not adversely affect the integrity and objectivity of the auditor; and

• the nature of the services provided do not compromise the general principles relating to auditor independence in

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

accordance with APES 110: Code of Ethics for Professional Accountants set by the Accounting Professional and Ethical Standards Board.

There were no fees for non-audit services paid or payable to the external auditors of the Parent Entity, its related practices or non-related audit firms during the year ended 30 June 2016.

Shares under option

There are no unissued ordinary shares of Tychean Resources Limited under option at the date of this report.

Shares issued on the exercise of options

The following ordinary shares of Tychean Resources Limited were issued during the year ended 30 June 2016 and up to the date of this report on the exercise of options granted:

	Exercise	Number of
Date shares issued	price	shares issued
2 July 2015	0.004	1,135
9 July 2015	0.004	2,225
24 July 2015	0.004	78,705
3 August 2015	0.004	7,965
16 September 2015	0.004	1,920
15 January 2016	0.04	5,000

Remuneration report – audited

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 Share-based compensation D Shareholdings E Use of Remuneration Consultants

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

A Principles used to determine the nature and amount of remuneration

The Group's policy for determining the nature and amounts of emoluments of board members and senior executive officers of the Group is as follows:

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

Remuneration report – audited (continued)

The Company's Constitution specifies that the total amount of remuneration of non-executive directors shall be fixed from time to time by a general meeting. The current maximum aggregate remuneration of non-executive directors has been set at $300,000 per annum. Directors may apportion any amount up to this maximum amount amongst the non-executive directors as they determine. Directors are also entitled to be paid reasonable travelling, accommodation and other expenses incurred in performing their duties as directors. The remuneration of the Managing Director is determined by the non-executive directors on the Board as part of the terms and conditions of his employment which are subject to review from time to time. The remuneration of other executive officers and employees is determined by the Managing Director subject to the approval of the Board.

Non-executive director remuneration is by way of fees and statutory superannuation contributions. Non-executive directors do not participate in schemes designed for remuneration of executives nor do they receive options or bonus payments and are not provided with retirement benefits other than salary sacrifice and statutory superannuation.

The Company's remuneration structure is based on a number of factors including the particular experience and performance of the individual in meeting key objectives of the Company. The Board is responsible for assessing relevant employment market conditions and achieving the overall, long term objective of maximising shareholder benefits, through the retention of high quality personnel.

The Company does not presently emphasise payment for results through the provision of cash bonus schemes or other incentive payments based on key performance indicators of the Company given the nature of the Company's business as a mineral exploration entity and the current status of its activities. However the Board may approve the payment of cash bonuses from time to time in order to reward individual executive performance in achieving key objectives as considered appropriate by the Board.

The Company also has an Employee Share Option Plan approved by shareholders that enables the Board to offer eligible employees options to acquire ordinary fully paid shares in the Company. Under the terms of the Plan, options for ordinary fully paid shares may be offered to the Company's eligible employees at no cost unless otherwise determined by the Board in accordance with the terms and conditions of the Plan. The objective of the Plan is to align the interests of employees and shareholders by providing employees of the Company with the opportunity to participate in the equity of the Company as an incentive to achieve greater success and profitability for the Company and to maximise the long term performance of the Company.

The employment conditions of the Managing Director, Mr Houldsworth are formalised in a contract of employment. The base salary as set out in the employment contract is reviewed annually. The Managing Director’s contract may be terminated at any time on three months’ notice by either party. The Company may terminate these contracts without notice in serious instances of misconduct. Mr Houldsworth resigned as Managing Director on 1 September 2015.

Voting and comments made at the company’s 2015 Annual General Meeting

Tychean Resources Limited received more than 95% of ‘yes’ votes on its remuneration report for the 2015 financial year. The company did not receive any specific feedback at the AGM or throughout the year on its remuneration practices.

B Details of remuneration

This report details the nature and amount of remuneration for each key management person of the Company.

The names and positions held by directors and key management personnel of the Company during the financial year are:

• Mr R M Kennedy - Chairman, non-executive

• Mr J F Houldsworth – Managing Director (resigned 1 September 2015)

• Mr E J Vickery – Director, non-executive

• Mr I R Witton - Alternate director for R M Kennedy (since 26 August 2010) and E J Vickery (since 26 June 2013)

• Dr K J A Wills – Director, non-executive (appointed 1 September 2015)

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

Key management personnel of the Group and other executives of the Company and the Group

2016	Short-term employee benefits	Post- employment benefits	Share- based payments
Name	Salary $	Super- annuation $	Options $	Total $
Non-executive directors Robert Michael Kennedy Ewan John Vickery Ian Roy Witton Kevin John Anson Wills Managing Director Joe Houldsworth (resigned 1 September 2015)	41,142 24,886 4,566 27,250 11,416	3,908 2,364 434 - 1,084	- - - - -	45,050 27,250 5,000 27,250 12,500
Total key managementpersonnel compensation(Group)	109,260	7,790	-	117,050

Key management personnel of the Group and other executives of the Company and the Group

2015	Short-term employee benefits	Post- employment benefits	Share- based payments
Name	Salary $	Super- annuation $	Options $	Total $
Non-executive directors Robert Michael Kennedy Ewan John Vickery Kevin John Anson Wills Managing Director Joe Houldsworth	82,283 49,772 - 191,781	7,817 4,728 - 18,219	- - - -	90,100 54,500 - 210,000
Total key managementpersonnel compensation(Group)	323,836	30,764	-	354,600

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

Remuneration report – audited (continued)

C Share based compensation

Employee Share Option Plan

Shares issued on exercise of remuneration options

The Company has an Employee Share Option Plan approved by shareholders that enables the Board to offer eligible employees options to acquire ordinary fully paid shares in the Company. Under the terms of the Plan, options to acquire ordinary fully paid shares may be offered to the Company's eligible employees at no cost unless otherwise determined by the Board in accordance with the terms and conditions of the Plan. There were no employee share options issued during the financial year.

Options granted as remuneration

No options were granted to directors or key management personnel of the Company during the financial year.

Shares issued on exercise of remuneration options

No shares were issued to directors as a result of the exercise of remuneration options during the financial year.

Directors' interests in shares and options

Directors' relevant interests in shares and options of the Company are disclosed below.

Options

The number of options held by each key management person of the Group during the financial year is as follows:

30 June 2016 Directors Robert Kennedy Ewan Vickery Joseph Houldsworth Kevin Wills Ian Witton	Balance at beginning of year Issued as remuneration 25,666,644 - 5,000,001 - 6,891,270 - - - 224,444 -	Purchased (exercised/ expired) (25,666,644) (5,000,001) (6,891,270) - (224,444)	Acquired/ (disposed) - - - - -	Balance at the end of year Vested and exercisable Unvested - - - - - - - - - - - - - - -
	37,782,359 -	(37,782,359)	-	- - -

No options were issued as remuneration to KMP.

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TYCHEAN RESOURCES LIMITED

DIRECTORS’ REPORT

Remuneration report – audited (continued)

D Shareholdings

The number of ordinary shares in Tychean Resources Ltd held by each key management person of the Group during the financial year is as follows:

cial year is as follows:
30 June 2016 Directors Robert Kennedy Ewan Vickery Joseph Houldsworth Kevin Wills Ian Witton	Balance at beginning of year Granted as remuneration during the year Issued on exercise of options during the year Other changes during the year Balance at end of year 200,000,001 - - (179,999,999) 20,000,002 42,500,001 - - (38,249,999) 4,250,002 63,053,970 - - (63,053,970) - - - - 133,195 133,195 2,468,888 - - (2,221,999) 246,889
	308,022,860 - -(283,392,772) 24,630,088

E Use of Remuneration Consultants

The Remuneration Committee seeks external remuneration advice as required. No such advice was obtained during the financial year ending 30 June 2016.

Remuneration report ends.

A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 15.

The Report of Directors, incorporating the Remuneration Report, is signed in accordance with a resolution of the Board of Directors.

