GBM RESOURCES LIMITED. — Annual Report 2009

Sep 30, 2009

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GBM RESOURCES LIMITED

(ACN 124 752 745)

Annual Report For the period ended 30 June 2009

GBM RESOURCES LIMITED

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CORPORATE DIRECTORY

Directors

Peter May Non-Executive Chairman

Peter Thompson Managing Director

Cameron Switzer Non-Executive Director

Neil Norris Executive Director – Exploration Director

Company Secretary

Stuart Usher

Registered Office

Level 1, 335 Churchill Ave Subiaco WA 6008 AUSTRALIA Telephone: +61 8 9388 6899 Facsimile: +61 8 9388 6977

Principal Place of Business

Level 1, 335 Churchill Ave Subiaco WA 6008 AUSTRALIA

Postal Address

PO Box 608 Subiaco WA 6904 AUSTRALIA

Exploration Office

Auditors

HLB Mann Judd 15 Rheola Street West Perth WA 6005 AUSTRALIA

Share Registry

Advanced Share Registry Services 150 Stirling Highway Nedlands WA 6009 AUSTRALIA Telephone: +61 8 9389 8033 Facsimile: +61 8 9389 7871

Bankers

Commonwealth Bank Limited

Stock Exchange Listing

GBM Resources Limited - shares & options are listed on the Australian Securities Exchange (ASX Code: GBZ, GBZO)

Solicitors

Steinepreis Paganin Lawyers and Consultants Level 4, Next Building 16 Milligan Street Perth WA 6000 AUSTRALIA

Website and e-mail address

www.gbmr.com.au

Email: admin@gbmr.com.au

10 Parker Street PO Box 658 Castlemaine VIC 3450 AUSTRALIA

GBM RESOURCES LIMITED

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Contents	Page
Chairman’s Report	4
Directors’ Report	5
Auditors’ Independence Declaration	25
Corporate Governance Statement	26
Income Statements	30
Balance Sheets	31
Statements of Changes in Equity	32
Cash Flow Statements	33
Notes to the Financial Statements	34
Directors’ Declaration	59
Independent Auditor’s Report	60
Shareholder Information	62

GBM RESOURCES LIMITED

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CHAIRMAN’S REPORT

Dear shareholder,

The past financial year marked an important growth phrase for your company, achieving the transition from a newly listed explorer to one that has evolved a rapidly maturing suite of copper and gold projects in Australia, principally in the mining heartlands of Queensland and Victoria.

This growth included securing a wider footprint of more prospective ground in world-class minerals provinces, introducing state-of-the-art exploration technology to our endeavours and particularly across under-explored areas within our tenements, increasing resource estimates and attracting funding for our on-ground activities over the next year or so.

The outcome of this focus was a considerable increase in the number of drill-ready, highly prospective mineralised anomalies – with many of these to now be tested under priority drilling campaigns in the current year.

Pleasingly, by mid calendar year 2009, this transparent delivery of our stated exploration and project objectives over the past year has begun to attract a measurable increase in equity market interest further building value for shareholders.

This support was particularly evident in the strong take-up of the Entitlement Offer and associated Share Placement – raising nearly A$1.4 million.

Field success in the current financial year from our forward exploration program should encourage retention of that interest – a critical ingredient to attracting ongoing market funding to progress our leading copper and gold projects to a development outcome.

Significantly, the calibre of your Company’s exploration initiatives and project management skills was encapsulated during the year with a decision by both the Queensland and Victorian State Governments to award drill assistance grants for the first time to GBM.

The strict due diligence parameters applied by government ahead of such grant decisions, lends further support to our business plan.

Importantly, the across-the-board project gains were made despite the ongoing softness during the period under review evident in domestic and international economies from impacts of the Global Financial Crisis.

As a result, GBM is now well resourced to complete two key objectives this year – the drilling of a one kilometre deep diamond hole at Belltopper Hill within the Malmsbury Gold Project in central Victoria and a more intensive drilling program at high-grade gold and copper targets within the Brightlands project area near Mount Isa.

The Mt. Isa package of tenements also hosts our phosphate interests which will be progressed in line with more favourable market sentiment towards this commodity and most likely with a joint venture partner.

I thank you for your ongoing loyalty and support and we look forward to updating you as we progress with our growth plans for 2009-2010.

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Peter May Chairman 30 September 2009 Perth, WA

GBM RESOURCES LIMITED

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DIRECTORS’ REPORT

The Board of Directors of GBM Resources Limited has pleasure in presenting its report for the period ended 30 June 2009.

The names, qualifications and experience of directors in office during the financial period and until the date of this report are as follows:

Directors

Mr. Peter May Position : Non-Executive Chairman B.Com, G.Dip.App.Fin, M.MinEcon Experience : Mr May has a background in banking, finance, management consulting and corporate advisory services primarily focusing on clients in the resources, manufacturing and technology sectors.

Mr May has completed a Masters in Mineral and Energy Economics and has had involvement in evaluation of projects, mergers, acquisition and divestment opportunities. He has also worked with clients in aspects of business development and strategic planning with an industry focus on clients in the energy and natural resources sector.

Other current directorships of listed companies:

None

Former directorships of listed companies in last 3 years: None

Special responsibilities: Non-Executive Chairman Audit and Risk committee Chairman Remuneration committee Chairman

Interests in shares and options at date of directors’ report: 1,097,250 Ordinary shares 266,175 Options exercisable at 22 cents expiring 30 June 2010 766,175 Options exercisable at 25 cents expiring 30 June 2010

Mr Peter Thompson Position : Managing Director — Executive B.Bus, CPA, FCIS

Experience : Mr Thompson is a CPA qualified accountant and Fellow of Chartered Secretaries Australia. He has over 30 years’ experience in the mining industry in Australia, UK and South America. He has held senior roles with several major companies including Mt Edon Gold Mines, MIM Holdings Ltd and Xstrata Plc.

Since 2000, Mr Thompson has been involved in the development of various infrastructure projects, including mine and refinery expansions and establishment of infrastructure including roads, rail, port and power utilities.

Other current directorships of listed companies:

None

Former directorships of listed companies in last 3 years:

Non-executive director Golden West Resources Limited (Appointed 28 May 2007 - Resigned 15 February 2008)

Special responsibilities:

Chief Executive Officer

Interests in shares and options at date of directors’ report:

6,562,582 Ordinary shares

1,968,750 Options exercisable at 22 cents expiring 30 June 2010 2,968,775 Options exercisable at 25 cents expiring 30 June 2010

GBM RESOURCES LIMITED

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DIRECTORS’ REPORT (continued)

Mr Cameron Switzer Position : Non-Executive Director B.Sc.(Hons), MAusMM, MAIG Experience : Mr Switzer is a geologist with over 20 years of experience gained in 11 countries. He has held senior positions with a number of major mining companies including Senior Project Geologist at Newcrest Mining Ltd’s Telfer gold mine in Western Australia and Geology Manager at Acacia Resources Ltd’s Union Reef Gold Mine in the Northern Territory. Mr Switzer was also Principal Geologist with MIM Exploration Ltd for seven years during which time he gained broad experience with a range of deposits and geological and operating environments. Mr Switzer has a track record in the successful identification of mineral deposits, project generation, exploration management, validation of resources and the subsequent commercialisation of resources. Mr Switzer is a geological consultant based in Queensland. Other current directorships of listed companies: None Former directorships of listed companies in last 3 years: None Special responsibilities: Member Audit and Risk committee Member Remuneration committee Interests in shares and options at date of directors’ report: 4,593,750 Ordinary shares 1,968,750 Options exercisable at 22 cents expiring 30 June 2010 2,378,125 Options exercisable at 25 cents expiring 30 June 2010 Neil Norris BSc(hons), MAIMM, Position : Exploration Director (appointed 3 April 2009) MAIG Experience: Mr. Norris is a geologist with over 25 years experience gained in Australia and overseas. Recently he was Group Exploration Manager for Perseverance Corporation Limited and spent over ten years with Newmont Australia Limited holding senior positions in both mining and exploration areas. A key achievement was his development of the geological models which contributed to the discovery of the Phoenix ore body at Fosterville. Mr. Norris was also involved in the discovery of the world class Cadia and Ridgeway deposits. Mr. Norris has a track record in the successful identification of mineral deposits and his experience will greatly advance GBM’s exploration efforts. Other current directorships of listed companies: None Former directorships of listed companies in last 3 years: None Special responsibilities: Exploration Director Interests in shares and options at date of directors’ report: 6,250,000 Ordinary shares 3,093,635 Options exercisable at 25 cents expiring 30 June 2010

Directors have been in office since incorporation of the Company on 3 April 2007 and to the date of this report except where otherwise stated.

Company Secretary

Mr. Stuart Usher, B.Bus, Grad.Dip. CSP, CPA, ACIS, MAICD

Position : Company Secretary / Chief Financial Officer

Experience : Mr. Usher is a CPA, an Associate member of the Chartered Institute of Secretaries and Administrators and a member of ‘Chartered Secretaries Australia’ where he has attained the status of Chartered Company Secretary. He has extensive experience in the management and corporate affairs of public listed companies.

GBM RESOURCES LIMITED

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DIRECTORS’ REPORT (continued)

REVIEW OF OPERATIONS

Targeting World Class Gold and Copper Systems

2009 Highlights

• Strategic acquisition and consolidation of tenements in Mount Isa region which is host to world class mineral deposits . The projects are highly focused on the Eastern Succession which is recognised as the key host for Iron Oxide Copper Gold style Cu –Au targets in the region. A prolifically mineralised area with ongoing track record of discovery of copper gold deposits.

• Soil sampling of key targets on the Brightlands Cu-Au Project defined strong anomalies requiring drill testing.

• Drilling confirmed phosphate mineralisation on the Bungalien Project near Mount Isa.

• Soil and detailed gravity surveys support Intrusive Related Gold Systemat Malmsbury and potential extensions to the Malmsbury goldfield. Potential to emerge as a major gold system.

• Gold resource at Malmsbury increased by 76% to contain 104,000 ounces of Gold

1.0 GBM exploration strategy.

Financial year 2009 was GBM’s first full year of operation. At the end of this time our exploration strategy remains on track and unchanged. The strategic objective to discover a new mineral find remains the key goal for the company .

Focus on the discovery of world class gold and gold copper deposits.

Targeting areas of mineralisation where there has been previous exploration and nearby historic or current mineral production.

Discovery of a new deposit in our portfolio of assets is the key to adding significant value. Current exploration assets are on the way to achieving this outcome.

Applying a systems approach to mineral exploration.

In many instances previous exploration has focussed on small scale prospect level evaluation and failed to understand the broader geological environment or system which is essential to determine the likelihood of major deposits occurring, and provide vectors to their location and style.

Exploring in regions with historic production offer higher probability of new discovery. Exploration success in recent decades has been strongly biased to regions with an established mining history. Our current projects lie in such regions, or areas where recent geological interpretation indicates extension of known mineral provinces. Our focus to date has been toward regions of eastern Australia which apart from being highly prospective from a mineral exploration perspective, offer the opportunity to acquire quality tenure in areas with good infrastructure and access to a trained workforce.

Build a small experienced team of professional geoscientists

Our team along with a group of specialist consultants form the skill base essential for successful mineral exploration. We believe that well qualified and highly motivated people are a cornerstone for successful exploration and are committed to developing our skill base to assist in the company’s success.

Maximising in ground exploration expenditure

GBM operates from a small exploration base in regional Victoria, minimising overheads and staff numbers.

GBM RESOURCES LIMITED

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DIRECTORS’ REPORT (continued) REVIEW OF OPERATIONS (continued)

In 2010, the exploration programme to realise this strategy includes;

• Brightlands Project

• This is GBM’s premier project in the Mount Isa Region. Geophysical surveys and drill testing of Milo, Tiger and Tambourine along with further evaluation of other highly prospective Cu-Au ad Au target areas elsewhere on this large tenement area.

• Malmsbury Gold Project

Drill testing to confirm the potential size of the mineralising system following from geochemical and geophysical surveys and modelling completed during 2009.

• Bungalien - Horse Creek Project

Further evaluation and drill testing of phosphate potential and basement Iron Oxide Copper Gold (IOCG) targets. Seek a JV partner to progress with the phosphate development.

• Mount Margaret and Talawanta / Grassy Bore Projects

Subject to finding a suitable joint venture partner, geophysical surveys to further upgrade IOCG targets associated with significant magnetic features, and drill testing of priority targets.

• Dee Range Project

Field truth Cu-Au targets which have been upgraded with compilation of available data. Follow up with initial soil sampling and geophysics.

• Willaura Project

Enhance target definition using soil sampling, ground magnetic, induced polarisation geophysics and possible drilling.

2.0 Introduction

Since GBM listed on the ASX in October 2007, the small initial portfolio of quality exploration tenements in Victoria and Queensland has grown substantially with the acquisition of a strategic tenement holding in the Mount Isa Region. Seven major project areas in two states provide GBM with a quality portfolio of exploration assets with an excellent prospect of discovery of world class gold copper or copper deposits. Projects are located in areas with a pedigree of discovery of significant gold and copper-gold deposits. In Queensland the four major projects (Bungalien-Horse Creek, Brightlands, Mt. Margaret and Talawanta-Grassy Bore) in the prolific Mount Isa Region and the Dee Range Project nearby to the world class Mount Morgan copper-gold deposit are without question some of the most prospective exploration areas in Australia today.

In Victoria the Malmsbury Project located in the Bendigo zone of Victoria which has produced over 70M ounces of gold and hosts not only the well documented slate belt style deposits, but also the highly profitable fine gold deposit at Fosterville. In western Victoria, the Willaura project is located in prospective structures in the Mt Stavely belt which is a highly underexplored volcanic belt, possibly the continuation of the prolific Mount Read Volcanics in Tasmania.

A regional exploration office established in the rural city of Castlemaine in Central Victoria provides good access to Victorian projects and easy access to transport for interstate projects. The company has in place an experienced exploration team supported by consultants both local and interstate as required. The rural location provides a cost effective and practical base for the company’s exploration activities which has been vital in GBM not only surviving, but growing in a time of global uncertainty.

In the year to 30 June 2009, GBM has completed initial drilling programme at Bungalien in Queensland. Seventeen reverse circulation drill-holes have been completed for a total of 1,025 metres. Soil sampling has been completed at Milo, Tiger and Tambourine prospects on the Brightlands and Bungalien Projects in Queensland and at Malmsbury in Victoria with a total of 1,134 samples collected and analysed. In addition numerous rock chip samples have been collected and analysed. A significant data base relating to these tenements has been assembled and continues to grow as new tenements are acquired and data becomes available. Expenditure on exploration for the period to 30 June 2009 including the acquisition of tenements was $1.3M .

