EV RESOURCES LTD — Annual Report 2007

Aug 21, 2007

Appendix 4E Preliminary final report

Appendix 4E

Preliminary Final Report

Period ending 30 June 2006

Name of Entity	Richfield Group Limited
ABN	66 009 144 503
Financial Yearended	30 June2007
Previous corresponding period	30 June 2006

Results for announcement to the market

				$A
Revenue from ordinary activities	Up	88%	to	40,913
Net Loss from ordinary activities after tax attributable to members	Up	40%	to	179,053
Net Loss for the period attributable to members	Up	40%	to	179,053
Dividend Distributions		Amount Per	Security	Franked amount Per Security
Final Dividend		Nil		Nil
Interim Dividend		Nil		Nil
Previous corresponding period		Nil		Nil
Record datefordetermining entitlements to the dividends			NotApplicable
		Current period		Previous corresponding period
NetTangibleAsset backing perordinary share		0.0005 cents		(0.00003) cents
Commentary on the Result		The company did not carry on a business during the financial year. The company is investigating appropriate commercial opportunities.
Financial Report		Referattached

This Preliminary Final Report has been compiled using the attached Financial Report for the year ended 30 June 2007 and is based on accounts which are in the process of being audited.

1

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES

ABN 66 009 144 503

PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2007

CONTENTS

INCOME STATEMENTS ............................................................................................................................... 3 BALANCE SHEETS .................................................................................................................................... 4 STATEMENTS OF CHANGES IN EQUITY ....................................................................................................... 5 CASH FLOW STATEMENTS......................................................................................................................... 6 NOTES TO AND FORMING PART OF THE ACCOUNTS .................................................................................... 7

2

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES INCOME STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

	NOTE	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
		2007	2006	2007	2006
		$	$	$	$
Revenue	5	40,913	21,738	40,913	2,897
Changes in inventories of finished goods
and work in progress		-	(8,611)	-	-
Employee benefits expense		(14,821)	(66,648)	-	(6,000)
Depreciation and amortisation expense		(152)	(1,349)	(152)	(304)
Other expenses from ordinary activities	6	(204,993)	(72,893)	(195,012)	(193,451)
		───────	───────	───────	───────
Loss before income tax expense		(179,053)	(127,763)	(154,251)	(196,858)
Income tax expense	7	-	-	-	-
		───────	───────	───────	───────
Loss for the year		(179,053)	(127,763)	(154,251)	(196,858)
		───────	───────	───────	───────
Loss attributable to members of the parent
entity		(179,053)	(127,763)	(154,251)	(196,858)
		═══════	═══════	═══════	═══════
Earnings per share for loss attributable to the
ordinary equity holders of the company:
		CENTS	CENTS
Basic earnings per share (loss)	10	(0.0004)	(0.0003)
Diluted earnings per share (loss)	10	(0.0004)	(0.0003)
		───────	───────

The accompanying notes form part of these financial statements.

3

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES BALANCE SHEETS AS AT 30 JUNE 2007

	NOTE	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
		2007	2006	2007	2006
		$	$	$	$
CURRENTASSETS
Cash & Cash Equivalents	11	418,872	101,719	415,484	98,221
Trade & Other Receivables	12	16,766	27,021	16,766	-
		───────	───────	───────	───────
TOTALCURRENTASSETS		435,638	128,740	432,250	98,221
		───────	───────	───────	───────
NONCURRENTASSETS
Other Financial Assets	13	22,378	37,296	22,378	37,296
Property, Plant & Equipment	15	-	7,574	-	7,574
Intangible Assets	16	-	-	-	-
		───────	───────	───────	───────
TOTALNONCURRENTASSETS		22,378	44,870	22,378	44,870
		───────	───────	───────	───────
TOTALASSETS		458,016	173,610	454,628	143,091
		───────	───────	───────	───────
CURRENTLIABILITIES
Trade & Other Payables	17	176,451	186,663	133,748	160,257
		───────	───────	───────	───────
TOTALCURRENTLIABILITIES		176,451	186,663	133,748	160,257
		───────	───────	───────	───────
TOTALLIABILITIES		176,451	186,663	133,748	160,257
		───────	───────	───────	───────
NETASSETS		281,565	(13,053)	320,880	(17,166)
		═══════	═══════	═══════	═══════
EQUITY
Contributed Equity	18	9,223,096	8,730,799	9,223,096	8,730,799
Reserves	19	(2,217)	16,409	-	-
Accumulated Losses	20	(8,939,314)	(8,760,261)	(8,902,216)	(8,747,965)
		───────	───────	───────	───────
TOTALEQUITY		281,565	(13,053)	320,880	(17,166)
		═══════	═══════	═══════	═══════

The accompanying notes form part of these financial statements.