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Robert Kennedy

Chairman

Dated 2 August 2016

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Level 1, 67 Greenhill Rd Wayville SA 5034

Correspondence to: GPO Box 1270 Adelaide SA 5001

T 61 8 8372 6666 F 61 8 8372 6677 E info.sa@au.gt.com W www.grantthornton.com.au

AUDITOR’S INDEPENDENCE DECLARATION TO THE DIRECTORS OF TYCHEAN RESOURCES LIMITED

In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Tychean Resources Limited for the year ended 30 June 2016, I declare that, to the best of my knowledge and belief, there have been:

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

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

GRANT THORNTON AUDIT PTY LTD Chartered Accountants

S K Edwards Partner – Audit & Assurance

Adelaide, 2 August 2016

Grant Thornton Audit Pty Ltd ACN 130 913 594

a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

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

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Consolidated Statement of Profit or Loss and Other Comprehensive Income

For the Year Ended 30 June 2016

		Consolidated year ended	Consolidated year ended
		30 June 2016 30	June 2015
	Note	$	$
Revenue	2	352,251	19,894
Administration expenses	3	(562,783)	(742,270)
General exploration written off	3	(7,941)	(6,485)
Impairment of exploration expenditure	3	(3,505,983)	-
(Loss) before income tax		(3,724,456)	(728,861)
Income tax benefit (expense)	4	47,293	47,713
(Loss) for the year		(3,677,163)	(681,148)
Other comprehensive income, net of income tax		-	-
Total comprehensive income for the year		(3,677,163)	(681,148)
Earnings per share for loss attributable to the ordinary equity holders of the Company
	Note	Cents
Cents
Basic earnings per share (cents)	14	(1.38)	(0.03)
Diluted earnings per share (cents)	14	(1.38)	(0.03)

The above consolidated statement of profit or loss and comprehensive income should be read in conjunction with the accompanying notes.

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Consolidated Statement of Financial Position

As at 30 June 2016

Note ASSETS Current Assets Cash and cash equivalents 6 Trade and other receivables 7 Other assets 9 Total Current Assets Non-Current Assets Property, plant and equipment 8 Exploration, evaluation and development assets 10 Total Non-Current Assets Total Assets LIABILITIES Current Liabilities Trade and other payables 11 Employee benefits 12 Total Current Liabilities Non-Current Liabilities Total Liabilities Net Assets EQUITY Issued capital 13 Reserves Retained earnings Total Equity	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 288,331 102,522 53,040 36,294 4,601 10,838
	345,972 149,654
	6,303 10,124 252,521 4,096,218
	258,824 4,106,342
	604,796 4,255,996
	142,023 381,720 - 17,139
	142,023 398,859
	- -
	142,023 398,859
	462,773 3,857,137
	37,324,853 37,042,054 - 1,083,478 (36,862,080) (34,268,395)
	462,773 3,857,137

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

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Consolidated Statement of Changes in Equity

For the Year Ended 30 June 2016

Balance at 1 July 2014 Loss for year Total comprehensive income for the year Transactions with owners in their capacity as owners Contributions of equity, net of transaction costs and tax Balance at 30 June 2015 Balance at 1 July 2015 Loss for year Total comprehensive income for the year Transactions with owners in their capacity as owners Contributions of equity, net of transaction costs and tax Share Options expired Balance at 30 June 2016	Attributable to owners of the Tychean Resources Limited Issued Capital $ Retained Earnings $ Reserves $ Total $ 35,437,223 (33,587,247) 1,083,478 2,933,454
	- (681,148) - (681,148)
	- (681,148) - (681,148)
	1,604,831 - - 1,604,831
	1,604,831 - - 1,604,831
	37,042,054 (34,268,395) 1,083,478 3,857,137
	37,042,054 (34,268,395) 1,083,478 3,857,137 - (3,677,163) - (3,677,163)
	- (3,677,163) - (3,677,163)
	282,799 - - 282,799 1,083,478 (1,083,478) -
	282,799 - - 282,799
	37,324,853 (36,862,080) - 462,773

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

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Consolidated Statement of Cash Flows

For the Year Ended 30 June 2016

Note CASH FLOWS FROM OPERATING ACTIVITIES: Receipts from customers Payments to suppliers and employees Research and development tax received Interest received Net cash (used in) operating activities 23 CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property, plant and equipment Payments for exploration assets Proceeds from the sale of investments Proceeds from sale of exploration assets Net cash used by investing activities CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issue of shares Net cash provided by financing activities Net (decrease) increase in cash and cash equivalents held Cash and cash equivalents at beginning of year Cash and cash equivalents at end of financial year 6	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 8,000 6,000 (650,154) (753,355) 48,478 96,541 2,212 13,894
	(591,464) (639,920)
	- (11,138) (97,065) (1,819,762) 541,539 - 200,000 -
	644,474 (1,830,900)
	132,799 1,474,056
	132,799 1,474,056
	185,809 (996,764) 102,522 1,099,286
	288,331 102,522

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

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements

For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies

The principal accounting policies adopted in the preparation of these consolidated Financial Statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated. The Financial Statements are for the consolidated entity consisting of Tychean Resources Limited and its subsidiaries.

(a) Basis of Preparation

These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and interpretations issued by the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. Tychean Resources Limited is a for profit entity for the purpose of preparing the financial statements.

(i) Compliance with IFRS These consolidated financial statements also comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

• (ii) New and amended standards adopted by the Group.

A number of new and revised standards became effective for the first time to annual periods beginning on or after 1 July 2015. Information on the more significant standard(s) is presented below.

• AASB 2015-4 Amendments to Australian Accounting Standards – Financial Reporting Requirements for Australian Groups with a Foreign Parent.

• AASB 2015-4 amends AASB 128 Investments in Associates and Joint Ventures to ensure that its reporting requirements on Australian groups with a foreign parent align with those currently available in AASB 10 Consolidated Financial Statements for such groups. AASB 128 will now only require the ultimate Australian entity to apply the equity method in accounting for interests in associates and joint ventures, if either the entity or the group is a reporting entity, or both the entity and group are reporting entities.

• AASB 2015-4 is applicable to annual reporting periods beginning on or after 1 July 2015.

The adoption of this amendment has not had a material impact on the Group.

(b) Basis of Consolidation

The Group financial statements consolidate those of the Parent and all of its subsidiaries as of 30 June 2016. The Parent controls a subsidiary if it 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. All subsidiaries have a reporting date of 30 June. All transactions and balances between Group companies are eliminated on consolidation, including unrealised gains and losses on transactions between Group companies. Where unrealised losses on intra-group asset sales are reversed on consolidation, the underlying asset is also tested for impairment from a group perspective. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Group.

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.

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.

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

(c) Business combinations

Business combinations are accounted for by applying the acquisition method which requires an acquiring entity to be identified in all cases. The acquisition date under this method is the date that the acquiring entity obtains control over the acquired entity.

The fair value of identifiable assets and liabilities acquired are recognised in the consolidated financial statements at the acquisition date.

On the acquisition date the consideration transferred is compared with the fair value of the net identifiable assets acquired. The excess of consideration over the assets acquired is recorded as an exploration & evaluation asset.

(d) Investments in associates and joint ventures

Associates are those entities over which the Group is able to exert significant influence but which are not subsidiaries.

A joint venture is an arrangement that the Group controls jointly with one or more other investors, and over which the Group has rights to a share of the arrangement’s net assets rather than direct rights to underlying assets and obligations for underlying liabilities. A joint arrangement in which the Group has direct rights to underlying assets and obligations for underlying liabilities is classified as a joint operation.

Investments in associates and joint ventures are accounted for using the equity method. Interests in joint operations are accounted for by recognising the Group assets (including its share of any assets held jointly), its liabilities (including its share of any liabilities incurred jointly), its revenue from the sale of its share of the output arising from the joint operation, its share of the revenue from the sale of the output by the joint operation and its expenses (including its share of any expenses incurred jointly).

Any goodwill or fair value adjustment attributable to the Group’s share in the associate or joint venture is not recognised separately and is included in the amount recognised as investment.

The carrying amount of the investment in associates and joint ventures is increased or decreased to recognise the Group’s share of the profit or loss and other comprehensive income of the associate and joint venture, adjusted where necessary to ensure consistency with the accounting policies of the Group.

Unrealised gains and losses on transactions between the Group and its associates and joint ventures are eliminated to the extent of the Group interest in those entities. Where unrealised losses are eliminated, the underlying asset is also tested for impairment.

(e) Comparative Amounts

Comparatives are consistent with prior years, unless otherwise stated.

Where a change in comparatives has also affected the opening retained earnings previously presented in a comparative period, an opening statement of financial position at the earliest date of the comparative period has been presented.

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

(f) Income Tax

The tax expense recognised in the profit or loss and other comprehensive income relates to current income tax expense plus deferred tax expense (being the movement in deferred tax assets and liabilities and unused tax losses during the year).

Current tax is the amount of income taxes payable (recoverable) in respect of the taxable profit (tax loss) for the year and is measured at the amount expected to be paid to (recovered from) the taxation authorities, using the tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax is provided on temporary differences which are determined by comparing the carrying amounts of tax bases of assets and liabilities to the carrying amounts in the consolidated financial statements.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax consequences relating to a non-monetary asset carried at fair value are determined using the assumption that the carrying amount of the asset will be recovered through sale.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and losses can be utilised.

