GWR GROUP LIMITED — AGM Information 2007

Oct 30, 2007

Notice of Annual General Meeting and Explanatory Statement

Annual General Meeting to be held at The Golden Ballroom North, Sheraton Perth Hotel, 207 Adelaide Terrace, Perth, Western Australia on Thursday, the 29th day of November, 2007 commencing at 10.00am (WST)

GOLDEN WEST RESOURCES LIMITED

ABN 54 102 622 051

This Notice of Annual General Meeting and Explanatory Statement should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their accountant, solicitor or other professional adviser without delay.

Corporate Directory

Directors	John Daniels (Non Executive Chairman) Gary Hutchinson (Managing Director) Peter Thompson (Executive Director) Michael Wilson (Executive Director) Alan Rudd (Non Executive Director) Constantino Markopoulos (Non Executive Director)
Secretary	John Palermo
Registered Office	Level 1, 284 Oxford Street Leederville WA 6007 Telephone: Facsimile:	(08) 9242 1622 (08) 9443 2859
Principal Office	Suite 6, 136 Main Street Osborne Park WA 6017 Telephone: Facsimile:	(08) 9201 9202 (08) 9201 9203
Auditor	Stantons International 1st Floor, 1 Havelock Street West Perth WA 6005
Lawyers	Pullinger Readhead Lucas Commercial Lawyers Level 2, Fortescue House 50 Kings Park Road West Perth WA 6005
Share Registry	110 Stirling Highway Nedlands WA 6009 Telephone: Facsimile:	Advanced Share Registry Services (08) 9389 8033 (08) 9389 7871
ASX Codes	GWR GWRO

The 2007 Annual General Meeting of Golden West Resources Limited (ABN 54 102 622 051) will be held at The Golden Ballroom North, 207 Adelaide Terrace, Perth, Western Australia on Thursday, the 29th day of November 2007 commencing at 10.00am (WST).

Ordinary Business

Financial Statements and Reports

Period 1 July 2006 to 30 June 2007

To receive and consider the Annual Financial Report, together with the Directors' and Auditor's Reports for the year ending 30 June 2007.

1 Adoption of Remuneration Report

To consider and, if thought fit, pass the following resolution with or without amendment as an ordinary resolution:

That, for all purposes, Shareholders adopt the Remuneration Report set out in the Directors' Report for the year ending 30 June 2007.

Please note that the vote on this resolution is advisory only, and does not bind the Directors or the Company.

2 Election of Director

To consider and, if thought fit, pass the following resolution as ordinary resolution:

That, for all purposes, Mr Alan Paul Rudd, who retires and offers himself for re‐ election, is re‐elected as a Director.

Special Business

3 Approval of Securities Issue

To consider and, if thought fit, pass the following resolution with or without amendment as an ordinary resolution:

That, for all purposes, Shareholders approve the issue of up to 14, 477, 689 Shares at an issue price, to the parties, for the purposes and on the terms set out in the Explanatory Statement.

For the purposes of Listing Rule 7.3, the Company will disregard any votes cast on resolution 3 by any person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a security holder, if the resolution is passed, and any of their associates, unless it is cast by a person as proxy for a person who is entitled to vote (in accordance with the directions on the proxy form) or the person chairing the meeting as proxy for a person who is entitled to vote (in accordance with a direction on the proxy form to vote as the proxy decides).

Explanatory Statement

The Explanatory Statement accompanying this Notice of Annual General Meeting is incorporated in and comprises part of this Notice of Annual General Meeting.

Shareholders are specifically referred to the Glossary in the Explanatory Statement which contains definitions of capitalised terms used both in this Notice of Annual General Meeting and Explanatory Statement.

Proxies

Please note that:

• (a) a member of the Company entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy;
• (b) a proxy need not be a member of the Company; and
• (c) a member of the Company entitled to cast two or more votes may appoint two proxies and may specify the proportion or number of votes each proxy is appointed to exercise, but where the proportion or number is not specified, each proxy may exercise half of the votes.

The enclosed proxy form provides further details on appointing proxies and lodging proxy forms.

"Snap-shot" Time

The Company may specify a time, not more than 48 hours before the meeting, at which a "snap‐ shot" of shareholders will be taken for the purposes of determining shareholder entitlements to vote at the meeting.

The Company's directors have determined that all shares of the Company that are quoted on ASX at 5.00pm (WST) on 27 November 2007 shall, for the purposes of determining voting entitlements at the Annual General Meeting, be taken to be held by the persons registered as holding the shares at that time.

By Order of the Board of Directors

John Palermo Company Secretary Golden West Resources Limited

30 October 2007

Explanatory Statement

This Explanatory Statement has been prepared for the information of Shareholders in relation to the business to be conducted at the Company's 2007 Annual General Meeting.

The purpose of this Explanatory Statement is to provide Shareholders with all information known to the Company which is material to a decision on how to vote on the resolutions in the accompanying Notice of Annual General Meeting.

This Explanatory Statement should be read in conjunction with the Notice of Annual General Meeting. Capitalised terms in this Explanatory Statement are defined in the Glossary.

1 Financial Statements and Reports

The Annual Financial Report, Directors' Report and Auditor's Report for the Company for the year ending 30 June 2007 will be laid before the meeting.

There is no requirement for Shareholders to approve these reports. However, the Chairman will allow a reasonable opportunity for Shareholders to ask questions or make comments about those reports and the management of the Company. Shareholders will also be given a reasonable opportunity to ask the auditor questions about the conduct of the audit and the preparation and content of the Auditor's Report.

In addition to taking questions at the meeting, written questions to the Chairman about the management of the Company, or to the Company's auditor about:

• the preparation and content of the Auditor's Report;
• the conduct of the audit;
• accounting policies adopted by the Company in relation to the preparation of the financial statements; and
• the independence of the auditor in relation to the conduct of the audit

may be submitted no later than 5 business days before the meeting date to John Palermo at the Company's registered office at Level 1, 284 Oxford Street, Leederville WA 6007 or sent by facsimile to the registered office on (08) 9443 2859.

2 Resolution 1: Adoption of Remuneration Report

The Remuneration Report of the Company for the financial year ending 30 June 2007 is set out in the Director's Report on pages 26 to 30 of the Company's Annual Report.

The Remuneration Report sets out the Company's remuneration arrangements for the executive and non‐executive Directors and executive employees of the Company.

A reasonable opportunity will be given for the discussion of the Remuneration Report at the meeting. Shareholders should note that the vote on this resolution is advisory only and does not bind the Company or the Directors.

3 Resolution 2: Election of Director

In accordance with Listing Rule 14.4 and clause 14.4 of the Constitution, at every Annual General Meeting, one third of the Directors for the time being must retire from office and are eligible for re‐election. The Directors to retire are to be those who have been in office for 3 years since their appointment or last re‐appointment or who have been longest in office since their appointment or last re‐appointment or, if the Directors have been in office for an equal length of time, by agreement. For this reason, Mr Rudd retires and approval is sought for his re‐election.

Details of Mr Alan Rudd are set out in the Annual Report which is available at www.goldenwestresources.com.

4 Resolution 3: Approval of Securities Issue

Listing Rule 7.1 provides generally that a company may not issue shares or options to subscribe for shares equal to more than 15% of the company's issued share capital in any 12 months without obtaining shareholder approval. Resolution 3 seeks this approval.

The Board believes that the proposed issue is beneficial for the Company and recommends Shareholders vote in favour of the resolution. It will allow the Company to retain the flexibility to issue further securities representing up to 15% of the Company's share capital during the next 12 months.

The Company proposes to issue up to 14,477,689 Shares at an issue price equal to at least 80% of the average market price of Shares, calculated over the last 5 days on which sales of Shares were recorded before the date upon which the issue is made or, if the Shares are issued under a prospectus, 5 days on which sales of Shares were recorded before the date of signing of the prospectus.

The issue of the Shares will be equal to approximately 19.9% of the Company's undiluted share capital assuming no further issues of securities by the Company.

The issue date is yet to be determined, but will not be any later than 3 months after the date of Shareholder approval. The securities will be allotted progressively.

The allottees are yet to be identified, however they will be parties determined by the Company having regard to the level of demand for the Shares, the identification of investors with long term commitment to the Company and other factors the Company may consider appropriate, and will not be related parties of the Company.

The Shares will be issued on terms and conditions contained in the Constitution which are summarised in Annexure A. The Company will apply to ASX for official quotation of the Shares.

The Company intends to use funds from the issue to for the purposes of further exploration at the Wiluna Project including 18,760 metres of reserve drilling, 45,000 metres of resource drilling and for general working capital purposes.

5 Glossary

In this Explanatory Statement, the following terms have the following unless the context otherwise requires:

Auditorʹs Report	The auditorsʹ report contained in the Companyʹs annual report dated 27 September 2007
Annual Financial Report	The Companyʹs financial report contained in the Companyʹs annual report dated 27 September 2007
Annexure	annexure to this Explanatory Statement.
ASX	ASX Limited.
Board	board of Directors.
Company	Golden West Resources Limited ABN 54 102 622 051.
Constitution	constitution of the Company.
Corporations Act	Corporations Act 2001 (Cth).
Director	director of the Company.
Directorsʹ Report	the Directorsʹ report contained in the Companyʹs annual report dated 27 September 2007.
Meeting	The annual general meeting of the Company convened by this notice.
Resolution	Each of the resolutions contained in this notice of annual general meeting.
Share	fully paid ordinary share in the capital of the Company.
Shareholder	shareholder of the Company.

Annexure A

Terms of Shares

The following is a broad summary (though not necessarily an exhaustive or definitive statement) of the rights attaching to the shares of the Company. Full details are contained in the Constitution, available for inspection at the Company's registered office.

(a) Share Capital

All issued ordinary shares rank equally in all respects.

(b) Voting Rights

At a general meeting of the Company, every holder of shares present in person, by an attorney, representative or proxy has one vote on a show of hands and on a poll, one vote for every fully paid share held, and for every contributing share held, a fraction of a vote equal to the proportion which the amount paid up bears to the total issue price of the contributing share.

(c) Dividend Rights

Subject to the rights of holders of shares issued with any special or preferential rights (at present there are none), the profits of the Company which the Directors may from time to time determine to distribute by way of dividend are divisible among the shareholders in proportion to the shares held by them respectively, according to the amount paid up or credited as paid up on the shares.

(d) Rights on Winding‐Up

Subject to the rights of holders with shares with special rights in a winding‐up (at present there are none), on a winding‐up of the Company all assets which may be legally distributed amongst the members will be distributed in proportion to the shares held by them respectively, according to the amount paid up or credited as paid up on the share.

(e) Transfer of Shares

Shares in the Company may be transferred by instrument in any form which complies with the Constitution, the Corporations Act, Listing Rules and SCH Business Rules.

Shares may be transferred by such means in accordance with Listing Rules and the SCH Business Rules. The Directors may refuse to register a transfer of shares only in those circumstances permitted by Listing Rules and SCH Business Rules.

(f) Calls on Shares

Shares issued as fully paid are not subject to any calls for payment by the Company and will not therefore become liable for forfeiture.

(g) Further Increases in Capital

The allotment and issue of any new shares is under the control of the Directors and, subject to any restrictions on the allotment of shares imposed by the Constitution, Listing Rules or the Corporations Act, the Directors may allot, issue or grant options over or otherwise dispose of those shares to such persons, with such rights or restrictions as they may from time to time determine.

(h) Variation of Rights Attaching to Shares

Where shares of different classes are issued, the rights attaching to the shares of a class can thereafter only be varied by a special resolution passed at a separate general meeting of the holders of those shares of that class, or with the written consent of the holders of at least three quarters of the issued shares of that class.

(i) General Meeting

Each shareholder will be entitled to receive notice of, and to attend and vote at, general meetings of the Company and to receive notices, accounts and other documents required to be furnished to shareholders under the Constitution, the Corporations Act and Listing Rules.

Shareholder Details

Name: ………………………………………………………………………………………………………………………………………….
Address: …………………………………………………………………………………………………………………………………………….
Contact Telephone No: …………………………………………………………………………………………………………………………….
Contact Name (if different from above): …………………………………………………………………………………………………………

Appointment of Proxy

I/We being a shareholder/s of Golden West Resources Limited and entitled to attend and vote hereby appoint

The Chairman of the Meeting	OR	Write here the name of the person you are appointing if this person is someone other than the Chairman of the Meeting.
(mark with an 'X')

or failing the person named, or if no person is named, the Chairman of the Meeting, as my/our proxy to attend and act generally at the meeting on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, as the proxy sees fit) at the Annual General Meeting of Golden West Resources Limited to be held at The Golden Ballroom North, Sheraton Perth Hotel, 207Adelaide Terrace, Perth, Western Australia on 29 November 2007 at 10.00am (WST) and at any adjournment of that meeting.

If the Chairman of the Meeting is your nominated proxy, or may be appointed by default, and you have not directed your proxy how to vote, please place a mark in this box with an 'X'. By marking this box you acknowledge that the Chairman of the Meeting may exercise your proxy even if he has an interest in the outcome of the resolutions and that votes cast by him, other than as a proxy holder, would be disregarded because of that interest. If you do not mark this box, and you have not directed your proxy how to vote, the Chairman of the Meeting will not cast your votes on the resolutions and your votes will not be counted in computing the required majority if a poll is called. The Chairman of the Meeting intends to vote undirected proxies in favour of each resolution.

Voting directions to your proxy – please mark to indicate your directions

Ordinary Business		For	Against	Abstain*
Resolution 1.	Remuneration Report
Resolution 2.	Re‐election of Mr Alan Paul Rudd
Special Business
Resolution 3.	Approval of Securities Issue

*If you mark the Abstain box for a particular Resolution, you are directing your proxy not to vote on your behalf on a show of hands or on a poll and your votes will not be counted in computing the required majority on a poll.

Appointment of a second proxy (see instructions overleaf)

IMPORTANT

If you wish to appoint a second proxy, state the % of your voting rights applicable to the proxy appointed by this form

PLEASE SIGN HERE This section must be signed in accordance with the instructions overleaf to enable your directions to be implemented

Individual or Shareholder 1 Shareholder 2 Shareholder 3

Sole Director and Sole Company Secretary Director Director/Company Secretary

How to complete this Proxy Form

Your Name and Address

Please print your name and address as it appears on your holding statement and the Company's share register. If shares are jointly held, please ensure the name and address of each joint shareholder is indicated. Shareholders should advise the company of any changes. Shareholders sponsored by a broker should advise their broker of any changes. Please note, you cannot change ownership of your securities using this form.

Appointment of a Proxy

If you wish to appoint the Chairman of the Meeting as your proxy, mark the box. If the person you wish to appoint as your proxy is someone other than the Chairman of the Meeting please write the name of that person. If you leave this section blank, or your named proxy does not attend the meeting, the Chairman of the Meeting will be your proxy. A proxy need not be a shareholder of the Company.

Votes on Resolutions

You may direct your proxy how to vote by placing a mark in one of the boxes opposite each Resolution. All your shareholding will be voted in accordance with such a direction unless you indicate only a portion of voting rights are to be voted on any Resolution by inserting the percentage or number of shares you wish to vote in the appropriate box or boxes. If you do not mark any of the boxes on a given Resolution, your proxy may vote as he or she chooses. If you mark more than one box on a Resolution your vote on that Resolution will be invalid.

Appointment of a Second Proxy

You are entitled to appoint up to two persons as proxies to attend the Meeting and vote on a poll. If you wish to appoint a second proxy, an additional Proxy Form may be obtained by telephoning the Company Secretary on (08) 9242 1622 or you may photocopy this form.

To appoint a second proxy you must on each Proxy Form state (in the appropriate box) the percentage of your voting rights which are the subject of the relevant proxy. If both Proxy Forms do not specify that percentage, each proxy may exercise half your votes. Fractions of votes will be disregarded.

Signing Instructions

You must sign this form as follows in the spaces provided:

Individual:	where the holding is in one name, the holder must sign.
Joint Holding:	where the holding is in more than one name, all of the shareholders should sign.
Power of Attorney:	to sign under Power of Attorney, you must have already lodged this document with the company's share registry. If you have not previously lodged this document for notation, please attach a certified photocopy of the Power of Attorney to this form when you return it.
Companies:	where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone. Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please indicate the office held by signing in the appropriate place.

If a representative of the corporation is to attend the meeting a "Certificate of Appointment of Corporate Representative" should be produced prior to admission. A form of the certificate is either included in the Notice of General Meeting or may be obtained from the Company's share registry.

Lodgement of a Proxy

This Proxy Form (and any Power of Attorney under which it is signed) must be received at the address given below not later than 48 hours before the commencement of the meeting (ie. no later than 10.00am WST on 27 November 2007). Any Proxy Form received after that time will not be valid for the Meeting.

This Proxy Form (and any Power of Attorney and/or second Proxy Form) may be sent or delivered to the Company's registered office at Level 1, 284 Oxford Street, Leederville WA 6007 or sent by facsimile to the registered office on (08) 9443 2859.

Annual Report 2007

ABN 54 102 622 051

"In April 2007, the Directors of your Company announced a maiden Inferred Mineral Resource of 50 million tonnes at 61% Fe. The intense work that has gone into this achievement was carried out by a dedicated field team, working in severe conditions."