4

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES

STATEMENTS OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2007

		ISSUED		ACCUMULATED
	NOTE	CAPITAL	RESERVES	LOSSES	TOTAL
CONSOLIDATEDENTITY
Balance at 1 July 2005		8,963,131	(24,503)	(8,632,498)	306,130
‘In Specie’ Distribution	18	(232,332)	-	-	(232,332)
Adjustments from translation of
foreign controlled entities	19	-	40,912	-	40,912
Loss attributable to members of
parent entity	20	-	-	(127,763)	(127,763)
		─────────	─────────	─────────	─────────
Balance at 30 June 2006		8,730,799	16,409	(8,760,261)	(13,053)
		─────────	─────────	─────────	─────────
Contributions of equity, net of
transaction costs	18	492,297	-	-	492,297
Adjustments from translation of
foreign controlled entities	19	-	(18,626)	-	(18,626)
Loss attributable to members of
parent entity	20	-	-	(179,053)	(179,053)
		─────────	─────────	─────────	─────────
Balance at 30 June 2007		9,223,096	(2,217)	(8,939,314)	281,565
		═════════	═════════	═════════	═════════
PARENTENTITY
Balance at 1 July 2005		8,963,131	-	(8,551,107)	412,024
‘In Specie’ Distribution	18	(232,332)	-	-	(232,332)
Loss attributable to members of
parent entity	20	-	-	(196,858)	(196,858)
		─────────	─────────	─────────	─────────
Balance at 30 June 2006		8,730,799	-	(8,747,965)	(17,166)
		─────────	─────────	─────────	─────────
Contributions of equity, net of	18
transaction costs		492,297	-	-	492,297
Loss attributable to members of
parent entity	20	-	-	(154,251)	(154,251)
		─────────	─────────	─────────	─────────
Balance at 30 June 2007		9,223,096	-	(8,902,216)	320,880
		═════════	═════════	═════════	═════════

The accompanying notes form part of these financial statements.

5

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES CASH FLOW STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007

	NOTE	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
		2007	2006	2007	2006
		$	$	$	$
CASHFLOWS FROMOPERATINGACTIVITIES
Receipts from customers		2,835	77,487	-	7,546
Payments to suppliers and employees		(162,334)	(248,431)	(157,959)	(72,063)
Interest received		2,981	2,897	2,981	2,897
		───────	───────	───────	───────
Net cash outflow from operating activities	23(a)	(156,518)	(168,047)	(154,978)	(61,620)
		───────	───────	───────	───────
CASHFLOWS FROMINVESTINGACTIVITIES
Proceeds from sale of property, plant &
equipment		-	640	-	-
Loans to controlled entities		-	-	(20,056)	(40,028)
		───────	───────	───────	───────
Net cash inflow/(outflow) from investing
activities		-	640	(20,056)	(40,028)
		───────	───────	───────	───────
CASHFLOWS FROMFINANCINGACTIVITIES
Proceeds from issue of shares	18	521,250	-	521,250	-
Share Issue Transaction Costs	18	(28,953)	-	(28,953)	-
		───────	───────	───────	───────
Net cash inflow from financing activities		492,297	-	492,297	-
		───────	───────	───────	───────
Net increase/(decrease) in cash and cash
equivalents		335,779	(167,407)	317,263	(101,648)
Cash and cash equivalents at the
beginning of the financial year		101,719	251,598	98,221	199,869
Effect of exchange rates on cash holdings
in foreign currencies		(18,626)	17,528	-	-
		───────	───────	───────	───────
Cash and cash equivalents at the end of
the financial year	11	418,872	101,719	415,484	98,221
		═══════	═══════	═══════	═══════

The accompanying notes form part of these financial statements.

6

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

This financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards, Urgent Issues Group Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001 .

The financial report covers the consolidated entity of Richfield Group Limited and controlled entities, and Richfield Group Limited as an individual parent entity. Richfield Group Limited is a listed public company, incorporated and domiciled in Australia.

The following is a summary of the material accounting policies adopted by the consolidated entity in the preparation of the financial report. The accounting policies have been consistently applied, unless otherwise stated.

BASIS OF PREPARATION

Richfield Group Limited and controlled entities, and Richfield Group Limited as an individual parent entity have prepared financial statements in accordance with the Australian equivalents to International Financial Reporting Standards (AIFRS).