Current tax assets and liabilities are offset where there is a legally enforceable right to set off the recognised amounts and there is an intention either to settle on a net basis or to realise the asset and settle the liability simultaneously.

Deferred tax assets and liabilities are offset where there is a legal right to set off current tax assets against current tax liabilities and the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

Current and deferred tax is recognised as income or an expense and included in profit or loss for the period except where the tax arises from a transaction which is recognised in other comprehensive income or equity, in which case the tax is recognised in other comprehensive income or equity respectively.

Tychean Resources Limited and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under tax consolidation legislation. Each entity in the group recognises its own current and deferred tax assets and liabilities. Such taxes are measured using the ‘stand-alone taxpayer’ approach to allocation.

Current tax liabilities (assets) and deferred tax assets arising from unused tax losses and tax credits in the subsidiaries are immediately transferred to the head entity.

The tax consolidated group has entered into a tax funding arrangement whereby each company in the group contributes to the income tax payable by the group in proportion to their contribution to the group’s taxable income. Differences between the amounts of net tax assets and liabilities derecognised and the net amounts recognised pursuant to the funding arrangement are recognised as either a contribution by, or distribution to the head entity.

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

(g) Leases

Lease payments for operating leases, where substantially all of the risks and benefits remain with the lessor, are charged as expenses on a straight-line basis over the life of the lease term.

(h) Revenue and other income

Revenue is recognised when the amount of the revenue can be measured reliably, it is probable that economic benefits associated with the transaction will flow to the entity and specific criteria relating to the type of revenue as noted below, has been satisfied.

Revenue is measured at the fair value of the consideration received or receivable and is presented net of returns, discounts and rebates.

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

(i)

Goods and Services Tax (GST)

Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the amount of GST incurred is not recoverable from the Australian Taxation Office (ATO).

Receivables and payable are stated inclusive of GST.

The net amount of GST recoverable from, or payable to, the ATO is included as part of receivables or payables in the statement of financial position.

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

(j) Property, Plant and Equipment

Where the cost model is used, the asset is carried at its cost less any accumulated depreciation and any impairment losses. Costs include purchase price, other directly attributable costs and the initial estimate of the costs of dismantling and restoring the asset, where applicable.

Plant and equipment

Plant and equipment is measured on a cost basis. The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable amount. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the assets’ employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts.

Subsequent costs are included in the assets’ carrying amounts or recognised as separate assets as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost can be measured reliably. All other repairs and maintenance are charged to the statement of profit or loss and other comprehensive income during the financial year in which they are incurred.

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

Depreciation

The depreciable amount of all property, plant and equipment, except for freehold land is depreciated on a reducing balance method from the date that management determine that the asset is available for use. The depreciation rates used for each class of depreciable assets vary from 25% to 40%.

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

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

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

(k) Financial instruments

Financial instruments are recognised initially using trade date accounting, i.e. on the date the Group becomes party to the contractual provisions of the instrument.

On initial recognition, all financial instruments are measured at fair value plus transaction costs (except for instruments measured at fair value through profit or loss where transaction costs are expensed as incurred).

(l) Impairment of non-financial assets

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

(m) Cash and cash equivalents

For the purpose of presentation in the consolidated statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short term, highly liquid investments with original maturities of 12 months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Any bank overdrafts the Group have are shown within borrowings in current liabilities in the consolidated statement of financial position.

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

(n) Employee benefits

Short-term employee benefits

Short-term employee benefits are benefits, other than termination benefits, that are expected to be settled wholly within twelve (12) months after the end of the period in which the employees render the related service. Examples of such benefits include wages and salaries, non-monetary benefits and accumulating sick leave. Short-term employee benefits are measured at the undiscounted amounts expected to be paid when the liabilities are settled.

Other long-term employee benefits

The Group’s liabilities for annual leave and long service leave are included in other long term benefits as they are not expected to be settled wholly within twelve (12) months after the end of the period in which the employees render the related service. They are measured at the present value of the expected future payments to be made to employees. The expected future payments incorporate anticipated future wage and salary levels, experience of employee departures and periods of service, and are discounted at rates determined by reference to market yields at the end of the reporting period on high quality corporate bonds (2015: government bonds) that have maturity dates that approximate the timing of the estimated future cash outflows. Any remeasurements arising from experience adjustments and changes in assumptions are recognised in profit or loss in the periods in which the changes occur.

The Group presents employee benefit obligations as current liabilities in the statement of financial position if the Group does not have an unconditional right to defer settlement for at least twelve (12) months after the reporting period, irrespective of when the actual settlement is expected to take place.

(o) Earnings per share

Tychean Resources Ltd presents basic and diluted earnings per share information for its ordinary shares.

Basic earnings per share is calculated by dividing the profit attributable to owners of the company by the weighted average number of ordinary shares outstanding during the year.

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

(p) Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and share options which vest immediately are recognised as a deduction from equity, net of any tax effects.

(q) Share Based Payments

The Group operates equity-settled share-based payment employee share and option schemes. The fair value of the equity to which employees become entitled is measured at grant date and recognised as an expense over the vesting period, with a corresponding increase to an equity account. The fair value of shares is ascertained as the market bid price. The fair value of options is ascertained using a Binomial pricing model which incorporates all market vesting conditions. The amount to be expensed is determined by reference to the fair value of the options or shares granted. This expense takes in account any market performance conditions and the impact of any non-vesting conditions but ignores the effect of any service and non-market performance vesting conditions.

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

Non-market vesting conditions are taken into account when considering the number of options expected to vest. At the end of each reporting period, the Group revises its estimate of the number of options which are expected to vest based on the non-market vesting conditions. Revisions to the prior period estimate are recognised in profit or loss and equity.

(r) Functional and presentation currency

The functional currency of each of the Group entities is measured using the currency of the primary economic environment in which that entity operates. The consolidated financial statements are presented in Australian dollars which is the parent entity’s functional and presentation currency.

(s) Exploration and development expenditure

Exploration, evaluation and development expenditure incurred is accumulated in respect of each identifiable area of interest. These costs are only carried forward to the extent that they are expected to be recouped through successful development of the area or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves. As the asset is not available for use it is not depreciated or amortised.

Accumulated costs in relation to an abandoned area are written off in full against profit or loss in the period in which the decision to abandon that area is made.

A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area of interest.

(t) Adoption of new and revised accounting standards

A number of new and revised standards are effective for annual periods beginning on or after 1 July 2015. Information on these new standards is presented below.

Recently issued accounting standards to be applied in future accounting periods.

The accounting standards that have not been early adopted for the year ended 30 June 2016, but will be applicable to the Group in future reporting periods are detailed below.

New / revised pronouncement	Superseded pronouncement	Nature of change	Effective	Likely impact on initial application
			date(annual reporting periods beginning on or after...)
AASB 9_Financial_ Instruments (December 2014) [Also refer to AASB 2013-9 and AASB 2014-1 below]	AASB 139	AASB 9 introduces new requirements for the	1 January	The entity is yet to undertake a detailed assessment of the impact of AASB 9. However, based on the entity’s preliminary assessment, the Standard is not expected to have a material impact on the transactions and balances recognised in the financial statements when it is first adopted for the year ending 30 June 2019.
	Financial	classification and measurement of financial assets and liabilities and includes a forward-looking ‘expected loss’ impairment model and a substantially-changed approach to hedge accounting. These requirements improve and simplify the approach for classification and measurement of financial assets compared with the requirements of AASB 139. The main changes are: a Financial assets that are debt instruments will be classified based on: (i) the objective of the entity’s business model for managing the financial assets; and (ii) the characteristics of the contractual cash flows.	2018
	Instruments: Recognition and Measurement

Tychean Financial Statement 26 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