John L Daniels, Chairman

Corporate Directory

BOARD OF DIRECTORS

J L Daniels (Chairman) G W Hutchinson (Managing Director) M R Wilson P W Thompson A P Rudd C Markopoulos

CHIEF FINANCIAL OFFICER A L Meloncelli

COMPANY SECRETARY J Palermo

PRINCIPAL OFFICE

Suite 6, 136 Main Street Osborne Park, Western Australia 6017 PO Box 260 Osborne Park, Western Australia 6917 Telephone: +61 8 9201 9202 Facsimile: +61 8 9201 9203

WEBSITE www.goldenwestresources.com

E-MAIL admin@goldenwestresources.com

REGISTERED OFFICE

Level 1, 284 Oxford Street Leederville, Western Australia 6007 Telephone: +61 8 9242 1622 Facsimile: +61 8 9242 5903

AUDITORS

Stantons International Level 1, 1 Havelock Street West Perth, Western Australia 6005 Telephone: +61 8 9481 3188 Facsimile: +61 8 9321 1204

BANKERS

National Australia Bank Limited Suite 7, 51-53 Kewdale Road Welshpool, Western Australia 6106

SHARE REGISTRY

Advanced Share Registry Services 110 Stirling Highway Nedlands, Western Australia 6009 Telephone: +61 8 9389 8033 Facsimile: +61 8 9389 7871

SOLICITORS

Pullinger Readhead Lucas Level 2, 50 Kings Park Road West Perth, Western Australia 6005 Telephone: +61 8 9320 4999 Facsimile: +61 8 9320 4000

Table Of Contents

Corporate Directory	Inside front cover
Chairman's Report	2
Review of Operations	4
Directors' Report	22
Income Statement	29
Balance Sheet	30
Statement of Changes in Equity	31
Statement of Cash Flows	32
Notes to the Financial Statements	33
Directors' Declaration	54
Independent Audit Report	55
Auditor's Independence Declaration	57
ASX Additional Information	58
Corporate Governance Statement	63

Chairman's Report

Dear Shareholders,

I am pleased to present to you the Chairman's Report for the financial year ended 30 June 2007. The Company has enjoyed a very productive year. The Board has continued to pursue the exploration and development of the Company's cornerstone iron ore asset, the Wiluna West Project. In April 2007, the Directors of your Company announced a maiden Inferred Mineral Resource of 50 million tonnes at 61% Fe. The intense work that has gone into this achievement was carried out by a dedicated field team, working in severe conditions. The Directors, on behalf of the Company, congratulate the field team for a job well done.

The Company has set a target of increasing the current JORC compliant resource to at least 100 million tonnes at similar grade by 31 December 2007. I draw your attention to the present market price of iron ore. The price has risen significantly for the third year in succession and all indications are that it

will continue to rise adding further future value to the Company.

In order that the Company successfully expands and achieves its business objectives, several well experienced personnel have been appointed to new positions in the Company.

Infrastructure planning is underway with studies of the Wiluna via Weld Range to Oakajee corridor commenced. In addition the Company renewed its option over land required for developing an iron ore export facility at the port of Esperance. We also continue to evaluate the proposed port at Oakajee for our export purposes and this will depend on the progress and successful negotiations with various infrastructure third parties involved in the Mid West region. The Company is developing the Wiluna West project with the intention of exporting at least 10 million tonnes per annum for at least 10 to 15 years.

The year has seen considerable positive progress for your Company, which is now capitalised at approximately A\$250 million (fully-diluted).

On behalf of all Golden West shareholders, I would like to thank the Company's staff and contractors for their hard work throughout the year. They have indeed laid a solid foundation for the growth and prosperity of Golden West. Your Directors are committed to Golden West and its objectives, to returning wealth to all our shareholders.

Dated this 27th day of September, 2007.

Dr JOHN LEONARD DANIELS Chairman

Review of Operations Project Summary

Wiluna West Project

The Wiluna West Project is located 35 kilometres southwest of the township of Wiluna in the northeastern Goldfields of Western Australia, 700 kilometres northeast of the port of Geraldton and 450 kilometres north of Kalgoorlie. The Wiluna region is well known for large deposits of nickel, gold, lead, uranium and now iron ore. The Project occupies an area of 440 square kilometres over a strike length of 45 kilometres covering almost the entire Joyners Find Greenstone Belt.

The Company commenced a major reverse circulation (RC) drilling program in September 2006 and this has significantly progressed the development of the project. In April 2007, the Company announced its maiden Inferred Mineral Resource for Wiluna West of 50 million tonnes @ 61% Fe, a significant milestone. Based upon exploration results to date, the Company believes that the Wiluna West Project has the potential for a large deposit of high grade direct shipping hematite.

Scoping studies in particular on infrastructure suggest that the project will be highly profitable based on exporting 10 million tonnes per annum over 10 years. As such, the Company's immediate goal is to outline sufficient iron resources to underpin this base case and allow pre-feasibility studies to commence. This milestone should be achieved early in 2008.

Iron Ore (Hematite)

The Project contains a number of potentially mineralised units, named Units A, B, C, D and E, two of which run the entire 45 kilometre length of the tenements. Exploration to date has concentrated on the northern, more exposed sections of two units, namely "B" and "C". Initial results from exploration confirmed an Inferred Mineral Resource of 50 million tonnes @ 61% Fe. Results from further drilling, indicated that the project has the potential to host a large, high grade iron ore deposit. Exploration by way of mapping and RC drilling continues.

Gold

The Wiluna West Project contains a combined Indicated and Measured gold resource of 788,000 tonnes at 3.5 g/t for a contained 87,000 ounces of gold. The Company has not undertaken any gold exploration during the year under review, concentrating its focus on iron ore exploration. Directors believe that there remains considerable potential for additional gold discoveries.

Uranium

The Company holds exploration licence 53/1159 which is located in the southeast of the Project area. This tenement is upstream from the Dawson Well, Hinkler Well, Centipede and Lake Way uranium deposits. The region is highly prospective for calcrete style uranium deposits. The significant Yeleerie deposit is located 16 kilometres south of the Wiluna West Project. ASX listed company, U3O8 Limited has announced an Inferred Resource of 10 million pounds of U3 O8 at its Hinkler Well project, immediately to the west and along strike of E53/1159. The Company plans to undertake drilling of this target in the near future.

Dohertys Project

The Dohertys Project is located in the Barrambie greenstone belt, 65 kilometres north of the township of Sandstone in the Murchison region of Western Australia. It consists of a single granted mining licence, M57/619, covering an area of 175 hectares and containing an Indicated Mineral Resource of 25,700 tonnes @ 23.8 g/t for a contained 20,430 ounces of gold.

Bullabulling Project

The Bullabulling Project covers an area of 98 square kilometres and is located 35 kilometres southwest of Coolgardie at the southern end of the highly mineralised Coolgardie – Bullabulling greenstone belt. Gold deposits within 10 kilometres of the Bullabulling Project have produced more than one million ounces of gold. The Company is seeking a joint venture partner to explore this project.

Project Overview

The 440 square kilometre Wiluna West Project is located approximately 40 kilometres west of the township of Wiluna in the northeastern goldfields of Western Australia. Almost the entire Joyners Find greenstone belt is held with contiguous tenements over a length of 45 kilometres.

The Wiluna region is well mineralised hosting a number of large deposits of nickel, gold, lead, uranium and the Company's iron deposit.

The Wiluna West Project hosts significant gold and iron deposits and is prospective for calcrete hosted uranium.

The Company's primary focus is on iron ore exploration and development. An aggressive exploration program is continuing with the immediate goal being to delineate sufficient resources and reserves to develop a 10 million tonne per annum direct shipping iron ore project. To date the Company has outlined at the Wiluna West Project an Inferred Mineral Resource of 50.1 million tonnes @ 61% Fe.

Gold exploration has identified a combined gold resource of 788,000 tonnes at 3.5 g/t gold for a contained 87,000 ounces of gold, with considerable potential for additional discoveries.

The southern area of the Wiluna West Project is highly prospective for calcrete hosted uranium deposits located along strike from the Hinkler Well uranium deposit which ASX listed company, U3O8 Limited, has recently announced an Inferred Resource of 10 million pounds of uranium (U3 O8 ).

Iron Ore (Direct Shipping Hematite)

The Company initiated an aggressive exploration program targeting direct shipping hematite. The Project contains 5 major potentially mineralised units, named Units A, B, C and D, two of which appear to extend the entire 45 kilometre length of the tenements. Exploration to date has concentrated on the northern, more exposed sections of two of those units namely "B" and "C".

Exploration activities undertaken during the period July 1 2006 to the date of this Annual Report includes:

• 1. Geological mapping;
• 1. Air photography and
• photogrammetry; 3. Detailed aeromagnetics and radiometrics;
• 1. Flora and fauna surveys;
• 1. RC Drilling; and
• 1. Resource modeling and calculations.

In April 2007, the Company announced its initial Inferred Mineral Resource of 50 million tonnes at 61% Fe as summarised below. The deposits consist of direct shipping hematite and contain low levels of phosphorous, alumina and silica. No other significant deleterious contaminants have been identified.

This Inferred Mineral Resource is from four deposits, Two located upon Unit B (Joyners Find and Bowerbird) and deposits at C3 and C4 located on Unit C. These deposits are all located in the northern half of the project where to date more than 10 deposits have so far been identified. Only a small portion of the C3 deposit was included in the above resource calculation. An updated resource estimate is expected to be completed before 31 October 2007. Many of the iron deposits so far drilled remain open at depth and in some cases, open along strike. There also remains considerable potential for the discovery of new soil covered deposits in this region, particularly as the C4 deposit does not outcrop.

Table 1	GLOBAL Iron INFERRE D MINERA L RESOURCE – WILUNA WEST PROJECT
Deposit	Type	Cut Off	Tonnes	Fe (%)	Si02 (%)	Al2O3 (%)	P (%)	LOI (%)
Bowerbird	Block	50	9,470,000	59.8	7.7	3.5	0.06	2.7
Bowerbird Nth	Sectional	≈ 50	1,950,000	61.5	5.3	3.2	0.04	2.1
C4	Block	50	23,980,000	60.0	8.8	2.5	0.03	2.7
C3	Sectional	≈ 50	3,350,000	62.5	4.6	1.4	0.07	4.2
Joyners Find	Block	≈ 50	7,750,000	64.6	3.1	1.9	0.02	2.0
Joyners Nth	Sectional	≈ 50	3,570,000	63.1	4.8	2.5	0.03	2.1
TOTAL			50,070,000	61.1	7.0	2.6	0.04	2.6

Note: 1. Block model resources calculated by Snowden Mining Consultants Pty Ltd 2. Sectional resources calculated by Golden West Resources Limited

Unit B

Unit B has a strike length of approximately 35 kilometres. The exposed areas of the northern 20 kilometres have been explored in detail. Mineralisation on Unit B is characteristically high grade, hard and contains low levels of phosphorous, alumina and silica. Deposits of this type are of high value as they can be blended with lower quality ores to produce an acceptable product. As such one tonne of this ore type may underpin 2 or 3 tonnes of lower quality ore.

A number of high grade hematite deposits have been identified on Unit B. The Joyners Find and Bowerbird deposits have been drilled on sufficient density to allow the calculation of a resource. These deposits have a combined Inferred Mineral Resource of 22.7 million tonnes at 62% Fe, of which a high component is hard hematite.

Drilling and geological mapping outside of these resources has identified a number of targets for following up and will be explored during the coming year.

Unit C

The most significant iron mineralisation defined within the project area has been found in the notably wider 45 kilometres long Unit C. Whilst hematite deposits have been documented on Unit B, all of the discoveries on Unit C are new. Geological mapping identified a number of priority targets on the northern exposed portion of Unit C, (C1, C2, C3, C4, and C5). Systematic RC drilling of these targets commenced in September 2006 and in April 2007, an initial Inferred Mineral Resource estimate was completed for C4 and a portion of C3. The combined Inferred Mineral Resource released in April 2007 for these deposits was 27.3 million tonnes at 60.3% Fe, largely made up of C4 (23.98 million tonnes). Both of these deposits at the time of calculation were open at depth and along strike. RC drilling has now been completed on all of the previously identified C deposits (C1 to C5) and resource calculations are now being undertaken with an update expected by the end of October 2007.

The iron ore deposits found on Unit C are significantly wider than those found on Unit B. More than 70% of the C4 deposit is under soil cover and does not form a prominent outcrop. The top of the deposit is also hydrated and of lower grade. Initial drill targets on Unit C were based upon outcropping mineralisation and could overlook a deposit such as C4.

Based on detailed aeromagnetics, systematic RC drilling of Unit C has commenced from the northern tenement boundary on an initial line spacing of 400 metres and hole spacing of 80 metres. This first pass drilling has identified a number of new C deposits that will be followed up in the current period.

Exploration consisting of mapping and 3 RC drill rigs is continuing on the 35 kilometre C unit between and along strike of the 6 target areas C1, C2, C3, C4, C5 and C Regional now outlined. Mapping of 7 kilometres of the southern 20 kilometre section showed that it is covered by sand plain and has identified further targets.

Table 2	Summ ary of Significant Drill Results for C4 Prospect
Hole ID	North	East (MGA ZONE 50)	Dip/Azi	From (m)	To (m)	Width (m)	Fe (%)	SiO2 (%)	Al2O3 (%)	P (%)	LOI (%)
WWRC420	7045700	792320	- 60/90	142	156 EOH	14	65.4	2.7	1.6	0.05	1.8
WWRC432	7046000	792480	- 90/0	24	56	32	62.2	6.1	2.2	0.04	3.3
				89	103 EOH	14	64.7	4.7	1.4	0.01	1.0
WWRC433	7046000	792480	- 60/90	118	122	4	61.5	10.0	0.5	0.02	1.2
				170	174 EOH	4	59.2	13.7	0.5	0.04	0.8
WWRC435	7046000	792480	- 60/90	16	23	7	61.4	5.8	2.9	0.04	3.2
WWRC437	7046100	792570	- 60/90	60	64	4	66.2	2.3	1.1	0.03	1.4
				68	72	4	67.7	1.3	0.7	0.02	0.8
				14	18	4	62.8	8.2	0.4	0.05	1.3
WWRC439	7046500	792580	- 60/90	56	62	6	62.9	7.0	1.7	0.04	2.0
WWRC440	7045800	792500	- 60/90	0	14	14	62.9	4.2	1.7	0.04	3.7
				26	42	16	57.5	10.3	4.6	0.02	2.4
WWRC451	7045400	792320	- 60/90	8	88 EOH	80	62.3	8.2	0.9	0.03	1.5
WWRC452	7045600	792420	incl - 60/90	37 30	83 47	46 17	64.8 59.6	5.4 5.2	0.7 3.5	0.03 0.02	0.9 6.8
				69	95	26	65.8	3.9	0.8	0.03	1.1
				99	122	23	65.2	4.8	0.9	0.02	0.9
WWRC454	7045500	792360	- 60/90	24	69	45	59.5	8.5	3.1	0.03	3.0
				132	138	6	60.8	11.4	0.5	0.03	0.7
				143	148	5	64.2	6.0	0.8	0.02	0.9
				169	192	23	67.0	2.3	0.4	0.06	1.0
WWRC455	7046300	792570	- 60/90	68	82	14	60.5	9.0	2.0	0.07	2.1
WWRC457	7046400	792550	- 60/90	68	94	26	61.6	7.1	1.2	0.08	2.9
WWRC458	7045800	792420	- 90/0	2	106 EOH	104	61.9	5.7	3.5	0.05	2.9
			incl	28	106	78	63.7	5.7	3.5	0.05	2.9
WWRC459	7045700	792420	- 90/0	0	126 EOH	126	65.0	3.6	2.0	0.07	2.5
			incl	20	126	106	67.9	1.7	1.0	0.08	1.6
WWRC460	7045600	792440	- 90/0	26 48	118 114	92 66	64.0 66.9	4.6 4.6	1.5 1.5	0.07 0.07	2.9 2.9
WWRC461	7045600	792380	- 60/90	32	46	14	63.5	2.6	1.6	0.04	5.4
				78	138	60	64.2	4.9	1.2	0.04	1.8
		inc		96	126	30	67.7	4.9	1.2	0.04	1.8
WWRC462	7045600	792380	- 90/0	0	76	76	64.6	3.6	2.4	0.02	2.2
WWRC463	7045650	792330	- 60/90	92	174	82	61.8	7.7	1.7	0.04	2.6
		inc	incl	100	164	64	63.1	6.3	1.7	0.04	2.1
WWRC464	7045500	792320	- 60/90	26	50	24	57.7	7.4	4.1	0.02	5.8
				80	84	4	60.5	8.1	0.8	0.03	4.6
				122	127	5	60.2	11.1	1.5	0.04	1.6
WWRC465	7045650	792410	- 60/90	6	10	4	57.9	6.7	4.2	0.02	6.3
				29	33	4	56.2	6.5	3.8	0.02	9.6
				43	101	58	65.0	3.4	1.2	0.03	2.5
				64 126	101 133	37 7	68.5 59.2	1.0 13.3	0.4 0.6	0.03 0.04	0.6 1.0
				137	145	8	62.7	9.0	0.4	0.03	0.7
WWRC482	7046500	792550	- 60/90	15	24	9	61.0	5.8	2.7	0.03	4.4
			incl	15	20	5	63.0	5.4	1.4	0.08	3.2
WWRC484	7046450	792560	- 60/90	1	6	5	59.4	6.2	4.0	0.01	3.6

Table 3	Summ	ary of Significant Drill		Results for C3 Prospect
Hole ID	North	East (MGA ZONE 50)	Dip/Azi	From (m)	To (m)	Width (m)	Fe (%)	SiO2 (%)	Al2O3 (%)	P (%)	LOI (%)
WWRC448	7042600	792450	- 60/90	11	24	13	58.7	7.5	2.9	0.05	5.0
				32	39	7	60.9	6.0	1.2	0.07	5.1
WWRC474	7039890	792610	- 60/90	20	64	44	66.7	1.8	0.6	0.00	1.6
WWRC475	7039890	792570	- 60/90	125	141	16	58.7	5.7	1.0	0.06	8.8
WWRC491	7039800	792445	- 60/270	94	99	5	59.3	9.5	0.7	0.05	4.4
WWRC495	7040300	792370	- 60/270	7	47	40	60.1	8.3	1.2	0.02	4.2
WWRC564	7040300	792330	- 60/270	1	7	6	58.4	12.1	1.5	0.01	2.7
WWRC566	7040600	792320	- 68/270	15	33	18	59.1	8.8	3.4	0.01	2.9
			incl	11	27	16	62.2	6.9	1.6	0.02	2.3
WWRC567	7040600	792360	- 60/270	0	29	29	61.0	6.9	0.9	0.07	4.7
WWRC617	7039050	792770	- 60/90	18	24	6	55.5	11.1	5.2	0.02	4.1
				30	39	9	60.7	6.1	4.1	0.02	2.5
WWRC619	7038950	792645	- 60/90	35	45	10	56.5	8.4	5.8	0.03	4.4

C1 Prospect

Outcropping hematite mineralised iron formation lies along the western edge of the C ridge for a strike length of some 3.5km. Mineralisation is generally separated from the main iron formation by mafic schist some 50m in width. Drilling along the length of this unit has shown the mineralisation occurs within anastomising pods up to 400m in length as a result of fold repetition and structural dislocation.

