IODM LIMITED - Annual Report 2007

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ANNUAL REPORT

PARADIGM METALS LIMITED

(Formerly Paradigm Gold Limited)

ABN 28 102 747 133

YEAR ENDED 30 JUNE 2007

CORPORATE DIRECTORY

Directors

Richard Austen (Non-Executive Chairman) Graham Carman (Managing Director) John Gaskell (Non-Executive Director) Stephen Lonergan (Non-Executive Director and Company Secretary) Richard Harvey (Alternate for R Austen)

Registered Office and principal place of business

Suite 202, 122 Walker St North Sydney NSW 2060 Telephone: 61 2 9955 7130 Facsimile: 61 2 8920 3576 Email: [email protected]

Share Registry

Registries Limited Level 2, 28 Margaret Street Sydney, NSW 2000 Telephone: 61 2 9290 9600 Facsimile: 61 2 9279 0664

Auditors

PKF Level 10, 1 Margaret Street Sydney, NSW 2000

Stock Exchange Listing

The Company is listed on The Australian Securities Exchange (ASX)

Home Exchange : Sydney

ASX Code : Shares – PDM, Options - PDMO

Web Page

http://www.paradigmmetals.com.au

Page CHAIRMAN’S LETTER…………………………………………………………………………….. 3 OPERATIONS REPORT……………………………………………………………………………5 DIRECTORS’ REPORT……………………………………………………………………………. 13 AUDITORS’ INDEPENDENCE DECLARATION……..…………………………………………. 19 INCOME STATEMENT………………………………………………………………………......... 20 BALANCE SHEET…………………………………………………………………...……….......... 21 STATEMENT OF CHANGES IN EQUITY….……………………………………………………. 22 CASH FLOW STATEMENT….…………………………………………………………………….. 23 NOTES TO THE FINANCIAL STATEMENTS…………………………………………………… 24 DIRECTORS’ DECLARATION……………………………………………………………………. 46 INDEPENDENT AUDIT REPORT………………………………………………………………… 47 CORPORATE GOVERNANCE STATEMENT………………………………………………...... 49 ADDITIONAL SHAREHOLDER INFORMATION……………………………………………….. 52

PARADIGM METALS LIMITED

CHAIRMAN’S LETTER

FOR THE YEAR ENDED 30 JUNE 2007

Fellow Shareholders, 27 September 2007

In contrast to what was a frustrating year to 30 June 2006, the past year has seen a number of significant, positive developments for your Company. This change in fortunes began when the Company applied for exploration ground in the Mt Isa-Cloncurry area of Queensland that was judged to be prospective for uranium mineralization. Then in December 2006, Paradigm exercised an option to purchase from Copper Strike Ltd two contiguous Exploration Licenses prospective for tungsten and base metals, located in central NSW between Yass and Cowra.

In order to raise the funds to rapidly advance exploration of these new prospects, in March this year the Company completed a fully underwritten, 1 for 4 rights issue at 15 cents (with one free attaching option exercisable at 25 cents on or before 18 May 2008) and placed an additional 4 million shares at 15 cents (plus one free option exercisable at 25 cents on or before 18 May 2008) to specified nominees of the underwriter. As a result of these issues some $2.2 million was added to shareholder funds.

Following encouraging preliminary exploration results, shareholders approved the issue of options to acquire a 100% ownership of the NSW Exploration Licenses from Copper Strike at a General Meeting of shareholders in May. The upfront purchase price was the reimbursement of $100,000 in exploration costs plus 5 million options to acquire Paradigm shares at 7.5 cents. At the same meeting shareholders also approved the proposal that the Company’s name be changed to Paradigm Metals Ltd in order to reflect the changing exploration direction.

Subsequent to the May meeting, Paradigm has made rapid progress at all of its new projects. This work is described in detail in the Operations Report but the main points may be summarized as follows: -

Copper-Base Metals exploration at Frogmore NSW: Paradigm 100%

Following preliminary geophysical work (Induced Polarization and ground magnetics), geochemical soil sampling and shallow air core drilling, 9 reverse circulation (1,296 metres) and 3 diamond drill holes (1,038 metres) were completed around the old Frogmore copper mine and smelter (worked during late 1800s). At the time of writing, assays from the second and third diamond drill holes are not available but assays from the RC holes and the first diamond hole plus visual inspection of the two other diamond holes indicated strong chalcopyrite (copper) mineralization over potentially mineable widths from near surface to depths of 250 metres. Currently the mineralization is open at depth and in both directions along strike, and exploration is continuing at a rapid pace.

Tungsten exploration at White Rock NSW: Paradigm 100%

Previous explorers’ drill information was utilised by Paradigm to define an Indicated and Inferred tungsten Resource of 150,000 tonnes grading 0.9% W03 at White Rock. Paradigm has since completed an initial round of RC drilling (1700 metres in 43 percussion holes) with several high-grade tungsten intersections made, including some outside of the Resource area. At the time of writing the Company is shortly to undertake a RC drill program comprising 18 holes for a total of 600 metres. The objective of this work is to improve confidence in the existing resource and to extend the total tonnage. Although the deposit is relatively small in size, it is high grade and located at shallow depths (in general less than 40 metres). Preliminary metallurgical test work is underway to determine whether the ore can be processed to a saleable concentrate relatively simply by a combination of magnetic and gravity techniques.

Uranium exploration in the Mt Isa – Cloncurry area QLD: Paradigm 100%

Paradigm now has granted exploration tenements at Blue Bush and Jacktim northwest of Cloncurry, and a large group of leases (300 sq km) east of Cloncurry. The Blue Bush prospect is targeting basement rocks of Proterozoic age rocks within the Mt Isa block, while the leases east of Cloncurry and Jacktim are in Mesozoic sediments sitting ontop of the basement. To date preliminary exploration comprising mapping and outcrop sampling has been concentrated in the sediments and numerous exposures with anomalous uranium contents have been located. Follow-up work will consist of more sampling, mapping and structural analysis to determine the most prospective locations for drilling. At Blue Bush, a probe in a hole drilled by CRA in 1983 registered strongly anomalous gamma ray radiation which could indicate uranium mineralization within skarn rocks similar in age and composition to those at the old, high grade, Mary Kathleen uranium mine. The hole was never assayed for uranium since CRA’s target was copper. Three RC holes are planned for the coming months.

Paradigm continues to maintain very tight cost controls over corporate overheads in keeping with its objective of maximizing expenditure on direct exploration mainly in the form of drilling. As at 30 June 2007 your Company had

PARADIGM METALS LIMITED

CHAIRMAN’S LETTER

FOR THE YEAR ENDED 30 JUNE 2007

over $2 million which will be sufficient to fund the planned exploration programs at all three areas for the foreseeable future.

During the year, your Board reluctantly accepted the resignation of Mr Ray Soper. I would like to take this opportunity to thank him for his valuable contributions in the formative years of your Company.

I look forward to a continuing flow of exciting results from our prospects. Thank you for your support.

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Richard Austen AO Chairman

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

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FIGURE 1 LOCATION OF PARADIGM PROJECTS IN EASTERN AUSTRALIA

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

Frogmore Copper - Base Metals Project, NSW (PDM 100%)

The old mining township of Frogmore is located 200km west of Sydney, 30km from the agricultural town of Boorowa. Excellent road access exists via the Hume Highway and the Yass-Cowra road from Sydney. The old Frogmore Copper Mines were worked in the late 1800s, with approximately 12,000 tonnes of 10% copper ore mined and smelted on site. The area has seen little modern exploration prior to Paradigm’s work, except for a number of RC percussion holes drilled during the 1990s. The old mining sites were rehabilitated shortly thereafter.