New / revised pronouncement	Superseded	Nature of change	Effective	Likely impact on initial application
	pronouncement		date(annual
			reporting periods
			beginning on or
			after...)
AASB 9_Financial_ Instruments (December 2014) [Also refer to AASB 2013-9 and AASB 2014-1 below]	AASB 139 Financial Instruments: Recognition and Measurement	b Allows an irrevocable election on initial recognition to present gains and losses on investments in equity instruments that are not held for trading in other comprehensive income (instead of in profit or loss). Dividends in respect of these investments that are a return on investment can be recognised in profit or loss and there is no impairment or recycling on disposal of the instrument. c Introduces a ‘fair value through other comprehensive income’ measurement category for particular simple debt instruments. d Financial assets can be designated and measured at fair value through profit or loss at initial recognition if doing so eliminates or significantly reduces a measurement or recognition inconsistency that would arise from measuring assets or liabilities, or recognising the gains and losses on them, on different bases. e Where the fair value option is used for financial liabilities the change in fair value is to be accounted for as follows: the change attributable to changes in credit risk are presented in Other Comprehensive Income (OCI) the remaining change is presented in profit or loss If this approach creates or enlarges an accounting mismatch in the profit or loss, the effect of the changes in credit risk are also presented in profit or loss. Otherwise, the following requirements have generally been carried forward unchanged from AASB 139 into AASB 9: classification and measurement of financial liabilities; and derecognition requirements for financial assets and liabilities AASB 9 requirements regarding hedge accounting represent a substantial overhaul of hedge accounting that enable entities to better reflect their risk management activities in the financial statements. Furthermore, AASB 9 introduces a new impairment model based on expected credit losses. This model makes use of more forward-looking information and applies to all financial instruments that are subject to impairment accounting.	1 January 2018	The entity is yet to undertake a detailed assessment of the impact of AASB 9. However, based on the entity’s preliminary assessment, the Standard is not expected to have a material impact on the transactions and balances recognised in the financial statements when it is first adopted for the year ending 30 June 2019.
AASB 1057 Application of Australian Accounting Standards	None	In May 2015, the AASB decided to revise Australian Accounting Standards that incorporate IFRSs to minimise Australian-specific wording even further. The AASB noted that IFRSs do not contain application paragraphs that identify the entities and financial reports to which the Standards (and Interpretations) apply. As a result, the AASB decided to move the application paragraphs previously contained in each Australian Accounting Standard (or Interpretation), unchanged, into a new Standard AASB 1057_Application of Australian_ Accounting Standards.	1 January 2016	When this Standard is first adopted for the year ending 30 June 2017, there will be no impact on the financial statements.

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

New / revised pronouncement	Superseded pronouncement	Nature of change	Effective	Likely impact on initial application
			date(annual reporting periods beginning on or after...)
AASB 15_Revenue_ from Contracts with Customers	AASB 118 Revenue AASB 111 Construction Contracts Int. 13_Customer_ Loyalty Programmes Int. 15 Agreements for the Construction of Real Estate Int. 18_Transfer of_ Assets from Customers Int. 131_Revenue_ – Barter Transactions Involving Advertising Services Int. 1042 Subscriber Acquisition Costs in the Telecommunicatio ns Industry	AASB 15: replaces AASB 118_Revenue_, AASB 111_Construction_ Contracts_and some revenue-related Interpretations: establishes a new revenue recognition model changes the basis for deciding whether revenue is to be recognised over time or at a point in time provides new and more detailed guidance on specific topics (e.g. multiple element arrangements, variable pricing, rights of return, warranties and licensing) expands and improves disclosures about revenue In May 2015, the AASB issued ED 260_Income of Not-for- Profit Entities, proposing to replace the income recognition requirements of AASB 1004_Contributions_ and provide guidance to assist not-for-profit entities to apply the principles of AASB 15. The ED was open for comment until 14 August 2015 and the AASB is currently in the process of redeliberating its proposals with the aim of releasing the final amendments in late 2016.	1 January 2018	When this Standard is first adopted for the year ending 30 June 2019, there will be no material impact on the transactions and balances recognised in the financial statements.
AASB 16_Leases_	AASB 117_Leases_ Int. 4_Determining_ whether an Arrangement contains a Lease Int. 115_Operating_ Leases—Lease Incentives Int. 127 Evaluating the Substance of Transactions Involving the Legal Form of a Lease	AASB 16: replaces AASB 117_Leases_and some lease-related Interpretations requires all leases to be accounted for ‘on-balance sheet’ by lessees, other than short-term and low value asset leases provides new guidance on the application of the definition of lease and on sale and lease back accounting largely retains the existing lessor accounting requirements in AASB 117 requires new and different disclosures about leases	1 January 2019	The entity is yet to undertake a detailed assessment of the impact of AASB 16. However, based on the entity’s preliminary assessment, the Standard is not expected to have a material impact on the transactions and balances recognised in the financial statements when it is first adopted for the year ending 30 June 2020.
AASB 2014-1 Amendments to Australian Accounting Standards (Part D: Consequential Amendments arising from AASB 14)	None	Part D of AASB 2014-1 makes consequential amendments arising from the issuance of AASB 14.	1 January 2016	When these amendments become effective for the first time for the year ending 30 June 2017, they will not have any impact on the entity.

Tychean Financial Statement 28 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

New / revised pronouncement	Superseded	Nature of change	Effective	Likely impact on initial application
	pronouncement		date(annual reporting periods beginning on or after...)
AASB 2014-3 Amendments to Australian Accounting Standards – Accounting for Acquisitions of Interests in Joint Operations	None	The amendments to AASB 11 state that an acquirer of an interest in a joint operation in which the activity of the joint operation constitutes a ‘business’, as defined in AASB 3 Business Combinations, should: 1 Apply all of the principles on business combinations accounting in AASB 3 and other Australian Accounting Standards except principles that conflict with the guidance of AASB 11. This requirement also applies to the acquisition of additional interests in an existing joint operation that results in the acquirer retaining joint control of the joint operation (note that this requirement applies to the additional interest only, i.e. the existing interest is not re-measured) and to the formation of a joint operation when an existing business is contributed to the joint operation by one of the parties that participate in the joint operation; and 2 Provide disclosures for business combinations as required by AASB 3 and other Australian Accounting Standards.	1 January 2016	When these amendments are first adopted for the year ending 30 June 2017, there will be no material impact on the transactions and balances recognised in the financial statements.
AASB 2014-4 Amendments to Australian Accounting Standards – Clarification of Acceptable Methods of Depreciation and Amortisation	None	The amendments to AASB 116 prohibit the use of a revenue-based depreciation method for property, plant and equipment. Additionally, the amendments provide guidance in the application of the diminishing balance method for property, plant and equipment. The amendments to AASB 138 present a rebuttable presumption that a revenue-based amortisation method for intangible assets is inappropriate. This rebuttable presumption can be overcome (i.e. a revenue-based amortisation method might be appropriate) only in two (2) limited circumstances: 1 The intangible asset is expressed as a measure of revenue, for example when the predominant limiting factor inherent in an intangible asset is the achievement of a revenue threshold (for instance, the right to operate a toll road could be based on a fixed total amount of revenue to be generated from cumulative tolls charged); or 2 When it can be demonstrated that revenue and the consumption of the economic benefits of the intangible asset are highlycorrelated.	1 January 2016	When these amendments are first adopted for the year ending 30 June 2017, there will be no material impact on the transactions and balances recognised in the financial statements.
AASB 2014-5 Amendments to Australian Accounting Standards arising from AASB 15	None	AASB 2014-5 incorporates the consequential amendments arising from the issuance of AASB 15.	1 January 2018	Refer to the section on AASB 15 above.
AASB 2014-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2014)	None	AASB 2014-7 incorporates the consequential amendments arising from the issuance of AASB 9.	1 January 2018	Refer to the section on AASB 9 above.
AASB 2014-9 Amendments to Australian Accounting	None	The amendments introduce the equity method of accounting as one of the options to account for an entity’s investments in subsidiaries, joint ventures and associates	1 January 2016	When these amendments are first adopted for the year ending 30 June 2017, there will be no material impact

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Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued	1 Summary of Significant Accounting Policies continued	1 Summary of Significant Accounting Policies continued
New / revised pronouncement	Superseded pronouncement	Nature of change	Effective	Likely impact on initial application
			date(annual reporting periods beginning on or after...)
Standards – Equity Method in Separate Financial Statements		in the entity’s separate financial statements.		on the financial statements.
AASB 2014-10 Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture	None	The amendments address a current inconsistency between AASB 10_Consolidated Financial Statements_ and AASB 128_Investments in Associates and Joint_ Ventures. The amendments clarify that, on a sale or contribution of assets to a joint venture or associate or on a loss of control when joint control or significant influence is retained in a transaction involving an associate or a joint venture, any gain or loss recognised will depend on whether the assets or subsidiary constitute a business, as defined in AASB 3_Business Combinations_. Full gain or loss is recognised when the assets or subsidiary constitute a business, whereas gain or loss attributable to other investors’ interests is recognised when the assets or subsidiary do not constitute a business. This amendment effectively introduces an exception to the general requirement in AASB 10 to recognise full gain or loss on the loss of control over a subsidiary. The exception only applies to the loss of control over a subsidiary that does not contain a business, if the loss of control is the result of a transaction involving an associate or a joint venture that is accounted for using the equity method. Corresponding amendments have also been made to AASB 128. AASB 2015-10_Amendments to Australian Accounting_ Standards – Effective Date of Amendments to AASB 10 _and AASB 128_deferred the mandatory application date of AASB 2014-10 from 1 January 2016 to 1 January 2018. Refer to the section onAASB 2015-10below for further information.	1 January 2018	When these amendments are first adopted for the year ending 30 June 2019, there will be no material impact on the financial statements.
AASB 2015-1 Amendments to Australian Accounting Standards – Annual Improvements to Australian Accounting Standards 2012- 2014 Cycle	None	These amendments arise from the issuance of_Annual_ Improvements to IFRSs 2012-2014 Cycle_in September 2014 by the IASB. Among other improvements, the amendments clarify that when an entity reclassifies an asset (or disposal group) directly from being held for sale to being held for distribution (or vice-versa), the accounting guidance in paragraphs 27-29 of AASB 5_Non-current Assets Held for _Sale and Discontinued Operations_does not apply. The amendments also state that when an entity determines that the asset (or disposal group) is no longer available for immediate distribution or that the distribution is no longer highly probable, it should cease held-for- distribution accounting and apply the guidance in paragraphs 27-29 of AASB 5.	1 January 2016	When these amendments are first adopted for the year ending 30 June 2017, there will be no material impact on the financial statements.