• Significant intercepts include: • WWRC182, 24m @ 64.4% Fe
• • WWRC555, 76m @ 59.8% Fe
• • WWRC557, 23m @ 63.1% Fe

C2 Prospect

Drilling at C2 is not as extensive as that at C3 however it has shown the hematite mineralisation extends for a strike length of some 2.3km within an anastomising band. The area is structurally complex with apparent isoclinal folding with one or more low angle faults/thrusts cutting across the iron formation possibly facilitating a later mineralising event. The area in considered to have considerable potential with further drilling expected to enhance the mineralisation intercepted to date.

Significant intercepts include:

• • WWRC531, 29m @ 60.4% Fe
• • WWRC533, 16m @ 63.2% Fe
• • WWRC865, 29m @ 61.4% Fe

C3 Prospect

C3 mineralisation outcrops over widths of between 85 and 130m and is made up of 3 parallel zones comprised of both hard and powdery hematite. Structural repetition and folding lends a degree of complexity to this prospect. Limited drilling to date has defined hematite ore over a strike length of some 2.5 km with a further pod of ore defined over a like length of some 500m north of the main C3 zone defining further prospectivity to a zone of some 3.3km strike length.

• Significant intercepts include:
• • WWRC347, 61m @ 60.1% Fe • WWRC487, 32m @ 62.8% Fe
• • WWRC474, 57m @ 66.7% Fe
• • WWRC543, 42m @ 60.0% Fe
• • WWRC624, 37m @ 62.8% Fe

Exploration mapping and drilling some 150m east of the main C3 horizon has intercepted a zone some 300m in mapped length with a best intercept of 57m @ 66.7% Fe which remains open at depth and to the south. C3 has excellent prospectivity for the definition of further hematite ore reserves close to surface with further drilling.

C4 Prospect

The hematite iron ore lies on the contact with an ultramafic or mafic intrusive to the east with only iron formation to the west. In general there are two interpreted Fe mineralised zones (possibly representing fold limbs) which strike approximately north-south and dip between 400 and 800 towards the west. A total of 3 east-west faults were interpreted from the available geology and gravity data. Infill drilling to date has confirmed the C4 deposit is up to 130m wide and remains open at depth in the southern end where the mineralisation is widest and shows excellent continuity. The deepest hole drilled on the project to date, WWRC779, ended in mineralisation at 209m.

Further drilling in the northern end of the prospect since the definition of inferred resources has confirmed continuity of mineralisation with some structural dislocation. Diamond drilling due to commence within the next quarter is designed to provide metallurgical, geotechnical, geochemical, geological, structural and petrological data which will further enhance the confidence of the resource, together with providing valuable information for further modelling. This data should provide the framework for definition drilling.

Significant intercepts include:

• • WWRC458, 104m @ 61.9% Fe
• • WWRC459, 126m @ 65.0% Fe
• • WWRC779, 33m @ 60.3% Fe
• • WWRC824, 88m @ 60.1% Fe

C5 Prospect

The C5 prospect lies within a 20m wide zone of hard hematite mineralisation on the eastern side of the main C Ridge, the horizon is prominent for approximately 300m at the northern end of the deposit. Drilling has intersected this zone over a strike length of some 600m and appears to be closed off north and south but open at depth, however mapping in the northeast has identified a possible structural displacement of the unit which requires drill testing. Further structural off sets are expected to be intercepted during future drilling. Significant intercepts include:

• • WWRC507, 27m @ 61.3% Fe
• • WWRC982, 48m @ 56.6% Fe
• • WWRC504, 27m @ 61.3% Fe

CR Prospect

The CR prospect was defined during regional drilling targeting magnetic anomalies immediately and along strike of C4 and C5 beneath Tertiary paleochannels and sand plain. Drilling intersected high grade hematite ore up to 21m true width for 63.7% Fe some 4.5km north of C5. This zone has been defined on 2 lines some 200m apart to date. A second area of mineralisation was discovered 1.3km north of C5, at present it has only been intersected in one drill line. Best intercept within WWRC643 returned 18m @ 65.2% Fe which ended in mineralisation. Drilling to date indicates a high degree of structural complexity for this zone however further drilling is expected to define further mineralisation.

Significant intercepts include:

• • WWRC643, 18m @ 65.2% Fe
• • WWRC675, 19m @ 67.1% Fe
• • WWRC773, 21m @ 62.5% Fe

C Unit Southern Extension

Geological mapping of the unexplored 20 kilometre long southern half of the project area has identified widespread iron mineralisation. More than 50% of the southern area is under cover and to date a total of 7 kilometres of mapping of the strike south of Ullala Road has been completed. A number of drill targets have been identified for follow up drilling.

Wiluna West Project

Project Development

Overview

An Inferred Mineral Resource of 50.1 million tonnes of iron ore @ 61% Fe was calculated in accordance with the JORC code. A draft submission for mining approval (NOI) for Bowerbird has been commenced by Keith Lindbeck and Associates and is under review. Application to convert exploration licences to mining leases in the north of the project area has commenced.

A high level project timeline is being developed to define the tasks and resources necessary to achieve a 10 million tonne per annum production project by mid 2011. A conceptual pictorial overview of the area is also to be developed showing potential mining areas and infrastructure locations. The key aspects currently being initiated include a scoping study to define the sustained economic parameters required for the future feasibility study and a programme to expand the environmental studies to encompass the whole north area of the project.

Key project objectives for 2007-2008 are:

• 1. Complete bulk sample mining on Bower Bird and the C4 deposit;
• 1. Finalise the Oakajee and/or Esperance Port alternatives;
• 1. Complete the pre feasibility study;
• 1. Complete all heritage and environmental studies for the north project area; and
• 1. Lodge Mining Proposal with the Department of Industry and Resources.

Offsite Infrastructure

Longrun Transport Developments Pty Ltd has been engaged to complete a study to evaluate the alternative infrastructure options and costs for linking the Wiluna West Project to the proposed Midwest regional rail system to Oakajee Port. The Wiluna West Project is 700 kilometres from the proposed Oakajee port (25 kilometres north of Geraldton).

The plans will initially involve transporting at least 10 million tonnes

of iron ore per annum through the Oakajee port. Railway infrastructure plans include railway construction from Wiluna west to south of Meekatharra at Weld Range for approximately 250 kilometres, then joining the proposed Midwest regional planned infrastructure.

An infrastructure planning report for Wiluna to Esperance has been completed by Longrun Transport Developments Pty Ltd with cost estimates. The report is being revised and updated as project details are refined. The report will also progress the preparation of a comprehensive feasibility study. Initial cost estimates are not published in detail but an estimated cost of \$25 per tonne for cartage from Wiluna to Esperance gives the Company confidence to pursue studies of the Esperance route as a viable alternative option to the proposed Oakajee port. Costs of transport for Wiluna to Oakajee are expected to be significantly less then the Esperance option.

The Oakajee port planning has been less detailed and is dependant on Government approvals and on port and rail infrastructure being constructed by third parties. The Company is in discussion with the proponents in the Midwest Region for the proposed rail and port facilities to Oakajee.

Geraldton Iron Ore Alliance (GIOA)

The Company is one of seven members comprising the GIOA. The alliance is promoting the development of a successful iron ore industry in the Midwest region of Western Australia. The GIOA is assisting the members in dealing with the West Australian Government on sustainability including environmental and economic matters relating to mining of iron deposits and building the required infrastructure of rail and port to service this Midwest region.

Steel Mills

Presentations to overseas steel mills and iron ore dealers continued through the year. Strong interest is directed at longer term involvement in the Project through offtake agreements and infrastructure requirements. Several Asian steel mills have visited the Wiluna West Project. Due to confidentiality agreements, the Company cannot disclose information of interested steel mills until commercial agreements are finalised.

The demand for iron ore remains strong going forward. The Company's strategy is to ensure maximum shareholder value by fully understanding Wiluna West's potential prior to entering into any commercial agreements.

Gold

The Joyners Find and Brilliant Shear Zones exhibit a major structural control on the known gold mineralisation with the Wiluna project area. Mineralisation is most intense where shearing is adjacent to Banded Iron Formations producing both quartz reef and quartz stockwork style mineralisation.

Gold exploration undertaken recently successfully increased the resource at the Iron Monarch prospect and has identified a new resource at Eagle East. Nine gold deposits have now been identified for a combined Indicated and Measured resource of 788,000 tonnes at 3.5 g/t gold for 87,000 ounces of gold as summarised in Table 4.

No exploration has been carried out on the gold targets since the Company's primary focus concentrated on iron ore. The gold resources will remain an asset of the Company and will possibly be commercialised in due course when mined in conjunction with iron ore mining.

Uranium

The most southern Wiluna project tenement is exploration licence 53/1159. This lease is located upstream from the

Table 4	Summ ary of Gold Resources – Wiluna West Project
Prospect	Reso urce Type	Tonnage	Grade g/t Au	Ounces Au
Iron Monarch	Indicated	140,000	3.0	13,500
Eagle East	Indicated	102,000	3.7	12,000
Hawk	Indicated	42,000	2.5	3,400
Iron King	Indicated	163,000	3.3	17,300
Iron Duke	Indicated	143,000	2.6	12,000
Goldfinch	Indicated	72,000	3.0	6,900
Bronzewing	Indicated	30,000	5.5	5,300
Bottom Camp	Measured	21,000	7.6	5,100
	Indicated	16,000	5.5	2,800
Brilliant North	Indicated	59,000	4.6	8,700
TOTAL		788,000	3.5	87,000

Dawson Well, Hinkler Well, Centipede and Lake Way uranium deposits. These deposits, like the Yeleerie deposit (50,000 tonnes of contained U3 08 ), located 16 kilometres south of the Company's Project, are calcrete hosted style deposits.

A single stratigraphic traverse of RC holes (26 holes for 1,238 metres) was completed to test a possible palaeochannel target within the Abercromby Creek system immediately upstream from the Dawson-Hinkler

ASX listed company U308 Limited has announced additional significant uranium mineralisation from drilling at its Dawson-West Prospect, downstream and contiguous with the eastern boundary of E53/1159. It has been noted that the westernmost traverse, through the Dawson Well zone, intersected a substantial zone of uranium mineralisation one kilometre wide and up to 5 metres thick, 300 - 700 metres from the Company's eastern tenement boundary.

Tenements

The Wiluna West Project consists of more than 440 square kilometres and the list of tenements is as follows:

Mining Leases 53/1016 to 53/1018 inclusive. The Company owns 100% of the tenements, subject to a gold royalty agreement with the original prospectors. Exploration Licences 53/1114,

53/1116, 53/1159, 53/1173 and 53/1177. Exploration Licence 53/1089 and

Mining Lease 53/1078, the Company is earning 60% from Jindalee Resources Ltd.

Miscellaneous Licences L53/115, L53/146, L53/148 and Application L53/147.

Review of Operations Other Projects

Dohertys Project

The Dohertys Project is located in the Barrambie greenstone belt, 65 kilometres north of the township of Sandstone in the Murchison region of Western Australia. The Project consists of a single granted prospecting licence, P57/972, covering an area of 175 hectares.

The Barrambie region has a previous history of high-grade gold production. Historical records show that 27,308 ounces of gold have been produced from 34,101 tonnes of ore from four mining centres. The Dohertys Project

consists of three groups of historical mine workings; the Dohertys, Old Camp and South Shear mines. Dohertys is the largest, having produced 2,292 tonnes at a grade of 25.4 g/t gold between 1955 and 1985. Exploration over the Dohertys Project area concentrated upon the Dohertys mine and culminated with shaft sinking and underground development where high grade gold mineralisation was defined on the eighth level (100 metre depth) averaging 43.1 g/t gold over a distance of 51 metres.

All of the previous exploration data

has been compiled and re-assessed, leading to a much clearer understanding of the high-grade mineralisation present.

This work has resulted in a complete reappraisal of the deposit which now contains an Indicated resource of 25,700 tonnes @ 23.8 g/t Au for a contained 20,430 ounces.

A limited exploration program at depth has been planned.

The Dohertys Project clearly contains a high-grade gold resource.

Wiluna KaraLundee Football Team, Supported by Golden West Resources Limited

Bullabulling Project

The Bullabulling Project covers an area of 98 square kilometres and is located 35 kilometres south-west of Coolgardie at the southern end of the highly mineralised Coolgardie – Bullabulling greenstone belt. Gold deposits within 10 kilometres of the project have produced more than one million ounces of gold.

Two large gold-in-soil anomalies have been delineated, being the Triton and Canyon Prospects. The Canyon Prospect overlies the Reptile and Bullabulling shear zones and contains anomalous gold intercepts (up to 2g/t) along the down-hole saprolite-saprock interface below transported overburden.

The Company is seeking a joint venture partner for this project.

Iron Ridge, Wiluna West Project

Your Directors submit their report on the consolidated entity consisting of Golden West Resources Limited and its controlled entity for the financial year ended 30 June 2007.

DIRECTORS

The following persons were Directors of Golden West Resources Limited during the financial year and up to the date of this report. Directors were in office for this entire period unless otherwise stated.

• • John Leonard Daniels (Chairman)
• • Gary Wayne Hutchinson
• • Michael Reginald Wilson
• • Peter Wayne Thompson (appointed 28 May 2007)
• • Alan Paul Rudd
• • Constantino Markopoulos (appointed 3 March 2007)
• • Patrick William Gallagher (appointed 22 January 2007 and retired 21 September 2007)
• • George Peter Gregory (resigned 28 November 2006)

John Leonard Daniels, B.Sc(Hons), M.Sc, PhD, F.G.S. – Non Executive Chairman

Dr Daniels is an experienced geologist and Company Director. Dr Daniels has produced extensive publications on petrology, mineralogy, photogeology, remote sensing, regional geology, economic geology, gossans and gemstones. He has undertaken extensive regional mapping and photogeological studies in Australia, North Africa, Somalia, Brazil, Iran and Saudi Arabia and visited and studied mineral deposits in Brazil, Venezuela, Canada and the U.S.A.

Present Directorships: Caldera Resources Inc.

Previous Directorships (last 3 years): Adamus Resources Limited.

Gary Wayne Hutchinson – Managing Director

Mr Hutchinson has had considerable experience in the administration of several listed mining companies and has had over 20 years in the finance and banking industry as the principal of a finance broking business and Branch Manager of a major finance house. Present Directorships: Nil.

Previous Directorships (last 3 years): Nil.

Michael Reginald Wilson, B.App.Sc – Exploration Manager, Executive Director

Mr Wilson is an exploration geologist with more than 20 years experience within Australia and South East Asia. He was actively involved in the discovery of the Bullabulling gold deposits in Western Australia and the development of the Longos gold deposit in the Philippines.

Present Directorships: Nil.

Previous Directorships (last 3 years): Nil.

Peter Wayne Thompson, B.Bus, CPA, FCIS – General Manager (Operations), Executive Director

Mr Thompson's 30 years experience in the mining industry in Australia, the UK and South America includes senior corporate, project commercialisation and operational management roles with Mount Edon Gold Mines, MIM Holdings and Xstrata.

Present Directorships: GBM Resources Limited.

Previous Directorships (last 3 years): Nil.

Alan Paul Rudd, B.App.Sc – Non Executive Director

Mr Rudd has been involved in mineral exploration for 16 years since graduating from Curtin University of Western Australia in 1990. He has successfully explored for a wide range of commodities including gold and base metals predominantly in the Eastern Goldfields of Western Australia. Mr Rudd resides in Kalgoorlie and brings a wealth of experience in all facets of geology including tenement project acquisition, grass roots exploration and project development.