The Frogmore base metal project (EL 6590) is located on a major NNW trending structure separating Ordovician sediments to the east from Silurian volcanics to the west (Figure 2). Paradigm controls 100% of the extended 50km shear zone with its current tenure position. A number of base metal occurrences are known along the shear zone including Frogmore and the old Federal Copper Mine, the latter located within a recent EL application.

In early 2007 Paradigm carried out a variety of prospecting techniques including IP geophysics, soil sampling and air core drilling (72 metres in 1,618 holes) over an area within 1km of the old copper workings. These results were encouraging, and highlighted a number of prospects with potential for significant base metal mineralisation (copper, lead, zinc). The best aircore results included 4 metres grading 3% combined lead-zinc-copper in FGP069 from an area 800 metres south of the main Frogmore workings.

A number of RC percussion holes were drilled (12 holes for 1,296 metres) targeting IP anomalies and in particular the old Pride of Frogmore workings on the western side of the mining field. Drill hole FRC006 intersected 3m grading 2% copper from a vertical depth of 60 metres beneath the old workings. Due to problems with the exaggerated degree of lift preventing depth penetration, a decision was made to test the copper structure with 3 diamond drill holes. The first diamond hole, FDD001, intersected strong copper mineralisation over 3 separate intervals as summarised in Table 1:

Table 1. Significant copper intercepts – drill hole FDD001

Interval	Grade	Depth from	Estimated true width
3.3 metres 8.7 metres Including 1 metre 14.8 metres Including 0.8 metres	2.1% copper 1.9% copper 4.8% copper 2.0% copper 8.3% copper	157.4 metres 250.6 metres 255 metres 275.1 metres 287.6 metres	2 metres 5 metres 9 metres

At the time of writing assays are awaited for drill holes FDD002 and FDD003. Some intervals of strong chalcopyrite mineralisation have been observed in both holes. All drill hole traces and the surface projection of copper intersections are plotted on a drill map in Figure 3. A long section of the northeast trending copper structure is shown in Figure 4.

The copper mineralisation is hosted by strongly sheared, chlorite-sericite-carbonate altered felsic volcanic and volcaniclastic rocks. The mineralised structure is steeply dipping to the southeast. The highest grade copper mineralisation occurs with massive black chlorite alteration, while quartz veining and silicification can occur with the copper mineralisation but not always. Chalcopyrite is the dominant sulphide but occurs with significant pyrrhotite and lesser pyrite within veins and sulphide breccias which post-date the deformed fabric in the rock. The chalcopyrite ‘stockwork’ veins are irregular, so copper grades can be highly variable over narrow intervals.

It was initially thought that the copper mineralisation in the three diamond holes trended north-south parallel to the old mined lodes. However the drill results suggest a wide, northeast-southeast copper trend that was previously unrecognised. This is significant because mineralisation along the structure is open in both directions and at depth. High-priority drill targets exist up-dip of the diamond drill intercepts near to the surface, and will be tested by upcoming percussion drill programs. If these results are positive and continuity of the copper structure is subsequently proven, Frogmore could be a significant new copper discovery. Other base metal anomalies including zinc and lead will also be assessed in the upcoming exploration programmes.

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

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FIGURE 2 GEOLOGY MAP OF FROGMORE AND WHITE ROCK PROJECTS, NSW

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

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FIGURE 3 DRILL MAP OF FROGMORE PROJECT WITH RECENT COPPER DRILL INTERSECTIONS

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FIGURE 4 LONG SECTION OF NEW COPPER STRUCTURE AT FROGMORE

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

White Rock Tungsten Project, NSW (PDM 100%)

The White Rock tungsten project (EL 6274) is located adjacent to the township of Rye Park, 25km southeast of Boorowa. Minor quantities of tungsten as scheelite (CaWO4) were mined during the early 1900’s and in the 1950’s. A small open pit was dug on one of the shallow ore lenses. Only minor quantities of ore were treated off-site, and several thousand tonnes of tungsten ore is stockpiled on site.

Paradigm has calculated an in situ Mineral Resource of 150,000 tonnes grading 0.9% WO3 (indicated and inferred) at White Rock to a maximum depth of 40 metres, on the basis of pre-existing drill data. This Resource is equivalent in gold terms to 43,000 oz of gold at a grade of 9 g/t, assuming 100% scheelite recovery (assumptions: $600/oz gold, $200/MTU WO3). Although high-grade, the Resource is currently too small to be considered economic because of the relatively high capital costs involved in building a plant. Paradigm is targeting an open pit tungsten deposit of approximately 500,000 tonnes grading around 1% WO3 as a base for which the Company could generate significant cash flow.

Following the acquisition of the White Rock project, extensive ground magnetic surveys were carried out within 3km of White Rock to identify drill targets. In early 2007 the Company completed an initial phase of RC drilling consisting of 43 drill holes for a total advance of almost 1,700 metres.

Tungsten-bearing skarn was intersected in approximately half of the drill holes over vertical thicknesses of between 1 and 10 metres. Some of the best intersections are listed in Table 2:

Table 2: Drill intersections at White Rock by Paradigm during 2007

Table 2: Drill	intersections at	White Rock by Paradigm during 2007
Drill hole	Interval	Grade	Depth from	Estimated true width
WRP037 WRP039 WRP040 WRP026 WRP016	12 metres 8 metres 4 metres 11 metres 3 metres	1.54% WO3and 428 ppm Mo 1.80% WO3and 138 ppm Mo 1.0% WO3and 176 ppm Mo 0.40% WO3and 0.16% SnO2 0.27% WO3and 0.44% SnO2	6 metres 12 metres 23 metres 30 metres 23 metres	10 metres 6 metres 4 metres 10 metres 3 metres

* intercepts within existing Mineral Resource envelope

The geology at White Rock is zoned from a core granite contact zone of magnetite skarn with high-grade tungsten mineralisation, to a lower-grade envelope of garnet skarn with tungsten-tin mineralisation. A typical cross section through the deposit is shown in Figure 5. The high-grade tungsten occurs as scheelite (CaWO4) with visible molybdenite, which may also be recoverable as a credit in a future mining operation.

Preliminary metallurgical tests of the magnetite, which makes up to 40% of the high-grade tungsten skarn, indicates that the magnetite may be suitable for use in the coal washing industry (NB. magnetite is used in coal washeries to increase the density of the water so that the coal may be separated – the magnetite is then largely recovered using magnets). Metallurgical testwork of the magnetite skarn is underway to determine whether the ore can be processed to a saleable concentrate simply by a combination of magnetic and gravity techniques.

At the time of writing the Company is about to undertake a further RC drill program comprising of at least 18 holes for a total of 600 metres. The objective of this work is to improve confidence in the existing resource and to extend the total tonnage.

Background on tungsten

Tungsten is now a highly sought after commodity following many years of subdued prices. Tungsten is not yet traded on the London Metals Exchange because it still holds its ‘boutique’ metal status. Its industrial uses are wide, primarily because of tungsten’s unique physical properties. Tungsten carbide is the second hardest known substance to diamond, so is most extensively used in the ‘hard metal’ industry (eg. drill bits, etc). Tungsten has a very high melting point so it is used in light filaments, while its very high density allows for a variety of other uses (eg. ballast, golf club heads etc). Further information is available on our website at

www.paradigmmetals.com.au

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

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FIGURE 5 CROSS SECTION THROUGH THE WHITE ROCK TUNGSTEN DEPOSIT

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FIGURE 6 LOCATION OF PARADIGM’S URANIUM PROJECTS, MT ISA REGION QUEENSLAND

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

Uranium Projects, Queensland (PDM 100%)

Cloncurry Project

The Company controls 300 square kilometres of granted contiguous exploration permits at the Cloncurry Uranium project (EPMs 15325, 15906, 15931, 16073, 16200), located about 40km east of Cloncurry in the Mt Isa region of Queensland (Figure 6). The permits cover significant portions of extensive airborne radiometric uranium anomalies, related to uranium mineralisation within the Mesozoic Toolebuc limestone. Rock chip sampling of outcropping limestone within the permits to date has produced encouraging results. Although the uranium grades are not presently of economic grade, the potential exists for a concentration of uranium in a ‘roll front’ setting or concentrated in the oxidised limestones by faults.