The parent and consolidated entities have elected to adopt the exemptions available under AASB 1 relating to AASB 132: Financial Instruments: Disclosure and Presentation, and AASB 139: Financial Instruments: Recognition and Measurement.

Reporting Basis and Conventions

The financial report has been prepared on an accrual basis and is based on historical cost and does not take into account changing money values, or except where stated current valuations of non-current assets. Cost is based on the fair values of the consideration given in exchange for assets.

The financial report has been prepared on a going concern basis, which contemplates continuity of normal business activities and the realisation of assets and liabilities in the ordinary course of business and on the assumption of sufficient funds becoming available for the operations of the consolidated entity.

ACCOUNTING POLICIES

(a) Principles of Consolidation

The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Richfield Group Limited (“company” or “parent entity”) as at 30 June 2007 and the results of all subsidiaries for the year then ended. Richfield Group Limited and its subsidiaries together are referred to in this financial report as the “consolidated entity” or “group”.

Subsidiaries are all those entities over which the company has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the company controls another entity.

Subsidiaries are fully consolidated from the date on which control is transferred. They are de-consolidated from the date that control ceases.

The purchase method of accounting is used to account for the acquisition of subsidiaries.

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

Investments in subsidiaries are accounted for at cost in the individual financial statements of Richfield Group Limited.

7

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D

(a) Principles of Consolidation (Cont’d)

All inter-company balances and transactions between entities in the consolidated entity, including any unrealised profits or losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistencies with those policies applied by the parent entity.

Where controlled entities have entered or left the consolidated entity during the year, their operating results have been included/excluded from the date control was obtained or until the date control ceased.

If applicable, minority equity interests in the equity and results of the entities that are controlled are shown as a separate item in the consolidated financial report.

(b) Income Tax

The charge for current income tax expense is based on the profit for the year adjusted for any nonassessable or disallowed items. It is calculated using the tax rates that have been enacted or are substantially enacted by the balance sheet date.

Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.

Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or liability is settled. Deferred tax is credited in the income statement except where it relates to items that may be credited directly to equity, in which case the deferred tax is adjusted directly against equity.

Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be available against which deductible temporary differences can be utilised.

The amount of benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that the consolidated entity will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law.

(c) Inventories

Inventories are measured at the lower of cost and net realisable value. The cost of manufactured products includes direct materials, direct labour and an appropriate portion of variable and fixed overheads. Overheads are applied on the basis of normal operating capacity. Costs are assigned on the basis of weighted average costs.

(d) Property, Plant & Equipment

Each class of property, plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation and impairment losses. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Plant & Equipment

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

8

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

The cost of fixed assets constructed within the consolidated entity includes the cost of materials, direct labour, borrowing costs and an appropriate proportion of fixed and variable overheads.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future consolidated benefits associated with the item will flow to the group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.

Depreciation

The depreciable amount of all fixed assets including building and capitalised lease assets, but excluding freehold land, is depreciated on a straight-line basis over their useful lives to the consolidated entity commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.

The depreciation rates used for each class of depreciable assets are:

CLASS OFFIXEDASSET	DEPRECIATIONRATE
LeaseholdImprovements	2%
Plant andMachinery	10%- 20%
OfficeFurniture	6%- 20%
OfficeEquipment	20%
Motor Vehicles	10%-30%

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

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the income statement. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings

(e) Leases

A distinction is made between finance leases which effectively transfer from the lessor to the lessee substantially all the risks and benefits incidental to ownership of leased non-current assets, and operating leases under which the lessor effectively retains substantially all such risks and benefits.

Finance leases are capitalised by recording an asset and a liability at the lower of the amounts equal to the fair value of the leased property or the present value of the minimum lease payments, including any guaranteed residual values. Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the period.

Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful lives or the lease term.

9

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D

Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses in the periods in which they are incurred. Lease incentives under operating leases are recognised as a liability and amortised on a straight-line basis over the life of the lease term.

(f) Financial Instruments

Recognition

Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related contractual rights or obligations exist. Subsequent to initial recognition these instruments are measured as set out below.

Financial assets at fair value through profit and loss

A financial asset is classified in this category if acquired principally for the purpose of selling in the short term or if so designated by management and within the requirements of AASB 139: Recognition and Measurement of Financial Instruments. Derivatives are also categorised as held for trading unless they are designated as hedges. Realised and unrealised gains and losses arising from changes in the fair value of these assets are included in the income statement in the period in which they arise.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are stated at amortised cost using the effective interest rate method.