Tychean Financial Statement 30 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

New / revised pronouncement	Superseded pronouncement	Nature of change	Effective	Likely impact on initial application
			date(annual reporting periods beginning on or after...)
AASB 2015-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 101	None	The Standard makes amendments to AASB 101 _Presentation of Financial Statements_arising from the IASB’s Disclosure Initiative project. The amendments: clarify the materiality requirements in AASB 101, including an emphasis on the potentially detrimental effect of obscuring useful information with immaterial information clarify that AASB 101’s specified line items in the statement(s) of profit or loss and other comprehensive income and the statement of financial position can be disaggregated add requirements for how an entity should present subtotals in the statement(s) of profit and loss and other comprehensive income and the statement of financial position clarify that entities have flexibility as to the order in which they present the notes, but also emphasise that understandability and comparability should be considered by an entity when deciding that order remove potentially unhelpful guidance in AASB 101 for identifying a significant accounting policy	1 January 2016	When these amendments are first adopted for the year ending 30 June 2017, there will be no material impact on the financial statements.
AASB 2015-8 Amendments to Australian Accounting Standards – Effective Date of AASB 15	None	AASB 2015-8 amends the mandatory application date of AASB 15_Revenue from Contracts with Customers_so that AASB 15 is required to be applied for annual reporting periods beginning on or after 1 January 2018 instead of 1 January 2017. It also defers the consequential amendments that were originally set out in AASB 2014-5_Amendments to Australian Accounting_ Standards arising from AASB 15.	1 January 2017	Refer to the section on AASB 15 above.
AASB 2015-9 Amendments to Australian Accounting Standards – Scope and Application Paragraphs	None	AASB 2015-9 inserts scope paragraphs into AASB 8 Operating Segments_and AASB 133_Earnings per Share in place of application paragraph text in AASB 1057. In July and August 2015, the AASB reissued AASB 8, AASB 133 and most of the Australian Accounting Standards that incorporate IFRSs to make editorial changes. The application paragraphs in the previous versions of AASB 8 and AASB 133 covered scope paragraphs that appear separately in the corresponding IFRS 8 and IAS 33. In moving those application paragraphs to AASB 1057 when AASB 8 and AASB 133 were reissued in August, the AASB inadvertently deleted the scope details from AASB 8 and AASB 133. This amending Standard puts the scope details into those Standards, and removes the related text from AASB 1057. There is no change to the requirements or the applicability of AASB 8 and AASB 133.	1 January 2016	When this Standard is first adopted for the year ending 30 June 2017, there will be no impact on the financial statements.
AASB 2015-10 Amendments to Australian Accounting Standards – Effective Date of Amendments to AASB 10 and AASB 128	None	This Standard defers the mandatory application date of amendments to AASB 10_Consolidated Financial_ Statements_and AASB 128_Investments in Associates and Joint Ventures_that were originally made in AASB 2014-10_Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an _Investor and its Associate or Joint Venture_so that the amendments are required to be applied for annual reporting periods beginning on or after 1 January 2018 instead of 1 January 2016.	1 January 2016	Refer to the section on AASB 2014-10 above.

Tychean Financial Statement 31 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

New / revised pronouncement	Superseded pronouncement	Nature of change	Effective	Likely impact on initial application
			date(annual reporting periods beginning on or after...)
		The amendments have been deferred as the IASB is planning to address them as part of its longer term_Equity_ _Accounting_project. However, early application of the amendments is still permitted.
AASB 2016-1 Amendments to Australian Accounting Standards – Recognition of Deferred Tax Assets for Unrealised Losses	None	AASB 2016-1 amends AASB 112_Income Taxes_to clarify how to account for deferred tax assets related to debt instruments measured at fair value, particularly where changes in the market interest rate decrease the fair value of a debt instrument below cost.	1 January 2017	When these amendments are first adopted for the year ending 30 June 2018, there will be no material impact on the financial statements.
AASB 2016-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 107	None	AASB 2016-2 amends AASB 107_Statement of Cash_ _Flows_to require entities preparing financial statements in accordance with Tier 1 reporting requirements to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes.	1 January 2017	When these amendments are first adopted for the year ending 30 June 2018, there will be no material impact on the financial statements.
Standards issued	by the IASB, but not yet by the AASB
Clarifications to IFRS 15 Revenue from Contracts with Customers	None	The amendments clarify the application of IFRS 15 in three (3) specific areas to reduce the extent of diversity in practice that might otherwise result from differing views on how to implement the requirements of the new standard. They will help companies: 1. Identify performance obligations (by clarifying how to apply the concept of ‘distinct’); 2. Determine whether a company is a principal or an agent in a transaction (by clarifying how to apply the control principle); 3. Determine whether a licence transfers to a customer at a point in time or over time (by clarifying when a company’s activities significantly affect the intellectual property to which the customer has rights). The amendments also create two (2) additional practical expedients available for use when implementing IFRS 15: 1. For contracts that have been modified before the beginning of the earliest period presented, the amendments allow companies to use hindsight when identifying the performance obligations, determining the transaction price, and allocating the transaction price to the satisfied and unsatisfied performance obligations. 2. Companies applying the full retrospective method are permitted to ignore contracts already complete at the beginning of the earliest period presented. The AASB is expected to publish the equivalent Australian amendments in quarter 2 of 2016.	1 January 2018	When these amendments are first adopted for the year ending 30 June 2019, there will be no material impact on the financial statements.

Tychean Financial Statement 32 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

1 Summary of Significant Accounting Policies continued

(u) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision makers. The chief operation decision maker has been identified as the Board of Directors.

(v) Trade Receivables

Trade Receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. Trade receivables are generally due for settlement within 30 days. They are presented as current assets unless collection is not expected for more than 12 months after the reporting date.

(w) Reserves

Reserves represent the share option reserve. This reserve records items recognised as expenses on valuation of employee share options and rights.

(x) Key estimates

The preparation of the consolidated financial statements requires management to make estimates and judgments. These estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that may have a financial impact on the Group and that are believed to be reasonable under the circumstances.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The 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:

(i) Estimated impairment

The Group assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined.

(ii) Exploration and evaluation

The Group policy for exploration and evaluation is discussed in note 1 (s). The application of this policy requires management to make certain assumptions as to future events and circumstances. Any such estimates and assumptions may change as new information becomes available. If, after having capitalised exploration and evaluation expenditure, management concludes that the capitalised expenditure is unlikely to be recovered by future sale or exploration, then the relevant capitalised amount will be written off through the statement of profit or loss. The related carrying amounts are disclosed in note 3.

(y) Financial report

The financial report was authorised for issue on 2 August 2016 by the Board of directors.

Tychean Financial Statement 33 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements

For the Year Ended 30 June 2016

2 Revenue and Other Income

Other Income Royalties Interest received Gain on sale of investments	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 8,500 6,000 2,212 13,894 341,539 - 352,251 19,894

3 Expenses

Profit before income tax from continuing operations includes the following expenses: Administration Compliance Consulting fees Depreciation Legal fees Administration costs Employment costs Exploration expenditure General Exploration written off Impairment of assets Capitalised exploration expenditure	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 55,887 129,057 136,333 60,000 3,821 3,187 3,138 12,058 250,370 259,333 113,234 278,635
	562,783 742,270
	7,941 6,485
	7,941 6,485
	3,505,983 -
	3,505,983 -

Tychean Financial Statement 34 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

4 Income Tax Expense

• (a) The major components of tax expense (income) comprise:

Deferred tax expense Deferred tax Research & Development Tax Concession Income tax expense for continuing operations (b) Reconciliation of income tax to accounting profit: Prima facie profit from ordinary activities Tax at the Australian tax rate of Prima facie tax payable on ordinary activities Add: Tax effect of amounts which are not deductible (taxable) in calculating taxable income: Other non-allowable items Impairment of exploration assets Adjustment for Research and Development tax offset Tax Effect of temporary differences not brought to account as they do not meet the recognition criteria Utilised Tax losses through Exploration Development and Incentive Scheme	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 1,185 48,828 (48,478) (96,541)
	(47,293) (47,713)
	(47,293) (47,713)
	(3,724,456) (728,861) 30% 30%
	(1,117,337) (218,658) - 500 1,051,795 - (48,478) (96,541) 66,727 266,986
	(47,293) (47,713)
	(631,116) -

A deferred tax asset (DTA) has not been recognised in respect of temporary differences as they do not meet the recognition criteria per AASB 112 Income Taxes . A DTA has not been recognised in respect of tax losses as realisation of the benefit is not regarded as probable.