Of more than 200 Toolebuc limestone samples collected by Paradigm (mostly within EPM 15906), 20% of the samples returned 100ppm U or more with individual assays up to 300ppm U. The area of anomalous limestone outcrop is at least 10 sq km, while the outcrops dip gently into Paradigm’s permits to the east. Other co-anomalous elements include molybdenum (up to 250 ppm) phosphorus (up to 1% P), vanadium (0.2% V2O5), zinc (450ppm Zn) and silver (4.5ppm Ag). A plot of uranium rock chip results is presented in Figure 7.

The anomalous limestone is believed to be only 1-3m thick generally. The Company is completing a structural analysis of the Toolebuc basin in order to identify possible zones of uranium enrichment and limestone thickening, prior to drilling.

Blue Bush project

The Blue Bush project (EPM 15324), located 120km northwest of Cloncurry, was staked because of a strong magnetic anomaly in the buried Proterozoic rocks lying beneath 100m of Mesozoic cover. A single CRA hole drilled in 1983 targeted the magnetic anomaly, and encountered strongly altered magnetite-bearing rocks with highly anomalous gamma ray activity up to 450 counts per second over a 60m wide zone. The basement rocks are believed to be Corella Formation metasediments, similar to the host rocks at the Mary Kathleen uranium deposit. Copper mineralisation was a minor component. Allanite, a radioactive mineral also known at Mary Kathleen, was described in mineralogical studies of the drill core, yet the rocks were not assayed for uranium due to the focus on copper. Unfortunately the core samples were eventually discarded.

Paradigm is planning more detailed geophysical studies prior to a 3-hole drilling program.

Jacktim Project

No active field work has been carried out on the Jacktim project (EPM 15323) as the EPM was only recently granted. The area was staked due to a radiometric uranium anomaly covering Toolebuc limestone. Exploration will begin there shortly.

Farm-out of Gold Projects, NSW & Queensland

Given the change of Company focus to copper, tungsten and uranium, Paradigm decided that it will attempt to farm-out or sell its wholly owned gold projects in NSW (North Cadia EL 6588, Guyra EL 5976), and southeast Queensland (Lighthouse Gully EPM 13878 and Auburn EPMs 15264, 15296, and 15322). At this time no farm-out arrangements have been successfully concluded. However, in the meantime the Company intends to continue exploration on these projects.

The Company decided to withdraw from the Mt David joint venture on EL 5242 in central NSW with Jaguar Minerals Ltd during the year.

The Company was unable to attract a farm-in partner to advance its Brown Mountain project (EL 5980, EL 6277) in southeast NSW. Rather than incur additional costs involved with renewal of these licences, the two Brown Mountain exploration licences were relinquished.

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

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FIGURE 7 ROCK CHIP URANIUM VALUES ON A RADIOMETRIC GRID, CLONCURRY PROJECT

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ REPORT

FOR THE YEAR ENDED 30 JUNE 2007

The Directors of Paradigm Metals Limited hereby present the financial report of the Company and its controlled entities for the year ended 30 June 2007.

DIRECTORS

The names of Directors of the Company who held office during the period and were in office at the date of this report unless otherwise stated are:

� Richard Austen (Non-Executive Chairman)

Term of office: Non-Executive Chairman since December 2002.

Mr Austen has a strong background in mining – he was co-founder of Austen and Butta Limited in 1950. In 1982 he was awarded an AO for services to the coal mining industry. He has been Chairman of a number of Public Companies, and for nine years between 1984 and 1993 was Chairman of the Australian Meat and Livestock Corporation. From 1979 to 2000 he was an Australian representative and is a past Chairman of the Coal Industry Advisory Board of the International Energy Agency. He was Chairman of Savage Resources Limited until its takeover by Pasminco Ltd in 1999.

Directorships of other listed companies:

None.

� Graham Carman, PhD (Managing Director)

Term of office: Managing Director since September 2003.

Dr Carman graduated with a Bachelor of Science (Hons) from Victoria University of Wellington, New Zealand, in 1986. He spent several years exploring for gold in Western Australia, North Queensland and Lihir Island in Papua New Guinea, completing a PhD at Monash University in 1994. He was six years exploring for gold-copper and zinc deposits in Peru, firstly with Rio Tinto and then as Exploration Manager of Savage Resources Ltd (latterly Pasminco Ltd) until 2000. Several significant discoveries of gold and base-metals were made during this time. Dr Carman returned to Melbourne to run the exploration efforts of Pasminco Ltd in Australia. He currently resides in Sydney. Dr Carman performs the functions of chief executive officer and chief financial officer of the Company.

Directorships of other listed companies:

None.

John Gaskell (Non-Executive Director)

Term of office: Director since November 2002.

Mr Gaskell was Managing Director of Savage Resources Limited (Savage) until March 1999, when it was taken over by Pasminco Ltd. He played a leading role in the growth of Savage from a junior NSW coal miner in 1992 to an international metal and mining company. During this time he was involved in establishing Savage’s ownership of the Ernest Henry gold-copper mine in Queensland, the acquisition by Savage of the zinc mines and refinery in Tennessee and the development of Savage’s exploration in North and South America. Mr Gaskell graduated as a geologist from the University of Leeds in 1966 and since then has been involved in the exploration industry world-wide in a number of public and private companies. He currently lives in Sydney and works as a consultant. Mr Gaskell is Chairman of the Company’s Audit Committee.

Directorships of other listed companies:

Dominion Mining Limited since December 2004.

� Stephen Lonergan (Non-Executive Director and Company Secretary)

Term of office: Director since November 2002.

Mr Lonergan is a commercial lawyer based in Sydney. He has some 25 years’ experience in the Australian and international mining industry having been General Counsel of the Pancontinental Mining Group, a partner in the law firm Baker and McKenzie, Sydney, and General Counsel and Company Secretary of Savage Resources Ltd. Mr Lonergan has an Honours graduate in law from the Australian National University and holds a Masters degree in law from McGill University, Montreal. Mr Lonergan is a member of the Company’s Audit Committee.

Directorships of other listed companies:

Finders Resources Limited since March 2005.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ REPORT

FOR THE YEAR ENDED 30 JUNE 2007

� Richard Harvey (Alternate to Richard Austen)

Mr Harvey has some 30 years in financial management in a number of companies mainly in the resources sector including Peko Wallsend Ltd from 1978 to 1981, and Shell Australia Coal Division from 1981 to 2002. He is currently Director of Business Development in the Hartley Pastoral Group. He is a Chartered Secretary and a qualified accountant.

Directorships of other listed companies:

None.

� Ray Soper (Non-Executive Director – Retired as a Director as of 1 February 2007)

Term of office: Mr Soper was a Director and Chairman of the Audit Committee from November 2002February 2007.

PRINCIPAL ACTIVITIES

The consolidated entity operates predominantly in the mining exploration industry throughout New South Wales and Queensland.

OPERATING RESULT

The consolidated loss of the consolidated entity for the financial year after providing for income tax amounted to $1,022,845 (2006: $504,665).