Present Directorships: Fairstar Resources Limited.

Previous Directorships (last 3 years): Nil.

Constantino Markopoulos – Non Executive Director

Mr Markopoulos's professional career has spanned significant involvement in strategic procurement and management solutions within the resources, engineering, petro-chemicals, automotive, insurance and retail sectors, with a focus on cost reductions, consolidation and continuous improvement. His senior management positions have included appointments with Beach Petroleum, Delhi Santos, Shell, ICI/ Orica, Pasminco, RACV, Autojap and Coles Myer as well as the provision of strategic planning consultancy services to the private sector. Present Directorships: Classic Minerals Limited.

Previous Directorships (last 3 years): Nil.

Former Directors

Mr Patrick Gallagher was a Non Executive Director from 22 January 2007 until retirement on 21 September 2007. Dr George Peter Gregory was a Non Executive Director until his resignation on 28 November 2006.

COMPANY SECRETARY

John Palermo, B.Bus, FCA, FCPA, JP

Mr Palermo has been the Company Secretary of Golden West Resources Limited since 14 November 2003. He is a Chartered Accountant and a consultant to the Chartered Accounting Practice, Palermo Chartered Accountants. He was the Principal of that practice from 1978 to 2006. His main areas of expertise are corporate services and company administration.

DIRECTORS' MEETINGS

The number of Directors meetings (including Resolutions) and number of meetings attended by each of the Directors of the Company during the financial year are:

	Board Meetings		Resolutions
	Number Eligible to attend	Number Attended	Number Executed
J L Daniels (Chairman)	12	10	45
G W Hutchinson	12	12	45
M R Wilson	12	12	45
P W Thompson (appointed 28 May 2007)	1	1	5
A P Rudd	12	12	45
C Markopoulos (appointed 3 March 2007)	7	7	12
P W Gallagher (appointed 22 January 2007 and retired 21 September 2007)	8	8	22
G P Gregory (resigned 28 November 2006)	2	2	21

AUDIT AND RISK MANAGEMENT COMMITTEE

During the financial year ended 30 June 2007, the Company held 3 Audit and Risk Management Committee Meetings. The total number of meetings attended by each Director on the committee were:

	Number Eligible	Number
	to Attend	Attended
J L Daniels *	1	1
G W Hutchinson *	2	2
C Markopoulos (appointed 3 March 2007)	3	3
P W Gallagher (appointed 22 January 2007 and retired 21 September 2007)	3	3

* Attended the meetings by invitation.

PRINCIPAL ACTIVITIES

The principal activity of the consolidated entity in Australia during the course of the financial year was predominantly exploration activities relating to minerals in Australia.

CONSOLIDATED RESULTS

The consolidated loss for the year after income tax was \$20,847,328 (2006: loss of \$2,271,381).

REVIEW OF OPERATIONS

A Review of Operations for the financial year and up to the date of this report is included in this document and should be read as part of the Directors' Report.

SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

Significant changes in the state of affairs of the consolidated entity during the financial year were as follows:

• The Company issued 16,327,247 fully paid ordinary shares raising \$17,105,433 (before capital raising costs) by way of share placements and exercise of options.

LIKELY DEVELOPMENTS

The Company and its controlled entity intend to continue their exploration activities.

DIVIDENDS

No dividends were paid or recommended for the year ended 30 June 2007.

EVENTS SUBSEQUENT TO REPORTING DATE

Details of subsequent events are set out in note 29.

ENVIRONMENTAL REGULATION

The consolidated entity has assessed whether there are any particular or significant environmental regulations which apply. It has determined that the risk of non-compliance is low.

The Company has appointed Keith Lindbeck and Associates to advise and oversee the consolidated entity's environmental programs.

DIRECTORS' INTERESTS

The relevant interest of each Director in the shares and options over such instruments issued by the Company and other related body corporates, as notified by the Directors to the Australian Securities Exchange in accordance with S205G(1) of the Corporations Act 2001, at the date of this report is as follows:

	Number of Ordinary Shares	Number of Options over Ordinary Shares
J L Daniels	Nil	2,750,000
G W Hutchinson	2,062,500	4,631,250
M R Wilson	1,653.573	4,426,786
P W Thompson (appointed 28 May 2007)	Nil	Nil
A P Rudd	Nil	2,600,000
C Markopoulos (appointed 3 March 2007)	3,300	Nil

REMUNERATION REPORT

Principles of compensation - audited

Remuneration is referred to as compensation throughout this report.

Key management personnel have authority and responsibility for planning, directing and controlling the activities of the Company and the Group, including Directors of the Company and other Executives. Key management personnel comprise the Directors and Executives of the Company.

Executive remuneration and other terms of employment are reviewed annually by the Board having regard to performance against goals set at the start of the year, relevant comparative information and independent expert advice. As well as a base salary, remuneration packages include superannuation, retirement and termination entitlements, performance-related bonuses and fringe benefits.

The compensation structures explained below are designed to attract suitably qualified candidates, reward the achievement of strategic objectives, and achieve the broader outcome of creation of value for shareholders. The compensation structures take into account:

• • the capability and experience of the key management personnel.
• • the key management personnel's ability to control the relevant segments performance.
• • the Group's performance including:
• the Group's earnings;
• the growth in share price and delivering constant returns on shareholder wealth; and
• the amount of incentives within each key management person's compensation.

Executive directors

The Company has entered into an executive service agreement with Mr Gary Hutchinson pursuant to which Mr Hutchinson is engaged by the Company as Managing Director with effect from 24 December 2004, being the date the Company achieved ASX listing until terminated in accordance with the terms of the agreement.

Under the agreement, the Company is to pay Mr Hutchinson a salary of \$280,000 per annum (exclusive of statutory superannuation) which salary will increase by the greater of 5% or CPI every 12 months. The Company is also required to pay to Mr Hutchinson a motor vehicle allowance of \$1,000 per calendar month.

The Company may terminate the agreement immediately in the usual circumstances. In addition, either the Company or Mr Hutchinson may terminate the agreement with three month's notice and payment by the Company to Mr Hutchinson of one month's salary for every 12 month period of service, up to a maximum of 12 months salary.

The Company has also entered into an executive service agreement with Mr Michael Wilson pursuant to which Mr Wilson is engaged by the Company as Exploration Manager with effect from 24 December 2004, being the date the Company achieved ASX listing until terminated in accordance with the terms of the agreement. The agreement with Mr Wilson is on the same key terms as the executive service agreement with Mr Hutchinson, other than Mr Wilson's salary is \$220,000 per annum (exclusive of statutory superannuation) and the Company must provide Mr Wilson with a fully maintained commercial motor vehicle.

The Company is intending to enter into an agreement with Regalquest Investments Pty Ltd (a related party of Mr Peter Thompson) pursuant to which Regalquest Investments Pty Ltd provides the services of Mr Thompson as General Manager – Operations with effect from 28 May 2007. Under the arrangement, the Company has paid Regalquest Investments Pty Ltd an initial fee of \$35,000 plus fees of \$240,000 per annum (paid monthly in arrears).

Non-executive directors

The Constitution provides that the remuneration of non-executive Directors will be not more than the aggregate fixed sum determined by a general meeting of shareholders. The aggregate remuneration has been set at an amount of \$250,000 per annum.

Effective 1 April 2007, the Directors have resolved that fees payable to non-executive chairman will be \$60,000 per annum and to the non-executive directors \$40,000 per annum (exclusive of statutory superannuation entitlements).

Mr Markopoulos is also paid \$10,000 per annum as a member of the Audit and Risk Management Committee (exclusive of statutory superannuation entitlements). Non-executive Directors are also entitled to be paid reasonable travelling, accommodation and other expenses incurred as a consequence of their attendance at meetings of Directors and otherwise in the execution of their duties as Directors.

The Board undertakes an annual review of its performance against goals set at the start of the year.

REMUNERATION REPORT – Continued

Directors' and executive officers' remuneration – audited

Details of the nature and amount of emolument paid for each Director of Golden West Resources Limited are set out below:

		Sala ry & Fees \$	Cash Bon us \$	Short-term Non Moneta ry \$	Total \$	Post Emplo yment Superan nuation \$	Share based payments Options & rights \$	Othe r Benefits \$	Total \$	Propo rtion of remuneration perform ance fixed %	Value of options as a propo rtion of remuneration %
Non-executive directors
Dr J L Daniels	2007	49,250	-	1,974	51,224	-	2,477,500	-	2,528,724	-	97.97%
Chairman	2006	45,000	-	-	45,000	-	-	-	45,000	-	-
Mr A P Rudd	2007	42,844	-	1,974	44,818	-	2,477,500	-	2,522,318	-	98.22%
	2006	36,655	-	-	36,655	2,250	-	-	38,905	-	-
Mr P W Gallagher	2007	2,243	-	1,974	4,217	17,306	-	-	21,523	-	-
Appointed 22 January 2007 Retired 21 September 2007	2006	-	-	-	-	-	-	-	-	-	-
Mr C Markopoulos	2007	15,083	-	1,974	17,057	1,357	-	-	18,414	-	-
Appointed 3 March 2007	2006	-	-	-	-	-	-	-	-	-	-
Dr G P Gregory	2007	-	-	1,974	1,974	11,353	-	-	13,327	-	-
Resigned 28 November 2006	2006	25,000	-	-	25,000	2,250	-	-	27,250	-	-
Executive directors
Mr G W Hutchinson		2007 112,500	-	1,974	114,474	113,675	3,716,250	12,000	3,956,399	-	93.93%
Managing Director		2006 151,250	-	-	151,250	13,612	-	12,000	176,862	-	-
Mr M R Wilson		2007 176,000	-	1,974	177,974	15,840	3,716,250	-	3,910,064	-	95.04%
Exploration Manager		2006 123,000	-	-	123,000	11,070	-	-	134,070	-	-
Mr P W Thompson	2007	20,000	-	1,974	21,974	-	-	35,000	56,974	-	-
General Manager - Operations Appointed 28 May 2007	2006	-	-	-	-	-	-	-	-	-	-
Total		2007 417,920		- 15,792	433,712		159,531 12,387,500	47,000	13,027,743
		2006 380,905	-	-	380,905	29,182	-	12,000	422,087

Options and rights over equity instruments granted as compensation – audited

Details of options over ordinary shares in the Company that were granted as compensation to each key management person during the reporting period and details of options that were vested during the reporting period are as follows:

Directo rs	Number of options grant ed during 2007	Grant date	Fair val ue per option at grant date (\$)	Exercise price per option (\$)	Expiry date	Number of options vested during 2007
J L Daniels	1,000,000	21/03/07	\$1.2942	\$2.00	31/12/10	1,000,000
	1,000,000	21/03/07	\$1.1833	\$3.00	31/12/11	1,000,000
G W Hutchinson	1,500,000	21/03/07	\$1.2942	\$2.00	31/12/10	1,500,000
	1,500,000	21/03/07	\$1.1833	\$3.00	31/12/11	1,500,000
M R Wilson	1,500,000	21/03/07	\$1.2942	\$2.00	31/12/10	1,500,000
	1,500,000	21/03/07	\$1.1833	\$3.00	31/12/11	1,500,000
A P Rudd	1,000,000	21/03/07	\$1.2942	\$2.00	31/12/10	1,000,000
	1,000,000	21/03/07	\$1.1833	\$3.00	31/12/11	1,000,000

Using the Black Scholes option valuation methodology resulted in valuations of \$1.2942 per option for the \$2.00 exercise priced options and \$1.1833 each for the \$3.00 exercise priced options. The volatility rate was 60% and risk free interest rate used was 6.13%.

During the year ended 30 June 2006, no shares or options were issued to Directors, employees and consultants for remuneration purposes.

No options have been granted since the end of the financial year. The options were provided at no cost to the recipients.

REMUNERATION REPORT – Continued

Analysis of movements in options - unaudited

The movement during the reporting period, by value, of options over ordinary shares in the Company held by each Company director and other key management personnel is detailed.

		Value of Options
	Granted in year \$ (A)	Exercised in year \$ (B)	Forfeited in year \$ (C)	Total option val ue in year \$
J L Daniels	2,477,500	--	--	2,477,500
G W Hutchinson	3,716,250	--	--	3,716,250
M R Wilson	3,716,250	--	--	3,716,250
A P Rudd	2,477,500	--	--	2,477,500
	12,387,500	--	--	12,387,500

• A. The value of options granted in the year is the fair value of the options calculated at grant date using a binominal option-pricing model. The total value of the options granted is included in the table above.
• B. The value of options exercised during the year is calculated as the market price of shares of the Company on the Australian Securities Exchange as at close of trading on the date the options were exercised after deducting the price paid to exercise the option.
• C. The value of the options that lapsed during the year represents the benefit forgone and is calculated at the date the option lapsed using a binominal option-pricing model with no adjustments for whether the performance criteria have or have not been achieved.

SHARE OPTIONS

At the date of this report, there existed the following outstanding options to acquire ordinary shares.

Unlisted Options

• • 12,724,990 options remain on issue, exercisable at \$2.00 on or before 31 December 2010.
• • 7,000,000 options remain on issue, exercisable at \$3.00 on or before 31 December 2011.
• • 1,250,000 options remain on issue, exercisable at \$0.25 on or before 30 June 2008.
• • 1,250,000 options remain on issue, exercisable at \$0.30 on or before 30 June 2008.
• • 1,250,000 options remain on issue, exercisable at \$0.40 on or before 30 June 2008.

Listed Options

• 16,845,794 options remain on issue, exercisable at \$0.20 on or before 31 December 2007.

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

INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS

The Company has entered into a Directors and Officers Insurance policy.

The Company has, during or since the financial year, in respect of any person who is or has been an officer of the Company or a related body corporate:

• • Indemnified or made any relevant agreement for indemnifying against a liability incurred as an officer, including costs and expenses in successfully defending legal proceedings; or
• • paid or agreed to pay a premium in respect of a contract insuring against a liability incurred as an officer for the costs or expenses to defend legal proceedings.

INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS – Continued

Insurance of Officers

Since the end of the previous financial year, the Company has paid insurance premiums of \$15,792 in respect of Directors and Officers liability and corporate reimbursement, for Directors and Officers of the Company. The insurance premiums relate to:

• • any loss for which the Directors and Officers may not be legally indemnified by the Company arising out of any claim, by reason of any wrongful act committed by them in their capacity as a Director or officer, first made against them jointly or severally during the period of insurance; and
• • indemnifying the Company against any payment which it has made and was legally permitted to make arising out of any claim, by reason of any wrongful act, committed by any Director or Officer in their capacity as a Director or Officer, first made against the Director or Officer during the period of insurance.

The insurance policy outlined above does not allocate the premium paid to each individual Officer of the Company.

CORPORATE GOVERNANCE

The Company's corporate governance statement is contained at page 63 in the Annual Report.

AUDITOR'S INDEPENDENCE DECLARATION

A copy of the Auditor's independence declaration as required under Section 307C of the Corporations Act 2001 is set out on page 57.

NON-AUDIT SERVICES

Any non-audit services that were provided by the entity's auditor, Stantons International, is shown at Note 20. 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 nature and scope of each type of non-audit service provided means that auditor independence was not compromised.