GBM RESOURCES LIMITED

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DIRECTORS’ REPORT (continued) REVIEW OF OPERATIONS (continued)

3.0 Queensland Projects ‘Mount Isa – nothing else on earth measures up’

During the year, GBM strategy of seeking world class copper–gold deposits in world class mineral provinces recognised, and could not ignore, the prospectivity of the Mount Isa region. During the second half of 2008 the company acquired ten tenements in the Eastern Fold Belt of the Mount Isa Region providing it with a strategic landholding in the region which represents a substantial increase in the value and prospectivity of the company’s portfolio of mineral exploration tenements. During 2009, field work and research by the company has resulted in a further, significant, increase in value to this portfolio of mineral tenements.

The Proterozoic Mount Isa Block is recognised as one of the most fertile provinces on earth for the discovery of metallic mineral deposits. The concentration of world class deposits is unrivalled; nothing else on earth measures up . The Mount Isa Inlier contains four of the world’s ten largest zinc deposits, three of the ten largest lead deposits and three of the ten largest silver deposits. There are also numerous copper deposits with twenty four deposits each containing over 400,000 tonnes of copper including (three deposits that contain over 1 million tonnes of copper) and fifteen deposits are hosted by the Eastern Fold Belt. Most of these deposits (and all of those hosted in the Eastern Fold Belt) contain economically significant levels of associated gold mineralisation. (Queensland Department of Minerals and Energy, Taylor Wall & Associates, SRK Consulting Pty Ltd & ESRI Australia, 2000: North West Queensland Mineral Province Report. Queensland Department of Minerals and Energy, Brisbane. Queensland Minerals, a Summary of Major Mineral Resources, Mines and Projects, Fourth Edition. Queensland Department of Minerals and Energy, Brisbane)

The recent mineral exploration boom has seen at least two more significant discoveries in the region, the Rocklands CuCo-Au deposit, and what at this early stage appears to be a world class Mo-Rh discovery at Merlin. Prior to this the last major new discovery was Ernest Henry in 1991. As a direct result of low levels of mineral exploration through the 1990’s and early part of the new millennium, many areas have not been actively explored for almost two decades. In this time significant advances in understanding of ore deposit styles and in exploration techniques have occurred. GBM will harness these advances, particularly in the application of electrical geophysical techniques in areas of cover, to further exploration of our tenements.

The most common deposit style in the Eastern Sequence is Iron-Oxide-Cu-Au (IOCG), a deposit style which includes many very large deposits throughout the world, including the massive Olympic Dam Cu-Au-U Deposit in South Australia; however other styles including sediment hosted mineralisation are also represented in the region. In addition the area contains a number of Uranium occurrences.

The overlying sediments of the Georgina Basin continue to emerge as one of the world’s major phosphate provinces with phosphate resources currently identified totalling over three billion tonnes. New deposits now at feasibility or construction stage continue to emphasise the potential of the area to be a long term supplier of phosphate rock, vital to feed the growing world population.

The Dee Range Project is located near the Mount Morgan Mine that produced over 400,000 tonnes of copper and 8 million ounces of gold.

3.1 Brightlands Project (EPM14416)

Target: IOCG & ‘Tick Hill Au’ style deposits in the Eastern Sequence of the Proterozoic Mount Isa Inlier.

During 2009, gold and copper targets on the Brightlands Project area, located south west of Cloncurry have been a key focus of exploration by the company. Widespread mineral occurrences are considered to hold potential for IOCG and high grade Tick Hill (Au) styles of mineralisation. Multiple exploration target areas have been identified by previous explorers. During the year a new litho structural review identified a total of 58 targets, both new and existing, based on structure, alteration and stratigraphic interpretation.

Assimilation of recently acquired data sets and research with the existing geological framework has resulted in a vastly improved structural model which in turn has significantly enhanced the geological prospectivity for the Brightlands Project. The recent analyses incorporated Aster and SPOT satellite imagery, both of which provided interpretive evidence for alteration areas and allowed revision of available geological mapping. In addition, hyper spectral mapping (Hymap data) made available by the Queensland Government has provided additional alteration mapping over much of the tenement area. Interpretations from the recently completed pmd*CRC project over the Mount Isa Inlier is resulting in publication of concepts which have also been incorporated into the new interpretation.

GBM RESOURCES LIMITED

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DIRECTORS’ REPORT (continued) REVIEW OF OPERATIONS (continued)

Most major Cu-Au deposits within the Mt Isa region are intimately associated with major fault zones and their detailed location determined by specific structural settings. This study identified several key regional structural features which may have been significant in focusing ore forming processes;

• Recognition that major east-north-east trending fault zones in the north of the tenement form part of the Cloncurry Flexure considered by the pmd*CRC to be a deep seated structure dating back to basin development and sedimentation.

• Confirmation that the Pilgrim Fault Zone is a long lived, deep seated, probable mantle tapping structure.

• • The Wakeful Syncline is now interpreted as a major fault zone, possibly a back thrust linked to the Pilgrim Fault Zone and providing access for mantle derived fluids into the Brightlands Prospect area.

• The Milo Prospect area lies within a very extensive interpreted alteration and mineralising system, possibly with a buried granite at depth.

Many of the targets identified have supportive geochemical and geophysical signatures. Ranking of recognised targets identified six targets for immediate follow-up.

The following have been identified to be of high priority for immediate follow-up;

• Tiger Prospect- soil sampling and grab samples collected by GBM during the year have confirmed a copper anomaly in a fault with associated breccia zones interpreted as part of a structural zone hosting the Rocklands deposit (Cudeco) located 3km northwest. Rock chip sampling of the structure has returned high Cu values with anomalous Au .The Rockland’s mineralisation is relatively narrow at surface or has no surface expression in places, however at depth it turns into a 20-30m wide mineralised structure. Initial drill testing will take place during the September quarter 2009.

• Tambourine Prospect (previously The Range): Soil and rock sampling completed by GBM have confirmed previous sampling where 43 anomalous rock chip samples collected over 1.3km[2] . contain between 0.5 and 21.1 ppm Au, 25% contain >1% Cu and as high as 8%Cu. Petrography identified strong tourmaline-quartz-albite alteration of metasediments and amphibolites. Mineralisation appears to be associated with significant fault splay from the Pilgrim fault and adjacent to areas of iron alteration types as mapped from Aster satellite imagery and Hy Map data sets hosted within the potentially reactive Timberoo Member of the Malbon Group. Initial drill testing will take place during the September quarter 2009.

• Milo & Milo West Prospects- soil sampling completed by GBM has delineated a large, coherent Cu-Au anomaly with localized U and Mo anomalism associated with multiple zones of gossan and Cu bearing shears (and breccias) hosted by Dolerite overlain by Calc-silicate. Surface rock chip samples frequently returning >1% Cu and 0.3ppm Au, limited drilling indicating significant sections of >0.1% Cu with no Au assays. The old Milo Mine was noted as a Cu-U occurrence.

• Fine Gold Gully- interpreted by Newcrest as being in a similar stratigraphic position as the Tick Hill Mine (470,000t @ 28g/t Au) with a similar geochemical anomaly, one hole previously drilled over weaker (30ppb in soil) geochemical response returned 6m @ 0.2g/t Au and 0.23%Cu.

• Southern Gold Prospects - anomalous Cu, Au, Zn and Mn are associated with the extensive Chumvale Breccia Unit. Some of the few alluvial gold workings in the Eastern Sequence are associated with these prospects.

3.2 Bungalien - Horse Creek Project (EPM14355, EPM15150, EPM14120, EPM17885, EPM17886 & EPM15681) Target: IOCG Style deposits in the Eastern Sequence of the Mount Isa Inlier.

Previously a review of available exploration confirmed strong magnetic anomalies as targets for potential IOCG style mineralisation on Bungalien, Malbon2 and Horse creek tenements. The Company’s review has identified six discrete magnetic anomalies under cover of the Georgina Basin which comprises between 100 to 500 metres of sediment cover.

Lag sampling on Malbon2 returned a clear +400ppm Cu anomaly which is interpreted to represent a significant ‘leakage’ of bedrock geochemistry through more than 100 metres of the overlying Georgina Basin sediments. This anomaly lies on a major north-easterly trend identified in the regional magnetic image, and is interpreted as being underlain by the Wimberu Granite. The outcropping Wimberu Granite hosts a number of historic Cu-Au-U occurrences and is being actively explored by other companies.

GBM was successful in obtaining Queensland DME Strategic Drilling Initiative funding to fund a hole to test a magnetic high located in the south-western part of Bungalien. This anomaly is considered prospective for IOCG style mineralisation.

GBM RESOURCES LIMITED

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DIRECTORS’ REPORT (continued) REVIEW OF OPERATIONS (continued)

Target: Sediment hosted Phosphate Mineralisation

Phosphate mineralisation is widespread in the Beetle Creek Formation which outcrops near the margin of the Cambrian Georgina Basin sediments in the Bungalien – Horse Creek Project area. During the year the tenement coverage in the area was expanded to take in further areas prospective for phosphate mineralisation. The Cambrian Georgina Basin cover sequence in the area has potential to host phosphate deposits similar to the Phosphate Hill Mine located some 70 km south of the Bungalien tenement.

During the year GBM completed broad spaced soil sampling (128 samples) which successfully defined a phosphate anomaly associated with the outcrop position of the Beetle Creek formation in the northern portion of the Bungalien licence area. This anomaly was tested at shallow depth by a series of 17 reverse circulation drill holes (1025 metres).

The program demonstrated the continuity of the Beetle Creek Formation throughout the project area; this sedimentary rock sequence is the key host to phosphate mineralisation within the Georgina Basin. Of 17 RC holes drilled, 5 returned peak values in excess of 10% P2O5 and two eastern most holes returned peak values of more than 22% P2O5. Interpretation of the drilling results demonstrates that the project area contains some 16 square kilometres of the Beetle Creek Formation within a depth of 50 metres from surface and over a strike length of 9 kilometres. The drilling intersections confirm a very flat lying orientation for the mineralised Beetle Creek Formation, which most holes intersected between 40 to 50 metres down hole.

Work to date has confirmed the potential of the Bungalien project area to host significant phosphate mineralisation. In addition, the project is ideally supported by a road and rail corridor through its tenement boundary, enhancing potential future development options.

3.3 Talawanta- Grassy Bore Project (EPM15406 & EPM15681)

Target: IOCG Style deposits in the Eastern Sequence of the Mount Isa Inlier.

Talawanta and Grassy bore licence areas are centred on a north trending linear magnetic complex interpreted to represent a feature in the underlying Proterozoic basement (extension of Mount Isa Inlier under cover). The magnetic complex is locally extremely intense, particularly given the depth of the cover sequence which would tend to mask the magnetic response. Previous drilling has confirmed the presence of widespread copper mineralisation and associated hydrothermal alteration. This region is outside the outcropping Mount Isa Inlier under the Carpentaria Basin cover sequence, in this area reported to be 300 to 600m thick.

Talawanta is centred on a major magnetic anomaly which is the most intense anomaly in the district next to Ernest Henry. The magnetic anomaly is 15km x 7km in area. The anomaly has been drill tested by three drill holes which intersected alteration and zones of Cu–Au mineralisation.

The magnetic anomaly is clearly associated with alteration and the potential for discovering IOCG style mineralisation is considered high.

Grassy Bore is centred on a series of bull’s eye magnetic and gravity features. Limited drilling has confirmed the presence of alteration and weak mineralisation. The depth of cover is reported as around 300 metres. Grassy bore also contains valid targets for IOCG style mineralisation.

Both areas contain significant geophysical anomalies capable of hosting world class IOCG style deposits.

3.4 Mount Margaret Project (EPM1627, EPM14614, EPMA 16398 & EPMA16222)

Target: IOCG Style deposits in the Eastern Sequence of the Mount Isa Inlier.

These tenements are situated in the same geophysical and geological domain as the Ernest Henry Cu-Au Mine currently operated by Xstrata Plc.

The tenements are centred on a series of magnetic anomalies that surround prospective granites. The area also contains extensive geochemical targets (Cu, Au), though the relationship with basement magnetic features has not been established in our review to date. It is a highly mineralised district with Ernest Henry and Mt Margaret deposits located nearby.

GBM RESOURCES LIMITED

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DIRECTORS’ REPORT (continued) REVIEW OF OPERATIONS (continued)

3.5 Dee Range Project (EPM16057, EPM17105, EPM17163 & EPMA17734)

Target: Intrusive Related Copper Gold deposits near Mt Morgan

GBM has a substantial strategic tenement holding in the Mount Morgan region of Queensland. The initial license, EPM 16057 has been supplemented by three additional licenses and applications with the total tenement holding in the area now covering some 690 square kilometers.

The Mount Morgan Au-Cu mine yielded around 8m ounces of gold and over 420,000 tonnes of copper. A total of 50 million tonnes of ore was treated at an average grade of 5.9 g/t Au and 0.7% Cu making Mount Morgan a world class deposit which remains a highly attractive exploration target.

Detailed review of previous exploration reports has identified a number of target areas on the basis of available geochemical, geophysical and geological data. Research has also identified a very strong geochemical trend defining a corridor including the Mount Chalmers Au deposit near Rockhampton and the Mount Morgan Au-Cu Deposit adjacent to our tenement areas. This corridor is also noted in lineament analyses indicating that it may reflect a fundamental crustal feature contributing to mineralisation at a regional scale.

4 .0 Victorian Projects

Gold mining in Victoria is currently experiencing a new boom with Fosterville, Stawell and Bendigo Gold mines in Central Victoria all operating profitably and producing over 220,000 ounces of gold per annum. In addition mine development is earmarked to continue at the Morning Star and A1 mines in Eastern Victoria and numerous other projects now receiving exploration funding. Victoria remains a world class gold province and has a long history of gold production commencing in the 1850’s with total production 80M ozs which represents almost 2% of all recorded gold production. Whilst the contribution from quartz vein related styles is well known, other styles have made substantial contributions including sulphide lode style (with a granite related component) at Stawell, intermediate dyke hosted mineralisation in the Woods Point - Walhalla Belt and recent work at Fosterville has highlighted the existence of a substantial gold field with a gold endowment at this time approaching 4M ozs and growing as exploration continues.

Recent geological research on both sides of Bass Strait has highlighted the likely geological links between Tasmania and Victoria, with a possible relationship between the Mount Read Volcanic Belt in Tasmania and the Mount Stavely Zone in western Victoria. The Mount Read Volcanics are host to numerous deposits and deposit styles including the Mount Lyell Copper Mine (>1Mt Cu, 1.4M ozs Au), Henty Gold Mine and Beaconsfield Gold are moving toward releasing a maiden resource of 47,000 tonnes of contained copper (10.6 million tonnes at 0.45% copper) for the wholly owned Thursdays Gossan oxide deposit. Exciting gold results have also been reported recently associated with mineralised porphyry east of copper deposit.

4.1 Malmsbury Project (EL4515, ELA5120)

Target: Intrusive Related Gold System (IRGS) in Central Victoria.