The net assets of the consolidated entity have increased from $3,006,783 at 30 June 2006 to $5,356,700 at 30 June 2007. This increase is largely the result of a rights issue capital raising and issue of options during the year.

REVIEW OF OPERATIONS

A review of the operations of the Company during the financial year and the results of those operations is set out in the Operations Report.

DIVIDENDS

No dividends were paid or declared since the start of the financial year.

CHANGES IN STATE OF AFFAIRS

During the year, there were no significant changes in the state of affairs of the Company except as follows:

On 28 March 2007 the Company allotted 11,033,044 ordinary fully paid shares and 11,033,044 25 cent options expiring 18 May 2008 pursuant to a non-renounceable rights issue to raise approximately $1.65 million (the Rights Issue).

On 11 April 2007 the Company issued 4,000,000 ordinary fully paid shares and 4,000,000, 25 cent options expiring 18 May 2008 to nominees of the Underwriter of the Rights Issue.

On 22 May 2007 the Company issued 5,000,000 unlisted options to Copper Strike Limited as part consideration for the purchase of the White Rock Tungsten Project. Each option entitled the holder to subscribe for and be issued one fully paid ordinary share in the Company on payment of 7.5 cents before the third anniversary of the issue date. Three million of these options were exercised during the year and shares allotted on 7 June 2007.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ REPORT

FOR THE YEAR ENDED 30 JUNE 2007

On 22 May 2007 the Company issued 300,000 employee options each entitling the holder to subscribe for and be issued one fully paid ordinary share in the Company on payment of 25 cents before 22 May 2010.

On 2 June 2007 the Company issued 2,360 ordinary fully paid shares following the exercise of 2,360 listed 25 cent options.

SUBSEQUENT EVENTS

There has not been any matter or circumstance, other than that referred to in the financial statements or notes thereto, that has arisen since the end of the financial year, that has significantly affected, or may affect, the operations of the Company, the results of those operations, or the state of affairs of the Company in future periods.

DIRECTORS’ SHARES AND OPTIONS

No securities in the Company were issued to a Director or any employee during the year in connection with their provision of services.

MEETINGS OF DIRECTORS

During the financial year, 13 meetings of Directors (including meetings of committees of Directors) were held. Attendances by each Director during the year were:

DIRECTOR	Director Meetings	Director Meetings	Audit Committee	Audit Committee
	NUMBER ELIGIBLE	NUMBER ATTENDED	NUMBER ELIGIBLE TO	NUMBER
	TO ATTEND		ATTEND	ATTENDED
Richard Austen	13	12	-	-
Graham Carman	13	13	-	-
John Gaskell	13	13	2	2
Stephen Lonergan	13	11	2	2
Raymond Soper	8	6	1	1
Richard Harvey (Alternate	13	12	-	-
to R Austen)

REMUNERATION REPORT

Remuneration of Directors is approved by the Board and is set in aggregate within the maximum amount approved by the shareholders from time to time. The performance of the Directors is reviewed annually. Aside from the Managing Director there are no key management personnel (KMP) of the Company. No component of any Directors’ of KMP’s remuneration is based on meeting any particular performance criteria.

The remuneration and terms and conditions of employment for the Managing Director are reviewed annually having regard to performance and comparative remuneration information in respect of other listed mineral exploration companies in Australia, and approved by the Board, as required. The Company’s performance as a minerals exploration entity depends on retaining energetic and innovative management. The Directors believe that this remuneration policy is successful evidenced by the retention of the Managing Director and the progress made by the Company, especially in the 2006/7 financial year.

No Director or executive of the Company has received a benefit other than a benefit included in the aggregate amount of emoluments received or due and receivable by Directors and executives shown below.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ REPORT

FOR THE YEAR ENDED 30 JUNE 2007

Remuneration paid to the Directors and key management personnel during the year was as follows;

	PRIMARY BENEFITS	PRIMARY BENEFITS	PRIMARY BENEFITS	PRIMARY BENEFITS	PRIMARY BENEFITS	PRIMARY BENEFITS	POST EMPLOYMENT	POST EMPLOYMENT	Equity Compen -sation	Equity Compen -sation
	Salaries and Fees		Cash Bonuses		Non Monetary		Superannuation		Options / Shares		TOTAL
	2007	2006	2007	2006	2007	2006	2007	2006	2007	2006	2007	2006
	$	$	$	$	$	$	$	$	$	$	$	$
Richard Austen	42,500	40,000	-	-	-	-	-	-	-	-	42,500	40,000
Graham Carman	133,000	139,380	25,000 *	-	-	-	42,000	25,620	-	-	200,000	165,000
John Gaskell	-	27,523	-	-	-	-	32,500	2,477	-	-	32,500	30,000
Stephen Lonergan	-	-	-	-	-	-	32,500	30,000	-	-	32,500	30,000
Raymond Soper	16,055	27,523	-	-	-	-	1,445	2,477	-	-	17,500	30,000
	191,555	234,426	25,000	-	-	-	108,445	60,574	-	-	325,000	295,000

A bonus of $25,000 gross was paid to Dr Carman following the successful completion of the Rights Issue. This was a discretionary bonus allocated by the Directors (other than Mr Carman) and was not pursuant to any performance arrangement in Dr Carman’s contract of employment. It reflected the Director’s belief that Dr Carman had played a pivotal role in securing additional working capital for the Company and in acquiring the White Rock Tungsten Project on attractive terms.

DIRECTORS’ SHAREHOLDINGS

The following table sets out each Director’s relevant direct or indirect interest in the securities of Paradigm Metals Limited as at the date of this report:

Director Richard Austen Graham Carman John Gaskell Stephen Lonergan Total	Fully paid Ordinary Shares Listed Options over unissued Ordinary Shares 2007 2006 2007 2006 No’s No’s No’s No’s 3,513,260 2,810,608 1,240,152 870,834 3,083,300 2,466,640 683,330 66,670 1,041,675 833,340 275,005 66,670 562,500 450,000 302,500 -
	8,200,735 6,650,588 2,500,987 1,004,174

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ REPORT

FOR THE YEAR ENDED 30 JUNE 2007

The terms of the Options are the same as other listed Paradigm Options (Note 11 to the Financial Statements), with an exercise price of 25c expiring 18 May 2008. All Directors’ shareholdings increased during the year because each of the Directors took up their full share of entitlements pursuant to the Rights Issue of March 2007.

DIRECTORS' AND OFFICERS' INDEMNITIES AND INSURANCE

The Company has entered into deeds with each of the Directors and the Company Secretary under which the Company has agreed to indemnify the Directors and the Company Secretary on a full indemnity basis and to the full extent permitted by law for losses or liabilities incurred as an officer of the Company.

During the financial year, the Company has paid an insurance premium in respect of a contract insuring each of the Directors and Company Secretary of the Company named in this report, against all liabilities and expenses arising as a result of work performed in their respective capacities, to the extent permitted by law. Disclosure of the total amount of the premium and the nature of the liabilities in respect of such insurance is prohibited by the policy.

ENVIRONMENTAL REGULATIONS

The Company participates in mineral exploration activities covered by mineral exploration licences governed by the respective States. These licences specify the environmental regulations applicable to the exploration of minerals. There have been no known breaches of the environmental obligations of the Company’s contracts or licences.

FUTURE DEVELOPMENTS

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

NON-AUDIT SERVICES

Non-audit services are approved by resolution of the audit committee and approval is provided in writing to the Board of Directors. Non-audit services provided by the auditors of the consolidated entity during the year are detailed below. The Directors are satisfied that the provision of the non-audit services during the year by the auditor did not compromise the general principles relating to auditor independence in accordance with APES110, code of ethics for professional accountants set by the Accounting Professional and Ethics Standards Board.