Held-to-maturity investments

These investments have fixed maturities, and it is the group’s intention to hold these investments to maturity. Any held-to-maturity investments held by the group are stated at amortised cost using the effective interest rate method.

Available-for-sale financial assets

Available-for-sale financial assets include any financial assets not included in the above categories. Available-for-sale financial assets are reflected at fair value. Unrealised gains and losses arising from changes in fair value are taken directly to equity.

Financial liabilities

Non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and amortisation.

Derivative instruments

Derivative instruments are measured at fair value. Gains and losses arising from changes in fair value are taken to the income statement unless they are designated as hedges.

Richfield Group Limited and Controlled Entities designates certain derivatives as either;

• i. hedges of the fair value of recognised assets or liabilities or a firm commitment (fair value hedge); or

• ii. hedges of highly probably forecast transactions (cash flow hedges).

At the inception of the transaction the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions is documented.

Assessments, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions have been and will continue to be highly effective in offsetting changes in fair values or cash flows of hedged items, are also documented.

10

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(i) Fair value hedge

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the income statement, together with any changes in the fair value of the hedge asset or liability that are attributable to the hedged risk.

(ii) Cash flow hedge

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is deferred to a hedge reserve in equity. The gain or loss relating to the ineffective portion is recognised immediately in the income statement.

Amounts accumulated in the hedge reserve in equity are transferred to the income statement in the periods when the hedged item will affect profit or loss.

Fair value

Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to similar instruments and option pricing models.

Impairment

At each reporting date, the group assess whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a prolonged decline in the value of the instrument is considered to determine whether impairment has arisen. Impairment losses are recognised in the income statement.

(g) Impairment of Assets

At each reporting date, the group reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the income statement.

Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.

Where it is not possible to estimate the recoverable amount of an individual asset, the group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

(h) Intangibles

Goodwill

Goodwill and goodwill on consolidation are initially recorded at the amount by which the purchase price for a business or for an ownership interest in a controlled entity exceeds the fair value attributed to its net assets at date of acquisition. Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill on acquisition of associates is included in investments in associates. Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

(i) Foreign Currency Transactions and Balances

Functional and presentation currency

The functional currency of each of the group’s entities is measured using the currency of the primary consolidated 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.

11

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

Transaction and balances

Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.

Exchange differences arising on the translation of monetary items are recognised in the income statement, except where deferred in equity as a qualifying cash flow or net investment hedge.

Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in the income statement.

Group companies

The financial results and position of foreign operations whose functional currency is different from the group’s presentation currency are translated as follows:

• assets and liabilities are translated at year-end exchange rates prevailing at that reporting date;

• income and expenses are translated at average exchange rates for the period; and

• retained earnings are translated at the exchange rates prevailing at the date of the transaction.

Exchange differences arising on translation of foreign operations are transferred directly to the group’s foreign currency translation reserve in the balance sheet. These differences are recognised in the income statement in the period in which the operation is disposed.

(j) Employee Entitlements

Provision is made for the company’s liability for employee benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits.

(k) Cash

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of one month or less, and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities on the balance sheet.

(l) Revenue

• Revenue from the sale of goods is recognised upon the delivery of goods to customers.

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

Revenue from investment properties is recognised on an accruals basis or straight-line basis in accordance with leases agreements.

Dividend revenue is recognised when the right to receive a dividend has been established. Dividends received from associates and joint venture entities are accounted for in accordance with the equity method of accounting.

Revenue from the rendering of a service is recognised upon the delivery of the service to the customers.

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

12

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D

(m) Borrowing Costs

Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

All other borrowing costs are expensed in the period in which they are incurred.

(n) Trade and Other Creditors

These amounts represent liabilities for goods and services provided to the Consolidated Entity prior to the end of the financial year and which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition.

(o) Contributed Equity

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds.

(p) Earnings Per Share

(i) Basic earnings per share

Basic earnings per share is determined by dividing the net loss attributable to equity holders of the company, by the weighted average number of ordinary shares outstanding during the year.

(ii) Diluted earnings per share

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

(q) Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the balance sheet are shown inclusive of GST.

Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

(r) Comparative Figures

When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.

2. FINANCIAL RISK MANAGEMENT

The company’s activities expose it to financial risks; market risk (including currency risk, fair value interest rate risk), credit risk, liquidity risk and cash flow interest rate risk. Due to immaterial levels of activity during the financial year, derivative financial instruments such as foreign exchange contracts and interest rate swaps to hedge certain risk exposures were not required to be used. Where relevant and appropriate, the company will avail itself of appropriate hedging instruments in future financial years.