The Malmsbury gold project covers the locations of Belltopper Hill and the historical Drummond North gold fields. Work completed in 2008 has resulted in the Leven Star inferred resource on Belltopper Hill increasing to 800,000 tonnes at an average grade of 4.0 g/t gold containing 104,000 ounces of gold using a 2.5g/t gold cut off. The resource remains open at depth and along strike. The Leven Star deposit can be described as a distinctive gold –sulphide association and sulphide-carbonate alteration similar to gold mineralisation at Northgate’s Fosterville gold mine which now has a known gold endowment of 4 million ounces.

Soil sampling (175 samples) has defined a coherent Gold-Molybdenum-Bismuth anomaly at Belltopper Hill with spatially related and overprinting Gold-Arsenic-Antimony anomalism. Interpretation of this data in conjunction with geophysical data further supports the conclusion that the Malmsbury gold mineralisation is genetically related to an intrusive below Belltopper Hill and forms part of an IRGS.

The historical Drummond north goldfield produced 98,000 tonnes of ore at an average grade of 29g/t in the late 19[th] century and has little targeted exploration activity, and remarkably, no record of drilling has been located to date. Many zones remain to be drill tested and resources evaluated. The Drummond North Goldfield includes a number of structurally controlled mineralised zones which are significant and hold similarities to the Belltopper Hill mineralisation suggesting that these too are part of a large IRGS.

GBM RESOURCES LIMITED

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DIRECTORS’ REPORT (continued) REVIEW OF OPERATIONS (continued)

The Malmsbury gold project is distinctly different from the typical central Victorian Slate Belt style deposits. Key differences include; association of gold with the disseminated auriferous arsenical sulphide minerals, elemental associations, disseminated and stockwork gold host and fine grained gold distribution.

The results of exploration activities support the conclusion that the Malmsbury gold project has the potential to emerge as a major gold system.

4.2 Willaura Project (EL4631, EL4751 & EL5033)

Target: Intrusive Related Cu-Au Deposits in Western Victoria

The Willaura Project is located within the Stavely Zone of Western Victoria which has been interpreted as a possible continuation of the Mount Read Volcanic Belt in Western Tasmania. The Stavely Zone contains a number of well known copper and base metal occurrences including the Thursdays Gossan intrusive related gold deposits (IRGD) which has returned up to 229 metres averaging 0.22% Cu in previous drilling. Recent drilling by Beaconsfield Gold NL has returned high grade primary (chalcopyrite) intersections including 4.2% Cu and 1.1 g/t Au over 7.7 metres in the same area. In addition Beaconsfield has discovered high grade gold mineralisation associated with porphyry intrusions. The link to the Mount Read Volcanics is indicative of significant exploration potential for mineral discovery. The Stavely Zone is still considered to be one of the most highly under-explored volcanic belts in Australia.

In the Willaura tenements GBM is targeting intrusive related gold deposits similar to Cadia and Mount Lyell (Cu-Au), however as with all tenements, potential for other styles will be considered as part of the company’s evaluation.

GBM have been successful in receiving a drilling assistance grant as part of the Rediscover Victoria drilling initiative to test a number of strong geophysical targets, some with associated Cu-Au geochemical anomalies which have been outlined by previous explorers in the Willaura tenements. Three magnetic features with associated Cu geochemical anomalies (anomaly’s A, B and C) were previously highlighted by GBM in EL4631 and EL4751 as targets for early testing.

In addition a number of other magnetic features adjacent to the regionally significant Moysten Fault along the eastern margin of EL4631 remain to be evaluated.

5.0 Tenements

On listing in October 2007 GBM held five mineral tenements in three project areas in two states. The Company’s tenement holding has continued to grow and it now holds 22 tenements in seven project areas that cover a total area of approximately 2,560 square kilometres in some of Australia’s most prospective mineral provinces. During the year the Lauriston EL5120 was granted providing coverage of potential extensions to mineralisation on the Malmsbury Project. Evaluation of the Ararat EL5033 resulted in a decision to relinquish that licence.

All of these licences and applications (see table below) are held 100% by the Company (or its wholly owned subsidiaries). Application EPM18051 is a competing application and at this stage no indication of priority has been received by the company.

GBM RESOURCES LIMITED

• 14 -

DIRECTORS’ REPORT (continued)

REVIEW OF OPERATIONS (continued)

Project /	Tenement	Owner	GBMR	Manager	Granted	Expiry	Approx	Status	State
Name	No.		Equity				Area
							(km2)
Victoria
Malmsbury
Belltopper	EL4515*1	GBMR	100%	GBMR	6/10/2005	5/10/2010	25	Granted	Vic
Lauriston	EL5120	GBMR	100%	GBMR	17/12/2008	16/12/2013	143	Granted	Vic
Willaura
Lake Bolac	EL4631	GBMR	100%	GBMR	21/03/2002	20/03/2009	98	Granted	Vic
Woorndoo	EL4751	GBMR	100%	GBMR	19/11/2003	18/11/2010	29	Granted	Vic
Queensland
Dee Range
Dee Range	EPM16057	GBMR	100%	GBMR	27-Sep-07	26-Sep-12	178	Granted	Q'ld
Boulder Creek	EPM17105	GBMR	100%	GBMR	26-Mar-08	25-Mar-10	178	Granted	Q'ld
Mt Morrisey	EPM17163	GBMR	100%	GBMR	23-Apr-08	23-Apr-10	161	Granted	Q'ld
Black Range	EPMA17734	GBMR	100%	GBMR			180	Appl'n	Q'ld
Mount Isa
Region
Talawanta - Grassy Bore
Talawanta	EPM15406	GBMR*2	100%	GBMR	15-Jan-08	14-Jan-11	325	Granted	Q'ld
Grassy Bore	EPM15681	GBMR*⁴	100%	GBMR	28-Sep-07	28-Sep-10	325	Granted	Q'ld
Mount Margaret
Mt Margaret	EPM1627	GBMR*2	100%	GBMR	31-Jul-07	30-Jul-12	36	Granted	Q'ld
W. Ext
Mt Margaret	EPM14614	GBMR*2	100%	GBMR	2-Aug-05	1-Aug-10	129	Granted	Q'ld
West
Mt Malakoff	EPM16398	GBMR*2	100%	GBMR			84	Appl'n	Q'ld
Ext
Cotswold	EPM16622	GBMR*2	100%	GBMR			45	Appl'n	Q'ld
Brightlands
Brightlands	EPM14416	GBMR*2	100%	GBMR	5-Aug-05	4-Aug-10	251	Granted	Q'ld
Brightlands	EPM18051	GBMR	100%	GBMR			99	Appl'n	Q'ld
West
Bungalien
Bungalien	EPM14355	GBMR*2	100%	GBMR	13-Oct-04	12-Oct-09	61	Granted	Q'ld
Burke River	EPM17885	GBMR	100%	GBMR			3	Appl'n	Q'ld
Horse Creek	EPM15150	GBMR*2	100%	GBMR	13-Jul-06	12-Jul-09	80	Granted	Q'ld
Limestone	EPM17849	GBMR	100%	GBMR			72	Appl'n	Q'ld
Creek
Malbon 2	EPM14120	GBMR*2	100%	GBMR	24-Aug-04	23-Aug-10	15	Granted	Q'ld
Horse Creek	EPM17886	GBMR	100%	GBMR			45	Appl'n	Q'ld
Ext
Totals							2562
_Note _	* 1subject to a	2.5% net smelter royalty to vendors.
	* 2 subject to a	2% net smelter	royalty ispayable to Newcrest Mining Ltd.

GBM Resources Limited tenement summary at 30[th] June 2009.

The information in this report that relates to Mineral Resources and Exploration Results is based on information compiled by Neil Norris, who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Norris is a full-time employee of the company. Mr. Norris has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr. Norris consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

GBM RESOURCES LTD.

• 15 -

DIRECTORS’ REPORT (continued) REVIEW OF OPERATIONS (continued)

Sustainable Development

GBM is committed to safe and responsible development of Australia’s mineral resources.

GBM continued to upgrade and extend the Safety Health and Environmental Systems it moved quickly to establish as a key priority after listing on the ASX in October 2007. The company is committed to maintaining a working environment and culture that places the safety of all as the number one priority. Supporting key policies, the company has established an Occupational Health and safety Management plan and a range of management standards and operating procedures. These have been, and will continue will be reviewed by staff and management as part of a process of continuous improvement in all aspects of the company’s operations.

GBM is encouraging a culture of awareness and respect for the environments in which we operate. Exploration activities include assessment of each site with all practicable measures taken to minimise any environmental impacts, and to implement rehabilitation in a timely manner.

GBM remains a member of the Mining Council of Australia (MCA), actively participating in the activities of the Victorian Branch. GBM is a signatory to the MCA’s Enduring Value, the Australian Minerals Industry framework for sustainable development.

Key achievements during the current year of operation were;

• Zero LTI’s were sustained on our sites though out the year, this is in line with GBM’s target of zero injuries.

• Zero LTI’s were sustained on our sites though out the year.

• Zero significant environmental incidents were sustained on our sites throughout the year.

• Review of key policies (Occupational Health and Safety Policy, Fit for Work Policy and Occupational Rehabilitation Policy).

• Review of the safety management system and Management Standards.

• Nomination for Victorian DPI Strzelecki Award Excellence in Sustainable Development in the Minerals Industry for low impact drilling at the Malmsbury Project.

GBM is committed to establishing a culture of understanding and respect for the communities in which we work. To this end consultation was conducted with our neighbours and is considered a key part of doing business. Periodic information updates are provided to all stakeholders.

Principal Activities

The principal activity of the Company during the financial year was gold and copper exploration.

Financial Overview

Operating Results

The net loss of the company and the consolidated entity for the financial year after tax was $791,905 (2008: $1,046,698).

Dividends Paid or Recommended

No dividend was paid or declared for the financial year.

Significant Changes in State of Affairs

Apart from the above there were no significant changes in the state of affairs of the company during the financial period:

After Balance Date Events

The company undertook a share placement which was finalised on 13 August 2009 with the issue of 25,000,000 shares issued at an issue price of 2 cents per share to raise $500,000.

Except for the above developments, no other matters or circumstances have arisen since the end of the financial period which significantly affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of the company in future financial years.

GBM RESOURCES LIMITED

• 16 -

DIRECTORS’ REPORT (continued)

Environmental Regulations

The economic entity holds participating interests in a number of exploration tenements. The various authorities granting such tenements require the tenement holder to comply with the terms of the grant of the tenement and all directions given to it under those terms of the tenement. There have been no known breaches of the tenement conditions, and no such breaches have been notified by any government agencies during the period ended 30 June 2009. Refer to the review of operations report for details of GBM’s Sustainable Development work.

Likely Developments and Expected Results of Operations

Comments on expected results of the operations of the company are included in this report under the review of operations.

Disclosure of other information regarding likely developments in the operations of the company in future financial years and the expected results of those operations is likely to result in unreasonable prejudice to the company. Accordingly, this information has not been disclosed in this report.

GBM RESOURCES LIMITED

• 17 -

DIRECTORS’ REPORT (continued)

REMUNERATION REPORT

This report details the nature and amount of remuneration for each of the directors of GBM Resources Limited, the executives and key management personnel receiving the highest remuneration.

Remuneration Policy (audited)

The Board of Directors of GBM Resources Limited is responsible for determining and reviewing compensation arrangements for directors and executive staff. Remuneration levels for executives are competitively set to attract the most qualified and experienced directors and senior executive officers, in the context of prevailing market conditions, particular experience of the individual concerned and the overall performance of the company, with the objective of ensuring maximum stakeholder benefit from the retention of a high quality board and executive team. The assistance of an external consultant or remuneration surveys is used where necessary.

The Board of GBM Resources Limited believes the remuneration policy is appropriate and effective in its ability to attract and retain appropriate executives and directors to run and manage the consolidated entity, as well as create goal congruence between directors, executives and shareholders.

The Board’s policy for determining the nature and amount of remuneration for Board members and senior executives of the consolidated entity is as follows.

The remuneration policy, setting the terms and conditions for the executive directors and other senior executives, was developed by the remuneration committee and approved by the Board after seeking professional advice from independent external consultants. All executives receive a base salary (which is based on factors such as length of service and experience), superannuation and fringe benefits. The remuneration committee reviews executive packages annually by reference to the consolidated entity’s performance, executive performance and comparable information from industry sectors and other listed companies in similar industries.

The performance of executives is measured against criteria agreed biannually with each executive and is based predominantly on the forecast growth in shareholders’ value. All bonuses and incentives must be linked to predetermined performance criteria. The Board may, however, exercise its discretion in relation to approving incentives, bonuses and options, and can recommend changes to the committee’s recommendations. Any changes must be justified by reference to measurable performance criteria. The policy is designed to attract the highest calibre of executives and reward them for performance that results in long-term growth in shareholder wealth.

All remuneration paid to directors and executives is valued at the cost to the company and expensed. Remuneration in respect of securities issued to directors and executives is valued as the difference between the market price of those shares and the amount paid by the director or executive.

Each of the non-executive directors receives a fixed fee for their services as directors. Non-executive directors' fees not exceeding an aggregate of $200,000 per annum have been approved by the company in a general meeting. There is no direct link between remuneration paid to any of the directors and corporate performance such as bonus payments for achievements of certain key performance indicators. During the year the executive management agreed to a 25% salary reduction voluntarily accepted by the Board and key suppliers

GBM RESOURCES LIMITED

• 18 -

DIRECTORS’ REPORT (continued)

REMUNERATION REPORT (continued)

Details of remuneration for the year ended 30 June 2009 (audited)

The remuneration for each director and for key management personnel who are also the highest paid executives of the consolidated entity during the 12 month financial period was as follows:

	Short-term benefits Post employment Share based payments Total Performance related
	Salary & Fees Superannuation Contributions Retirement benefits Shares Options $ $ $ $ $ % 24,500 - - - - 24,500 - 199,384 - - - - 199,384 - 34,621 - - - - 34,621 - 35,243 - - - - 35,243 -

Details of remuneration for the period ended 30 June 2008 (3 April 2007 to 30 June 2008)

	Short-term benefits Post employment Share based payments Total Performance related
Directors Mr. Peter May – Chairman (appointed 3 April 2007) Mr. Peter Thompson – Managing Director (appointed 3 April 2007) Mr. Cameron Switzer - Non-executive Director (appointed 3 April 2007) Total Remuneration	Salary & Fees Superannuation Contributions Retirement benefits Shares Options $ $ $ $ $ % 40,834 - - - 14,139 54,973 - 90,747 - - - 14,139 104,886 - 29,662 - - - 14,139 43,801 -
	161,243 - - - 42,417 203,660 -

Equity instrument disclosures relating to key management personnel

(i) Share holdings : The numbers of shares in the company held during the financial period by each director and other key management personnel of the Group, including their personally related parties, are set out below.