Amounts paid or payable to an auditor for non-audit services provided during the year by the auditor to any entity that is part of the consolidated entity	2007 $	2006 $
Taxation Services	6,160	15,260

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ REPORT

FOR THE YEAR ENDED 30 JUNE 2007

AUDITOR’S INDEPENDENCE DECLARATION

In accordance with the Audit Independence requirements of the Corporations Act 2001 , the Directors have received and are satisfied with the “Audit Independence Declaration” provided by the Company’s external auditors PKF. The Audit Independence Declaration has been attached as part of this Directors’ Report on the following page.

Signed in accordance with a resolution of the Directors made pursuant to Section 298(2) of the Corporations Act 2001 .

For and on behalf of the Directors

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Graham Carman Managing Director

Dated: 27 SEPTEMBER 2007

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES AUDITOR’S INDEPENDENCE DECLARATION

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AUDITOR'S INDEPENDENCE DECLARATION

To: The Directors

Paradigm Metals Limited

As lead engagement partner for the audit of Paradigm Metals Limited for the year ended 30 June 2007, I declare that, to the best of my knowledge and belief, there have been:

(a) no contraventions of the auditor independence requirements of the Corporations Act in relation to the audit; and
(b) no contraventions of any applicable code of professional conduct in relation to the audit.

This declaration is in respect of Paradigm Metals Limited and the entities it controlled.

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Tim Sydenham

Partner

Sydney

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PKF Dated this 27[th] day of September 2007

Tel: 61 2 9251 4100 | Fax: 61 2 9240 9821 | www.pkf.com.au PKF | ABN 83 236 985 726

Level 10, 1 Margaret Street | Sydney | New South Wales 2000 | Australia

DX 10173 | Sydney Stock Exchange | New South Wales

Liability limited by a scheme approved under Professional Standards Legislation

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES INCOME STATEMENT

FOR THE YEAR ENDED 30 JUNE 2007

INCOME STATEMENT

Financial year ended 30 June 2007

Note Continuing operations Other income 2 Employee benefit expense Depreciation Other expenses 3 Loss before income tax Income tax 4 Loss for the year Earnings/(loss) per share: Basic (cents per share) 18 Diluted (cents per share) 18 Dividend per share	CONSOLIDATED ENTITY 2007 2006 $ $ 76,506 89,262 (213,063) (181,444) (1,877) (6,086) (884,411) (406,397) (1,022,845) (504,665) - - (1,022,845) (504,665) (2.1) cents (1.1) cents (2.1) cents (1.1) cents - -	PARENT ENTITY 2007 2006 $ $ 76,506 89,262 (213,063) (181,444) (1,877) (6,086) (2,205,293) (612,754)
		(2,343,727) (711,022) - -
		(2,343,727) (711,022)

The above Income Statement should be read in conjunction with the accompanying notes.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES BALANCE SHEET

FOR THE YEAR ENDED 30 JUNE 2007

BALANCE SHEET As at 30 June 2007 Note CURRENT ASSETS Cash and cash equivalents 19 Trade and other receivables 5 Other current assets 6 Total current assets NON-CURRENT ASSETS Plant and equipment 7 Financial assets 8 Other non-current assets 6 Total non-current assets TOTAL ASSETS CURRENT LIABILITIES Trade and other payables 9 Short term provisions 10 Total current liabilities NON-CURRENT LIABILITIES Long term provisions 10 Total non-current liabilities TOTAL LIABILITIES NET ASSETS EQUITY Issued capital 11 Share options reserve Accumulated losses TOTAL EQUITY	CONSOLIDATED ENTITY 2007 2006 $ $ 2,172,887 1,169,094 - - 105,798 67,445 2,278,685 1,236,539 36,781 23,650 - - 3,071,579 1,799,744 3,108,360 1,823,394 5,387,045 3,059,933 23,845 46,650 1,500 1,500 25,345 48,150 5,000 5,000 5,000 5,000 30,345 53,150 5,356,700 3,006,783 7,283,597 5,036,193 1,125,358 - (3,052,255) (2,029,410) 5,356,700 3,006,783	PARENT ENTITY 2007 2006 $ $ 2,172,887 1,169,094 - - 85,798 32,445
		2,258,685 1,201,539
		36,781 23,650 3 2 - 64,048
		36,784 87,700

		2,295,469 1,289,239
		23,845 46,650 1,500 1,500
		25,345 48,150
		5,000 5,000
		5,000 5,000
		30,345 53,150
		2,265,124 1,236,089
		7,283,597 5,036,193 1,125,358 - (6,143,831) (3,800,104)
		2,265,124 1,236,089

The above Balance Sheet should be read in conjunction with the accompanying notes.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2007

STATEMENT OF CHANGES IN EQUITY Financial year ended 30 June 2007

STATEMENT OF CHANGES IN EQUITY Financial year ended 30 June 2007
		CONSOLIDATED ENTITY
	Issued	Option	Accumulated
	capital	reserve	losses	Total
	$	$	$	$
Balance at 1 July 2005	5,036,193	-	(1,524,745)	3,511,448
Loss for year	-	-	(504,665)	(504,665)
Balance at 30 June 2006	5,036,193	-	(2,029,410)	3,006,783
Balance at 1 July 2006	5,036,193	-	(2,029,410)	3,006,783
Shares issued during the year	2,254,956	-	-	2,254,956
Options issued during the year	-	1,053,222	-	1,053,222
Options exercised during the year	225,590	-	-	225,590
Reserve transfer on exercise of options	628,824	(628,824)	-	-
Issue costs	(861,966)	700,960	-	(161,006)
Loss for year	-	-	(1,022,845)	(1,022,845)
Balance at 30 June 2007	7,283,597	1,125,358	(3,052,255)	5,356,700
		PARENT ENTITY
	Issued	Option	Accumulated
	capital	reserve	losses	Total
	$	$	$	$
Balance at 1 July 2005	5,036,193	-	(3,089,082)	1,947,111
Loss for year	-	-	(711,022)	(711,022)
Balance at 30 June 2006	5,036,193	-	(3,800,104)	1,236,089
Balance at 1 July 2006	5,036,193	-	(3,800,104)	1,236,089
Shares issued during the year	2,254,956	-	-	2,254,956
Options issued during the year	-	1,053,222	-	1,053,222
Options exercised during the year	225,590	-	-	225,590
Reserve transfer on exercise of options	628,824	(628,824)	-	-
Issue costs	(861,966)	700,960	-	(161,006)
Loss for year	-	-	(2,343,727)	(2,343,727)
Balance at 30 June 2007	7,283,597	1,125,358	(6,143,831)	2,265,124

The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES CASHFLOW STATEMENT

FOR THE YEAR ENDED 30 JUNE 2007

CASH FLOW STATEMENT

Financial year ended 30 June 2007

Cash flows from operating activities Note Receipts from other income Payments to suppliers and employees Interest received Net cash used in operating activities 19 Cash flows from investing activities Purchase of plant and equipment Proceeds of tenement deposits New tenement deposits Capitalised exploration expenditure Net cash used in investing activities Cash flows from financing activities Proceeds from issue of equity securities (net of issue costs) Payment to wholly owned subsidiaries Net cash provided by/(used in) financing activities Net increase/(decrease) in cash held Cash at the beginning of financial year Cash at the end of financial year 19	CONSOLIDATED ENTITY 2007 2006 $ $ 3,477 3,184 (696,798) (483,026) 73,029 86,078 (620,292) (393,764) (15,008) - 44,000 - (37,500) - (686,947) (396,014) (695,455) (396,014) 2,319,540 - - 2,319,540 - 1,003,793 (789,778) 1,169,094 1,958,872 2,172,887 1,169,094	PARENT ENTITY 2007 2006 $ $ 3,477 3,184 (712,933) (561,605) 73,029 86,078
		(636,427) (472,343)
		(15,008) - - - - - (64,048)
		(15,008) (64,048)
		2,319,540 - (664,312) (253,385)
		1,655,228 (253,385)
		1,003,793 (789,776) 1,169,094 1,958,870
		2,172,887 1,169,094

The above Cash Flow Statement should be read in conjunction with the accompanying notes.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

The financial report covers Paradigm Metals Limited (formerly Paradigm Gold Limited) and its controlled entities. Paradigm Metals Limited is a listed public company incorporated and domiciled in Australia.