(a) Market Risk

(i) Foreign Exchange Risk

Foreign exchange risk arises when future commercial transactions and recognised assets and liabilities are denominated in a currency that is not the entity’s functional currency.

13

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

The group is comprised of overseas based subsidiaries and is exposed to foreign exchange risk arising from currency exposures to the Singapore dollar. These risks were not considered to have been material in relation to the financial year ended 30 June 2007.

(ii) Fair Value Interest Rate Risk

Refer to (d) below.

(b) Credit risk

The Consolidated Entity did not have any material credit risk exposure to any single debtor or group of debtors at balance date.

(c) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash to fund the Consolidated Entity’s activities. The directors regularly monitor the company’s cash position and on an on-going basis consider a number of strategic initiatives to ensure that adequate funding continues to be available.

(d) Cash flow and fair value interest rate risk

Due to the company’s significant holding of cash and cash equivalents, the group’s income and operating cash flows are materially exposed to changes in market interest rates.

The group is not exposed to interest-rate risk arising from either short-term or long-term borrowings.

3. CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS

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 entity 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. There are no estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

4. SEGMENT INFORMATION

There is no reportable segment information as the consolidated entity did not undertake any business activity during the financial year and accordingly, did not derive revenues from sales to external customers.

In the prior financial year, the group derived revenue from sales to external customers predominantly in one geographical and business segment, being its Singapore based IT activities.

.

14

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

		CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
		2007	2006	2007	2006
		$	$	$	$
5.	REVENUE
	Sale of goods	-	18,841	-	-
	Interest received - Other Persons	7,162	2,897	7,162	2,897
	Other revenue	33,751	-	33,751	-
		───────	───────	───────	───────
	Total Revenue	40,913	21,738	40,913	2,897
		═══════	═══════	═══════	═══════

15

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
	2007	2006	2007	2006
EXPENSES	$	$	$	$
Loss before income tax expense includes
the following specific items:
Bad and doubtful debts
- trade receivables	(24,186)	-	-	-
- wholly owned subsidiaries	-	-	(20,056)	(139,482)
Foreign currency translation gain/(losses)	(4,418)	7,546	-	7,546
Impairment of Other Financial Assets	(14,918)	-	(14,918)	-
Loss on disposal of plant and equipment	(7,422)	-	(7,422)	-
Professional fees	(39,223)	(25,200)	(39,223)	(25,200)
	═══════	═══════	═══════	═══════
INCOMETAXEXPENSE
Reconciliation of income tax expense to prima facie tax payable:
Loss from ordinary activities before income
tax expense	(179,053)	(127,763)	(154,251)	(196,858)
	───────	───────	───────	───────
Prima facie tax benefit on loss from ordinary
activities before income tax at 30% (2006:
30%)	(53,716)	(38,329)	(46,275)	(59,057)
Tax effect of amounts which are taxable
(deductible) in calculating taxable income:
- non-deductible expenditure	3,157	-	3,157	-
- write-downs to recoverable amounts	-	-	6,017	41,844
- impairment expenses	4,476	-	4,476	-
	───────	───────	───────	───────
	(46,083)	(38,329)	(32,625)	(17,213)
Deferred tax assets not recognised	46,083	38,329	32,625	17,213
	───────	───────	───────	───────
Income tax expense	-	-	-	-
	═══════	═══════	═══════	═══════
Unused tax losses for which no deferred tax
asset has been recognized	2,043,046	1,924,526	1,777,594	1,675,327
	═══════	═══════	═══════	═══════
Potential Tax Benefit at 30%	612,914	577,358	533,278	502,598
	═══════	═══════	═══════	═══════

6. EXPENSES

(a) Loss before income tax expense includes the following specific items:

7. INCOME TAX EXPENSE

(a) Reconciliation of income tax expense to prima facie tax payable:

The potential tax benefit will only be obtained if:

• (i) the consolidated entity derives future assessable income of a nature and of an amount sufficient to enable the benefit from the deductions for the losses to be realised;

• (ii) the consolidated entity continues to comply with the conditions for deductibility imposed by tax legislation; and

• (iii) no changes in tax legislation adversely affect the consolidated entity in realising the benefit from the deductions for the losses.