(i) Share holdings: The numbers of sh and other key management personnel below.	ares in the company held during the financial period by each director of the Group, including their personally related parties, are set out
Number of shares held by Specified Directors	Balance 30.06.08 Received as Remuneration Acquired on market Other changes Balance 30.06.09
Directors Mr. Peter May – Non-executive Chairman Mr. Peter Thompson - Managing Director Mr. Cameron Switzer- Non-executive Director Mr. Neil Norris – Executive Director (appointed 3 April 2009) Total Number of shares held by Specified Directors	658,350 - - 438,9002 1,097,250 3,937,549 - - 2,625,0332 6,562,582 2,756,250 - - 1,837,5002 4,593,750 - 3,750,0001 2,500,0002 6,250,000
	7,352,149 - - 11,151,433 18,503,582
	Balance 03.04.07 Received as Remuneration Acquired on market Other changes Balance 30.06.08
	- - - 658,350 658,350 - - - 3,937,549 3,937,549 - - - 2,756,250 2,756,250

GBM RESOURCES LIMITED

• 19 -

DIRECTORS’ REPORT (continued)

REMUNERATION REPORT (continued)

1 Shares held on appointment date as a director.

2 Non-renounceable rights issue

3 Other changes include seed and promoter subscription in addition to subscriptions through initial public offering prospectus dated 31 July 2007.

(ii) Option holdings

Number of options held by Directors

(ii) Option holdings Number of options held by Directors
	Balance 30.06.08 Received as Remuneration Other Balance 30.06.09
	1,032,350 - - 1,032,350 4,937,525 - - 4,937,525 4,346,875 - - 4,346,875 - - 3,093,6353 3,093,635

1 Shares held on appointment date as a director.

	Balance 03.04.07 Received as Remuneration Other Balance 30.06.08
Directors Mr. Peter May – Non-executive Chairman (appointed 3 April 2007) Mr. Peter Thompson - Managing Director (appointed 3 April 2007) Mr. Cameron Switzer- Non-executive Director (appointed 3 April 2007) Total	- 500,000 266,1751 266,1752 1,032,350 - 1,000,000 1,968,7501 1,968,7752 4,937,525 - 1,000,000 1,968,7501 1,378,1252 4,346,875
	- 2,500,000 7,816,750 10,316,750

1 Subscribed as part of seed promoter allocation.

2Subscribed for through the non-renounceable entitlement issue dated 6 February 2008.

3 Holdings on appointment date.

GBM RESOURCES LIMITED

• 20 -

DIRECTORS’ REPORT (continued)

REMUNERATION REPORT (continued)

Share based compensation (audited)

Options granted as part of remuneration Year ended 30 June 2009

Nil options were granted during the year.

Period ended 30 June 2008

Grant date	Vesting date	Expiry date	Number	In Escrow	Exercise price
12 June 2007	12 June 2007	30 June 2010	3,000,000	24 months ending 24 October 2009	25 cents

Options

Options were granted under the GBM Resources Limited Employee Option Plan which was approved by shareholders on 10 May 2007 in a general meeting of shareholders. Staff eligible to participate in the plan are full time employees, Directors and consultants.

Options are granted under the plan for no consideration.

Options granted under the plan carry no dividend or voting rights.

When exercisable, each option is convertible into one ordinary share fourteen days after options exercised.

Details of options over ordinary shares in the company provided as remuneration to each director of GBM Resources Limited and each of the key management personnel of the Group are set out below. When exercisable, each option is convertible into one ordinary share of GBM Resources Limited.

Value of Options issued to Directors and Executives

Grantee	Grant date	Number	Value of options	granted	Value of options exercised at	Value of options lapsed	Total
			at the grant date		the exercise	at the date of
					date	lapse
Peter May	12 June 2007	1,000,000		$14,139		-	$14,139
Peter Thompson	12 June 2007	1,000,000		$14,139		-	$14,139
Cameron Switzer	12 June 2007	1,000,000		$14,139		-	$14,139
Total		3,000,000		$42,417		-	$42,417

The assessed fair value at grant date of options granted to the Directors is allocated equally over the period from grant date to vesting date, and the amount is included in the remuneration tables above. Fair values at grant date are independently determined using a Black Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option.

The model inputs for options granted to Directors during the period ended 30 June 2008 included:

• (a) options are granted for no consideration;

• (b) exercise price: $0.25;

• (c) grant date:14 June 2007;

• (d) expiry date: 30 June 2010;

• (e) share price at grant date: $0.10;

• (f) expected price volatility of the company’s shares on grant date–60%;

• (h) risk-free interest rate on grant date– 6.31%.

GBM RESOURCES LIMITED

• 21 -

DIRECTORS’ REPORT (continued)

REMUNERATION REPORT (continued)

Service agreements (audited)

Consultancy Agreement with Mr Peter Thompson – Managing Director

The Company has entered into a consultancy agreement ( Agreement ) with Peter Thompson ( Consultant ) through his consultancy company, Regalquest Investments Pty Ltd ( Consultancy Company ), on the following material terms and conditions:

• (a) ( Term ) : the Consultant was engaged for a period of one (1) year that commenced on 1 May 2007 and was extended for a further 12 months from 1 April 2009.

• (b) ( Remuneration ) : A review was completed and effective from 1 April 2009 whereby Mr. Thompson remuneration was reduce to $140,000 per annum (previously Mr Thompson remuneration was $200,000 p.a.) plus an entitlement to director’s fees was reduce to $17,500 per annum ( were previously $25,000 p.a.).

• (c) ( Position ) : the Consultant is engaged in the capacity of Chief Executive Officer/Managing Director of the Company.

• (d) ( Termination by Consultant ): the Consultant may terminate the Agreement at any time and for any reason by giving the Company three months’ written notice.

• (e) ( Termination by Company without cause ): the Company may terminate the agreement immediately by serving written notice to the Consultant and paying him the equivalent of three months’ Fee.

• (f) ( Termination by Company with cause ): the Company may terminate the Agreement by serving one month’s notice on the Consultant if:

• (i) the Consultancy Company goes into liquidation or makes an arrangement with creditors or takes advantage of any statute for the relief of insolvent debtors;

• (ii) the Consultant commits any serious or persistent breach of any of the provision contained in the Agreement and the breach is not remedied within 14 days of the receipt of written notice from the Company to do so;

• (iii) in the reasonable opinion of the Board, the Consultant demonstrates incompetence in the performance of his duties under the Agreement; or

• (iv) the Consultant is guilty of grave misconduct or wilful neglect in the discharge of his duties and the breach is not remedied within 28 days of the receipt of written notice from the Company to do so.

• (g) ( Immediate termination by Company with cause ): the Company may terminate the Agreement immediately if the Consultant:

• (i) is convicted of a major criminal offence which brings the Consultant or the Company into lasting disrepute; or

• (ii) discloses or misuses price sensitive information affecting the Company or a client without prior written consent, except where disclosure is required by law.

GBM RESOURCES LIMITED

• 22 -

DIRECTORS’ REPORT (continued)

REMUNERATION REPORT (continued)

Service agreements (audited)

Consultancy Agreement with Mr Neil Norris – Exploration Director

The Company has entered into a consultancy agreement ( Agreement ) with Neil Norris ( Consultant ) through his consultancy company, Norris Orchards Pty Ltd ( Consultancy Company ), on the following material terms and conditions:

• (a) ( Term ) : the Consultant was engaged on 31 March 2009 for a term of one year with an initial fixed period to 31 December 2009.

• (b) ( Position ) : the Consultant is engaged in the capacity of Exploration Director of the Company.

• (c) ( Remuneration ) : A review was completed and effective from 1 April 2009 whereby Mr. Norris remuneration was reduce to $183,600 per annum (previously Mr Norris remuneration in his role as exploration manager was $261,600 p.a.) plus an entitlement to director’s fees of $17,500 per annum .

• (d) ( Termination by Consultant ): the Consultant may terminate the Agreement at any time and for any reason by giving the Company three months’ written notice.

• (e) ( Termination by Company without cause ): the Company may terminate the agreement immediately by serving written notice to the Consultant and paying him the equivalent of three months’ Fee.

• (f) ( Termination by Company with cause ): the Company may terminate the Agreement by serving one month’s notice on the Consultant if:

• (j) the Consultancy Company goes into liquidation or makes an arrangement with creditors or takes advantage of any statute for the relief of insolvent debtors;

• (v) the Consultant commits any serious or persistent breach of any of the provision contained in the Agreement and the breach is not remedied within 14 days of the receipt of written notice from the Company to do so;

• (vi) in the reasonable opinion of the Board, the Consultant demonstrates incompetence in the performance of his duties under the Agreement; or

• (vii) the Consultant is guilty of grave misconduct or wilful neglect in the discharge of his duties and the breach is not remedied within 28 days of the receipt of written notice from the Company to do so.

• (g) ( Immediate termination by Company with cause ): the Company may terminate the Agreement immediately if the Consultant:

• a. is convicted of a major criminal offence which brings the Consultant or the Company into lasting disrepute; or

• b. discloses or misuses price sensitive information affecting the Company or a client without prior written consent, except where disclosure is required by law.

GBM RESOURCES LIMITED

• 23 -

DIRECTORS’ REPORT (continued)

The number of meetings of the company’s Board of Directors and each board committee held during the period ended 30June 2009, and the numbers of meetings attended by each director were:

	Director	Meetings
	Number eligible to attend	Number attended
Mr. P May	13	13
Mr. P Thompson	13	13
Mr. C Switzer	13	13
Mr. N Norris	6	6

Audit and Risk Management Committee

The Board of Directors established the Audit and Risk Management Committee on 30 July 2007. The members of committee are the non-executive directors, Peter May (Chairman) and Cameron Switzer. No meetings were held during financial period. All matters that would normally be dealt with by the audit committee are handled by the Board as it is considered that due to the small size of the Board it is more appropriate to deal within the Board.

INDEMNIFYING DIRECTORS AND OFFICERS

During the financial period, GBM Resources Limited paid a premium of $14,819 (2008:$17,038) to insure the directors and secretary of the company.

The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought against the officers in their capacity as officers of entities in the consolidated entity, and any other payments arising from liabilities incurred by the officers in connection with such proceedings, other than where such liabilities arise out of conduct involving a wilful breach of duty by the officers or the improper use by the officers of their position or of information to gain advantage for themselves or someone else or to cause detriment to the company. It is not possible to apportion the premium between amounts relating to the insurance against legal costs and those relating to other liabilities.

CORPORATE GOVERNANCE

In recognising the need for the highest standards of corporate behaviour and accountability, the directors of GBM Resources Limited support and adhere to the principles of corporate governance. The company’s corporate governance statement is contained in the following section of this annual report.

PROCEEDINGS ON BEHALF OF COMPANY

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

The company was not a party to any such proceedings during the period.

OPTIONS

At the date of this report, the unissued ordinary shares of the company are as follows:

Grant date 19/3/2008 1/2/2008 30/7/2007 30/7/2007	Date of expiry 30/6/2010 30/6/2010 30/6/2010 30/6/2010	Exercise price 25 cents 25 cents 25 cents 25 cents		Number under options 32,879,552 7,500,000 20,000,000 3,730,000
				64,109,552

GBM RESOURCES LIMITED

• 24 -

DIRECTORS’ REPORT (continued)

Auditor Independence and Non-Audit Services

Section 307C of the Corporations Act 2001 requires our auditors, HLB Mann Judd, to provide the directors of the Company with an Independence Declaration in relation to the audit of the annual report. This Independence Declaration is set out on page 25 and forms part of this directors’ report for the period ended 30 June 2009.

Non-Audit Services

The following non-audit services were provided by our auditors, HLB Mann Judd. The directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act.

The directors are of the opinion that the services do not compromise the auditor’s independence as all non-audit services have been reviewed to ensure that they do not impact the integrity and objectivity of the auditor and none of the services undermine the general principles relating to auditor independence as set out in Code of Conduct APES110 Code of Ethics for Professional Accountants issued by the Accounting Professional & Ethical Standards Board.

HLB Mann Judd received or are due to receive the following amounts for the provision of non-audit services: —Preparation of an Investigating Accountant’s Report for inclusion in the initial public offering prospectus dated 31 July 2007. —Other professional services	Consolidated Consolidated 30-June 2009 30-June 2008 - 14,000 - 2,600
	- 16,600

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

==> picture [70 x 45] intentionally omitted <==

Peter May Chairman

Dated this 30 day of September 2009

-25-

==> picture [174 x 75] intentionally omitted <==

Auditor’s Independence Declaration

As lead auditor for the audit of the financial report of GBM Resources Limited for the year ended 30 June 2009, 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.

This declaration is in respect of GBM Resources Limited.

==> picture [177 x 57] intentionally omitted <==

Perth, Western Australia 30 September 2009

W M CLARK Partner, HLB Mann Judd

==> picture [17 x 14] intentionally omitted <==

Level 2 15 Rheola Street West Perth 6005 PO Box 263 West Perth 6872 Western Australia. Telephone +61 (08) 9481 0977. Fax +61 (08) 9481 3686. Email: hlb@hlbwa.com.au. Website: http://www.hlb.com.au Liability limited by a scheme approved under Professional Standards Legislation

HLB Mann Judd (WA Partnership) is a member of

International, a world-wide organisation of accounting firms and business advisers

GBM RESOURCES LIMITED

• 26 -

CORPORATE GOVERNANCE STATEMENT

GBM Resources Limited is committed to protecting and enhancing shareholder value and adopting best practice governance policies and practices. This Corporate Governance Statement outlines the main Corporate Governance practices that were in place throughout the financial period, which comply with the Australian Securities Exchange (‘ASX’) Corporate Governance Council recommendations. Where a recommendation has not been followed, this is clearly stated along with an explanation for the departure.

Principle 1

Lay solid foundations for management and oversight

The Board is the governing body of the company. The Board and the company act within a statutory framework – principally the Corporations Act 2001 and also the constitution of the company. Subject to this statutory framework, the Board has the authority and the responsibility to perform the functions, determine the policies and control the affairs of GBM Resources Limited.

The Board must ensure that GBM Resources Limited acts in accordance with prudent commercial principles, and satisfies shareholders – consistent with maximising the company’s long term value.

The primary responsibilities of the Board include:

• Charting the direction, strategies and financial objectives of the company and ensuring appropriate resources are available

• Monitoring the implementation of those policies and strategies and the achievement of those financial objectives

• Monitoring compliance with control and accountability systems, regulatory requirements and ethical standards

• Ensuring the preparation of accurate financial reports and statements

• Reporting to shareholders and the investment community on the performance and state of the company

• Appoint the Chief Executive Officer and monitor performance of the Chief Executive Officer and senior executives

• Establish proper succession plans for management of the company

Separate functions of the Board and management existed and were practised throughout the period.

Principle 2

Structure the Board to add value

The composition of the Board has been determined on the basis of providing the company with the benefit of a broad range of technical, administrative and financial skills, combined with an appropriate level of experience at a senior corporate level. Each director brings a range of complementary skills and experience to the Group as indicated in the Annual Report. Details of each Director’s skills and experience are set out in the Directors’ report.