The Group has unrecognised assessed losses of $6,696,701 (2015: $9,161,569) that are available indefinitely for offset against future taxable profits of the Group.

The tax rates applicable to each potential tax benefit are as follows: Timing differences - 30%; Tax losses - 30%.

Tychean Financial Statement 35 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements

For the Year Ended 30 June 2016

5 Operating Segments

Segment information

Identification of reportable segments

The Group has identified its operating segments based on the internal reports that are reviewed and used by the Board of Directors (chief operating decision makers) in assessing performance and determining the allocation of resources.

The Group is managed primarily on the basis of geographical area of interest as the diversifications of the Group’s operations inherently have notably different risk profiles and performance assessment criteria. Operating segments are therefore determined on the same basis.

Reportable segments disclosed are based on aggregating operating segments where the segments are considered to have similar economic characteristics and are also similar with respect to the following:

• geographical location; and

• any external regulatory requirements.

Basis of accounting for purposes of reporting by operating segments

(a) Accounting policies adopted

Unless stated below, all amounts reported to the Board of Directors, being the chief operating decision maker with respect to operating segments, are determined in accordance with accounting policies that are consistent to those adopted in the annual financial statements of Tychean Resources Ltd

Tychean Financial Statement 36 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

5 Operating Segments continued

(b) Segment performance

(b) Segment performance	e
Year ended 30 June 2016 Spargoville Suplejack Valley Floor Resources $ $ $ Segment revenue - - - Adjusted EBITDA (2,988,994) - (516,989) Segment assets - 252,521 - Segment asset movements for the period Sales of tenements (450,000) - - Capital expenditure 104,931 1,477 5.878 Impaired (2,988,994) - (516,989) Total movement for the year (3,334,063) 1,477 (511,111) Segment assets - 252,521 - Unallocated assets Total assets Segment liabilities Unallocated liabilities Total liabilities	Spargoville Suplejack Valley Floor Resources $ $ $ - - - (2,988,994) - (516,989) - 252,521 -	Total $ - (3,505,983) 252,521
		(450,000) 112,286 (3,505,983) (3,843,697)
	- 252,521 -	252,521
		352,275
		604,796
		- 142,023
		142,023

Tychean Financial Statement 37 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

• 5 Operating Segments continued

Year ended 30 June 2015 Spargoville Suplejack Valley Floor Resources $ $ $ Segment revenue - - - Adjusted EBITDA - - - Segment assets 3,334,063 251,044 511,111 Segment asset movements for the period Acquisition of tenements - - - Capital expenditure 1,956,703 17,918 129,219 Impaired - - - Total movement for the year 1,956,703 17,918 129,219 Segment assets 3,334,063 251,044 511,111 Unallocated assets Total assets Segment liabilities 278,435 - 551 Unallocated liabilities Total liabilities	Spargoville Suplejack Valley Floor Resources $ $ $ - - - - - - 3,334,063 251,044 511,111	Total $ - - 4,096,218
		- 2,103,840 - 2,103,840
	3,334,063 251,044 511,111 278,435 - 551	4,096,218 159,778
		4,255,996
		278,986 119,873
		398,859

Tychean Financial Statement 38 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements

For the Year Ended 30 June 2016

5 Operating Segments continued

(c) Adjusted EBITA

Allocated Reconciliation of segment liabilities Unallocated Interest Revenue Other revenue Investment revenue Marketing expenses Administrative expenses Impairment Expense General exploration Profit before Income Tax Income Tax Profit after income tax	Consolidated year ended 30 June 2016 $ 30 June 2015 $ - - 2,212 13,894 8,500 6,000 341,539 - - (3,729) (562,783) (738,541) (3,505,983) - (7,941) (6,485)
	(3,724,456) (728,861)
	47,293 47,713
	(3,677,163) (681,148)

(d) Segment Revenues

Segment revenue reconciles to total revenue from continuing operations as follows:

Total segment revenue Interest revenue Other revenue Investment revenue Total revenue from continuing operations	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 2,212 13,894 8,500 6,000 341,539 -
	352,251 19,894

Tychean Financial Statement 39 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements

For the Year Ended 30 June 2016

5 Operating Segments continued

(e) Segment Assets

Reportable segments' assets are reconciled to total assets as follows:

Allocated Segment assets Unallocated Cash and cash equivalents Trade and other receivables Other current assets Property, plant and equipment Total assets	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 252,521 4,096,218 288,331 102,522 53,040 36,294 4,601 10,838 6,303 10,124
	604,796 4,255,996

(f) Segment liabilities

Reportable segments' liabilities are reconciled to total liabilities as follows:

Allocated Segment liabilities Unallocated Trade and other payables Provisions Total Liabilities	Consolidated year ended 30 June 2016 $ 30 June 2015 $ - 278,986 142,023 102,734 - 17,139
	142,023 398,859

Tychean Financial Statement 40 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

6 Cash and cash equivalents

Cash at bank and in hand	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 288,331 102,522
	288,331 102,522

7 Trade and other receivables

CURRENT Trade receivables GST receivable Other receivables Total current trade and other receivables	Consolidated year ended 30 June 2016 $ 30 June 2015 $ - 5,998
	- 5,998 3,040 30,289 50,000 7
	53,040 36,294

The carrying value of trade receivables is considered a reasonable approximation of fair value due to the short-term nature of the balances.

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable in the financial statements.

As at 30 June 2016 there were no material trade and other receivables that were considered to be past due or impaired (2015: Nil).

Tychean Financial Statement 41 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

8 Property, plant and equipment

PLANT AND EQUIPMENT Property, plant and equipment At cost Accumulated depreciation Total property, plant and equipment	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 16,137 16,137 (9,834) (6,013)
	6,303 10,124

(a) Movements in carrying amounts of property, plant and equipment

Movement in the carrying amounts for each class of property, plant and equipment between the beginning and the end of the current financial year:

Consolidated Year ended 30 June 2016 Balance at the beginning of year Additions Depreciation expense Balance at the end of the year Consolidated Year ended 30 June 2015 Balance at the beginning of year Additions Depreciation expense Balance at the end of the year	Computer Equipment $ Computer Software $ Total $ 1,521 8,603 10,124 - - - (380) (3,441) (3,821)
	1,141 5,162 6,303
	Computer Equipment $ Computer Software $ Total $ 2,028 145 2,173 - 11,138 11,138 (507) (2,680) (3,187)
	1,521 8,603 10,124

9 Other assets

CURRENT Prepayments Total other assets	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 4,601 10,838
	4,601 10,838

Tychean Financial Statement 42 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements

For the Year Ended 30 June 2016

10 Exploration, evaluation and development assets

Exploration and evaluation 2016 Balance at beginning of the year Disposals Impairment Expenditure incurred Balance at end of the year 2015 Balance at beginning of the year Expenditure incurred Balance at end of the year	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 252,521 4,096,218	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 252,521 4,096,218
	252,521 4,096,218
		Exploration and evaluation $ 4,096,218 (450,000) (3,505,983) 112,286
		252,521
		1,992,378 2,103,840
		4,096,218

The recoverability of the carrying amount of the exploration and evaluation assets is dependent on successful development and commercial exploitation, or alternatively, sale of the respective areas of interest.

The impairment of the exploration assets in 2015/2016 relates predominantly to the impairment within the Spargoville and Valley Floor Areas of Interest. An agreement was entered into to dispose of its interest in the Spargoville Project to a third party. Tenements with the Valley Floor Area of Interest were surrendered within the 2015/2016 year.

11 Trade and other payables

CURRENT Unsecured liabilities Trade payables Employee benefits Unissued shares Other payables and accrued expenses Total current liabilities	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 38,721 170,080 - 17,457 - - 103,302 194,183
	142,023 381,720

All amounts are short term and the carrying values are considered to be a reasonable approximation of fair value.