Dated at Perth this 27th day of September, 2007. Signed in accordance with a resolution of the Directors:

GARY WAYNE HUTCHINSON Director

Income Statement For the year ended 30 June 2007

	Note	Consolidated		Parent Entit y
		2007	2006	2007	2006
		\$	\$	\$	\$
Revenue	5	244,563	75,008	244,563	75,008
Administration costs	6(b)	(486,398)	(228,237)	(486,187)	(227,167)
Borrowing costs	6(a)	(8,894)	(85)	(8,894)	(85)
Consulting fees	6(b)	(100,246)	(51,410)	(99,996)	(51,410)
Corporate costs	6(b)	(182,584)	(84,653)	(182,334)	(84,653)
Depreciation	6(a)	(185,527)	(40,596)	(185,527)	(40,596)
Employee costs	6(b)	(1,151,342)	(451,582)	(1,151,342)	(451,582)
Exploration expenditure written off	6(b)	(130,735)	(1,458,200)	(130,735)	(1,458,200)
Legal costs	6(b)	(99,881)	(10,385)	(99,881)	(10,385)
Occupancy costs	6(b)	(40,892)	(21,241)	(40,892)	(21,241)
Other expenses	6(c)	(86,870)	--	(87,582)	(1,069)
Share based payments	30	(18,618,522)	--	(18,618,522)	--
Loss before income tax	7	(20,847,328)	(2,271,381)	(20,847,329)	(2,271,380)
Income tax		--	--	--	--
Loss after income tax		(20,847,328)	(2,271,381)	(20,847,329)	(2,271,380)
Loss attributable to members of
Golden West Resources Limited	19	(20,847,328)	(2,271,381)	(20,847,329)	(2,271,380)
Basic loss per share (cents per share)	24	(34.31)	(4.79)

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

Balance Sheet As at 30 June 2007

	Note Consolidated				Parent Entit y
		2007	2006	2007	2006
		\$	\$	\$	\$
Current Assets
Cash and cash equivalents	8	7,297,730	1,500,216	7,297,730	1,500,216
Trade and other receivables	9	480,030	110,765	480,030	110,765
Other	10	13,882	10,494	13,882	10,494
Total Current Assets		7,791,642	1,621,475	7,791,642	1,621,475
Non Current Assets
Plant and equipment	11	881,130	298,964	881,130	298,964
Mineral exploration and
evaluation expenditure	12	11,273,581	3,259,756	11,273,581	3,259,756
Other financial assets	13	36,200	5,000	36,201	5,001
Total Non Current Assets		12,190,911	3,563,720	12,190,912	3,563,721
Total Assets		19,982,553	5,185,195	19,982,554	5,185,196
Current Liabilities
Interest bearing liabilities	14	211	74,244	211	74,244
Trade and other payables	15	693,408	24,875	693,409	24,875
Provisions	16(a)	226,608	97,280	226,608	97,280
Total Current Liabilities		920,227	196,399	920,228	196,399
Non Current Liabilities
Provisions	16(b)	70,060	38,622	70,060	38,622
Total Non Current Liabilities		70,060	38,622	70,060	38,622
Total Liabilities		990,287	235,021	990,288	235,021
Net Assets		18,992,266	4,950,174	18,992,266	4,950,175
Equity
Contributed equity	17(a)	24,141,804	7,895,906	24,141,804	7,895,906
Reserves	18	18,751,550	108,028	18,751,550	108,028
Accumulated losses	19	(23,901,088)	(3,053,760)	(23,901,088)	(3,053,759)
Total Equity		18,992,266	4,950,174	18,992,266	4,950,175

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

Statement of Changes in Equity For the year ended 30 June 2007

	Ordina ry Sha re Capital	Options Rese rves	Acc umulated Losses	Tota L
Consolidated	\$	\$	\$	\$
Balance at 01/07/2005	4,870,648	108,028	(782,379)	4,196,297
Shares issued during the year	3,039,075	--	--	3,039,075
Capital raising costs	(13,817)	(125,000)	--	(138,817)
Options issued during the year	--	125,000	--	125,000
Loss attributable to members of parent entity	--	--	(2,271,381)	(2,271,381)
Balance at 30/06/2006	7,895,906	108,028	(3,053,760)	4,950,174
Balance at 01/07/2006	7,895,906	108,028	(3,053,760)	4,950,174
Shares issued during the year	17,105,433	--	--	17,105,433
Capital raising costs	(859,535)	--	--	(859,535)
Options issued during the year	--	18,643,522	--	18,643,522
Loss attributable to members of parent entity	--	--	(20,847,328)	(20,847,328)
Balance at 30/06/2007	24,141,804	18,751,550	(23,901,088)	18,992,266
Parent
Balance at 01/07/2005	4,870,648	108,028	(782,379)	4,196,297
Shares issued during the year	3,039,075	--	--	3,039,075
Capital raising costs	(13,817)	(125,000)	--	(138,817)
Options issued during the year	--	125,000	--	125,000
Loss attributable to members of parent entity	--	--	(2,271,380)	(2,271,380)
Balance at 30/06/2006	7,895,906	108,028	(3,053,759)	4,950,175
Balance at 01/07/2006	7,895,906	108,028	(3,053,759)	4,950,175
Shares issued during the year	17,105,433	--	--	17,105,433
Capital raising costs	(859,535)	--	--	(859,535)
Options issued during the year	--	18,643,522	--	18,643,522
Loss attributable to members of parent entity	--	--	(20,847,329)	(20,847,329)
Balance at 30/06/2007	24,141,804	18,751,550	(23,901,088)	18,992,266

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

Statement of Cash Flows

For the year ended 30 June 2007

	Note	Consolidated			Parent Entit y
		2007	2006	2007	2006
		\$	\$	\$	\$
Cash Flows from Operating Activities
Payments to suppliers and employees		(1,697,491)	(1,011,770)	(1,696,779)	(1,010,701)
Interest received		267,440	73,588	267,440	73,588
Interest paid		(8,894)	(85)	(8,894)	(85)
Deposits paid		(31,200)	(5,000)	(31,200)	(5,000)
Other costs – GST		(331,615)	(33,155)	(331,615)	(33,155)
Net Cash Used in Operating Activities	21	(1,801,760)	(976,422)	(1,801,048)	(975,353)
Cash Flows from Investing Activities
Payments for exploration expenditure		(8,032,935)	(1,323,398)	(8,032,935)	(1,323,398)
Proceeds – fuel tax credit		43,311	--	43,311	--
Payments for plant and equipment		(817,504)	(320,462)	(817,504)	(320,462)
Proceeds from sale of plant and equipment		35,005	--	35,005	--
Proceeds of loan to controlled entity		--	--	(712)	(1,069)
Net Cash Used in Investing Activities		(8,772,123)	(1,648,860)	(8,772,835)	(1,649,929)
Cash Flows from Financing Activities
Proceeds from issue of shares and options		17,105,433	3,039,075	17,105,433	3,039,075
Costs associated with share and option issues		(660,003)	(13,817)	(660,003)	(13,817)
Net Cash Provided by Financing Activities		16,445,430	3,025,258	16,445,430	3,025,258
Net increase in cash and cash equivalents held		5,871,547	404,976	5,871,547	404,976
Cash and cash equivalents at the beginning of the financial year		1,425,972	1,020,996	1,425,972	1,020,996
Cash and cash equivalents at the end of the financial year	8	7,297,519	1,425,972	7,297,519	1,425,972

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

Notes to the Financial Statements For the year ended 30 June 2007

NOTE 1: REPORTING ENTITY

Golden West Resources Limited (the 'Company') is a company domiciled in Australia. The consolidated accounts of the Company as at and for the year ended 30 June 2007 comprise the Company and its subsidiary (referred to as the 'Consolidated Entity'). The operations and assets of Golden West Resources Limited and its controlled entity are predominantly employed in exploration activities relating to minerals in Australia.

NOTE 2: BASIS OF PREPARATION

Statement of compliance

The financial report is a general purpose financial report which has been prepared in accordance with Australian Accounting Standards (AASBs) (including Australian Interpretations) adopted by the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. The consolidated financial report of the Group also complies with the IFRSs and interpretations adopted by the International Accounting Standards Board. The Company's financial report does not comply with IFRSs as the Company has elected to apply the relief provided to parent entities by AASB 132 Financial Instruments: Presentation and Disclosure in respect of certain disclosure requirements.

The financial statements were approved by the Board of Directors on 27th September 2007.

Going Concern

The consolidated entity has incurred a loss after tax for the year of \$20,847,328 (2006: \$2,271,381) and has a consolidated working capital surplus as at 30 June 2007 of \$6,871,415 (2006: \$1,425,076). The financial report has been prepared on the going concern basis, which contemplates continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business. The Directors believe this to be appropriate for the following reasons:

• • The expected conversion of 16,845,794 listed options exercisable at 20 cent into fully paid ordinary shares raising \$3.369 million prior to 31 December 2007;
• • The expected conversion of 3,750,000 unlisted options exercisable at 25, 30 and 40 cents into fully paid ordinary shares raising \$1.187 million prior to 30 June 2008;
• • Presentations to overseas steel mills and iron ore dealers continued throughout the year. Their strong interest was directed to longer term involvement in the project through offtake agreements;
• • The appointment of Azure Capital Pty Ltd as a corporate advisor, to assist the Company to define an optimal funding strategy for the consolidated entity; and
• • The Company will have sufficient cash for the current period by managing cash reserves on hand from time to time.

New standards and interpretations not yet adopted

The following standards, amendments to standards and interpretations have been identified as those which may impact the entity in the period of initial application. They are available for early adoption at 30 June 2007, but have not been applied in preparing this financial report:

• • AASB 7 Financial Instruments: Disclosures (August 2005) replaces the presentation requirements of financial instruments in AASB 132. AASB 7 is applicable for annual reporting periods beginning on or after 1 January 2007, and may require additional disclosures with respect to the group's financial instruments and share capital.
• • AASB 2005-10 Amendments to Australian Accounting Standards (September 2005) makes consequential amendments to AASB 132 Financial Instruments: Disclosure and Presentation, AASB 101 Presentation of Financial Statements, AASB 114 Segment Reporting, AASB 117 Leases, AASB 133 Earnings Per Share, AASB 139 Financial Instruments: Recognition and Measurement, AASB 1 First time Adoption of Australian Equivalents to International Financial Reporting Standards, AASB 4 Insurance Contracts, AASB 1023 General Insurance Contracts and AASB 1038 Life Insurance Contracts arising from the release of AASB

for the Year ended 30 June 2007

NOTE 2: BASIS OF PREPARATION – Continued

1. AASB 2005-10 is applicable for annual reporting periods beginning on or after 1 January 2007 and is expected to only impact disclosures contained within the consolidated financial report.

2. • AASB 8 Operating Segments replaces the presentation requirements of segment reporting in AASB 114 Segment Reporting. AASB 8 is applicable for annual reporting periods beginning on or after 1 January 2009 and is not expected to have an impact on the financial results of the Company and the group as the standard is only concerned with disclosures.

3. • AASB 2007-3 Amendments to Australian Accounting Standards arising from AASB 8 makes amendments to AASB 5 Noncurrent Assets Held for Sale and Discontinued Operations, AASB 6 Exploration for and Evaluation of Mineral Resources, AASB 102 Inventories, AASB 107 Cash Flow Statements, AASB 119 Employee Benefits, AASB 127 Consolidated and Separate Financial Statements, AASB 134 Interim Financial Reporting, AASB 136 Impairment Assets, AASB 1023 General Insurance Contracts and AASB 1038 Life Insurance Contracts. AASB 2007-3 is applicable for annual reporting periods beginning on or after 1 January 2009 and must be adopted in conjunction with AASB 8 Operating Segments. This standard is only expected to impact disclosures contained within the financial report.
4. • Interpretation 10 Interim Financial Reporting and Impairment prohibits the reversal of an impairment loss recognised in a previous interim period in respect of goodwill, an investment in an equity instrument or a financial asset carried at cost. Interpretation 10 will become mandatory for the Group's 2008 financial statements, and will apply to goodwill, investments in equity instruments, and financial assets carried at cost prospectively from the date that the group first applied the measurement criteria of AASB 136 and AASB 139 respectively (i.e., 1 July 2004 and 1 July 2005, respectively). The adoption of Interpretation 10 is not expected to have any impact on the consolidated financial report.
5. • Interpretation 11 AASB 2 Share-based Payment Group and Treasury Share Transactions addresses the classification of a sharebased payment transaction (as equity or cash settled), in which equity instruments of the parent or another group entity are transferred, in the financial statements of the entity receiving the services. Interpretation 11 will become mandatory for the Group's 2008 financial report. Interpretation 11 is not expected to have any impact on the financial report.
6. • AASB 2007-1 Amendments to Australian Accounting Standards arising from AASB Interpretation 11 amends AASB 2 Sharebased Payments to insert the transitional provisions of AASB 2, previously contained in AASB 1 First-time Adoption of Australian Equivalents to International Financial Reporting Standards. AASB 2007-1 is applicable for annual reporting periods beginning on or after 1 March 2007 and is not expected to have any impact on the consolidated financial report.
7. • AASB 2007-2 Amendments to Australian Accounting Standards arising from AASB Interpretation 12 makes amendments to AASB 1 First-time Adoption of Australian Equivalents to International Financial Reporting Standards, AASB 117 Leases, AASB 118 Revenue, AASB 120 Accounting for Government Grants and Disclosures of Government Assistance, AASB 121 The Effects of Changes in Foreign Exchange Rates, AASB 127 Consolidated and Separate Financial Statement, AASB 131 Interest in Joint Ventures, and AASB 139 Financial Instruments: Recognition and Measurement. AASB 2007-2 is applicable for annual reporting periods beginning on or after 1 January 2008 and must be applied at the same time as Interpretation 12 Service Concession Arrangements.

NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Principles of consolidation

The consolidated accounts incorporate the assets and liabilities of the entity controlled by Golden West Resources Limited (parent entity) as at 30 June 2007 and the results of its controlled entity for the year then ended. The effects of all transactions between Golden West Resources Limited and its controlled entity are eliminated in full.

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. Where control of an entity ceases during a financial year, its results are included for the part of the year for which control exists.

(b) Income Tax

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

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

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

Notes to the Financial Statements for the Year ended 30 June 2007

NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued

in which case the deferred tax is adjusted directly against equity.

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

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

(c) Property, Plant and Equipment

Each class of property, plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation and impairment losses.

Plant and equipment

Plant and equipment is measured on the cost basis less depreciation and impairment losses.

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

Depreciation

The depreciable amount of all fixed assets is depreciated on a diminishing value method over their useful lives to the consolidated entity commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.

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

Leasehold improvements	20%
Motor vehicles	18.75%
Plant and equipment	7.50-40.00%

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

An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the income statement.

(d) Exploration and Development Expenditure

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

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

When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the area according to the rate of depletion of the economically recoverable reserves.

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

Costs of site restoration are provided over the life of the facility from when exploration commences and are included in the costs of that stage. Site restoration costs include the dismantling and removal of mining plant, equipment and building structures, waste removal, and rehabilitation of the site in accordance with clauses of the mining permits. Such costs have been determined using estimates of future costs, current legal requirements and technology on a discounted basis.

Any changes in the estimates for the costs are accounted on a prospective basis. In determining the costs of site restoration, there is uncertainty regarding the nature and extent of the restoration due to community expectations and future legislation. Accordingly the costs have been determined on the basis that the restoration will be completed within one year of abandoning the site.

for the Year ended 30 June 2007

NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued

(e) Leases

Leases of fixed assets where substantially all the risks and benefits incidental to the ownership of the asset, but not the legal ownership that are transferred to entities in the consolidated entity are classified as finance leases.

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

Leased assets are depreciated on a straight-line basis over their estimated useful lives where it is likely that the consolidated entity will obtain ownership of the asset or over the term of the lease.

Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as expenses in the periods in which they are incurred.

Lease incentives under operating leases are recognised as a liability and amortised on a straight-line basis over the life of the lease term.

(f) Financial Instruments

Recognition

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

Financial assets at fair value through profit and loss

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

Loans and receivables

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

Held-to-maturity investments

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

Available-for-sale financial assets

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

Financial liabilities

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

Fair value

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

Impairment

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

for the Year ended 30 June 2007

NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued

(g) Impairment of Assets

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

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

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

(h) Investments in Associates

Investments in associate companies are recognised in the financial statements by applying the equity method of accounting where significant influence is exercised over an investee. Significant influence exists where the investor has the power to participate in the financial and operating policy decisions of the investees but does not have control or joint control over those policies. The equity method of accounting recognises the Company's share of post acquisition reserves of its associates.

(i) Employee Benefits

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

(j) Cash and Cash Equivalents

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

(k) Revenue

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

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

Revenue from the rendering of a service is recognised upon the delivery of the service to the customers. All revenue is stated net of the amount of goods and services tax (GST).

(l) Borrowing Costs

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

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

(m) Goods and Services Tax (GST)

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

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

for the Year ended 30 June 2007

NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued

(n) Earnings per share

(i) Basic Earnings per share

Basic earnings per share is determined by dividing the operating profit/(loss) after income tax attributable to members of Golden West Resources Limited by the weighted average number of ordinary shares outstanding during the financial year. (ii) Diluted Earnings per Share

Diluted earnings per share adjusts the amounts used in the determination of basic earnings per share by taking into account unpaid amounts on ordinary shares and any reduction in earnings per share that will probably arise from the exercise of options outstanding during the financial year.

(o) Contributed equity

Issued and paid up capital is recognised at 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.

(p) Share based payments

The fair value of employee stock options is measured using a binomial lattice model. The fair value of share appreciation rights is measured using the Black Scholes option valuation methodology. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the instruments (based on historical experience and general option holder behaviour), expected dividends, and the risk-free interest rate (based on government bonds). Service and non-market performance conditions attached to the transactions are not taken into account in determining fair value.

(q) Comparative Figures

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

NOTE 4: USE OF ESTIMATES AND JUDGEMENTS

The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected.