In the context of director independence, ‘materiality’ is considered from both the company and individual director perspective. The determination of materiality requires consideration of both quantitative and qualitative elements. An item is presumed to be quantitatively immaterial if it is equal or less than 5% of the appropriate base amount. It is presumed to be material (unless there is evidence to the contrary) if it is equal to or greater than 10% of the appropriate base amount. Qualitative factors considered include whether a relationship is strategically important, the competitive landscape, the nature of the relationship and the contractual or other arrangements governing it and other factors which point at the actual ability in question to shape the direction of the company’s loyalty.

In accordance with the definition of independence above, and the materiality thresholds set, the following directors of GBM Resources Limited are considered to be independent:

Name Position Mr. P. May Non-Executive Chairman Mr. C. Switzer Non-Executive Director

GBM RESOURCES LIMITED

• 27 -

CORPORATE GOVERNANCE STATEMENT (continued)

Principle 2 (Continued)

The roles of Chairman and Executive Officer were exercised by different individuals, providing for clear division of responsibility at the head of the company. Their roles and responsibilities, and the division of responsibilities between them, were clearly understood and there was regular communication between them.

With the prior approval of the Chairman, each director has the right to seek independent legal and other professional advice at the company’s expense concerning any aspect of the company’s operations or undertakings in order to fulfil their duties and responsibilities as directors.

Director’s are subject to re-election by rotation at annual general meetings as stipulated in the Corporations Act and the company’s constitution. There are no maximum terms for non-executive director appointments. Newly elected directors must seek re-election at the first general meeting of shareholders following their appointment.

The remuneration of the directors has been determined by a remuneration committee. Further information and the components of remuneration for directors’ are set out in the Directors’ Report and notes to the financial statements. The members of the remuneration committee during the period were:

• Mr. P. May (Chairman)

• Mr. C. Switzer

Principle 3

Promote ethical and responsible decision-making

The Board places great emphasis on ethics and integrity in all its business dealings.

In regards to principle 3.1, the Board considers the business practices and ethics exercised by individual Board members and key executives to be of the highest standards.

Trading in the company’s shares

The company’s policy restricts directors and employees from acting on material information until it has been released to the market and adequate time has been given for this to be reflected in the securities’ prices. Statutory provisions of the Corporations Act dealing with insider trading have been strictly complied with.

Principle 4

Safeguard integrity in financial reporting

The Board has an established audit committee, which operates under a charter approved by the Board. It is the Board’s responsibility to ensure that an effective internal control framework exists within the entity. This includes internal controls to deal with both the effectiveness and efficiency of significant business processes, including the safeguarding of assets, the maintenance of proper accounting records, and the reliability of financial information. The Board has delegated responsibility for the establishment and framework of internal controls and ethical standards for the management of the consolidated entity to the audit committee.

The committee should provide the Board with additional assurance regarding the reliability of financial information for inclusion in the financial reports. All members of the audit committee were independent non-executive directors. The external auditors, the Managing Director, Chief Financial Officer & Company Secretary and senior executives, may be invited to Committee meetings at the discretion of the Committee.

During the year the functions normally expected of the audit committee were performed by the Board. The Board has processes in place which raise the issues that would otherwise be considered by an audit committee.

The members of the audit committee during the year were:

• Mr. P. May (Chairman)

• Mr. C. Switzer

GBM RESOURCES LIMITED

• 28 -

CORPORATE GOVERNANCE STATEMENT (continued)

Principle 5

Make timely and balanced disclosure

The company complied with all disclosure requirements to ensure that it manages the disclosure of price sensitive information effectively and in accordance with the requirements as set out by regulatory bodies. All market disclosures are approved by the Board.

The Chairman, Managing Director and Company Secretary are authorised to communicate with shareholders and the market in relation to Board approved disclosures.

All announcements made to the ASX are placed on the company’s web site immediately after public release.

Principle 6

Respect the rights of shareholders

The company has a positive strategy to communicate with shareholders and actively promote shareholder involvement in the company. It aims to continue to increase and improve the information available to shareholders on its website. All company announcements, presentations to analysts and other significant briefings are posted on the company’s website after release to the Australian Securities Exchange.

Principle 7

Recognise and manage risk

The Board oversees the establishment, implementation and ongoing review of the company’s risk management and internal control system. Recommendation 7.1 requires the establishment of a risk committee. The Board has delegated the responsibility for implementing the risk management system to the Audit and Risk Committee. The Audit and Risk Committee will submit particular matters to the Board for its approval or review. The Board does not believe that any marked efficiencies or enhancements would be achieved by the creation of a separate risk committee.

The company carries out regular risk assessments in a timely manner and covers all aspects of the company. The company also has in place classes of insurance at levels which, in the reasonable opinion of the directors, are appropriate for it size and operations.

During the year the functions normally expected of the audit and Risk committee were performed by the Board. The Board has processes in place which raise the issues that would otherwise be considered by an audit committee.

Principle 8

Remunerate fairly and responsibly

The Board is responsible for determining and reviewing compensation arrangements for the directors themselves, the Chief Executive Officer and senior executives. The Board had an established remuneration committee, comprising two non-executive directors.

The remuneration policy, which sets the terms and conditions for the Chief Executive Officer and other senior executives, was developed by the remuneration committee after seeking professional advice from independent consultants and was approved by the Board. All executives during the financial period received a base salary, superannuation, fringe benefits and performance incentives. The remuneration committee did review executive packages annually by reference to company performance, executive performance, comparable information from industry sectors and other listed companies and independent advice. The performance of executives was measured against criteria agreed half-yearly which was based on the forecast growth of the company’s profits and shareholders’ value. The policy was designed to attract the highest caliber executives and reward them for performance which results in long-term growth in shareholder value.

Director disclosure requirements are dealt with in the Remuneration Report.

GBM RESOURCES LIMITED

• 29 -

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GBM RESOURCES LIMITED

FINANCIAL REPORT

For the period ended 30 June 2009

This financial report covers both GBM Resources Limited as an individual entity and the consolidated entity consisting of GBM Resources Limited and its subsidiaries. The financial report is presented in Australian currency.

GBM Resources Limited is a company limited by shares, incorporated and domiciled in Australia.

A description of the nature of the consolidated entity’s operations and its principal activities is included in the review of operations and activities on page 7 of the directors’ report, which does not form part of this financial report.

The financial report was authorised for issue by the directors on 30 September 2009. The company has the power to amend and reissue the financial report.

GBM RESOURCES LIMITED

• 30 -

INCOME STATEMENTS

For the year ended 30 June 2009 Note Revenue 3 Consulting and professional services Depreciation 11 Employee benefits expense Exploration expenditure written off Forgiveness of loan 4 Option fees Impairment of loan Travel Other expenses Loss before income tax 4 Income tax 5 Loss attributable to members of the parent entity Loss per share for loss from continuing operations attributable to the ordinary equity holders of the company Basic loss per share (cents per share) 8 Diluted loss per share (cents per share) 8	Consolidated Parent Year ended For the 15 months ended Year ended For the 15 months ended 30 Jun 2009 $ 30 Jun 2008 $ 30 Jun 2009 $ 30 Jun 2008 $ 76,162 134,614 76,162 134,614 (457,926) (385,354) (457,926) (385,354) (34,878) (12,153) (34,878) (12,153) (74,597) (159,707) (74,597) (159,707) (55,094) - (44,707) - - (459,945) - (459,945) - (45,455) - (45,455) - - (10,387) - (74,471) (42,551) (74,471) (42,551) (171,101) (76,147) (171,101) (76,147)
	(791,905) (1,046,698) (791,905) (1,046,698) - - - -
	(791,905) (1,046,698) (791,905) (1,046,698)
	Cents Cents (1.2) (2.0) (1.2) (2.0)

The above income statements should be read in conjunction with the accompanying notes.

GBM RESOURCES LIMITED

• 31 -

BALANCE SHEET

As at 30 June 2009 Note Current Assets Cash and cash equivalents 9 Receivables 10 Total Current Assets Non-Current Assets Property, plant and equipment 11 Deferred exploration expenditure 12 Other financial assets 13 Total Non-Current Assets Total Assets Current Liabilities Payables 14 Total Current Liabilities Total Liabilities Net Assets Equity Contributed equity 15 Reserves 16(a) Accumulated losses 16(b) Total Equity	Consolidated Parent 30 Jun 2009 $ 30 Jun 2008 $ 30 Jun 2009 $ 30 Jun 2008 $ 1,570,871 2,764,821 1,570,771 2,764,721 322,299 291,509 275,430 244,641
	1,893,170 3,056,330 1,846,201 3,009,362
	108,800 113,843 108,800 113,843 4,216,273 2,997,966 178,303 681,491 - - 4,084,939 2,363,443
	4,325,073 3,111,809 4,372,042 3,158,777
	6,218,243 6,168,139 6,218,243 6,168,139
	335,844 350,623 355,844 350,623
	335,844 350,623 355,844 350,623
	335,844 350,623 335,844 350,623
	5,882,399 5,817,516 5,882,399 5,817,516
	7,347,040 6,490,252 7,347,040 6,490,252 373,962 373,962 373,962 373,962 (1,838,603) (1,046,698) (1,838,603) (1,046,698)
	5,882,399 5,817,516 5,882,399 5,817,516

The above balance sheet should be read in conjunction with the accompanying notes.

GBM RESOURCES LIMITED

• 32 -

STATEMENTS OF CHANGES IN EQUITY

For the year ended 30 June 2009

EQUITY For the year ended 30 June 2009
Note Total equity at the beginning of the financial period Loss for the year Contributions of equity 15 Capital raising costs 15(a) Share based payments 16(a) Option reserve 15(a) Total equity at the end of the financial period	Consolidated Parent Year ended For the 15 months ended Year ended For the 15 months ended 30 Jun 2009 $ 30 Jun 2008 $ 30 Jun 2009 $ 30 Jun 2008 $ 5,817,516 - 5,817,516 - (791,905) (1,046,698) (791,905) (1,046,698) 876,788 7,152,153 876,788 7,152,153 (20,000) (661,901) (20,000) (661,901) - 45,166 - 45,166 - 328,796 - 328,796
	5,882,399 5,817,516 5,882,399 5,817,516

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

GBM RESOURCES LIMITED

• 33 -

CASH FLOW STATEMENTS

For the period ended 30 June 2009

Note Cash flows from operating activities Payments to suppliers and employees Interest received Net cash used in operating activities 17(a) Cash flows from investing activities Payments for plant and equipment Payments for exploration Payments for exploration tenements Payments on acquisition of subsidiaries 17(c) Loans advanced Loans to controlled entities Net cash used in investing activities Cash flows from financing activities Proceeds from issue of shares and options Costs of share issues Net cash provided by financing activities Net (decrease)/increase in cash and cash equivalents Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period 9	Consolidated Parent Period ended 30-June 2009 $ Period ended 30-June 2008 $ Period ended 30-June 2009 $ Period ended 30-June 2008 $ (674,101) (829,549) (674,101) (782,681) 76,162 134,614 76,162 134,614
	(597,939) (694,935) (597,939) (648,067)
	(29,835) (119,555) (29,835) (119,555) (1,173,401) (1,372,942) (131,286) (463,317) (100,000) - - - - (201,850) - (201,850) - (459,945) - (459,945) - - (1,142,115) (956,593)
	(1,303,236) (2,154,292) (1,303,236) (2,201,260)
	727,225 6,275,949 727,225 6,275,949 (20,000) (661,901) (20,000) (661,901)
	707,225 5,614,048 707,225 5,614,048
	(1,193,950) 2,764,821 (1,193,950) 2,764,721 2,764,821 - 2,764,721 -
	1,570,871 2,764,821 1,570,771 2,764,721

The above cash flow statements should be read in conjunction with the accompanying notes.

GBM RESOURCES LIMITED

• 34 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of the financial report are set out below. These policies have been consistently applied, unless otherwise stated. The financial report covers the consolidated entity of GBM Resources Limited (“company” or “parent entity”) and its controlled entities. GBM Resources Limited is a listed public company, incorporated and domiciled in Australia.

(a) Basis of preparation

The financial report is a general purpose financial report that has been prepared in accordance with Australian equivalents to International Financial Reporting Standards (AIFRSs), other authoritative pronouncements of the Australian Accounting Standards Board, Urgent Issues Group Interpretations and the Corporations Act 2001.

Compliance with IFRSs

Australian Accounting Standards include AIFRSs. Compliance with AIFRSs ensures that the consolidated financial statements and notes of GBM Resources Limited comply with International Financial Reporting Standards (IFRSs). The parent entity financial statements and notes also comply with IFRSs.

Historical cost convention

These financial statements have been prepared under the historical cost convention, and do not take into account changing money values or, except where stated, current valuations of non-current assets. Cost is based on the fair value of the consideration given in exchange for assets.

Critical accounting estimates

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

(b) Principles of consolidation

Subsidiaries

The consolidated financial statements incorporate the assets and liabilities of all subsidiaries controlled by GBM Resources Limited as at 30 June 2009 and the results of all subsidiaries for the period then ended. GBM Resources Limited and its subsidiaries together are referred to in this financial report as the Group or the consolidated entity. Where control of an entity is obtained during a financial year, its results are included in the consolidated income statement from the date on which control commences.

Controlled entities are all those entities over which the Group 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 Group controls another entity.

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

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

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.

Minority interests represent the portion of profit or loss and net assets in subsidiaries not held by the Group and are presented separately in the income statement and within equity in the consolidated balance sheet.

GBM RESOURCES LIMITED

• 35 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

(c) Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances and duties and taxes paid.

Interest revenue is recognised based on the effective interest method.

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

(d) Income Tax

Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the balance sheet date.

Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.

Deferred income tax liabilities are recognised for all taxable temporary differences except:

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

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

Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carry-forward of unused tax credits and unused tax losses can be utilised, except:

• when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or

• when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures, in which case a deferred tax asset is only recognised to the extent that it is probable that the temporary difference will reverse in the foreseeable future and taxable profit will be available against which the temporary difference can be utilised.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.

Unrecognised deferred income tax assets are reassessed at each balance sheet date and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date.

Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss.

Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation authority.

GBM RESOURCES LIMITED

• 36 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

Tax consolidation legislation

GBM Resources Limited and its 100% owned Australian resident subsidiaries have implemented the tax consolidation legislation. Current and deferred tax amounts are accounted for in each individual entity as if each entity continued to act as a taxpayer on its own.

GBM Resources Limited recognises both its own current and deferred tax amounts and those current tax liabilities, current tax assets and deferred tax assets arising from unused tax credits and unused tax losses which it has assumed from its controlled entities within the tax consolidated group.

Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts payable or receivable from or payable to other entities in the Group. Any difference between the amounts receivable or payable under the tax funding agreement are recognised as a contribution to (or distribution from) controlled entities in the tax consolidated group.

(e) Other taxes

Revenues, expenses and assets are recognised net of the amount of GST except:

• when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and

• receivables and payables, which are stated with the amount of GST included.

The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet.

Cash flows are included in the Cash Flow Statement 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 are classified as operating cash flows.