Tychean Financial Statement 43 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements

For the Year Ended 30 June 2016

12 Employee Benefits Current liabilities Opening balance Additional provisions Amounts used Closing balance 13 Issued Capital Ordinary Shares (a) Ordinary shares Date 01/07/2015 At the beginning of the reporting period 02/07/2015 Exercise of options 06/07/2015 Issued to Blue Spec Drilling 09/07/2015 Exercise of options 24/07/2015 Exercise of options 03/08/2015 Exercise of options 16/09/2015 Exercise of options 04/11/2015 1 for 10 Consolidation 23/12/2015 Placement 15/01/2016 Exercise of options Less: transaction costs arising on share issue (net of tax effect) At the end of the reporting period		Consolidated year ended 30 June 2016 $ 30 June 2015 $ 17,139 3,931 - 37,527 (17,139) (24,319)
		- 17,139
		Consolidated year ended 30 June 2016 $ 30 June 2015 $ 37,324,853 37,042,054
		37,324,853 37,042,054
		Consolidated year ended 30 June 2016 No. $ 2,431,492,488 37,042,054 1,135 4 75,000,000 150,000 2,225 7 78,705 313 7,965 31 1,920 7 (2,255,925,672) - 33,750,000 135,000 5,000 200 (2,763)
		284,413,766 37,324,853

Tychean Financial Statement 44 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements

For the Year Ended 30 June 2016

13 Issued Capital continued

Capital Management

Management controls the capital of the Group in order to maintain and generate long-term shareholder value and ensure that the Group can fund its operations and continue as a going concern.

The Group has no debt capital. The Group is not subject to any externally imposed capital requirements.

Management effectively manages the Group capital by assessing the Group financial risks and adjusting its capital structure in response to changes in these risks and in the market. These responses include the management of debt levels, distributions to shareholders and share issues.

(b) Options

• (i) For information relating to the Tychean Resources Ltd employee option plan, including details of options issued, exercised and lapsed during the financial year and the options outstanding at year-end, refer to Note 24 Share-based payments.

• (ii) For information relating to share options issued to key management personnel during the financial year, refer to Note 24.

14 Earnings per Share

(a) Basic earnings per share Loss attributable to the ordinary equity holders Weighted average number of shares outstanding during the year Basic earnings per share (cents) (b) Basic earnings per share from continuing operations Loss attributable to the ordinary equity holders from continuing operations Weighted average number of shares outstanding during the year Basic earnings per share from continuing operations(cents) (c) Dilutive earnings per share Loss attributable to the ordinary equity holders Weighted average number of shares outstanding during the year Dilutive earnings per share (cents) (d) Dilutive earnings per share from continuing operations Loss attributable to the ordinary equity holders from continuing operations Weighted average number of shares outstanding during the year Dilutive earnings per share from continuing operations (cents)	Consolidated year ended 30 June 2016 $ 30 June 2015 $ (3,677,163) (681,148) 283,660,4362,052,805,818
	(1.38) (0.033)
	(3,677,163) (681,148) 283,660,4362,052,805,818
	(1.38) (0.033)
	(3,677,163) (681,148) 283,660,4362,052,805,818
	(1.38) (0.033)
	(3,677,163) (681,148) 283,660,4362,052,805,818
	(1.38) (0.033)

Tychean Financial Statement 45 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

15 Capital and Leasing Commitments

(a) Contractual Commitments

In order to maintain current rights of tenure to exploration tenements, the Group will be required to outlay amounts totalling nil during the year ending 30 June 2017 (2016: $72,000) in respect of tenement lease rentals and to meet minimum expenditure requirements.

16 Financial Risk Management

The Group is exposed to a variety of financial risks through its use of financial instruments.

This note discloses the Group’s objectives, policies and processes for managing and measuring these risks.

The Group’s overall risk management plan seeks to minimise potential adverse effects due to the unpredictability of financial markets.

The Group does not speculate in financial assets.

The most significant financial risks to which the Group's is exposed to are described below:

Financial Assets Cash and cash equivalents Trade, term and loans receivables Total financial assets Financial Liabilities Financial liabilities at amortised cost Trade and other payables Total financial liabilities Specific risks	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 288,331 102,522 50,000 6,005
	338,331 108,527
	142,023 381,720
	142,023 381,720

• Market risk - currency risk, cash flow interest rate risk and price risk

• Credit risk  Liquidity risk

Financial instruments used

The principal categories of financial instrument used by the Group are:

• Trade receivables

• Cash at bank

• Trade and other payables

Tychean Financial Statement 46 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

16 Financial Risk Management continued

Objectives, policies and processes

Specific information regarding the mitigation of each financial risk to which the Group is exposed is provided below.

Liquidity risk

Liquidity risk arises from the Group’s management of working capital.

It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due.

The Group’s policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due. The Group maintains cash to meet its liquidity requirements for up to 30-day periods.

The Group manages its liquidity needs by carefully monitoring long-term financial liabilities as well as cash-outflows due in day-to-day business.

Liquidity needs are monitored in various time bands, on a day-to-day and week-to-week basis, as well as on the basis of a rolling 30-day projection. Long-term liquidity needs for a 180-day and a 360-day period are identified monthly.

At the reporting date, these reports indicate that the Group expected to have sufficient liquid resources to meet its obligations under all reasonably expected circumstances.

The Group liabilities have contractual maturities which are summarised below:

Financial assets - cash flows realisable Cash and cash equivalents Trade, term and loans receivables Total	Not later than 1 month 1 to 3 months 30 June 2016 $ 30 June 2015 $ 30 June 2016 $ 30 June 2015 $ 288,331 102,522 - - - 6,005 50,000 -
	288,331 108,527 50,000 -

Market risk

(i) Foreign currency sensitivity

All of the Group transactions are carried out in Australian Dollars, therefore the Group is not exposed to foreign exchange risk.

(ii) Cash flow interest rate sensitivity

The Group is exposed to interest rate risk.

The following table illustrates the sensitivity of the net result for the year and equity to a reasonably possible change in interest rates of +2.00% and -2.00% (2015: +2.00%/-2.00%), with effect from the beginning of the year. These changes are considered to be reasonably possible based on observation of current market conditions.

Tychean Financial Statement 47 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

16 Financial Risk Management continued

The calculations are based on the financial instruments held at each reporting date. All other variables are held constant.

	30 June	2016	30 June 2015	30 June 2015
	+2.00%	+2.00%	+2.00%	-2.00%
	$	$	$	$
Cash and cash equivalents
Net results	5,767	5,767	2,050	2,050
Equity	(5,767)	(5,767)	(2,050)	(2,050)
Borrowings
Equity	-	-	-	-

Credit risk

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in a financial loss to the Group.

Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits with banks and financial institutions, as well as credit exposure to wholesale and retail customers, including outstanding receivables and committed transactions.

Management considers that all the financial assets that are not impaired for each of the reporting dates under review are of good credit quality, including those that are past due.

The credit risk for liquid funds and other short-term financial assets is considered negligible, since the counterparties are reputable banks with high quality external credit ratings.

Net fair values

Fair value estimation

The fair values of financial assets and financial liabilities are presented in the following table and can be compared to their carrying values as presented in the consolidated statement of financial position. Fair values are those amounts at which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length transaction.

Fair values derived may be based on information that is estimated or subject to judgement, where changes in assumptions may have a material impact on the amounts estimated. Areas of judgement and the assumptions have been detailed below. Where possible, valuation information used to calculate fair value is extracted from the market, with more reliable information available from markets that are actively traded.

Tychean Financial Statement 48 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

16 Financial Risk Management continued

Financial assets Cash and cash equivalents Trade and other receivables Total financial assets Financial liabilities Trade and other payables Total financial liabilities	30 June 2016 30 June 2015 Net Carrying Value $ Net Fair value $ Net Carrying Value $ Net Fair value $ 288,331 288,331 102,522 102,522 50,000 50,000 6,005 6,005
	338,331 338,331 108,527 108,527
	142,023 142,023 381,720 381,720
	142,023 142,023 381,720 381,720

17 Dividends

There were no dividends paid during the year (2015: nil).

18 Key Management Personnel Disclosures

The totals of remuneration paid to the key management personnel of Tychean Resources Ltd during the year are as follows:

Short-term employee benefits Post-employment benefits Share-based payments Total Remuneration	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 109,260 323,836 7,790 30,764 --
	117,050 354,600

The Remuneration Report contained in the Directors' Report contains details of the remuneration paid or payable to each member of the Group’s Key Management Personnel for the year ended 30 June 2016.

Other key management personnel transactions

For details of other transactions with key management personnel, refer to Note 22: Related Party Transactions.