In particular, information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amount recognised in the financial statements are described in the following notes:

• • Note 7 Income Tax
• • Note 12 Mineral Exploration and Evaluation Expenditure
• • Note 16 Provisions
• • Note 28 Financial Instruments
• • Note 30 Share based payments

for the Year ended 30 June 2007

2007 2006 2007 2006 \$ \$ \$ \$ NOTE 5: REVENUE Revenue Interest received 241,371 73,588 241,371 73,588 Other income 3,192 1,420 3,192 1,420 Total revenue 244,563 75,008 244,563 75,008 NOTE 6: EX PENSES AN D LOSSES /(GAINS ) (a) Expenses Depreciation of non current assets Plant and equipment 136,916 32,715 136,916 32,715 Motor vehicle 43,300 7,881 43,300 7,881 Leasehold improvements 5,311 -- 5,311 -- Total depreciation of non current assets 185,527 40,596 185,527 40,596 Borrowing cost expense Interest expense 8,894 85 8,894 85 (b) Significant Items Loss before income tax includes the following expenses whose disclosure is relevant in explaining the financial performance of the entity: Administration costs 486,398 228,237 486,187 227,167 Consulting fees 100,246 51,410 99,996 51,410 Corporate costs 182,584 84,653 182,334 84,653 Employee costs 1,151,342 451,582 1,151,342 451,582 Exploration expenditure written off (Note 12) 130,735 1,458,200 130,735 1,458,200 Legal costs 99,881 10,385 99,881 10,385 Occupancy costs 40,892 21,241 40,892 21,241 (c) Other Expenses Loss on plant and equipment disposed 18,120 -- 18,120 -- Provision for termination pay 68,750 -- 68,750 -- Write off loan -- -- 712 1,069 Total other expenses 86,870 -- 87,582 1,069	Consolidated		Parent Entit y

for the Year ended 30 June 2007

	Consolidated		Parent Entit y
	2007	2006	2007	2006
	\$	\$	\$	\$
NOTE 7: INCO ME TAX
The prima facie tax on loss before income tax is reconciled to the income tax as follows:
Loss before income tax	(20,847,328)	(2,271,381)	(20,847,329)	(2,271,380)
Income tax calculated at 30%	(6,254,198)	(681,414)	(6,254,198)	(681,414)
Non deductible expenditure:
Accrued expenses	(941)	--	(941)	--
Exploration expenditure written off	39,221	437,460	39,221	437,460
Provisions	48,443	(28,549)	48,443	(28,549)
Share based payments	5,585,557	--	5,585,557	--
Sundry items	1,416	815	1,416	815
Deductible expenditure:
Accrued income	7,713	(7,139)	7,713	(7,139)
Capital raising costs	(87,562)	(63,651)	(87,562)	(63,651)
Exploration expenditure incurred	(2,443,368)	(397,019)	(2,443,368)	(397,019)
Tax losses not brought to account as deferred tax
assets	3,103,719	739,497	3,103,719	739,497
Income tax expense	--	--	--	--
Deferred tax assets:
Provisions	91,201	3,150	91,201	3,150
Capital raising costs	286,597	58,320	286,597	58,320
Losses	4,699,602	1,595,883	4,699,602	1,595,883
	5,077,400	1,657,353	5,077,400	1,657,353
Deferred tax liabilities:
Capitalised exploration expenditure	3,382,074	977,927	3,382,074	977,927

NOTE 8: CASH AND CASH EQUIVALENTS

Cash on hand Cash at bank	1,000 3,296,730	200 16	1,000 3,296,730	200 16
Term deposits	4,000,000	1,500,000	4,000,000	1,500,000
	7,297,730	1,500,216	7,297,730	1,500,216
Bank overdraft (Note 14)	(211)	(74,244)	(211)	(74,244)
Closing cash and cash equivalents	7,297,519	1,425,972	7,297,519	1,425,972

for the Year ended 30 June 2007

	Consolidated		Parent Entit y
	2007	2006	2007	2006
	\$	\$	\$	\$
NOTE 9: TRA DE AN D OTHER RECEIVA BLES
Current Accrued interest	7,559	33,628	7,559	33,628
Debtors	12,820	--	12,820	--
Fuel tax credits	23,709	--	23,709	--
Goods and services tax	435,942	77,137	435,942	77,137
	480,030	110,765	480,030	110,765
NOTE 10: OTHER
Current Prepayments	13,882	7,494	13,882	7,494
Imprest advance account	--	3,000	--	3,000
	13,882	10,494	13,882	10,494
NOTE 11: PLANT AN D EQUIPMENT
Plant and equipment at cost	692,425	218,424	692,425	218,424
Less: accumulated depreciation	(173,281)	(36,362)	(173,281)	(36,362)
Total plant and equipment	519,144	182,062	519,144	182,062
Motor vehicles at cost	253,018	124,783	253,018	124,783
Less: accumulated depreciation	(45,066)	(7,881)	(45,066)	(7,881)
Total motor vehicles	207,952	116,902	207,952	116,902
Leasehold improvements at cost	159,345	--	159,345	--
Less: accumulated depreciation	(5,311)	--	(5,311)	--
Total leasehold improvements	154,034	--	154,034	--
Total plant and equipment	881,130	298,964	881,130	298,964
Reconciliation of the carrying amount for plant and equipment, motor vehicles and leasehold
improvements is set out below:
Plant and equipment
Carrying amount at beginning of year	182,062	19,098	182,062	19,098
Additions	473,998	195,679	473,998	195,679
Depreciation expense	(136,916)	(32,715)	(136,916)	(32,715)
Carrying amount at end of year	519,144	182,062	519,144	182,062

for the Year ended 30 June 2007

	Consolidated		Parent Entit y
	2007	2006	2007	2006
	\$	\$	\$	\$
NOTE 11: PLANT AN D EQUIPMENT – Continued
Motor vehicles
Carrying amount at beginning of year	116,902	--	116,902	--
Additions	199,129	124,783	199,129	124,783
Disposals	(64,779)	--	(64,779)	--
Depreciation expense	(43,300)	(7,881)	(43,300)	(7,881)
Carrying amount at end of year	207,952	116,902	207,952	116,902
Leasehold improvements
Carrying amount at beginning of year	--	--	--	--
Additions	159,345	--	159,345	--
Depreciation expense	(5,311)	--	(5,311)	--
Carrying amount at end of year	154,034	--	154,034	--
Total carrying amount at end of year	881,130	298,964	881,130	298,964

NOTE 12: MINERAL EXPLORATION AND EVALUATION EXPENDITURE

Balance at beginning of year Exploration and evaluation expenditure incurred	3,259,756 8,144,560	3,394,558 1,323,398	3,259,756 8,144,560	3,394,558 1,323,398
Expenditure written off (Note 6b)	(130,735)	(1,458,200)	(130,735)	(1,458,200)
Balance at end of year	11,273,581	3,259,756	11,273,581	3,259,756

The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of factors, including whether the group decides to exploit the related lease itself or, if not, whether it successfully recovers the related exploration and evaluation asset through sale.

Factors that could impact the future recoverability include the level of reserves and resources, future technological changes, which could impact the cost of mining, future legal changes (including changes to environmental restoration obligations) and changes to commodity prices.

To the extent that capitalised exploration and evaluation on expenditure is determined not to be recoverable in the future, profits and net assets will be reduced in the period in which this determination is made.

In addition, exploration and evaluation expenditure is capitalised if activities in the area of interest have not yet reached a stage that permits a reasonable assessment of the existence or otherwise of economically recoverable reserves. To the extent it is determined in the future that this capitalised expenditure should be written off, profits and net assets will be reduced in the period in which this determination is made.

for the Year ended 30 June 2007

	Consolidated		Parent Entit y
	2007	2006	2007	2006
	\$	\$	\$	\$
NOTE 13: OTHER FINANCIA L ASSETS
Non Current
Related party receivables:
Controlled entity	--	--	1,781	1,069
Less: provision for non recovery	--	--	(1,781)	(1,069)
	--	--	--	--
Unlisted investments at cost
- shares in controlled entity	--	--	1	1
Deposits held	36,200	5,000	36,200	5,000
	36,200	5,000	36,201	5,001
NOTE 14: INTEREST BEARING LIABILITIES
Bank overdraft	211	74,244	211	74,244
NOTE 15: TRA DE AN D OTHER PAYA BLES
Trade creditors and accrued expenses	693,408	24,875	693,409	24,875
NOTE 16: PROVISIONS
a) Current
Employee entitlements	90,358	29,780	90,358	29,780
Termination benefits	136,250	67,500	136,250	67,500
	226,608	97,280	226,608	97,280
b) Non Current
Employee entitlements	70,060	38,622	70,060	38,622

for the Year ended 30 June 2007

	Consolidated		Parent Entit y
	2007 2006		2007 2006
	\$	\$	\$	\$
NOTE 17: CONTRI BUTE D EQUITY
(a) Issued Capital
68,983,624 Ordinary shares fully paid (2006: 52,656,377)	24,141,804	7,895,906	24,141,804	7,895,906

(b) Movements in ordinary share capital of the Company during the past two years were as follows:

Date	Details	No. of Sha res	Issue Price	\$
01/07/2005	Opening balance	43,211,002	--	4,870,648
17/11/2005	Share placements (a)	2,000,000	\$0.25	500,000
25/11/2005	Option conversion (b)	162,750	\$0.20	32,550
07/12/2005	Option conversion (b)	144,875	\$0.20	28,975
03/02/2005	Share placements (a)	3,900,000	\$0.336884	1,313,850
03/02/2005	Share placements (a)	3,100,000	\$0.3665	1,136,150
13/04/2006	Option conversion (b)	43,500	\$0.20	8,700
16/06/2006	Option conversion (b)	94,250	\$0.20	18,850
	Less: transaction costs arising on share issues	--	--	(13,817)
30/06/2006	Closing balance	52,656,377	--	7,895,906
28/07/2006	Option conversion (b)	125,000	\$0.20	25,000
21/08/2006	Option conversion (b)	110,000	\$0.20	22,000
25/08/2006	Share placements (a)	6,250,000	\$1.20	7,500,000
06/09/2006	Option conversion (b)	377,843	\$0.20	75,569
12/09/2006	Option conversion (b)	168,500	\$0.20	33,700
06/10/2006	Option conversion (b)	580,463	\$0.20	116,093
31/10/2006	Option conversion (b)	284,813	\$0.20	56,963
31/10/2006	Option conversion (b)	200,000	\$0.25	50,000
31/10/2006	Option conversion (b)	200,000	\$0.30	60,000
31/10/2006	Option conversion (b)	200,000	\$0.40	80,000
27/11/2006	Option conversion (b)	452,607	\$0.20	90,521
15/12/2006	Option conversion (b)	471,502	\$0.20	94,300
20/12/2006	Option conversion (b)	62,749	\$0.20	12,550
24/01/2007	Option conversion (b)	427,925	\$0.20	85,585
28/02/2007	Option conversion (b)	531,326	\$0.20	106,265
21/03/2007	Option conversion (b)	33,000	\$0.20	6,600
12/04/2007	Option conversion (b)	112,000	\$0.20	22,400
08/05/2007	Option conversion (b)	182,234	\$0.20	36,447
11/06/2007	Option conversion (b)	313,666	\$0.20	62,733
13/06/2007	Share placements (a)	2,955,556	\$1.80	5,320,000
29/06/2007	Option conversion (b)	543,629	\$0.20	108,726
29/06/2007	Share placements (a)	1,744,434	\$1.80	3,139,981
	Less: transaction costs arising on share issues	--	--	(859,535)
30/06/2007	Closing balance	68,983,624	--	24,141,804

(a) Funds raised for working capital purposes

(b) Conversions of options to shares

for the Year ended 30 June 2007

	Consolidated		Parent Entit y
	2007 2006		2007	2006
	\$	\$	\$	\$
NOTE 18: RESERVES
(a) Composition
Options reserve	18,751,550	108,028	18,751,550	108,028

(b) Movements in options of the Company during the past two years were as follows:

Date	Details	No. of Listed Options	No. of Unlist ed Options	Issue Price	\$
01/07/2005	Opening balance	21,605,506	4,350,000		108,028
17/11/2005	Option placement (a)	1,000,000	--	\$0.00	--
25/11/2005	Option conversion (c)	(162,750)	--	\$0.00	--
07/12/2005	Option conversion (c)	(144,875)	--	\$0.00	--
06/02/2006	Debt conversion (b)	625,000	--	\$0.20	125,000
13/04/2006	Option conversion (c)	(43,500)	--	\$0.00	--
16/06/2006	Option conversion (c)	(94,250)	--	\$0.00	--
	Less: transaction costs arising on option issues	--	--		(125,000)
30/06/2006	Closing balance	22,785,131	4,350,000		108,028
28/07/2006	Option conversion (c)	(125,000)	--	\$0.00	--
21/08/2006	Option conversion (c)	(110,000)	--	\$0.00	--
21/08/2006	Option placement (a)	1,562,500	--	\$0.00	--
06/09/2006	Option conversion (c)	(377,843)	--	\$0.00	--
12/09/2006	Option conversion (c)	(168,500)	--	\$0.00	--
06/10/2006	Option conversion (c)	(580,463)	--	\$0.00	--
31/10/2006	Option conversion (c)	(284,813)	--	\$0.00	--
31/10/2006	Option conversion (c)	--	(200,000)	\$0.00	--
31/10/2006	Option conversion (c)	--	(200,000)	\$0.00	--
31/10/2006	Option conversion (c)	--	(200,000)	\$0.00	--
27/11/2006	Option conversion (c)	(452,607)	--	\$0.00	--
07/12/2006	Option issued (d)	100,000	--	\$0.25	25,000
15/12/2006	Option conversion (c)	(471,502)	--	\$0.00	--
20/12/2006	Option conversion (c)	(62,749)	--	\$0.00	--
24/01/2007	Option conversion (c)	(427,925)	--	\$0.00	--
28/02/2007	Option conversion (c)	(531,326)	--	\$0.00	--
21/03/2007	Option issued (d)	--	7,000,000	\$1.2942	9,059,400
21/03/2007	Option issued (d)	--	7,000,000	\$1.1833	8,283,100
21/03/2007	Option conversion (c)	(33,000)	--	\$0.00	--
04/04/2007	Option issued (d)	--	1,025,000	\$1.2449	1,276,022
12/04/2007	Option conversion (c)	(112,000)	--	\$0.00	--
08/05/2007	Option conversion (c)	(182,234)	--	\$0.00	--
11/06/2007	Option conversion (c)	(313,666)	--	\$0.00	--
11/06/2007	Option placement (a)	--	2,955,556	\$0.00	--

for the Year ended 30 June 2007

NOTE 18: RESERVES – Continued

Date	Details	No. of Listed Options	No. of Unlist ed Options	Issue Price	\$
29/06/2007 29/06/2007	Option conversion (c) Option placement (a)	(543,629) --	-- 1,744,434	\$0.00 \$0.00	-- --
	Less: transaction costs arising on option issues	--	--		--
30/06/2007	Closing balance	19,670,374	23,474,990		18,751,550

(a) Option placement for working capital purposes

(b) Conversions of debt to equity

(c) Conversions of options to shares

(d) Incentive options issued to an external consultant/directors in consideration of his contribution to the Company.

Should the options not be exercised, the option premium reserve may be subject to capital gains tax.

	Consolidated			Parent Entit y
	2007	2006	2007	2006
	\$	\$	\$	\$
NOTE 19: ACCU MULATE D LOSSES
Balance at beginning of year	(3,053,760)	(782,379)	(3,053,759)	(782,379)
Loss attributable to members of Golden West
Resources Limited	(20,847,328)	(2,271,381)	(20,847,329)	(2,271,380)
Balance at end of year	(23,901,088)	(3,053,760)	(23,901,088)	(3,053,759)
NOTE 20: RE MUNERATION OF AU DITORS
Amount paid or due and payable to Stantons International for:
Audit services	22,346	16,277	22,346	16,277

The Auditors did not receive any other benefit during the year.

for the Year ended 30 June 2007

NOTE 21: NOTES TO THE STATEMENT OF CASH FLOWS

	Consolidated		Parent Entit
	2007	2006	2007	y 2006
	\$	\$	\$	\$
Reconciliation of net cash and cash equivalents used in operating activities to loss after income tax:
Loss after income tax	(20,847,328)	(2,271,381)	(20,847,329)	(2,271,380)
Depreciation	185,527	40,596	185,527	40,596
Exploration and evaluation expenditure written off	130,735	1,458,200	130,735	1,458,200
Loss on disposal of plant and equipment	18,120	--	18,120	--
Share based payments	18,618,522	--	18,618,522	--
Write off of loans	--	(1,420)	--	(1,420)
Movements in assets and liabilities:
(Increase) in receivables	(368,490)	(72,445)	(368,490)	(72,446)
(Decrease)/increase in payables	300,388	(183,874)	300,388	(182,805)
Increase in provisions	160,766	53,902	161,479	53,902
Net cash used in operating activities	(1,801,760)	(976,422)	(1,801,048)	(975,353)

NOTE 22: KEY MANAGEMENT PERSONNEL DISCLOSURES

The following were key management personnel of the group at any time during the reporting period and unless otherwise indicated were key management personnel for the entire period:

Directors
J L Daniels		Chairman (non-executive)
G W Hutchinson		(executive)
M R Wilson		(executive)
P W Thompson (appointed 28 May 2007)		(executive)
A P Rudd		(non-executive)
C Markopoulos (appointed 3 March 2007)		(non-executive)
P W Gallagher (appointed 22 January 2007 and retired 21 September 2007)		(non-executive)
G P Gregory (resigned 28 November 2006)		(non-executive)
	Consolidated			Parent Entit y
	2007	2006	2007	2006
	\$	\$	\$	\$
(a) Key management personnel compensation
Compensation by category:
Short-term	480,712	392,905	480,712	392,905
Post employment	159,531	29,182	159,531	29,182
Share-based payments	12,387,500	--	12,387,500	--
	13,027,743	422,087	13,027,743	422,087

The compensation disclosed represents an allocation of the key management personnel's estimated compensation from the consolidated entity in relation to their services rendered to the Company.

for the Year ended 30 June 2007

NOTE 22: KEY MANAGEMENT PERSONNEL DISCLOSURES – Continued

(b) Individual Directors and Executive compensation disclosure

Information regarding individual Directors and Executives compensation and some equity instruments disclosures as permitted by Corporations Regulations 2M.3.03 and 2M.6.04 are provided in the Remuneration Report section of the Directors' report on pages 25 to 27.

(c) Other key management personnel transactions

A number of key management persons, or their related parties, hold positions in other entities that result in them having control or significant influence over the financial or operating policies of those entities.