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

(f) Impairment of assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset’s recoverable amount. An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets and the asset's value in use cannot be estimated to be close to its fair value. In such cases the asset is tested for impairment as part of the cashgenerating unit to which it belongs. When the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-generating unit is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Impairment losses relating to continuing operations are recognised in those expense categories consistent with the function of the impaired asset unless the asset is carried at revalued amount (in which case the impairment loss is treated as a revaluation decrease).

An assessment is also made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in profit or loss unless the asset is carried at revalued amount, in which case the reversal is treated as a revaluation increase. After such a reversal the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount, less any residual value, on a systematic basis over its remaining useful life.

GBM RESOURCES LIMITED

• 37 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

(g) Acquisitions of assets

The purchase method of accounting is used to account for all acquisitions of assets (including business combinations) regardless of whether equity instruments or other assets are acquired. Cost is measured as the fair value of the assets given, shares issued or liabilities incurred or assumed at the date of exchange plus costs directly attributable to the acquisition. Where equity instruments are issued in an acquisition, the value of the instruments is their published market price as at the date of exchange unless, in rare circumstances, it can be demonstrated that the published price at the date of exchange is an unreliable indicator of fair value and that other evidence and valuation methods provide a more reliable measure of fair value. Transaction costs arising on the issue of equity instruments are recognised directly in equity.

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the income statement, but only after a reassessment of the identification and measurement of the net assets acquired. In respect of step acquisitions, the excess of acquisition price over the fair value of the net assets acquired is treated as goodwill.

Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.

(h) Cash and cash equivalents

Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions or other short-term highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

(i) Receivables

Receivables are recognised on an accrual basis as the services to which they relate are performed and are due for settlement no more than 30 days from the date of recognition.

Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off. A provision for doubtful receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The amount of the allowance is recognised in the income statement.

(j) Plant and Equipment

Items of plant and equipment are carried at historical cost less accumulated depreciation, and recoverable amount.

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 carrying amount. These are included in the income statement.

Depreciation

Items of plant and equipment are depreciated over their estimated useful lives. The straight line method of depreciation is used and assets are depreciated from the date of acquisition. The expected useful lives are as follows: Fixtures and equipment 3 years

(k) Investments in controlled entities

Investments in controlled entities are stated at cost. Where there has been a permanent diminution in the value of an investment an impairment charge is recognised.

GBM RESOURCES LIMITED

• 38 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

(l) Trade and other payables

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

(m) Provisions

Provisions are recognised when: the Group has a present legal or constructive obligation as a result of past events; it is more likely than not that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognised for future operating losses.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

(n) Employee Benefits

(i) Wages and salaries, annual leave and sick leave

Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave expected to be settled within 12 months of the reporting date are recognised in other payables in respect of employees' services up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled. Liabilities for non-accumulating sick leave are recognised when the leave is taken and measured at the rates paid or payable.

Contributions are made by the company to employee superannuation funds and are charged as expenses when incurred. During the period the company contributed 9% of salaries and wages under the Superannuation Guarantee Act requirements.

(ii) Long service leave

The liability for long service leave is recognised in the provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on national government bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.

(iii) Share based payments

Share-based compensation benefits are provided to employees via the company’s Employee Incentive Option Plan and the issuance of options. Information relating to these schemes is set out in note 24.

The fair value of options granted under the company’s Employee Incentive Option Plan is recognised as an employee benefit expense with a corresponding increase in equity. The fair value is measured at grant date and recognised over the period during which the employees become unconditionally entitled to the options.

The fair value at grant date is independently determined using a Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the vesting and performance criteria, the impact of dilution, the non-tradeable nature of the option, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk-free interest rate for the term of the option.

The fair value of the options granted excludes the impact of any non-market vesting conditions (for example, profitability and sales growth targets). Non-market vesting conditions are included in assumptions about the number of options that are expected to become exercisable. At each balance sheet date, the entity revises its estimate of the number of options that are expected to become exercisable. The employee benefit expense recognised each period takes into account the most recent estimate.

Upon the exercise of options, the balance of the share-based payments reserve relating to those options is transferred to share capital.

In respect of options, market conditions are factored into the valuation on grant date, with no subsequent adjustment made for changes in the probability of the target being met. The vesting condition is not included in the valuation of the share, but is used to adjust the number of equity instruments expected to vest. This probability is adjusted each period so that on a cumulative basis an expense is only recognised where the vesting condition is met. The expense is recognised over the vesting period, which is equal to the expected length of time required to meet the vesting conditions. If the employee leaves, the balance of the cost is recognised in full.

(iv) Termination benefits

Termination benefits are payable when employment is terminated before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Group recognises termination benefits

GBM RESOURCES LIMITED

• 39 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

when it is demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after balance sheet date are discounted to present value.

(o) Leases

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

Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease.

(p) Investments and other financial assets

The company classifies its investments in the following categories: loans and receivables, and available-for-sale financial assets. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.

(i) Loans and receivables

Loans and receivables are non derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the Group provides money, goods or services directly to a debtor with no intention of selling the receivable. They are included in current assets, except for those with maturities greater than 12 months after the balance sheet date which are classified as non-current assets. Loans and receivables are included in receivables in the balance sheet.

(ii)

Available-for-sale financial assets

Available-for-sale financial assets, comprising principally equity securities, are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within 12 months of the balance sheet date.

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

Available-for-sale financial assets and financial assets are subsequently carried at fair value. Loans and receivables are carried at amortised cost using the effective interest method. Unrealised gains and losses arising from changes in the fair value of non monetary securities classified as available-for-sale are recognised in equity in the available-for-sale investments revaluation reserve. When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments are included in the income statement as gains and losses from investment securities.

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

(q) Fair value estimation

The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes.

The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading and

GBM RESOURCES LIMITED

• 40 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

available-for-sale securities) is based on quoted market prices at the balance sheet date. The quoted market price used for financial assets held by the Group is the current bid price; the appropriate quoted market price for financial liabilities is the current ask price.

The nominal value less estimated credit adjustments of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Group for similar financial instruments.

(r) Contributed equity

Ordinary share capital is recognised as the fair value of the consideration received by the company. Any transaction costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share proceeds received.

(s) Earnings per share

(i) Basic earnings per share

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

(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.

(t) Exploration and evaluation

Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an exploration and evaluation asset in the year in which they are incurred where the following conditions are satisfied:

(i) the rights to tenure of the area of interest are current; and

• (ii) at least one of the following conditions is also met:

• (a) the exploration and evaluation expenditures are expected to be recouped through successful development and exploration of the area of interest, or alternatively, by its sale; or

• (b) exploration and evaluation activities in the area of interest have not at the reporting date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing.

Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, studies, exploratory drilling, trenching and sampling and associated activities and an allocation of depreciation and amortised of assets used in exploration and evaluation activities. General and administrative costs are only included in the measurement of exploration and evaluation costs where they are related directly to operational activities in a particular area of interest.

Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The recoverable amount of the exploration and evaluation asset (for the cash generating unit(s) to which it has been allocated being no larger than the relevant area of interest) is estimated to determine the extent of the impairment loss (if any). Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in previous years.

Where a decision has been made to proceed with development in respect of a particular area of interest, the relevant exploration and evaluation asset is tested for impairment and the balance is then reclassified to development.

GBM RESOURCES LIMITED

• 41 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

(u) Adoption of new and revised standards

• Changes in accounting policies on initial application of Accounting Standards

In the period ended 30 June 2009, the Group has adopted all of the new and revised Standards and Interpretations issued by the AASB that are relevant to its operations and effective for annual reporting periods beginning on or after 1 July 2009. Details of the impact of the adoption of these new accounting standards are set out in the individual accounting policy notes set out above.

The Group has also reviewed all new Standards and Interpretations that have been issued but are not yet effective for the period ended 30 June 2009. As a result of this review the Directors have determined that there is no impact, material or otherwise, of the new and revised Standards and Interpretations on its business and, therefore, no change necessary to Group accounting policies.

GBM RESOURCES LIMITED

• 42 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 2: Critical accounting estimates and judgements

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events 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 period are discussed below.

Deferred exploration and evaluation costs are dependent upon success in exploration and evaluation or sale or farm-out of the exploration interests.

NOTE 3: Revenue Other revenue Interest received NOTE 4: Expenses Loss before income tax includes the following specific expenses: Depreciation Share based payments Impairment of loan Operating lease Forgiveness of loan *	Consolidated Parent Year ended 30-June 2009 $ For the 15 months ended 30-June 2008 $ Year ended 30- June 2009 $ For the 15 months ended 30-June 2008 $ 76,162 134,614 76,162 134,614
	34,878 12,153 34,878 12,153 - 45,166 - 45,166 - - 10,387 - - - 9,321 459,945 - - 9,321 459,945

*Represents the forgiveness of an inter-company loan in accordance with a share sale agreement comprising of exploration expenditure incurred prior to the company listing.

GBM RESOURCES LIMITED

• 43 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTES TO THE FINANCIAL STATEMENTS For the year ended 30 June 2009
	Consolidated Parent
NOTE 5: Income tax (a) Income tax benefit The prima facie income tax on pre-tax accounting loss from operations reconciles to the income tax expenses/(benefit) in the financial statements as follows: Accounting loss from ordinary activities Prima facie tax benefit on loss at 30% Tax effect of: - Non-deductible items - Capital raising costs Benefit of tax losses not brought to account Income tax benefit	30-June 2009 $ 30-June 2008 $ 30-June 2009 $ 30-June 2008 $ (791,905) (1,046,698) (791,905) (1,046,698)
	(237,571) (314,009) (237,571) (314,009) 26,992 162,428 29,992 162,428 - (39,714) - (39,714) 210,579 191,295 207,579 191,295
	- - - -

(b) Deferred income tax The following deferred tax assets and liabilities have not been brought to account:

Deferred tax assets: Benefit of income tax losses Capital raising costs Other deferred tax assets Offset against deferred tax liabilities: Exploration expenditure Other Net deferred tax asset	1,600,264 1,015,797 1,600,264 1,015,797 119,142 158,856 119,142 158,856 63,560 108,833 63,560 108,833
	1,782,966 1,283,486 1,782,966 1,283,486
	1,264,882 899,389 1,264,882 899,389 46,749 37,799 46,749 37,799
	1,311,631 937,188 1,311,631 937,188
	471,335 346,298 471,335 346,298

The deductible temporary differences and tax losses do not expire under current tax legislation. Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available against which the Group can utilise the benefits thereof.

Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available against which the Group can utilise the benefits thereof.

GBM RESOURCES LIMITED

• 44 -

[

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 6: Key management disclosures

• (a) The company has applied the relief provided by Corporation Regulations 2M.6.04 which allows listed companies to transfer remuneration disclosures in relation to key management personnel required by Accounting Standard AASB 124: Related Party Disclosures, from the financial report to the Directors’ Report. These remuneration disclosures are provided in the Remuneration Report section of the Directors’ Report under Details of Remuneration and are designated as audited.

(b) Directors

The following persons were directors of GBM Resources Limited during the financial period:

(i) Executive directors

Mr. Peter Thompson (appointed 3 April 2007)

Mr. Neil Norris (appointed 3 April 2009)

(ii) Non-executive directors

Mr. Peter May (appointed 3 April 2007)

Mr. Cameron Switzer (appointed 3 April 2007)

(d) Key management personnel compensation

Short-term employee benefits Post-employment benefits Share-based payments	Consolidated entity Parent entity 2009 2008 2009 2008 $ $ $ $ 276,363 161,243 276,363 161,243 17,385 - 17,385 - - 42,417 - 42,417
	293,748 203,660 293,748 203,660

As noted above the company has taken advantage of the relief provided by Corporation Regulations 2M.6.04 has transferred the detailed remuneration disclosures to the directors’ report. The relevant information can be found in the remuneration report. (Refer to page 18).

Equity instrument disclosures relating to key management personnel

(i) Share holdings : The numbers of shares in the company held during the financial period by each director and other key management personnel of the Group, including their personally related parties, are set out below.

GBM RESOURCES LIMITED

• 45 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 6: Key management disclosures

Number of shares held by Specified Directors	Balance 01.07.08 Received as Remuneration Acquired on market Other changes Balance 30.06.09
Directors Mr. Peter May – Non-executive Chairman Mr. Peter Thompson - Managing Director Mr. Cameron Switzer- Non-executive Director Mr. Neil Norris – Executive Director (appointed 3 April 2009) Total Number of shares held by Specified Directors	658,350 - - 438,9002 1,097,250 3,937,549 - - 2,625,0332 6,562,582 2,756,250 - - 1,837,5002 4,593,750 - 3,750,0001 2,500,0002 6,250,000
	7,352,149 - - 11,151,433 18,503,582
	Balance 03.04.07 Received as Remuneration Acquired on market Other changes Balance 30.06.08
Directors Mr. Peter May – Non-executive Chairman (appointed 3 April 2007) Mr. Peter Thompson - Managing Director (appointed 3 April 2007) Mr. Cameron Switzer- Non-executive Director (appointed 3 April 2007) Total	- - - 658,350 658,350 - - - 3,937,549 3,937,549 - - - 2,756,250 2,756,250
	- - - 7,352,1491 7,352,149

1 Shares held on appointment date as a director.

2 Non-renounceable rights issue

3 Other changes include seed and promoter subscription in addition to subscriptions through initial public offering prospectus dated 31 July 2007.

(ii) Option holdings

Number of options held by Directors

(ii) Option holdings Number of options held by Directors
	Balance 01.07.08 Received as Remuneration Other Balance 30.06.09
Directors Mr. Peter May – Non-executive Chairman Mr. Peter Thompson - Managing Director Mr. Cameron Switzer- Non-executive Director Mr. Neil Norris – Executive Director (appointed 3 April 2009) Total	1,032,350 - - 1,032,350 4,937,525 - - 4,937,525 4,346,875 - - 4,346,875 - - 3,093,6353 3,093,635
	10,316,750 3,093,635 13,410,385
	Balance 03.04.07 Received as Remuneration Other Balance 30.06.08
	- 500,000 266,1751 266,1752 1,032,350 - 1,000,000 1,968,7501 1,968,7752 4,937,525 - 1,000,000 1,968,7501 1,378,1252 4,346,875

1 Subscribed as part of seed promoter allocation.

2Subscribed for in the non-renounceable entitlement issue dated 6 February 2008.

3 Holdings on appointment date.

GBM RESOURCES LIMITED

• 46 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 7: Remuneration auditors

NOTE 7: Remuneration auditors	NOTE 7: Remuneration auditors
During the period the following fees were paid or payable for
services provided by the auditor of the parent entity, its related
practices and non-related audit firms		Consolidated			Parent
		30-June 2009	30-June 2008	30-June 2009		30-June 2008
		$	$	$		$
HLB Mann Judd
Audit and review of the financial reports and other audit work under
the Corporations Act 2001.
—	Preparation of an Investigating Accountant’s Report for inclusion in the initial public offering prospectus dated 31	-	14,000	-		14,000
	July 2007.
—	Audit and review of financial reports	28,507	15,000	28,507		15,000
—	Other professional services	-	2,600	-		2,600
		28,507	31,600	28,507		31,600
NOTE 8: Loss per share		Consolidated		Consolidated
(a)	Reconciliation of loss used in calculating loss per share	30-June $	2009	30-June 2008 $
	Net loss		(791,905)	(1,046,698)
(b)	Weighted average number of shares used as the denominator		Number	Number
	Weighted average number of ordinary shares used as the denominator in calculating basic loss per share	65,759,103		53,436,460
(c)	Classification of securities
	Options outstanding have been classified as potential ordinary shares, however			they are	not
	considered to be dilutive in nature.