16

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

8. KEY MANAGEMENT PERSONNEL DISCLOSURES

• (a) Names and positions of consolidated and parent entity key management personnel in office at any time during the financial year are:

Key Management Person Position Mr Steven Pynt Chairman, Non-executive director Mr Mark Balfour Non-executive director – Appointed 5 February 2007 Mr Michael Scivolo Non-executive director – Appointed 5 February 2007 Mr Jack Bai Guo Jin Non-executive director – Resigned 5 February 2007 Mr Christopher Bai Non-executive director – Resigned 5 February 2007 Ms Jane Wilder Company Secretary – Appointed 1 March 2007 Mr Simon Headon Company Secretary - Resigned 14 March 2007

	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
	2007	2006	2007	2006
	$	$	$	$
(b) Compensation
Short-Term Employee Benefits	33,000	-	33,000	-
Post Employment Benefits	10,000	-	10,000	-
	───────	───────	───────	───────
	43,000	-	43,000	-
	═══════	═══════	═══════	═══════

The company has taken advantage of the relief provided by Corporations Regulation 2M.6.04 and has transferred the detailed remuneration disclosures to the Directors’ Report.

(c) Shareholdings

Number of Shares held by Key Management Personnel	Number of Shares held by Key Management Personnel	Number of Shares held by Key Management Personnel
	Balance	Received as	Net Change	Balance
	1 Jul 06	Compensation	Other*	30 Jun 07
Mr S Pynt	8,000	-	-	8,000
Mr M Balfour	0	-	-	0
Mr M Scivolo	0	-	-	0
	───────────	───────────	───────────	───────────
TOTAL	8,000	-	-	8,000
	═══════════	═══════════	═══════════	═══════════

Shareholdings of key management personnel include those that have been disclosed under representation made to them by the parties within the AASB 124 - Related Party Disclosures. The key management personnel have relied upon the representations made as they have no control or influence over the financial affairs of the personally related entities to substantiate the shareholdings declared. When a personally related entity declines to provide shareholding details, the shareholding of that personally related entity is assumed to be nil.

17

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
	2007	2006	2007	2006
	$	$	$	$
9. AUDITORS' REMUNERATION
Remuneration of the auditor of the parent entity	for:
- Auditing or reviewing of financial reports	14,250	10,800	14,250	10,800
	───────	───────	───────	───────
- Taxation compliance services	3,000	-	3,000	1,900
	───────	───────	───────	───────
- Corporate Advisory services	7,000	-	7,000	-
	───────	───────	───────	───────
- Other services	4,537	-	4,537	-
	═══════	═══════	═══════	═══════
10. EARNINGS PERSHARE
(a) Reconciliation of earnings to profit or loss
Loss attributable to ordinary equity holders	(179,053)	(127,763)
	────────	────────
Earnings used to calculate basic and diluted
EPS	(179,053)	(127,763)
	════════	════════
	No. shares	No. shares
(b) Weighted average number of ordinary
shares outstanding during the year used in
calculating basic and diluted EPS	485,049,986	464,676,013
	═══════	═══════

18

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

11. CASH AND CASH EQUIVALENTS Cash at bank and in hand

CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
2007	2006	2007	2006
$	$	$	$
418,872	101,719	415,484	98,221
═══════	═══════	═══════	═══════

Cash at bank is comprised of “at-call” funds attracting a floating rate of interest of between 0.95% and 4.50%.

Reconciliation of Cash

Cash at the end of the financial year as per statements of cash flows is reconciled to items in the balance sheet as follows:

balance sheet as follows:
Cash and at bank and in hand	418,872	101,719	415,484	98,221
Bank overdrafts	═══════	═══════	═══════	═══════
12. TRADE ANDOTHERRECEIVABLES
Trade receivables	24,186	27,021	-	-
Provision for doubtful debts	(24,186)	-	-	-
	───────	───────	───────	───────
	-	27,021	-	-
Other receivables	16,766	-	16,766	-
Amount receivable from:
Loans to subsidiaries	-	-	136,423	116,367
Less: Provision for non-recovery	-	-	(136,423)	(116,367)
	───────	───────	───────	───────
	16,766	27,021	16,766	-
	═══════	═══════	═══════	═══════
13. OTHERFINANCIALASSETS
Listed Investments - at cost	37,296	37,296	37,296	37,296
less: Impairment to recoverable amount	(14,918)	-	(14,918)	-
Investment in Subsidiaries	-	-	23,115	23,115
Less: Provision for Non-Recoverability	-	-	(23,115)	(23,115)
	───────	───────	───────	───────
	22,378	37,296	22,378	37,296
	═══════	═══════	═══════	═══════

During the previous financial year, an in specie distribution of 4,646,760 shares amounting to $232,332 in Richfield International Ltd was made to the shareholders of Richfield Group Ltd. A loan to Richfield International Ltd amounting to $37,290 was converted to shares in Richfield International Ltd.