A number of these entities transacted with the Company or its subsidiaries in the reporting period. The terms and conditions of the transactions with management persons and their related parties were no more favourable than those available, or which might reasonably be expected to be available, on similar transactions to non-director related entities on an arm's length basis.

The aggregate amounts recognised during the year relating to key management personnel and their related parties were as follows:

			2007	2006
			\$	\$
Consultancy, on site camp, personnel and mess facilities – Denarda Holdings Pty Ltd
(an associate of M R Wilson)			148,965	73,653
Drilling expenses – Denarda Holdings Pty Ltd (an associate of M R Wilson)			1,288,471	541,123
	Consolidated		Parent	Entit y
	2007	2006	2007	2006
	\$	\$	\$	\$
Interest Income – Denarda Holdings Pty Ltd (an associate of M R Wilson)			2,526	--
Employee – K Hutchinson (spouse of G W Hutchinson)			40,292	30,045

Amounts receivable from and payable to key management personnel and other related parties at reporting date arising from these transactions were as follows:

Payables 66,950 6,250 66,950 6,250

(d) Options and rights over equity instruments

The movement during the reporting period in the number of options over ordinary shares in Golden West Resources Limited held, directly, indirectly or beneficially, by each key management person, including their related parties, is as follows:

Listed Options

Balance	Granted as	No. of	Net Change	Balance	Total Vested	Total
	uneration	Options	Othe r	30/06/07	30/06/07	Exercisa ble
(No. Options )	(No. Options )	Exercised	(No. Options )	(No. Options )	(No. Options )	(No. Options )
--	--	--	--	--	--	--
1,031,250	--	--	--	--	--	1,031,250
826,786	--	--	--	--	--	826,786
--	--	--	--	--	--	--
--	--	--	--	--	--	--
--	--	--	--	--	--	--
1,858,036	--	--	--	--	--	1,858,036
		01/07/06Rem

for the Year ended 30 June 2007

NOTE 22: KEY MANAGEMENT PERSONNEL DISCLOSURES – Continued

Unlisted Options

	Balance	Granted as	No. of	Net Change	Balance	Total Vested	Total
	01/07/06Rem	uneration	Options	Othe r	30/06/07	30/06/07	Exercisa ble
	(No. Options )	(No. Options )	Exercised	(No. Options )	(No. Options )	(No. Options )	(No. Options )
Directo rs
J L Daniels	750,000	2,000,000	--	--	2,750,000	2,750,000	2,750,000
G W Hutchinson	600,000	3,000,000	--	--	3,600,000	3,600,000	3,600,000
M R Wilson	600,000	3,000,000	--	--	3,600,000	3,600,000	3,600,000
P W Thompson	--	--	--	--	--	--	--
A P Rudd	600,000	2,000,000	--	--	2,600,000	2,600,000	2,600,000
C Markopoulos	--	--	--	--	--	--	--
Total	2,550,000	10,000,000	--	--	12,550,000	12,550,000	12,550,000

(e) Movements in shares

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

	Balance	Received	No. of Options	Net Othe r	Balance
	01/07/06	Rem une ration	Exercised	Change	30/06/07
	(No. of Sha res)	(No. of Sha res)		(No. of Sha res)	(No. of Sha res)
Directo rs
J L Daniels	--	--	--	--	--
G W Hutchinson	2,062,500	--	--	--	2,062,500
M R Wilson	1,653,573	--	--	--	1,653,573
P W Thompson	--	--	--	--	--
A P Rudd	--	--	--	--	--
C Markopoulos	--	--	--	3,300	3,300
Total Directors	3,716,073	--	--	3,300	3,719,373

NOTE 23: RELATED PARTIES

The consolidated financial statements include the financial statements of Golden West Resources Limited and the subsidiary listed in the following table.

	Country of co rpo ration % Boo Equity Inte rest Held		k Value of Sha by Parent	res Entit y
		2007	2006	2007	2006
				\$	\$
Iron West Resources Pty Ltd	Australia	100%	100%	1	1
				1	1
				Parent	Entit y
				2007	2006
				\$	\$
Related party receivables with controlled entity:
Iron West Resources Pty Ltd				1,781	1,069
Less: provision for non recovery				(1,781)	(1,069)
				--	--

Related party transactions with Directors are disclosed in Note 22.

for the Year ended 30 June 2007

NOTE 24: LOSS PER SHARE

The following reflects the income and data used in the calculations of basic and diluted loss per share:

	2007	2006
	\$	\$
Loss used in calculating basic and diluted loss per share	(20,847,328)	(2,271,381)
	No. of sha res	No. of sha res
Weighted average number of ordinary shares used in calculating basic earnings per share:	60,765,816	47,454,094

Diluted loss per share is not disclosed as it would not reflect an inferior position.

Consolidated		Parent Entit y
2007	2006	2007	2006
\$	\$	\$	\$

NOTE 25: COMMITMENTS FOR EXPENDITURE

Tenement expenditure commitments

In order to maintain current rights of tenure to mining tenements, the Parent Entity and Consolidated Entity will be required to outlay in 2007/08 amounts of \$542,086 in respect of minimum tenement expenditure requirements and lease rentals. The obligations are not provided for in the accounts and are payable as follows:

Less than one year	542,086	536,254	542,086	536,254
Between one and five years	1,831,623	2,012,758	1,831,623	2,012,758
More than five years	5,169,814	5,478,864	5,169,814	5,478,864
	7,543,523	8,027,876	7,543,523	8,027,876

Rental of premises commitments

The Company currently has a rental of premises contract of \$7,705 per month, inclusive of variable outgoings and GST.

Less than one year	93,885	20,220	93,885	20,220
Between one and five years	402,407	20,220	402,407	20,220
More than five years	--	--	--	--
	496,292	40,440	496,292	40,440

NOTE 26: CONTINGENT LIABILITIES

Golden West Resources Limited has the following contingent liability at the end of the financial year:

• The Company has a contingent liability with the vendor Lingchip Pty Ltd to issue a further 5,000,000 ordinary shares in the Company to Lingchip Pty Ltd upon the delineation of a JORC code compliant indicated resource of 10 million tonnes of iron ore.

NOTE 27: SEGMENT INFORMATION

Business and geographical segments:

• The operations and assets of Golden West Resources Limited and its controlled entity are predominantly employed in exploration activities relating to minerals in Australia.

for the Year ended 30 June 2007

NOTE 28: FINANCIAL INSTRUMENTS

(a) Interest Rate Risk

The consolidated entity's exposure to interest rate risk, which is the risk that a financial instrument's value will fluctuate as a result of change in the market interest rates and the effective weighted average interest rates on classes of financial assets and financial liabilities, is as follows:

	Non Inte	rest		Weighted		Floating
	Bea ring \$		Average Inte rest	Effective Rate %		Inte rest Rate \$		\$
	2007	2006	2007	2006	2007	2006	2007	2006
Financial Assets
- Cash and cash equivalents	3,297,730	216	5.25	5.60	4,000,000	1,500,000	7,297,730	1,500,216
- GST	435,943	77,137	--	--	--	--	435,943	77,137
- Receivables	44,088	33,628	--	--	--	--	44,088	33,628
Total Financial Assets	3,777,761	110,981			4,000,000	1,500,000	7,777,761	1,610,981
Financial Liabilities
- Interest bearing liabilities	211	74,244	--	--	--	--	211	74,244
- Trade and other payables	693,408	24,875	--	--	--	--	693,408	24,875
Total Financial Liabilities	693,619	99,119			--	--	693,619	99,119
Net Financial
Assets	3,084,142	11,862			4,000,000	1,500,000	7,084,142	1,511,862

The consolidated entity's accounting policies, including the terms and conditions of each class of financial asset, financial liability and equity instrument, both recognised and unrecognised in the balance sheet are as follows:

Financial assets

• Trade and other receivables

Receivables are carried at nominal amounts due less any provision for doubtful debts. A provision for doubtful debts is recognised when collection of the full nominal amount is no longer probable. There are no repayment terms in relation to this debtor.

Financial liabilities

• Trade and other payables

Liabilities are recognised for amounts to be paid in future for goods and services received, whether or not billed to the consolidated entity. Creditors are paid and cleared in a 30 day cycle.

(b) Credit risk

The consolidated entity does not grant credit and therefore there are no significant concentrations of credit risk within the group. With respect to credit risk arising from the other financial assets of the group, which comprise cash and cash equivalents, the group's exposure to credit risk arises from default of the counter party, with a maximum exposure equal to the carrying amount of these instruments. Since the group trades only with recognised third parties, there is no requirement for collateral.

(c) Net fair values

For assets and other liabilities the net fair value approximates their carrying value except for Director related receivables which are not interest bearing. The consolidated entity has no financial assets or liabilities that are readily traded on organised markets at balance date and has no financial assets where the 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 the financial statements.

for the Year ended 30 June 2007

NOTE 29: MATTERS SUBSEQUENT TO THE END OF FINANCIAL YEAR

Subsequent to the end of the financial year, the following events have occurred:

• • On 5 July 2007, the Company issued 1,923,872 fully paid ordinary shares upon the exercise of 1,923,872 listed 20 cent options with expiry date of 31 December 2007 raising \$384,774.
• • On 1 August 2007, the Company issued 338,830 fully paid ordinary shares upon the exercise of 338,830 listed 20 cent options with expiry date of 31 December 2007 raising \$67,766.
• • On 17 August 2007, the Company incorporated a wholly owned subsidiary, Golden West Energy Limited.
• • On 31 August 2007, the Company issued 49,083 fully paid ordinary shares upon the exercise of 49,083 listed 20 cent options with expiry date of 31 December 2007 raising \$9,816.
• • On 4 September 2007, the Company received notification of a takeover bid by Fairstar Resources Limited.
• • On 13 September 2007, the Company issued 512,795 fully paid ordinary shares upon the exercise of 512,795 listed 20 cent options with expiry date of 31 December 2007 raising \$102,559.
• • On 21 September 2007, the Company held a General Meeting of Members where the following resolutions were passed:
• Re-election of Directors Messrs Thompson and Markopoulos;
• Ratification of previous share and option issues; and
• Approval of issue of options related parties.

NOTE 30: SHARE BASED PAYMENTS

On 15 March 2007, the following options were granted to various directors, employees, consultants and associated parties of the consolidated entity:

• J L Daniels (or nominee)
• 1,000,000 unlisted options exercisable at \$2 expiry date 31 December 2010; and
• 1,000,000 unlisted options exercisable at \$3 expiry date 31 December 2011.
• G W Hutchinson (or nominee)
• 1,500,000 unlisted options exercisable at \$2 expiry date 31 December 2010; and
• 1,500,000 unlisted options exercisable at \$3 expiry date 31 December 2011.
• M R Wilson (or nominee)
• 1,500,000 unlisted options exercisable at \$2 expiry date 31 December 2010; and
• 1,500,000 unlisted options exercisable at \$3 expiry date 31 December 2011.
• A P Rudd (or nominee)
• 1,000,000 unlisted options exercisable at \$2 expiry date 31 December 2010; and
• 1,000,000 unlisted options exercisable at \$3 expiry date 31 December 2011.
• J Doutch (or nominee)
• 1,500,000 unlisted options exercisable at \$2 expiry date 31 December 2010; and
• 1,500,000 unlisted options exercisable at \$3 expiry date 31 December 2011.
• J Palermo (or nominee)
• 500,000 unlisted options exercisable at \$2 expiry date 31 December 2010; and
• 500,000 unlisted options exercisable at \$3 expiry date 31 December 2011.

Notes to the Financial Statements for the Year ended 30 June 2007

NOTE 30: SHARE BASED PAYMENTS – Continued

The Company also issued a further 1,025,000 unlisted options exercisable at \$2 expiring 31 December 2010 to various employees, consultants and associated parties of the consolidated entity pursuant to an Offer dated 13 March 2007.

The number and weighted average exercise prices of share options is as follows:

	Weighted ave rage exercise price	Number of options	Weighted ave rage exercise price	Number of options
	2007	2007	2006	2006
Outstanding at 1 July	\$0.3166	4,350,000	\$0.3166	4,350,000
Forfeited during the year	--	--	--	--
Exercised during the year	\$0.3166	600,000	--	--
Granted during the year	\$2.4658	15,025,000	--	--
Outstanding at 30 June	\$2.0366	18,775,000	\$0.3166	4,350,000
Exercisable at 30 June	\$2.0366	18,775,000	\$0.3166	4,350,000

The options outstanding at 30 June 2007 have an exercise price in the range of \$0.25 to \$3.00 and a weighted average contractual life of 3.37 years.

The weighted average share price at the date of exercise for share options exercised in the 2007 financial year was \$2.0366 (2006: \$0.3166).

The options were valued using a Black Scholes option valuation methodology applying the following inputs:

	31 Decem ber 2010 Options	31 Decem ber 2011 Options	Offe r Info rmation Boo klet Options
Expected share price volatility	60%	60%	60%
Grant and vesting date	21 March 2007	21 March 2007	4 April 2007
Risk free interest rate	6.13%	6.13%	6.13%
Share price at grant and vesting date	\$2.20	\$2.20	\$2.35

Historical volatility has been the basis for determining expected share price volatility as it is assumed that this is indicative of future trends, which may not eventuate. The life of the options is based on the historical exercise patterns, which may not eventuate in the future. Included under share based payments in the income statement is \$18,618,522 (2006: Nil) and related in full to equity settled share based payment transactions for the year.

DIRECTORS' DECLARATION

The Directors declare that the financial statements and notes set out on pages 29 to 53:

• 1. (a) comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; and
• (b) give a true and fair view of the Company's and consolidated entity's financial position as at 30 June 2007 and of their performance, as represented by the results of their operations, changes in equity and their cash flows, for the financial year ended on that date.
• 1. The Managing Director and Chief Financial Officer have each declared that:
• (a) the financial records of the Company for the financial year have been properly maintained in accordance with section 286 of the Corporations Act 2001:
• (b) the financial statements and notes for the financial year comply with the Accounting Standards; and the financial statements and notes for the financial year give a true and fair view.

In the Directors' opinion:

• 1. (a) the financial statements and notes are in accordance with the Corporations Act 2001; 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.

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

Dated this 27th day of September, 2007.

GARY WAYNE HUTCHINSON Director

Independent Audit Report

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF GOLDEN WEST RESOURCES LIMITED

Report on the Financial Report

We have audited the accompanying financial report of Golden West Resources Limited, which comprises the balance sheet as at 30 June 2007, and the income statement, statement of changes in equity and cash flow statement for the year ended on that date, a summary of significant accounting policies and other explanatory notes and the directors' declaration of the consolidated entity comprising the company and the entities it controlled at the year's end or from time to time during the financial year.

As permitted by the Corporations Regulations 2001, the Company has disclosed the information about the remuneration of directors and executives ("remuneration disclosures"), required by Australian Accounting Standard AASB 124 Related Party Disclosures, under the heading "Remuneration report" on pages 25 to 27 of the Directors' report and not the financial report. We have audited these remuneration disclosures.

Directors' Responsibility for the Financial Report and the AASB 124 remuneration disclosures contained in the Directors' 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 designing, implementing and maintaining internal control 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 2, the directors also state, in accordance with Australian Accounting Standard AASB 101 Presentation of Financial Statements, that the financial report of the Group, comprising the financial statements and notes, complies with International Financial Reporting Standards, but that the financial report of the Company does not comply.

The directors of the Company are also responsible for the remuneration disclosures contained in the Directors' report.

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. Our responsibility is also to express an opinion that the remuneration disclosures contained in the Directors' report comply with Australian Accounting Standard AASB 124.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report and the remuneration disclosures contained in the Directors' report. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial report and the remuneration disclosures contained in the Directors' report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial report and the remuneration disclosures contained in the Directors' 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 control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report and the remuneration disclosures contained in the Directors' report.

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

Independent Audit Report

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 Golden West 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 2007 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.
• (b) the financial report of the Group also complies with International Financial Reporting Standards as disclosed in note .
• (c) the remuneration disclosures required by paragraphs Aus 25.4 to Aus 25.7.2 of Australian Accounting Standard AASB 124 Related Party Disclosures that are contained in the Remuneration report in the Directors' report comply with Australian Accounting Standard AASB 124 Related Party Disclosures.

STANTONS INTERNATIONAL

(An Authorised Audit Company)

J P Van Dieren Director

West Perth, Western Australia 28 September 2007

Auditor's Independence Declaration

28 September 2007

Board of Directors Golden West Resources Limited Suite 6, 136 Main Street OSBORNE PARK WA 6017

Dear Directors

RE: GOLDEN WEST RESOURCES LIMITED

In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of independence to the directors of Golden West Resources Limited.

As Audit Director for the audit of the financial statements of Golden West Resources Limited for the year ended 30 June 2007, I declare that to the best of my knowledge and belief, there have been no contraventions of:

(i) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and

(ii) any applicable code of professional conduct in relation to the audit.

Yours sincerely

STANTONS INTERNATIONAL (Authorised Audit Company)

John Van Dieren Director

ASX ADDITIONAL INFORMATION

1. QUOTED SECURITIES

(a) ORDINARY FULLY PAID SHARES

(i) DISTRIBUTION OF SHAREHOLDERS AS AT 20 SEPTEMBER 2007:

SPREAD OF HOLDINGS	HOLDERS	SHARES	PERCENTAGE OF ISSUED CAPITAL %
1 - 1,000	433	291,436	0.406
1,001 - 5,000	968	2,888,294	4.022
5,001 - 10,000	418	3,456,781	4.814
10,001 - 100,000	550	16,361,507	22.785
100,001+	74	48,810,186	67.973
	2,443	71,808,204	100.000

The number of shareholdings held in less than marketable parcels is 27.