GBM RESOURCES LIMITED

• 47 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 9: Cash and cash equivalents Cash at bank and on hand Deposits at call (i) Cash balances not available for use Bank guarantees NOTE 10: Receivables Current Other receivables GST receivable NOTE 11: Property, plant and equipment Fixtures and equipment At cost Less: Accumulated depreciation	Consolidated Parent 30-June 2009 $ 30-June 2008 $ 30-June 2009 $ 30-June 2008 $ 1,173,705 334,646 1,173,605 334,546 397,166 2,430,175 397,166 2,430,175
	1,570,871 2,764,821 1,570,771 2,764,721
	30,000 30,000 30,000 30,000
	177,127 39,098 177,337 39,099 145,172 252,411 98,093 205,542
	322,299 291,509 275,430 244,641
	155,831 125,996 155,831 125,996 (47,031) (12,153) (47,031) (12,153)
	108,800 113,843 108,800 113,843

Reconciliation

Reconciliation of the carrying amount of each class of property, plant and equipment is set out below:

Fixtures and Equipment

Balance at the beginning of the period Additions Depreciation expense Carrying amount at the end of the period	113,843 - 113,843 - 29,835 125,996 29,835 125,996 (34,878) (12,153) (34,878) (12,153)
	108,800 113,843 108,800 113,843

GBM RESOURCES LIMITED

• 48 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 12 : DEFERRED EXPLORATION EXPENDITURE

Consolidated 30-June 2009 $ 30-June 2008 $ Deferred Exploration and Evaluation Costs Balance at beginning of financial period 2,997,966 - Expenditure incurred 1,173,401 1,591,116 Acquisition of new tenements 100,000 - Tenements acquired on acquisition of subsidiaries - 1,406,850 Exploration transferred through loan account - - Exploration written off (55,094) - Provision for licence areas to be relinquished - - Balance at end of financial period 4,216,273 2,997,966 Ultimate recovery of deferred exploration and evaluation costs is dependent upon success in exploration and evaluation or sale or farm-out of the exploration interests. Note 13: Non-current assets - Other financial assets Investments in controlled entities – at cost - - Recoverability of investment is dependent upon success in exploration and evaluation or sale or farm-out of the entities’ exploration interests. Loans to controlled entities – at cost (Note 18) - - - - Recoverability of loans is dependent upon success in exploration and evaluation or sale or farm-out of the entities’ exploration interests. NOTE 14: Current liabilities - Payables Current Other creditors and accruals 141,816 350,623 Share subscriptions/ monies received 194,028 - 335,844 350,623	Consolidated 30-June 2009 $ 30-June 2008 $ 2,997,966 - 1,173,401 1,591,116 100,000 - - 1,406,850 - - (55,094) - - -	Parent 30-June 2009 $ 30-June 2008 $ 681,491 - 131,286 681,491 - - - - (589,767) - (44,707) - - -
	4,216,273 2,997,966	178,303 681,491
		1,406,850 1,406,850 2,678,089 956,593 4,084,939 2,363,443 141,816 350,623 194,028 - 335,844 350,623
	335,844 350,623

GBM RESOURCES LIMITED

• 49 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

Note 15: Contributed equity

(a) Issued and paid up capital	30-June 2009	30-June 2009	30-June	2008
	Number	$	Number	$
Issued and paid up capital	109,598,504	7,367,040	65,759,103	6,490,252
Movements during the period ended 30 June 2008
Ordinary shares	Number		Issue price	$
Balance at the beginning of the financial
period	-			-
Shares issued:
- Founder shares	3		$1.00	3
- Shares issued on acquisition of subsidiaries	100		$1.00	100
- Shares issued to seed investors	10,000,000		$0.10	1,000,000
- Shares issued to promoters	25,000,000		$0.00001	250
- Shares issued on acquisition of
controlled entities	6,025,000		$0.20	1,205,000
- Shares issued pursuant to prospectus	17,234,000		$0.20	3,446,800
- Share placement	7,500,000		$0.20	1,500,000
- Costs of share issue	-			(661,901)
	65,759,103			6,490,252
Balance at 30 June 2008	65,759,103			6,490,252
Movements during the year ended 30 June 2009
30 June 2009 - Non-renounceable rights
issue	43,839,401		$0.02	876,788
Costs of share issue	-			(20,000)
Balance at end of financial period	109,598,504			7,347,040

(b) Share Options

Options over ordinary shares issued during the period and outstanding at balance date:

40,379,552 Listed Options exercisable at 25 cents each expiring 30 June 2010.

On 19 March 2008, 32,879,552 options were issued over ordinary shares, exercisable anytime prior to their expiry date being 30 June 2010. The options were issued through a non-renounceable rights issue prospectus dated 6 February 2008, on the basis of one option for every two shares held as at 15 February 2008. The options are listed on the ASX and have been issued at $0.01 each. Funds from the issue have been included as an option reserve in the Balance Sheet. The issue was in accordance with the IPO prospectus whereby the Company advised a loyalty option issue would be completed at the end of 3 months from listing date to reward existing and new investors.

On 1 February 2008 7,500,000 options were issued as part of a private placement to sophisticated and professional investors.

20,000,000 Unlisted Options exercisable at 22 cents each expiring 30 June 2010.

During the financial period ended 30 June 2008 options were granted over ordinary shares as part of share placements and seed/promoter issues, exercisable prior to their expiry date being 30 June 2010. The options have an exercise price of $0.22 each for the life of the Option.

No option holder has any right under the options to participate in any other share issue of the company or any other entity.

3,730,000 Unlisted Options exercisable at 25 cents each expiring 30 June 2010.

On 30 July 2007 options were granted over ordinary shares as an issue through the GBM Resources Limited Employee Option Plan, exercisable prior to their expiry date being 30 June 2010. The options have an exercise price of $0.25 each for the life of the Option.

No option holder has any right under the options to participate in any other share issue of the company or any other entity.

GBM RESOURCES LIMITED

• 50 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 15: Contributed equity (cont’d)

(c) Terms and conditions of ordinary shares

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

At shareholders’ meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands.

NOTE 16: Reserves and Accumulated losses

NOTE 16: Reserves and Accumulated losses	Consolidated		Parent
	30 June 2009	30 June 2008	30 June 2009	30	June 2008
	$	$	$		$
(a) Reserves
Option reserve	328,796	328,796	328,796		328,796
Share based payments reserve	45,166	45,166	45,166		45,166
	373,962	373,962	373,962		373,962
Movements:
Option reserve
Opening balance	328,796	-	328,796		-
Proceeds received	-	328,796	-		328,796
Closing balance	328,796	328,796	328,796		328,796
Share based payments reserve
Opening balance	45,166	-	45,166		-
Option expense	-	45,166	-		45,166
Closing balance	45,166	45,166	45,166		45,166
Closing balance	373,962	373,962	373,962		373,962
The option reserve records proceeds received on the issue of
options.
The share based payments reserve records items recognised as
expenses on valuation of employee share options granted as
remuneration.
(b) Accumulated losses
Accumulated losses at the beginning of the financial period	(1,046,698)	-	(1,046,698)		-
Net loss attributable to the members of GBM Resources Limited	(791,905)	(1,046,698)	(791,905)	(1,046,698)
Accumulated losses at the end of the financial period	(1,838,603)	(1,046,698)	(1,838,603)	(1,046,698)

GBM RESOURCES LIMITED

• 51 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 17: Cash flow information

NOTE 17: Cash flow information (a) Reconciliation of loss to net cash used in operating activities for the period after income tax Loss after income tax Non-cash expenses Depreciation Share based payments expense Exploration expenditure written off Impairment of loan Forgiveness of loan Changes in operating assets and liabilities: (Increase)/decrease in receivables Increase/(decrease) in creditors and borrowings Net cash used in operating activities (b) Non cash financing activities Share subscriptions receivable	Consolidated Parent 30 June 2009 $ 30 June 2008 $ 30 June 2009 $ 30 June 2008 $ (791,905) (1,046,698) (791,905) (1,046,698) 34,878 12,153 34,878 12,153 - 45,166 - 45,166 55,094 - 44,707 - - - 10,387 - - 459,945 - 459,945 118,773 (291,509) 118,773 (244,641) (14,779) 126,008 (14,779) 126,008
	(597,939) (694,935) (597,939) (648,067)
	149,563 - 149,563 -

(b) Non cash financing activities Share subscriptions receivable

(c) Acquisition of subsidiaries

During the 2008 year the company acquired 100% of the issued capital of Willaura Minerals Pty Ltd and Belltopper Hill Pty Ltd for the purchase consideration of $1,406,850 as follows:

Purchase consideration Satisfied by: Cash Issue of 6,025,000 shares at $0.20 per share Asset and liabilities held at acquisition date: Exploration properties Liabilities	$ 1,406,850
	201,850 1,205,000
	1,406,850
	1,406,850 -
	1,406,850

GBM RESOURCES LIMITED

• 52 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 18: Related party transactions

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

Transactions with related parties:

Key management personnel Remuneration

Details of key management personnel remuneration are set out in the Directors’ Report under the section titled ‘Remuneration Report’.

Transactions with Related Parties in the Wholly Owned Group

Loans to/from related parties Loans to subsidiaries Beginning balance Loans advanced Balance at 30 June 2009	Consolidated Parent 30 June 2009 $ 30 June 2008 $ 30 June 2009 $ 30 June 2008 $ - - 956,593 - - - 3,128,346 956,593
	- - 4,084,939 956,593

Other related party disclosures relating to key management personnel are set out in note 6.

During the period fees were paid for services to Switzer Geological Services Pty Ltd, a company which Mr Cameron Switzer is both a director and shareholder. Fees paid during the period totalled $11,500. The company also acquired a field motor vehicle for use in the Mt. Isa region, the purchase was based on second hand values with a cost of $6,182.

GBM Resources Limited is the ultimate parent entity in the consolidated entity.

NOTE 19: Investments in controlled entities

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

Name of entity Country of incorporation Class of shares Equity holding 2009 Equity holding 2008 Syndicated Resources Exploration Pty Ltd Australia Ordinary 100% 100% Belltopper Hill Pty Ltd Australia Ordinary 100% 100% Willaura Minerals Pty Ltd Australia Ordinary 100% 100% ISA Tenements Pty Ltd Australia Ordinary 100% - ISA Brightlands Pty Ltd Australia Ordinary 100% -	Investment 2009 Investment 2008 - - 596,850 596,850 810,000 810,000 - - - -
	1,406,850 1,406,850

GBM RESOURCES LIMITED

• 53 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 20: Financial instruments

Overview

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

• Credit risk

• Liquidity risk

• Market risk

• Capital risk

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

The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework. Management monitors and manages the financial risks relating to the operations of the group through regular reviews of the risks.

(a) Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Group’s receivables from customers and investment securities. For the Company it arises from receivables from subsidiaries.

(i) Trade and other receivables

As the Group operates in the mining sector, it does not have trade receivables and therefore is not exposed to credit risk in relation to trade receivables.

Presently, the Group undertakes exploration and evaluation activities exclusively in Australia. At the balance sheet date there were no significant concentrations of credit risk.

(b) Liquidity risk

Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.

The Group manages liquidity risk by maintaining adequate reserves by continuously monitoring forecast and actual cash flows.

Typically the Group ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot be predicted, such as natural disasters.

(c) Market risk

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

(i) Currency risk

The Consolidated entity is currently not exposed to currency risk. All investments, purchases and borrowings are denominated in Australian dollars.

(ii) Interest rate risk

The Group’s exposure to the risk of changes in market interest rate relates to the Group’s cash and cash equivalents.

(d) Capital risk

The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance.

The Group’s overall strategy remains unchanged from 2008.

The capital structure of the Group consists of cash and cash equivalents and equity attributable to equity holders of the parent, comprising issued capital, reserves and retained earnings.

GBM RESOURCES LIMITED

• 54 -

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 20: Financial instruments (Cont’d)

None of the Group’s entities are subject to externally imposed capital requirements.

Operating cash flows are used to maintain and expand operations, as well as to make routine expenditures such as tax, dividends and general administrative outgoings.

Cashflow sensitivity analysis for variable rate instruments

A change of 100 basis points in interest rates at the reporting date would have increased (decreased) equity and profit or loss by amounts shown below, where interest is applicable. This analysis assumes that all other variables remain constant.

30 June 2009 Variable rate instruments Cash flow sensitivity (net) 30 June 2008 Variable rate instruments Cash flow sensitivity (net)	Profit or (loss) Equity 100bp increase 100bp decrease 100bp increase 100bp decrease $ $ $ $ 15,708 (15,708) 15,708 (15,708)
	15,708 (15,708) 15,708 (15,708)
	$ $ $ $ 27,640 (27,640) 27,640 (27,640)
	27,640 (27,640) 27,640 (27,640)

Summary of Financial Instruments

												Weighted Average	Weighted Average
	Fixed Interest Rate		Floating Interest Rate				Non-interest	Bearing	Total		Effective Interest Rate
	30-Jun 2009	30-Jun 2008	30-Jun	2009	30-Jun 2008		30-Jun 2009	30-Jun 2008	30-Jun 2009	30-Jun 2008	30-Jun	2009	30-Jun 2008
Consolidated	$	$	$		$		$	$	$	$	%		%
Financial Assets:
Cash and cash equivalents			1,067,175		2,429,836		503,696	334,985	1,570,871	2,764,821	4.00%		7.00%
Receivables				-		-	322,299	291,510	322,299	291,510		-	-
Total Financial Assets			1,067,175		2,429,836		825,995	626,495	1,893,170	3,056,331
Financial Liabilities:
Payables				-	-		335,844	350,623	335,844	350,623
Total Financial Liabilities				-	-		335,844	350,623	335,844	350,623
												Weighted Average
	Fixed Interest Rate		Floating Interest Rate				Non-interest	Bearing	Total		Effective Interest Rate
	30-Jun 2009	30-Jun 2008	30-Jun	2009	30-Jun 2008		30-Jun 2009	30-Jun 2008	30-Jun 2009	30-Jun 2008	30-Jun	2009	30-Jun 2008
Parent	$	$	$		$		$	$	$	$	%		%
Financial Assets:
Cash and cash equivalents			1,067,175		2,429,836		503,696	334,985	1,570,871	2,764,821	4.00%		7.00%
Receivables				-		-	275,430	244,641	275,430	244,641		-	-
Total Financial Assets			1,067,175		2,429,836		779,126	579,626	1,846,201	3,009,362
Financial Liabilities:
Payables				-	-		355,844	350,623	355,844	350,623
Total Financial Liabilities				-	-		355,844	350,623	355,844	350,623

(i) Net fair values

Methods and assumptions used in determining net fair value.