19

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

14. CONTROLLED ENTITIES

The Consolidated Entity incorporates the assets, liabilities and results of the following companies:

		Country of Incorporation	Class of Shares	Class of Shares	Percentage Owned	Percentage Owned	Percentage Owned
					2007		2006
					%		%
	Parent Entity
	Richfield Group Limited	Australia	Ordinary
	Subsidiaries of Richfield Group Limited
	Eastern Prime Corporation Pte Ltd	Singapore	Ordinary		100		100
	Advanz International Pte Ltd	Singapore	Ordinary		100		100
		CONSOLIDATED		ENTITY	PARENT		ENTITY
		2007		2006	2007		2006
		$		$	$		$
15.	PROPERTY, PLANT ANDEQUIPMENT
	Plant & Equipment
	At Cost	-		98,793		-	98,793
	Accumulated Depreciation	-		(98,793)		-	(98,793)
		───────	───────		───────		───────
	Net book value	-		-		-	-
		───────	───────		───────		───────
	Leasehold Buildings & Improvements
	At Cost	-		15,144		-	15,144
	Accumulated Depreciation	-		(7,570)		-	(7,570)
		───────	───────		───────		───────
	Net book value	-		7,574		-	7,574
		───────	───────		───────		───────
	Total net book value	-		7,574		-	7,574
		═══════	═══════		═══════		═══════
(a)	Movements in Carrying Amounts
	Consolidated Entity	Plant &		Leasehold			Total
		Equipment		Improvements
	Opening net book value		-		7,574		7,574
	Additions		-		-		-
	Disposals		-		(7,422)		(7,422)
	Depreciation expense		-		(152)		(152)
		──────────		──────────		──────────
	Closing net book value		-		-		-
		══════════		══════════		══════════
	Parent Entity	Plant &		Leasehold
		Equipment		Improvements			Total
	Opening net book value		-		7,574		7,574
	Additions		-		-		-
	Disposals		-		(7,422)		(7,422)
	Depreciation expense		-		(152)		(152)
		──────────		──────────		──────────
	Closing net book value		-		-		-
		══════════		══════════		══════════

20

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
	2007	2006	2007	2006
	$	$	$	$
16. INTANGIBLEASSETS
Goodwill on Consolidation	19,224	19,224	-	-
Accumulated Impairment Losses	(19,224)	(19,224)	-	-
	───────	───────	───────	───────
Net Carrying Value	-	-	-	-
	───────	───────	───────	───────
Total Intangibles	-	-	-	-
	═══════	═══════	═══════	═══════
17. TRADE ANDOTHERPAYABLES
Trade payables and accruals	69,419	56,960	26,716	29,440
Sundry payables	-	22,671	-	23,785
Amounts payable to:
- Other related parties	107,032	107,032	107,032	107,032
	───────	───────	───────	───────
	176,451	186,663	133,748	160,257
	═══════	═══════	═══════	═══════
18.CONTRIBUTED EQUITY
534,176,013 (2006: 464,676,013) fully paid
ordinary shares	9,223,096	8,730,799	9,223,096	8,730,799
	═══════	═══════	═══════	═══════
(a) Ordinary Shares
At the beginning of the reporting period	8,730,799	8,963,131	8,730,799	8,963,131
Share Placement (i)	521,250	-	521,250	-
Transaction costs arising on share
placement	(28,953)	-	(28,953)	-
‘In specie’ distribution (ii)	-	(232,332)	-	(232,332)
	───────	───────	───────	───────
At reporting date	9,223,096	8,730,799	9,223,096	8,730,799
	═══════	═══════	═══════	═══════
	No. Shares	No. Shares	No. Shares	No. Shares
At the beginning of reporting period	464,676,013	464,676,013	464,676,013	464,676,013
Share Placement (i)	69,500,000	-	69,500,000	-
	───────	───────	───────	───────
At reporting date	534,176,013	464,676,013	534,176,013	464,676,013
	═══════	═══════	═══════	═══════

(i) On 16 March 2007, the company raised $521,250 (gross) through the placement of 69,500,000 ordinary shares at $0.0075 per share to sophisticated investors.

(ii) On 30 November 2005, 4,646,730 shares in Richfield International Limited were distributed to shareholders of the company as an ‘in specie’ return of capital.