(ii) TOP 20 HOLDERS OF ORDINARY FULLY PAID SHARES:

The names of the twenty largest shareholders of ordinary fully paid shares are listed below:

		NO. OF ORDINARY	PERCENTAGE OF
NAME		SHARES HELD	ISSUED SHARES %
1.	Lingchip Pty Ltd	14,062,500	19.583
2.	ANZ Nominees Limited	12,456,599	17.347
3.	R Millard & J Reynolds	3,343,046	4.656
4.	M Spitzauer	1,500,000	2.089
5.	Fraser and Mountain Services Pty Ltd	1,188,889	1.656
6.	Shashua Pty Ltd	1,075,000	1.497
7.	N Joseph	940,167	1.309
8.	Shashua Pty Ltd	737,500	1.027
9.	Dolphin Technology Pty Ltd	624,000	0.869
10.	J Hanna	600,000	0.836
11.	Custodial Services Limited	588,835	0.820
12.	HSBC Custody Nominees (Australia) Limited	471,026	0.656
13.	N & D McEvoy	444,444	0.619
14.	J P Morgan Nominees Australia Limited	421,719	0.587
15.	Chatmoss Farming Co Limited	416,666	0.580
16.	Sunami Pty Ltd	411,646	0.573
17.	A & B Stevenson	384,000	0.535
18.	M & G Starcevich	375,000	0.522
19.	P Brady	333,333	0.464
20.	J Mcintyre	258,500	0.360
		40,632,870	56.585

(iii) VOTING RIGHTS

Articles 15 of the Constitution specify that on a show of hands every member present in person, by attorney or by proxy shall have: (a) for every fully paid share held by him one vote

(b) for every share which is not fully paid a fraction of the vote equal to the amount paid up on the share over the nominal value of the shares.

(iv) SUBSTANTIAL SHAREHOLDERS

The following Substantial Shareholders are recorded with the most recent notifications lodged:

Name	Ordina ry Sha res	%
Lingchip Pty Ltd , Beacon Lights Pty Ltd, D&F (WA) Pty Ltd, Gary Doutch,
Kim Doutch, Malcolm Doutch and John Doutch (lodged 10 May 2005).	18,130,001	25.24
Falak Holdings LLC (lodged 11 July 2007).	7,530,858	10.48

(v) ON-MARKET BUY BACK

There is no current on-market buy back.

(b) 16,845,794 OPTIONS EXERCISABLE AT \$0.20 ON OR BEFORE 31 DECEMBER 2007

(i) DISTRIBUTION OF OPTIONHOLDERS AS AT 20 SEPTEMBER 2007:

NO. OF HOLDERS	NO. OF OPTIONS	PERCENTAGE OF ISSUED OPTIONS %
29	17,711	0.105
79	285,234	1.693
52	427,428	2.537
125	4,186,677	24.853
41	11,928,744	70.811
326	16,845,794	100.000

(ii) TOP 20 HOLDERS OF OPTIONS EXERCISABLE AT \$0.20 ON OR BEFORE 31 DECEMBER 2007:

The names of the twenty largest holders of options exercisable at \$0.20 on or before 31 December 2007 are listed below:

			PERCENTAGE OF
NAME		NO. OF OPTIONS HELD	ISSUED OPTIONS %
1.	D & F (WA) Pty Ltd	1,500,000	8.904
2.	Lingchip Pty Ltd	895,515	5.316
3.	Shashua Pty Ltd	875,000	5.194
4.	M & M Overheu	762,600	4.527
5.	A & B Stevenson	563,917	3.348
6.	Fraser and Mountain Services Pty Ltd	545,833	3.240
7.	N Joseph	507,700	3.014
8.	M & G Starcevich	500,000	2.968
9.	R Doutch	375,000	2.226
10.	R Alter	338,858	2.012
11.	Dolphin Technology Pty Ltd	312,500	1.855
12.	W Brown	306,500	1.819
13.	I Jesnoewski	300,000	1.781
14.	J Crawford	300,000	1.781
15.	E Odeh	300,000	1.781
16.	Merrill Lynch (Australia) Nominees Pty Ltd	250,000	1.484
17	Transcontinental Credit Control Pty Ltd	211,350	1.255
18.	D Casella	200,000	1.187
19.	Sunami Pty Ltd	200,000	1.187
20.	P Francke	196,150	1.164
		9,440,923	56.043

(iii) VOTING RIGHTS

Holders of options are not entitled to vote at a General Meeting of Members in person, by proxy or upon a poll, in respect of their option holding only.

2. UNQUOTED SECURITIES

As at 20 September 2007 there existed the following unquoted options:

(a) 1,250,000 OPTIONS EXERCISABLE AT \$0.25 EACH ON OR BEFORE 30 JUNE 2008

DISTRIBUTION OF OPTIONHOLDERS AS AT 20 SEPTEMBER 2007:

			PERCENTAGE OF
SPREAD OF HOLDINGS	NO. OF HOLDERS	NO. OF OPTIONS	ISSUED OPTIONS %
1 - 1,000	--	--	--
1,001 - 5,000	--	--	--
5,001 - 10,000	--	--	--
10,001 - 100,000	--	--	--
100,001+	6	1,250,000	100.000
	6	1,250,000	100.000

	Options	%
J L Daniels	250,000	20.000
D & F (WA) Pty Ltd	200,000	16.000
Shashua Pty Ltd	200,000	16.000
A P Rudd	200,000	16.000
Wilmick Holdings Pty Ltd	200,000	16.000
Dolphin Technology Pty Ltd	200,000	16.000
	1,250,000	100.000

(b) 1,250,000 OPTIONS EXERCISABLE AT \$0.30 EACH ON OR BEFORE 30 JUNE 2008

DISTRIBUTION OF OPTIONHOLDERS AS AT 20 SEPTEMBER 2007:

NO. OF HOLDERS	NO. OF OPTIONS	PERCENTAGE OF ISSUED OPTIONS %
--	--	--
--	--	--
		--
		--
6	1,250,000	100.000
6	1,250,000	100.000
	-- --	-- --

	Options	%
J L Daniels	250,000	20.000
D & F (WA) Pty Ltd	200,000	16.000
Shashua Pty Ltd	200,000	16.000
A P Rudd	200,000	16.000
Wilmick Holdings Pty Ltd	200,000	16.000
Dolphin Technology Pty Ltd	200,000	16.000
	1,250,000	100.000

(c) 1,250,000 OPTIONS EXERCISABLE AT \$0.40 EACH ON OR BEFORE 30 JUNE 2008

DISTRIBUTION OF OPTIONHOLDERS AS AT 20 SEPTEMBER 2007:

			PERCENTAGE OF
SPREAD OF HOLDINGS	NO. OF HOLDERS	NO. OF OPTIONS	ISSUED OPTIONS %
1 - 1,000	--	--	--
1,001 - 5,000	--	--	--
5,001 - 10,000	--	--	--
10,001 - 100,000	--	--	--
100,001+	6	1,250,000	100.000
	6	1,250,000	100.000
		Options	%
J L Daniels		250,000	20.000
D & F (WA) Pty Ltd		200,000	16.000
Shashua Pty Ltd		200,000	16.000
A P Rudd		200,000	16.000
Wilmick Holdings Pty Ltd		200,000	16.000
Dolphin Technology Pty Ltd		200,000	16.000
		1,250,000	100.000

(d) 12,724,990 OPTIONS EXERCISABLE AT \$2.00 EACH ON OR BEFORE 31 DECEMBER 2010

DISTRIBUTION OF OPTIONHOLDERS AS AT 20 SEPTEMBER 2007:

SPREAD OF HOLDINGS	NO. OF HOLDERS	NO. OF OPTIONS	PERCENTAGE OF ISSUED OPTIONS %
1 - 1,000	--	--	--
1,001 - 5,000	3	9,443	0.074
5,001 - 10,000	9	68,891	0.541
10,001 - 100,000	85	2,908,665	22.858
100,001+	13	9,737,991	76.527
	110	12,724,990	100.000

TOP 20 HOLDERS OF OPTIONS EXERCISABLE AT \$2.00 EACH ON OR BEFORE 31 DECEMBER 2010 :

The names of the twenty largest holders of options exercisable at \$2.00 on or before 31 December 2010 are listed below:

			PERCENTAGE OF
NAME		NO. OF OPTIONS HELD	ISSUED OPTIONS %
1.	J Doutch	1,500,000	11.788
2.	M R Wilson	1,500,000	11.788
3.	G Doutch	1,421,325	11.170
4.	Shashua Pty Ltd	1,400,000	11.002
5.	J Daniels	1,000,000	7.859
5.	A Rudd	1,000,000	7.859
6.	Dolphin Technology Pty Ltd	500,000	3.929
7.	Falak Holdings LLC	500,000	3.929
8.	N and D McEvoy	444,444	3.493
9.	Thornbush Corporation Limited	150,000	1.179
10.	Raymore and Jacinta Millard	111,111	0.873
11.	D & F (WA) Pty Ltd	111,111	0.873
12.	K Hutchinson	100,000	0.786
13.	BPS (WA) Pty Ltd	100,000	0.786
14.	P Brady	100,000	0.786
15.	Orion Investment Management Pty Ltd	100,000	0.786
16.	D Rudd	60,000	0.472
17.	P and S Gianni	60,000	0.472
18.	Murchison Resources Pty Ltd	60,000	0.472
19.	Gianni Holdings Pty Ltd	60,000	0.472
20.	R and R Roberts <rgr Superannuation A/C></rgr	60,000	0.472
		10,337,991	81.246

(f) 7,000,000 OPTIONS EXERCISABLE AT \$3.00 EACH ON OR BEFORE 31 DECEMBER 2011

DISTRIBUTION OF OPTIONHOLDERS AS AT 20 SEPTEMBER 2007:

SPREAD OF HOLDINGS	NO. OF HOLDERS	NO. OF OPTIONS	PERCENTAGE OF ISSUED OPTIONS %
1 - 1,000	--	--	--
1,001 - 5,000	--	--	--
5,001 - 10,000	--	--	--
10,001 - 100,000	--	--	--
100,001+	6	7,000,000	100.000
	6	7,000,000	100.000
		Options	%
J Doutch		1,500,000	21.429
Shashua Pty Ltd		1,500,000	21.429
Michael Wilson		1,500,000	21.429
J L Daniels		1,000,000	14.286
A P Rudd		1,000,000	14.286
Dolphin Technology Pty Ltd		500,000	7.143
		7,000,000	100.000

(g) VOTING RIGHTS

Holders of options are not entitled to vote at a General Meeting of Members in person, by proxy or upon a poll, in respect of their option holding.

3. DIRECTORS' INTERESTS

Interests of each Director in the share capital of the Company at 30 June 2007 are detailed in the Directors Report and Note 22 of this Report.

CORPORATE GOVERNANCE STATEMENT

The ASX Corporate Governance Council requires that the Company must disclose the extent to which it has followed best practice recommendations, identify which recommendations have not been followed and the reason for not adopting the recommendations.

The ASX Corporate Governance Council recognises that not all recommendations are appropriate for all companies and that companies should only adopt those recommendations that are suitable in each individual case.

The following is a summary of policies adopted by the Company and where appropriate, explanations of where best practice recommendations have not been applied. The various policies and procedures were followed throughout the entire financial year.

Board Composition and Functions

Under the Company's Constitution, the Board is required to consist of at least 3 and no more than 10 directors. If the Company has 3 or more directors, one third of the directors, with the exception of the Managing Director, must retire and seek re-election at the Annual General Meeting each year.

The Board of the Company currently consists of three nonexecutive directors and three executive directors. The Board includes the Managing Director (executive) and the Chairman (non-executive).

The Company has followed ASX recommendations in the assessment of whether a director is considered to be "independent". The independent directors are Dr John Daniels, Mr Constantino Markopoulos and Mr Alan Rudd.

The Board delegates responsibilities to committees, executive directors and senior management.

The Board is responsible for corporate strategy, implementation of business plans, allocation of resources, approval of budgets and capital expenditure, and the adherence to Company policies.

The Board is also responsible for compliance with the Code of Conduct, overseeing risk management and internal controls, and the assessment, appointment and removal of the Managing Director, Company Secretary and other senior management.

Directors of the Company during the financial year and information pertaining to individual directors is included in the Directors' Report.

Board members have the right to seek independent professional advice in the furtherance of their duties as directors at the Company's expense.

Director Independence

The Company has established guidelines for testing the independence of directors which reflect the March 2003 document "ASX Corporate Governance Council - Best Practice Recommendations".

A director is considered to be independent if they satisfy certain criteria, the most significant being as follows:

The director must be in a non-executive role where any fees payable by the Company could not be considered to make the director reliant on such remuneration. The director must have no other material contractual relationship with the Company other than as a director of the Company.

The director is not a substantial

shareholder of the Company.

The director has not been employed in an executive capacity by the Company and has not been a principal of a material adviser or consultant to the Company within the last 3 years, and

The director is free from any interest which could reasonably be perceived to materially interfere with the director's ability to act in the best interests of the Company. For the avoidance of doubt, if a director has an interest and that interest is declared, that director does not take part in any Board deliberations in relation to that interest.

Risk Management

The Board is responsible for the identification of significant areas of business risk, implementing procedures to manage such risks and developing policies regarding the establishment and maintenance of appropriate ethical standards to:

Ensure compliance in legal, statutory and ethical matters;

Monitor the business environment; Identify business risk areas; Identify business opportunities; and Monitor systems established to ensure prompt and appropriate responses to shareholder complaints and enquiries.

The Board meets on a regular basis. The Company does not follow the ASX best practice recommendation that the Company should have an internal control function. The Board considers that the Company is not of a size or operational complexity to warrant the implementation of a separate internal control function.

The Managing Director and Company Secretary are required to state in writing to the Board that the Company has a

CORPORATE GOVERNANCE STATEMENT

sound system of risk management, that internal compliance and control systems are in place to ensure the implementation of Board policies, and that those systems are operating efficiently and effectively in all material respects.

Audit and Risk Management Committee

During the current financial year, in order to assist with the growth and strength of the Company your Board formed an Audit and Risk Management Committee as a sub-Committee of the Board of Directors – being a committee which is independent from the Management and which includes within its activities the role of Audit Committee as recommended by the ASX Best Practice Guidelines of March 2003.

The Board is reviewing the composition of Audit and Risk Management Committee following the retirement of Mr Patrick Gallagher of the recent General Meeting of Members.

Its Charter is included below along with a Report from the Chair of the Audit and Risk Management Committee. The names and qualifications of those appointed to the Audit and Risk Management Committee and their attendance at meetings of the Committee are included in this Report.

Procedure for the Selection of New Directors

The Company believes it is not of a size to justify having a Nomination Committee. If any vacancies arise on the Board, all directors are involved in the search and recruitment of a replacement.

Corporate performance is enhanced when the Board has an appropriate mix of skills and experience. The Board is evaluated before a candidate is selected to join the Board. Candidates are nominated by existing Board members and independent search consultants are also utilised if necessary. Where a director nominates a candidate for the Board, the director must disclose any preexisting relationship with the nominee.

New directors are to be provided with a letter of appointment setting out their responsibilities and rights, and are provided with a copy of the Company's Constitution.

Remuneration of Board Members

The Company believes it is not of a size to justify having a Remuneration Committee. However, investigation and recommendations on remuneration are the subject of written report by the Audit and Risk Management Committee (comprised only of independent directors) before consideration and approval by the full Board. In this way all directors are involved in the review of remuneration applicable to nonexecutive as well as executive directors' and senior management's remuneration. No director may be involved in setting their own remuneration or terms and conditions and in such a case relevant Directors are required to be absent from the full Board discussion.

Conflicts of Interest

The Board has put in place Code of Conduct and Share Trading Policies which have been designed to ensure that all directors and employees of the Company act ethically and do not use confidential information for personal gain.

Code of Conduct

The Board is responsible for setting the tone of legal, ethical and moral conduct to ensure that the Company is considered reputable by the industry and other outside entities. This involves considering the impact of the Company's decisions on the industry, colleagues and the general community. The Code of Conduct adopted by the Company requires that all employees abide by the laws, regulations and business practices whenever the Company operates.

The Board maintains an approach that preserves the integrity of any laws or regulations under which the Company operates. The Company has also put in place various internal Policies which provide internal controls to ensure employees only act within the authority given to them by the Board.

This is to ensure that the Board has responsibility for any material transactions and dealings with outside parties, and that any legal, environment and social consequences of such dealings will be properly considered before any action is taken.

The Company has an Environmental Policy which requires all employees to comply with the environmental regulations in force in the region in which work is undertaken. The Company is committed to dealing fairly and equitably with interested parties relating to environmental issues, such as landholders, governmental agencies and native title claimants.

Annual General Meeting

The Company Auditors are invited to each Annual General Meeting in accordance with the Corporations Act.

Golden West Resources Limited ABN 54 102 622 051

Phone: (08) 9201 9202 Fax: (08) 9201 9203

Suite 6, 136 Main Street Osborne Park Western Australia 6017

PO Box 260 Osborne Park Western Australia 6917

www.goldenwestresources.com admin@goldenwestresources.com

ABN 54 102 622 051