Scope of financial statements

The financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards including Australian Accounting Interpretations adopted by the Australian Accounting Standards Board and the Corporations Act 2001. The financial report of Paradigm Metals Limited and controlled entities and Paradigm Metals Limited as an individual parent entity complies with all Australian equivalents to International Financial Reporting Standards (AIFRS) in their entirety.

Reporting Period

The financial report is presented for the year ended 30 June 2007. The comparative reporting period was for the year ended 30 June 2006.

Authorisation of financial report

The financial report was authorised for issue on 27 September 2007 by the Directors.

Basis of Preparation

The accounting policies set out below have been consistently applied to all years presented.

Reporting Basis and Conventions

The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been applied.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

a) Principles of Consolidation

A controlled entity is one which Paradigm Metals Limited has the power to control the financial and operating policies of so as to obtain benefits from its activities.

A list of controlled entities is contained in Note 14 to the financial statements. All controlled entities have a June financial year end.

The consolidated financial statements incorporate the assets and liabilities of all entities controlled by Paradigm Metals Limited (‘Company’ or ‘parent entity’) as at 30 June 2007 and the results of all controlled entities for the year then ended. Paradigm Metals Limited and its controlled entities together are referred to in this financial report as the consolidated entity. The effects of all transactions between entities in the consolidated 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 form the date on which control commences. Where control of an entity ceases during a financial year its results are included for that part of the year during which control existed.

b) Financial Assets and Financial Liabilities

Financial assets and financial liabilities are recognised on the balance sheet when the Company becomes party to the contractual provisions of the financial instrument.

A financial asset is derecognised when the contractual rights to the cash flows from the financial assets expire or are transferred and no longer controlled by the entity. A financial liability is removed from the balance sheet when the obligation specified in the contract is discharged or cancelled or expires.

Upon initial recognition a financial asset or financial liability is designated as at fair value through profit or loss except for investments in equity instruments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured.

A gain or loss arising from a change in the fair value of a financial asset or financial liability classified as at fair value through profit or loss is recognised in profit or loss.

Financial assets not measured at fair value comprise loans and receivables. These are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are measured at amortised cost using the effective interest method.

Available-for-sale financial assets include other financial assets, comprising investments in subsidiaries, 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 comprise of trade and other payables, provisions and borrowings are measured at amortised cost using the effective interest method.

Trade accounts payable represent the principal amounts outstanding at balance date plus, where applicable, any accrued interest.

The amortised cost of a financial asset or a financial liability is the amount initially recognised minus principal repayments, plus or minus cumulative amortisation of any difference between the initial amount and maturity amount and minus any write-down for impairment or uncollectibility.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

c) Revenue Recognition

(i) Revenue from rendering of services

Revenue from rendering of services is recognised when the outcome of a transaction involving the rendering of services can be estimated reliably and when the other contractual obligations of the entity are performed.

(ii) Interest revenue

Interest revenue is recognised using the effective interest method. It includes amortisation of any discount or premium.

d) Leases

Lease of assets where substantially all the risks and benefits incidental to the ownership of the asset, but not the legal ownership, are transferred to the Company were classified as finance leases. Finance leases are capitalised, recording an asset and a liability equal to the present value of the minimum lease payments, including any guaranteed residual values. Leased assets are amortised on a straight-line basis over their estimated useful lives where it is likely that the Company will obtain ownership of the asset or over the term of the lease. Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the period.

Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are recognised as an expense on a straight line basis over the lease term unless another systematic basis is more representative of the time pattern in which benefits are diminished.

Lease incentives under operating leases are recognised as liabilities. The incentives are recognised as a reduction of expenses on a straight line basis unless another systematic basis is more representative of the time pattern in which benefits are diminished.

e) Income taxes

Income taxes are accounted for using the comprehensive balance sheet liability method whereby:

the tax consequences of recovering (settling) all assets (liabilities) are reflected in the financial statements;
current and deferred tax is recognised as income or expense except to the extent that the tax relates to equity items or to a business combination;
a deferred tax asset is recognised to the extent that it is probable that future taxable profit will be available to realise the asset; and
deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability settled.

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

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

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

The amount of benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that the group will derive sufficient

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by law.

Tax consolidation legislation

Paradigm Metals Limited and its wholly-owned Australian controlled entities have formed an income tax consolidated group under the tax consolidation regime. The tax consolidated group does not have a tax sharing and funding agreement in place.

f) Foreign Currency Transactions and Balances

Functional and Presentation Currency

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

Transaction and Balances

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

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

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

g) Cash and Cash Equivalents

Cash and cash equivalents comprise:

(i) cash on hand and at call deposits with banks or financial institutions, net of bank overdrafts;

(ii) investments in money market instruments; and (iii) cash in transit.

h) Receivables

Trade accounts receivables and other receivables represent the principal amounts due at balance date plus accrued interest and less, where applicable, any unearned income and provision for doubtful accounts. An estimated doubtful debt is made when collection of the full amount is no longer probable.

i) Financial Assets

Investments in controlled entities are measured on a cost basis. The carrying amounts of investments are reviewed annually by the Directors to ensure they are not in excess of recoverable amounts of these assets.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

j) Property, Plant and Equipment

Property, plant and equipment are included at cost. Assets in plant and equipment (except for capitalised leased assets) are depreciated on a straight line basis over their estimated useful lives. The depreciation rates used for each class of assets are as follows:

Class of Fixed Asset Depreciation Rate Office Equipment 5% - 50% Leasehold Improvements 5%

On disposal of an item of property, plant and equipment, the difference between the sales proceeds and the carrying amount of the asset is recognised as a gain or loss.

k) 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. In assessing value in use, the estimated future cash flows discounted to their present value using a pre-tax discount rate.

l) Contingent Liabilities

A contingent loss is recognised as an expense and a liability if it is probable that future events will confirm that, after taking into account any related probable recovery, an asset has been impaired or a liability incurred and, a reasonable estimate of the amount of the resulting loss can be made.

m) Short Term Employee Benefits

Short term employee benefits are employee benefits (other than termination benefits and equity compensation benefits) which fall due wholly within 12 months after the end of the period in which employee services are rendered. They comprise wages, salaries, social security obligations, short-term compensation absences, profit sharing and bonuses payables within 12 months and non-mandatory benefits such as medical care, housing, car and service goods.

The provision for employee entitlements to wages, salaries and annual leave represents the amount that the Group has a present obligation to pay resulting from employee services provided up to balance date. The provision has been calculated after taking into consideration estimated future increases in wages and salaries and past experience regarding staff departures and includes related on-costs.