At balance date, no share options were outstanding.

Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of shares held.

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

21

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES

NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT ENTITY	PARENT ENTITY
	2007	2006	2076	2006
	$	$	$	$
19. RESERVES
Foreign currency translation	(2,217)	16,409	-	-
	═══════	═══════	═══════	═══════
(a) Foreign Currency Translation Reserve
Balance at the beginning of the financial
year	16,409	(24,503)	-	-
Adjustment arising from the translation of
the financial statements of foreign controlled
entities	(18,626)	40,912	-	-
	───────	───────	───────	───────
Balance at the end of the financial year	(2,217)	16,409	-	-
	═══════	═══════	═══════	═══════
The foreign currency translation reserve records exchange differences arising on translation of a foreign
controlled subsidiary.
20. ACCUMULATEDLOSSES
Accumulated losses at the beginning of the
financial year.	(8,760,261)	(8,632,498)	(8,747,965)	(8,551,107)
Loss attributable to members of the parent
entity	(179,053)	(127,763)	(154,251)	(196,858)
	───────	───────	───────	───────
Accumulated losses at the end of the
financial year	(8,939,314)	(8,760,261)	(8,902,216)	(8,747,965)
	═══════	═══════	═══════	═══════

21. CAPITAL & LEASING COMMITMENTS

At balance date, there were no outstanding capital commitments for the consolidated entity or the parent entity.

22. CONTINGENT ASSETS & LIABILITIES

At balance date there were no contingent assets or liabilities.

22

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
	2007	2006	2007	2006
	$	$	$	$
23. CASHFLOWINFORMATION
(a) Reconciliation of Loss after Income Tax	to
Net Cash Outflow from Operating Activities
Loss after income tax	(179,053)	(127,763)	(154,251)	(196,858)
Bad and doubtful debts	-	-	-	139,482
Depreciation	152	1,349	152	304
Net loss on disposal of plant and equipment	7,422	-	7,422	-
Fair value adjustments to listed investments	14,918	-	14,918	-
Changes in operating assets and liabilities
(Increase)/decrease in:
Trade and other receivables	10,255	51,100	3,290	(383)
Inventories	-	9,764	-	-
Increase/(decrease) in:
Trade payables and accruals	(10,212)	(102,497)	(26,509)	(4,165)
	───────	───────	───────	───────
Net Cash outflow from operating activities	(156,518)	(168,047)	(154,978)	(61,620)
	═══════	═══════	═══════	═══════

24. EVENTS AFTER THE BALANCE SHEET DATE

There are no matters or circumstances which have arisen since the end of the financial year which significantly affected or may significantly affect the operations of the consolidated entity, the results of those operations, or the state of affairs of the consolidated entity in future financial years.

23

RICHFIELD GROUP LIMITED AND CONTROLLED ENTITIES NOTES TO AND FORMING PART OF THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE 2007

25. RELATED PARTY TRANSACTIONS

Directors and key management personnel

Disclosures relating to directors and key management personnel are set out in Directors’ Report and in note 8.

Subsidiaries

Richfield Group Limited is the parent entity in the wholly-owned group comprising the company and its controlled entities. Ownership interests in these controlled entities are set out in note 14.

Aggregate amounts included in the determination of the loss from ordinary activities before income tax that resulted from transactions with entities in the wholly-owned group are disclosed at note 6. Transactions between the parent entity and other entities in the wholly-owned group are reflected in Loans to Subsidiaries (refer note 12).

Transactions between the parent entity and other entities in the wholly-owned group during the year ended 30 June 2007 are summarized below.

	CONSOLIDATEDENTITY	CONSOLIDATEDENTITY	PARENT	ENTITY
	2007	2006	2007	2006
	$	$	$	$
(a) Loans to subsidiaries
Balance at the beginning of the financial year	-	-	116,367	76,339
Loans advanced	-	-	20,056	40,028
Provision for non-recovery	-	-	(20,056)	(116,367)
	───────	───────	───────	───────
Balance at the end of the financial year	-	-	-	-
	═══════	═══════	═══════	═══════

There are no fixed terms for the repayment of principal on loans advanced by the parent entity and no interest has been charged by the parent on the amounts advanced.

The following is a summary of transactions which occurred with other related parties

(b) Other Related Parties

Directors and director-related entities hold
directly, indirectly or beneficially as at the
reporting date the following equity interests
in members of the consolidated entity:
- Ordinary shares	8,000	257,154,061	8,000	257,154,061
	═══════	═══════	═══════	═══════

24