For assets and other liabilities, the net fair value approximates their carrying value. No financial assets and financial liabilities are readily traded on organised markets in standardised form. The Company has no financial assets where carrying amount exceeds net fair values at balance date.

The aggregate net fair values and carrying amounts of financial assets and financial liabilities are disclosed in the balance sheet and in the notes to and forming part of the financial statements.

GBM RESOURCES LIMITED

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NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 20: Financial instruments (Cont’d)

(ii) Capital management

Management controls the capital of the Group in order to provide shareholders with adequate returns and ensure that the Group can fund its operations and continue as a going concern.

There are no externally imposed capital requirements.

Management effectively manages the Group’s capital by assessing the Group’s cash projections up to two years in the future and any associated financial risks. Management will adjust the Group’s capital structure in responce to changes in these risks and in the market.

The following table details the company’s and the Group’s expected maturity for its non-derivative financial assets. These have been drawn up based on undiscounted contractual maturities of the financial assets including interest that will be earned on those assets except where the company/Group anticipates that the cash flow will occur in a different period. Consolidated

Weighted average effective interest rate % 2009 Non-interest bearing Variable interest rate instruments 4.0% 2008 Non-interest bearing Variable interest rate instruments 7.00% Parent Weighted average effective interest rate % 2009 Non-interest bearing Variable interest rate instruments 4.0% 2008 Non-interest bearing Variable interest rate instruments 7.00%	Less than 1 month 1 – 3 Months 3 months – 1 year $ $ $ 825,995 - - 1,067,175 - -
	1,893,170 - -
	596,155 - - 2,460,175 - -
	3,056,330 - -
	Less than 1 month 1 – 3 Months 3 months – 1 year $ $ $ 779,126 - - 1,067,175 - -
	1,846,201 - -
	549,187 - - 2,460,175 - -
	3,009,362 - -

GBM RESOURCES LIMITED

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NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

NOTE 20: Financial instruments (Cont’d)

The following table details the company’s and the Group’s expected maturity for its non-derivative financial liabilities. These have been drawn up based on undiscounted contractual maturities of the financial assets including interest that will be earned on those assets except where the company/Group anticipates that the cash flow will occur in a different period.

Consolidated

Weighted average effective interest rate % 2009 Non-interest bearing Variable interest rate instruments 2008 Non-interest bearing Variable interest rate instruments Parent Weighted average effective interest rate % 2009 Non-interest bearing Variable interest rate instruments 2008 Non-interest bearing Variable interest rate instruments	Less than 1 month 1 – 3 Months 3 months – 1 year $ $ $ 335,844 - - - - -
	335,844 - -
	350,623 - - - - -
	350,623 - -
	Less than 1 month 1 – 3 Months 3 months – 1 year $ $ $ 335,844 - - - - -
	335,844 - -
	350,623 - - - - -
	350,623 - -

Consolidated Parent 30-Jun 2009 30-Jun 2008 30-Jun 2009 30-Jun 2008 $ $ $ $

NOTE 21: Employee benefits

Remuneration commitments

Commitments for the payment of salaries and other remuneration under long-term employment contracts in existence at the reporting date but not recognised as liabilities, payable:

Within 1 year 107,332 181,800 107,332 181,800

Amounts disclosed as remuneration commitments include commitments arising from the service contracts of the Chief
Executive Officer that are not recognised as a liability and not included in the directors’ remuneration disclosure in the
directors’ report.
Aggregate employee benefits liability 2,254 12,844 2,254 12,844
Number of employees at balance date 4 4 4 4

GBM RESOURCES LIMITED

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NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

		Consolidated	Consolidated		Parent
	30-Jun	2009	30-Jun 2008	30-Jun 2009		30-Jun	2008
	$		$	$		$
NOTE 22: Commitments
(a) Lease commitments
Commitments in relation to leases contracted for at the
reporting date but not recognised as liabilities &
payables:
Within one year	15,129		7,025	15,129			7,025
Later than one year but not later than five years		-	-	-			-
Representing:
Cancellable operating leases	15,129		7,025	15,129			7,025
Non-cancellable operating leases		-	-	-			-

GBM RESOURCES LIMITED

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NOTES TO THE FINANCIAL STATEMENTS

For the year ended 30 June 2009

Note 23: Subsequent Events

The company undertook a share placement which was finalised on 13 August 2009 with the issue of 25,000,000 shares issued at an issue price of 2 cents per share to raise $500,000.

Except for the above developments, no other matters or circumstances have arisen since the end of the financial period which significantly affected or may significant affect the operations of the company, the results of those operations, or the state of affairs of the company in future financial years.

Note 24: Share based payments

(a) Employee Option Scheme

The establishment of the GBM Resources Limited Employee Option Plan was approved by shareholders at a general meeting held on 10 May 2007. Full time employees, part time employees, directors and consultants of the company are eligible to participate in the scheme.

Options are granted under the plan for no consideration and carry no dividend or voting rights.

When exercisable, each option is convertible into one ordinary share fourteen days after options exercised.

The assessed fair value at grant date of options granted to the individuals is allocated equally over the period from grant date to vesting date, and the amount is included in the remuneration tables above. Fair values at grant date are independently determined using a Black Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option.

Total expenses arising from share-based payment transactions recognised during the period as part of employee benefit expense were as follows:

No options were granted during the financial period. Options granted during the previous financial period ended on 30 June 2008 are detailed as follows:

No options were granted during the financial period. Options granted during the previous financial period ended on 30 June 2008 are detailed as follows:	No options were granted during the financial period. Options granted during the previous financial period ended on 30 June 2008 are detailed as follows:
Grant date Vesting date Expiry date Number In Escrow Exercise price
12 June 2007 12 June 2007 30 June 2010 3,000,000 24 months ending 30 July 2009 25 cents
15 June 2007 15 June 2008 30 June 2010 500,000 - 25 cents
16 January 2008 16 January 2009 30 June 2010 90,000 - 25 cents
16 January 2008 16 January 2010 30 June 2010 90,000 - 25 cents
11 February 2008 11 February 2009 30 June 2010 25,000 - 25 cents
11 February 2008 11 February 2010 30 June 2010 25,000 - 25 cents
Total options granted	3,730,000
Value of options granted under the plan: Options issued under the employee option scheme	Consolidated Parent 30-Jun 2009 $ 30-Jun 08 $ 30-Jun 2009 $ 30-Jun 08 $ - 51,444 - 51,444

GBM RESOURCES LIMITED

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DIRECTORS’ DECLARATION

In the directors opinion:

• (a) the financial statements and notes set out on pages 30 to 58 are in accordance with the Corporations Act 2001, including:

• (i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; and

• (ii) giving a true and fair view of the company’s and consolidated entity's financial position as at 30 June 2009 and of their performance, as represented by the results of their operations, changes in equity and their cash flows, for the period ended on that date; and

• (b) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable; and

• (c) the audited remuneration disclosures set out on pages 17 to 22 of the directors’ report comply with Accounting Standards AASB 124 Related Party Disclosures and Class Order 06/50 issued by the Australian Securities and Investments Commission.

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

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

On behalf of the Board

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Mr. Peter May Chairman

Place: Perth, WA

Dated 30 day of September 2009

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INDEPENDENT AUDITOR’S REPORT

To the members of GBM Resources Limited

Report on the Financial Report

We have audited the accompanying financial report of GBM Resources Limited (“the company”), which comprises the balance sheet as at 30 June 2009, the income statement, statement of changes in equity, cash flow statement and notes to the financial statements for the year ended on that date, and the directors’ declaration for both the company and the consolidated entity as set out on pages 30 to 59. The consolidated entity comprises the company and the entities it controlled at the year’s end or from time to time during the year.

Directors’ Responsibility for the Financial Report

The directors of the company are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Act 2001. This responsibility includes establishing and maintaining internal controls relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

In Note 1(a), the directors also state, in accordance with Accounting Standard AASB 101: Presentation of Financial Statements, that compliance with the Australian equivalents to International Financial Reporting Standards ensures that the financial report, comprising the financial statements and notes, complies 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. These Auditing Standards require that we 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.

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 controls relevant to the entity’s preparation and fair presentation of the financial report 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 entity’s internal controls. 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.

Our audit did not involve an analysis of the prudence of business decisions made by directors or management.

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

HLB Mann Judd (WA Partnership) ABN 22 193 232 714

Level 2 15 Rheola Street West Perth 6005 PO Box 263 West Perth 6872 Western Australia. Telephone +61 (08) 9481 0977. Fax +61 (08) 9481 3686. Email: hlb@hlbwa.com.au. Website: http://www.hlb.com.au Liability limited by a scheme approved under Professional Standards Legislation

HLB Mann Judd (WA Partnership) is a member of International, a world-wide organisation of accounting firms and business advisers

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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 GBM Resources Limited is in accordance with the Corporations Act 2001, including:

• (i) giving a true and fair view of the company’s and consolidated entity’s financial position as at 30 June 2009 and of their performance for the year ended on that date; and

• (ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001; and

• (b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 1(a).

Report on the Remuneration Report

We have audited the Remuneration Report included on pages 17 to 22 of the directors’ report for the year ended 30 June 2009. 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

In our opinion the Remuneration Report of GBM Resources Limited for the year ended 30 June 2009 complies with section 300A of the Corporations Act 2001 .

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HLB MANN JUDD Chartered Accountants

==> picture [178 x 57] intentionally omitted <==

Perth, Western Australia 30 September 2009

W M CLARK Partner

GBM RESOURCES LIMITED

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ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

The following additional information is disclosed in accordance with Section 4.10 of the Australian Securities Exchange Ltd Listing rules in respect of listed public companies only.

The following information is supplied as at 18 September 2009

1. Analysis of Shareholdings

a. Distribution of Shareholders (ASX Code: GBZ)

sruon o areoers ( oe: ) Number of Ordinary Shares Held 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – and over	Ordinary Shares Number of holders Number of shares 5 1,604 77 291,145 136 1,239,702 522 22,676,742 196 112,589,311
	936 136,798,504

There were 3 holders of less than a marketable parcel of ordinary shares.

b. Distribution of Optionholders (ASX Code: GBZO)

sruon o ponoers ( oe: ) Number of Options Held 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – and over	Options Number of holders Number of options 0 0 55 245,652 31 263,313 159 5,991,267 57 33,876,320
	302 40,379,552

2. Voting Rights

The voting rights attached to each class of equity security are as follows:

Ordinary shares

— Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or by proxy has one vote on a show of hands.

Options

— No voting rights.

GBM RESOURCES LIMITED

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ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

3.Twenty Largest Shareholders of quoted Ordinary Shares

3.Twenty Largest Shareholders of quoted Ordinary Shares
Name	Number of Ordinary SharesPercentage of Total
1. UOB Kay Hian Private Limited 2. Superfine Nominees Pty Ltd 3. Roseline Holdings Pty Ltd 4. De Gracie Nominees Pty Ltd 5. Deck Chair Holdings Pty Ltd 6. Mark Evans 7. Mahsor Holdings Pty Ltd 8. Kevin James Hendry 9. Carpentaria Corporation 10.Lawrence Keith Payne 11.Neil Norris 12.Michael John King 13.Peter Anthony Lynch & Laura Anne Lynch 14.Carpentaria Corporation Pty Ltd 15.Rosegate Investments Pty Ltd 16.Donna Cross 17.Sante Holdings Pty Ltd 18.Evan George Cross 19.M & J McDonald Investment P/L 20.David McDonald & Danielle McDonald	9,696,137 7.09 5,729,167 4.19 4,700,000 3.44 3,750,000 2.74 3,500,000 2.56 2,989,375 2.18 2,900,000 2.12 2,833,334 2.07 2,756,250 2.01 2,716,800 1.99 2,500,000 1.83 2,075,000 1.52 1,968,750 1.79 1,837,500 1.34 1,400,051 1.02 1,293,800 0.95 1,293,800 0.95 1,293,800 0.95 1,250,000 0.91 1,250,000 0.91
	57,733,764 42.56

4.a Twenty Largest Optionholders of quoted Options (GBZO)
Name	Number of Option	Percentage of Total
1. UOB Kay Hian Private Limited	8,358,340	20.83
2. De Gracie Nominees Pty Ltd	2,593,635	6.46
3. Superfine Nominees Pty Ltd	1,718,750	4.28
4. CIMB-GK Securities Pte Ltd	1,500,000	3.74
5. Roseline Holdings Pty Ltd	1,500,000	3.74
6. Carpentaria Corporation	1,378,125	3.43
7. Austock Investments Pty Ltd	1,250,000	3.11
8. David Ian Lees	1,250,000	3.11
9. Deck Chair Holdings Pty Ltd	1,000,000	2.49
10.Rylet Pty Ltd	750,000	1.87
11.Peter Anthony Lynch & Laura Anne Lynch	715,625	1.78
12.Silvermist Enterprises Pty Ltd	640,526	1.57
13.Dreampt Pty Ltd	500,000	1.25
14.Martin Gallagher	500,000	1.25
15.Peter James Mullens & Lizbeth Liliana Ramirez	500,000	1.25
16.Robert Westley Smith & Susan Anne Chudley-Smith	500,000	1.25
17.Rosegate Investments Pty Ltd	491,897	1.23
18.Daniel James Fraser	452,500	1.13
19.Detail Nominees Pty Ltd	359,000	0.89
20.Stuart Usher & Janette usher	350,000	0.87
	26,308,398	65.53

GBM RESOURCES LIMITED

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ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

5. Escrowed and Unquoted Securities

The number and class of voluntary escrowed securities and date of escrow are:

Ordinary Shares:

	Number of holders	Number		Date escrow period ends
	52	25,575,000		24 October 2009
Options:
	Number of holders	Number		Date escrow period ends
	53	16,075,000		24 October 2009
The number and class of unquoted securities:
			Number of holders	Number
Options exercisable at 22 cents expiring		30 June 2010	104	20,000,000
Options exercisable at 25 cents expiring		30 June 2010	7	3,730,000

The number and class of unquoted securities:

27% of options held by Regalquest Investments Pty Ltd and 27% held by Carpentaria Corporation ATF Daikoku Investment Trust

6. Substantial shareholders

The names of substantial shareholders who have notified the company in accordance with sections 709 and 710 of the Corporations Act 2001 are:

Sante Holdings Pty Ltd	3,881,400 ordinary shares
De Gracie Nominees Pty Ltd	3,750,000 ordinary shares
Superfine Nominees Pty Ltd	3,937,549 ordinary shares
Roseline Holdings Pty Ltd	3,000,000 ordinary shares

7. Statement in accordance with ASX Listing Rule 4.10.19

The company believes that for the period ended 30 June 2009, it used its cash and assets in a form readily convertible to cash, that it held at the time of admission in a way consistent with its business objectives.