The undiscounted amount of short-term benefits expected to be paid is recognised as an expense.

n) Long Term Employee Benefits

Long term employee benefits include long-service leave payable 12 months or more after the end of the period in which employee service are rendered.

o) Events after the Balance Sheet Date

Assets and liabilities are adjusted for events incurring after the balance date that provide evidence of conditions existing at the balance date. Important after balance date events which do not meet these criteria are disclosed in Note 22 to the financial statements.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

p) Goods and Services Tax

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 exclusive of GST.

q) Exploration and evaluation expenditure

Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest. An area of interest refers to an individual geological area where the presence of a mineral deposit is considered favourable or has been proved to exist, and in most cases will be an individual tenement. Exploration and evaluation expenditure is recognised in relation to an area of interest when the rights to tenure of the area of interest are current and either:

(a) such expenditure is expected to be recovered through successful development and commercial exploitation of the areas of interest; or

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

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

Exploration and evaluation assets are assessed for impairment when the facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount.

r) Restoration Provision

Where applicable, a provision for material rehabilitation and restoration obligations is recognised. The amount recognised includes the cost of reclamation and site rehabilitation after taking into account restoration works that are carried out during exploration. Costs are determined from estimates of future costs. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at reporting date taking into account the risks and uncertainties surrounding the obligation. Where the time value of money is material, the amount of the provision is the present value of the expected future cash flows required to settle the obligation. In each subsequent reporting period, the amount of the provision may be adjusted by any change in the estimated future rehabilitation and restoration costs of existing and new workings, and any discount associated with the change in the life of the project and the discount rate.

s) Comparative Figures

Where required by accounting standards, the reclassification of comparatives has been performed in order to conform to the changes in presentation for the current financial year.

t) Earnings per Share

Basic earnings per share

Basic earnings per share is determined by dividing the operating profit or loss after income tax attributable to the members of the Company, by the weighted average number of ordinary shares outstanding during the financial period.

Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share by taking into account any reduction in earnings per share that will arise from the exercise of options outstanding during the financial period.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

u) New Australian Accounting Standards

The following Australian Accounting Standards have been issued or amended and are applicable to the parent and consolidated entity but are not yet effective. They have not been adopted in preparation of the financial statements at reporting date.

• AASB 7 'Financial Instruments: Disclosures' and consequential amendments to other accounting standards resulting from its issue.	• Effective for annual reporting periods beginning on or after 1 January 2007
• AASB 8 'Operating Segment' and consequential amendments to other accounting standards resulting from its issue	• Effective for annual reporting periods beginning on or after 1 January 2009
• AASB 101 'Presentation of Financial Statements' – revised standard	• Effective for annual reporting periods beginning on or after 1 January 2007
• Interpretation 10 'Interim Financial Reporting and Impairment'	• Effective for annual reporting periods beginning on or after 1 November 2006
• Interpretation 11 'Group and Treasury Share Transactions' and consequential amendments to other accounting standards resulting from its issue	• Effective for annual reporting periods beginning on or after 1 March 2007
• Interpretation 12 'Service Concession Arrangements' and consequential amendments to other accounting standards resulting from its issue	• Effective for annual reporting periods beginning on or after 1 January 2008

The Directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material financial impact on the financial statements of the consolidated entity. The circumstances addressed by Interpretation 10, which prohibits the reversal of certain impairment losses, do not affect the consolidated entity's previously reported results and accordingly, there will be no impact to these financial statements on adoption of the Interpretation.

The application of AASB 101 (revised), AASB 7 and AASB 2005-10 will not affect any of the amounts recognised in the financial statements, but will change the disclosure presently made in relation to the consolidated entity's financial instruments and the objectives, policies and processes for managing capital.

These Standards and Interpretations will be first applied in the financial report of the consolidated entity that relates to the annual reporting period beginning after the effective date of each pronouncement.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

v) Share Based Payments

Equity settled share based payments are measured at the fair value of the equity instrument at grant date. Fair value is measured by the Black Scholes model.

The fair vale determined at the grant date of the equity-settled share based payment is expensed on a straight line basis over the vesting period, based on the consolidated entity’s estimate of the shares that will eventually vest.

Where the share based payment is for a capital item, the fair value expense is recorded in the balance sheet and treated accordingly.

w) Significant Judgement and Key Assumptions

The Directors evaluate estimates and judgements incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Company.

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

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 2: REVENUE Operating activities Interest received Non-operating activities Rent received (a) Interest received from: - other persons NOTE 3: LOSS FOR THE YEAR (a) Expenses: Exploration expenditure Write-off capitalised expenditure Write-off of tenement deposits Write down of amounts receivable from subsidiaries Directors fees Administration expenses Other expenses Share based payments	CONSOLIDATED ENTITY 2007 2006 $ $ 73,029 86,078 3,477 3,184 76,506 89,262 73,029 86,078 - (51,079) (456,653) (47,028) (15,000) - - - (125,000) (130,000) (282,576) (137,290) - (41,000) (5,182) - (884,411) (406,397)	PARENT ENTITY 2007 2006 $ $ 73,029 86,078 3,477 3,184
		76,506 89,262
		73,029 86,078 - (51,079) (71,711) - - - (1,705,824) (253,385) (125,000) (130,000) (297,576) (137,290) - (41,000) (5,182) -
		(2,205,293) (612,754)

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 4: INCOME TAX Income tax recognised in profit The prima facie tax on loss from ordinary activities before income tax is reconciled to the income tax as follows: Loss from operations Prima facie tax benefit on loss from ordinary activities before income tax at 30% (2006: 30%) Consolidated Entity Parent Entity Add: tax effect of non-allowable items Less: tax effect of timing differences not brought to account Deferred tax assets not brought to account Income tax attributable to the entity	CONSOLIDATED ENTITY 2007 2006 $ $ (1,022,845) (504,665) (306,854) (151,400) - - (306,854) (151,400) 615 1,997 (9,527) (121,509) 315,766 270,912 - -	PARENT ENTITY 2007 2006 $ $ (2,343,727) (711,022) - - (703,118) (213,307)
		(703,118) (213,307) 615 1,997 (35,128) 32,643 737,631 178,667
		- -

As at 30 June 2007, the Company had estimated unrecouped operating income tax losses of $5,155,870 (2006 $4,016,274). The benefit of these losses of $1,546,761 (2006:$1,204,882) has not been brought to account as realisation is not probable.

The benefit will only be obtained if:

(i) The Company derives future assessable income of a nature and an amount sufficient to enable the benefits from the deductions for the losses to be realized.

(ii) The Company continues to comply with the conditions for deductibility imposed by the law;

(iii) No changes in tax legislation aversely affect the Company in realising the benefit from the deductions for the losses.

As at 30 June 2007 there were no franking credits available for subsequent financial years.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 5: TRADE AND OTHER RECEIVABLES Amounts receivable from: - wholly owned subsidiaries - provision for impairment of receivables from wholly owned subsidiaries NOTE 6: OTHER ASSETS CURRENT Prepayments GST receivable Tenement deposits NON-CURRENT Tenement deposits Exploration expenditure capitalised: - exploration and evaluation phases	CONSOLIDATED ENTITY 2007 2006 $ $ - - - - - - 21,723 21,723 64,075 10,722 20,000 35,000 105,798 67,445 67,500 74,000 3,004,079 1,725,744 3,071,579 1,799,744	PARENT ENTITY 2007 2006 $ $ 4,228,781 2,512,043 (4,228,781) (2,512,043)
		- -
		21,723 21,723 64,075 10,722 - -
		85,798 32,445
		- - - 64,048
		- 64,048

Recoverability of the carrying amount of exploration assets is dependent on successful development and commercial exploration or sale of the respective areas of interest.

Capitalised costs amounting to $686,947 (2006: $396,014) have been included in the cash flows from investing activities in the cash flow statement.