19 Remuneration of Auditors

Remuneration of the auditor of the Group, Grant Thornton (Australia), for: Auditing or reviewing the financial report	Consolidated year ended 30 June 2016 $ 30 June 2015 $ 27,750 23,500
	27,750 23,500

Tychean Financial Statement 49 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

20 Deed of Cross-Guarantee

The Parent entity has not entered into any guarantees, in the current or previous financial year, in relation to the debts of its subsidiaries.

21 Contingent Liabilities

The Group has contingent liabilities totalling $119,233. This liability is not due or payable until such time as the Group successfully complete a Capital Raise.

22 Related Parties

(a) The Group’s main related parties are as follows:

(i) Key management personnel:

Any person(s) having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any director (whether executive or otherwise) of that entity are considered key management personnel.

For details of remuneration disclosures relating to key management personnel, refer to the remuneration report in the Directors' Report.

During the reporting period the Group entered an agreement to sell its interest in the Spargoville Project to Maximus Resources Limited. Mr Kennedy is the Chairman and Mr Vickery is a non-executive Director of Maximus Resources Limited.

There were no other transactions with KMP and their related entities.

(ii) Subsidiaries:

The consolidated financial statements include the financial statements of Tychean Resources Ltd and the following subsidiaries:

subsidiaries:
	% ownership	% ownership
	interest	interest
Name of subsidiary	2016	2015
Eromanga Uranium Resources Pty Ltd	-	-
South East Energy Ltd	-	-
Tychean Tanami Pty Ltd (previously ERO Metals Pty Ltd)	100.0	100.0
Valley Floor Resources Pty Ltd (acquired 23 August 2013 via the issue of
50,000,000 fully paid ordinary shares)	100.0	100.0

Tychean Financial Statement 50 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

23 Cash Flow Information

(a) Reconciliation of result for the year to cashflows from operating activities

Reconciliation of net income to net cash provided by operating activities: (Loss) for the year Cash flows excluded from profit attributable to operating activities Non-cash flows in profit: - depreciation - exploration and evaluation expenditure written off - income tax benefit - share based payments - gain on sale of investments - impairment loss - exploration recovery Changes in assets and liabilities, net of the effects of purchase and disposal of subsidiaries: - (increase)/decrease in trade and other receivables - (increase)/decrease in prepayments - (increase)/decrease in other assets - increase/(decrease) in trade and other payables - increase/(decrease) in provisions Cashflow from operations

Consolidated year ended 30 June 2016 $ 30 June 2015 $ (3,677,163) (681,148) 3,821 3,187 7,942 6,485 (47,293) 48,828 -- (341,539) 3,505,983- - (40,280) (16,747) 5,574 6,237 (1,253) - 14,114 (15,566) (8,635) (17,139) 13,208

(591,464) (639,920)

24 Share-based Payments

(i) Employee Options

2016	Exercise	Start of the	Granted	Exercised	Forfeited	Balance at	Vested and
Grant	price	year	during the	during the	during the	the end of	exercisable
Date			year	year	year	the year	at year end
14 May	-	-	-	-	-	-	-
2013
2015	Exercise	Start of the	Granted	Exercised	Forfeited	Balance at	Vested and
Grant	price	year	during the	during the	during the	the end of	exercisable
Date			year	year	year	the year	at year end
14 May	-	10,000,000	-	(10,000,000)	-	-	-
2013

Tychean Financial Statement 51 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

25 Events Occurring After the Reporting Date

No matters or circumstances have arisen since the end of the financial year which significantly affected or could significantly affect the operations of the Group, the results of those operations or the state of affairs of the Group in future financial years.

26 Parent entity

Statement of Financial Position Assets Current assets Non-current assets Total Assets Liabilities Current liabilities Total Liabilities Equity Issued capital Retained earnings/ (losses) Option reserve Total Equity Statement of Profit or Loss and Other Comprehensive Income Total profit or loss for the year Total comprehensive income	30 June 2016 $ 30 June 2015 $ 345,972 149,654 268,326 4,094,725 Year ended
	614,298 4,244,379
	142,022 398,859
	142,022 398,859
	37,324,853 37,042,054 (36,852,577)(34,280,012) - 1,083,478
	472,276 3,845,520
	(3,676,671) (681,075)
	(3,676,671) (681,075)

The Parent has contingent liabilities totalling $119,233. This liability is not due or payable until such time as the Company successfully completes a Capital Raise.

Tychean Financial Statement 52 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Notes to the Consolidated Financial Statements For the Year Ended 30 June 2016

27 Company Details

The registered office of and principal place of business of the company is: Tychean Resources Ltd Level 3, 100 Pirie Street Adelaide, South Australia 5000 Email: info@tycheanresources.com

28 Going concern

The financial report has been prepared on the basis of going concern.

The cash flow projections of the Group indicate that it will require positive cash flows from additional capital or sale of assets for continued operations. The Group incurred a loss of $3,677,163. The Group’s cash balance at 30 June 2016 was $288,331.

The Group's ability to continue as a going concern is contingent on obtaining additional capital and/or sale of assets. If additional capital is not obtained or assets not sold, the going concern basis may not be appropriate, with the result that the consolidated entity may have to realise its assets and extinguish its liabilities, other than in the ordinary course of business and in amounts different from those stated in the financial report. No allowance for such circumstances has been made in the financial report.

Tychean Financial Statement 53 | P a g e

Tychean Resources Ltd and Controlled Entities ABN: 40 119 031 864

Directors’ Declaration

For the Year Ended 30 June 2016

Director’s Declaration

The directors of the Group declare that:

1. the consolidated financial statements and notes for the year ended 30 June 2016 are in accordance with the Corporations Act 2001 and:

2. a. comply with Accounting Standards, which, as stated in accounting policy note 1 to the financial statements, constitutes explicit and unreserved compliance with International Financial Reporting Standards (IFRS); and

3. b. give a true and fair view of the financial position and performance of the Group;

4. the Managing Director and Chief Finance Officer have given the declarations required by Section 295A that:

5. a. the financial records of the Group for the financial year have been properly maintained in accordance with section 286 of the Corporations Act 2001 ;

6. b. the financial statements and notes for the financial year comply with the Accounting Standards; and

7. c. the financial statements and notes for the financial year give a true and fair view.

8. in the directors' opinion, there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable.

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

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Director ................................................................................................................................................

Robert Michael Kennedy

Dated 2 August 2016

Tychean Financial Statement 54 | P a g e

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Level 1, 67 Greenhill Rd Wayville SA 5034 Correspondence to: GPO Box 1270 Adelaide SA 5001

T 61 8 8372 6666 F 61 8 8372 6677 E info.sa@au.gt.com W www.grantthornton.com.au

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TYCHEAN RESOURCES LIMITED

Report on the financial report

We have audited the accompanying financial report of Tychean Resources Limited (the “Company”), which comprises the consolidated statement of financial position as at 30 June 2016, 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 comprising a summary of significant accounting policies and other explanatory information and the directors’ declaration of the consolidated entity comprising the Company and the entities it controlled at the year’s end or from time to time during the financial year.

Directors’ responsibility for the financial report

The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001. The Directors’ responsibility also includes 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. The Directors also state, in the notes to the financial report, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, the financial statements comply with International Financial Reporting Standards.

Auditor’s responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require us to comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement.

Grant Thornton Audit Pty Ltd ACN 130 913 594

a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

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

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.

2

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An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error.

In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation of the financial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial report.

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

Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.

Auditor’s opinion

In our opinion:

• a the financial report of Tychean Resources Limited is in accordance with the Corporations Act 2001, including:

• i giving a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and of its performance for the year ended on that date; and

• ii complying with Australian Accounting Standards and the Corporations Regulations 2001; and

• b the financial report also complies with International Financial Reporting Standards as disclosed in the notes to the financial statements.

Material uncertainty regarding continuation as a going concern

Without qualifying our opinion, we draw attention to Note 28 in the financial report which indicates that the consolidated entity incurred a net loss of $3,677,163 during the year ended 30 June 2016 and, as of that date, had cash and cash equivalents of $288,331. These conditions, along with other matters as set forth in Note 28, indicate the existence of a material uncertainty which may cast significant doubt about the consolidated entity’s ability to continue as a going concern and therefore, the consolidated entity may be unable to realise its assets and discharge its liabilities in the normal course of business, and at the amounts stated in the financial report.

3

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Report on the remuneration report

We have audited the remuneration report included in the directors’ report for the year ended 30 June 2016. 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.

Auditor’s opinion on the remuneration report

In our opinion, the remuneration report of Tychean Resources Limited for the year ended 30 June 2016, complies with section 300A of the Corporations Act 2001.

GRANT THORNTON AUDIT PTY LTD Chartered Accountants

S K Edwards Partner – Audit & Assurance

Adelaide, 2 August 2016