NOTE 7: PLANT AND EQUIPMENT Plant and equipment at cost Accumulated depreciation Total plant and equipment Movement in carrying amounts: Balance at beginning of year Additions Depreciation Carrying amount at end of year	51,483 36,475 (14,702) (12,825) 36,781 23,650 CONSOLIDATED ENTITY $ $ Total Plant & Equipment 23,650 29,736 15,008 - (1,877) (6,086) 36,781 23,650	51,483 36,475 (14,702) (12,825)
		36,781 23,650
		PARENT ENTITY $ $ Total Plant & Equipment 23,650 29,736 15,008 - (1,877) (6,086)
		36,781 23,650

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 8: FINANCIAL ASSETS Investment in wholly owned subsidiaries (Note 14) NOTE 9: TRADE AND OTHER PAYABLES CURRENT Unsecured liabilities: Trade payables Sundry payables and accrued expenses NOTE 10: PROVISIONS Consolidated Entity Opening balance at 1 July 2006 Amounts used Balance at 30 June 2007 Parent Entity Opening balance at 1 July 2006 Amounts used Balance at 30 June 2007 Analysis of total provisions: Current Non-current	CONSOLIDATED ENTITY 2007 2006 $ $ - -	PARENT ENTITY 2007 2006 $ $ 3 2
	17,059 9,750 17,059 9,750 6,786 36,900 6,786 36,900 23,845 46,650 23,845 46,650 Tenement Employee Total Restoration Benefits 5,000 1,500 6,500 - - - 5,000 1,500 6,500 5,000 1,500 6,500 - - - 5,000 1,500 6,500 CONSOLIDATED ENTITY PARENT ENTITY 2007 2006 2007 2006 $ $ $ $ 1,500 1,500 1,500 1,500 5,000 5,000 5,000 5,000	17,059 9,750 6,786 36,900
		23,845 46,650
	6,500 6,500 6,500 6,500

Provision for tenement restoration:

The restoration provision represents the present value of the Directors' best estimate of the future sacrifice of economic benefit that will be required for meeting environmental obligations for existing tenements after exploration activities have been completed. The provision is reviewed annually by the Directors.

Provision for employee benefits:

A provision has been recognised for employee entitlements relating to annual leave due within 1 year.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 11: ISSUED CAPITAL		CONSOLIDATED ENTITY	CONSOLIDATED ENTITY	PARENT	ENTITY
		2007	2006	2007	2006
		$	$	$	$
62,167,582 fully paid ordinary shares		7,984,557	5,036,193	7,984,557	5,036,193
(2006: 44,132,178)
		$	Number
(a) Ordinary Shares
Ordinary Shares at beginning of reporting period		5,036,193	44,132,178
Shares issued during the year	- 28 March 2007	1,654,956	11,033,044
Issue costs incurred	- 28 March 2007	(593,603)	-
Shares issued during the year	- 11 April 2007	600,000	4,000,000
Right issue costs incurred	- 11 April 2007	(268,363)	-
Options exercised during the year	- 2 June 2007	590	2,360
	- 7 June 2007	225,000	3,000,000
Transfer from Options Reserve on exercise of options		628,824	-
Ordinary Shares at reporting date		7,283,597	62,167,582

At reporting date the Company had 62,167,582 (2006: 44,132,178) authorised Ordinary Shares of no par value. Ordinary Shares entitle the holder to receive dividends as declared and, in the event of winding up the Company, to participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up on shares held. Ordinary Shares entitle the holder to one vote, either in person or by proxy, at a meeting of the Company.

Copper Strike Ltd exercised their remaining 2 million options on 1 August 2007. These are not included in the table above.

(b) Options

	CONSOLIDATED	ENTITY	PARENT ENTITY	PARENT ENTITY
	2007	2006	2007	2006
	$	$	$	$
Effect of share-based payment transactions
Expenses arising from share-based payment transactions	5,182	-	5,182		-
Expenses arising from share-based payment transactions capitalised as exploration costs	1,048,040	-		-	-

Movement during the financial year	Number of options 2007 Weighted average exercise price $ Number of options 2006 Weighted average exercise price $
	14,975,465 0.25 14,975,465 0.25 20,333,044 0.21 - - - - - - (3,002,360) 0.075 - -
Opening number of options
Granted during the financial year
Lapsed during the financial year
Exercised during the financial year
Closing number of options	32,306,149 0.24 14,975,465 0.25

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 11: ISSUED CAPITAL (CONTINUED)

Fair value

Fair value was measured using Black-Scholes and the inputs to it were as follows:

Weighted average price	share	Range from $0.21 to $0.25
Exercise price		Range from $0.075 to $0.25
Option life		Range from 1.14 years to 3 years
Risk-free interest rate		6.5%
Expected dividends		0%
Expected volatility*		80%

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Historical volatility has been the basis for determining the expected share price volatility as it is assumed that it is indicative of the future tender, which may not eventuate.

Details of options outstanding as at end of year

Details of options outstanding as at end of year
Grant date Expiry date	% Exercisable at 30 June 2007 30 June 2007 Outstanding Option No. Exercise Price $ Fair value at issued date
Shareholders 19 Sep 2003 18 May 2008	100 14,975,469 0.25 -
Shareholders 28 March 2007 18 May 2008	100 11,030,680 0.25 0.03
Nominee Far East Capital Ltd 11 April 2007 18 May 2008	100 4,000,000 0.25 0.07
Copper Strike Ltd 22 May 2007 22 May 2010	100 2,000,000 0.075 0.21
1 (Employee) 22 May 2007 22 May 2010	100 300,000 0.25 0.15
	100 32,306,149

Copper Strike Ltd exercised their remaining 2 million options on 1 August 2007. These are not included in the weighted average number of shares in the earnings per share calculation.

NOTE 12: AUDITOR’S REMUNERATION Amounts received or due and receivable by the auditor of the Company for: Audit or review of the financial reports of the Company Taxation services	CONSOLIDATED ENTITY PARENT ENTITY 2007 2006 2007 2006 $ $ $ $ 37,500 26,250 37,500 26,250 6,160 15,260 6,160 15,260
	43,660 41,510 43,660 41,510

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 13: KEY MANAGEMENT PERSONNEL COMPENSATION

Directors

The names of persons who were directors of Paradigm Metals Limited at any time during the financial year are Richard Austen (alternate Richard Harvey), Graham Carman, Stephen Lonergan, Ray Soper and John Gaskell.

Gaskell.
	PARENT ENTITY	PARENT ENTITY
	AND CONSOLIDATED	AND CONSOLIDATED
	2007	2006
	NUMBER	NUMBER
Aggregate numbers of shares and share options of Paradigm
Metals Limited held directly, indirectly, or beneficially by
Directors of the Company or the consolidated entity or their
Director related entities at balance date:
Ordinary shares	8,200,735	6,650,588
Options over unissued ordinary shares	2,310,987	1,004,174

Key management personnel

The following were key management personnel at various times during the reporting year.

Graham Carman – Managing Director

The aggregate compensation made to key management personnel of the Company and consolidated entity are set out below: -

out below: -
	CONSOLIDATED ENTITY PARENT ENTITY 2007 $ 2006 $ 2007 $ 2006 $
Short Term Employee Benefits Post Employment Benefits Other Payments Termination Benefits Share based payment Total	175,000 165,000 175,000 165,000 - - - - 25,000 - 25,000 - - - - - - - - -
	200,000 165,000 200,000 165,000

The Company has taken advantage of the relief provided by ASIC Class Order 06/50 and has transferred the detailed remuneration disclosures to the Directors’ report.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 14: RELATED PARTY TRANSACTIONS

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

Controlled Entities of Paradigm Metals Ltd	Country of	Percentage	Owned
	Incorporation	2007	2006
		%	%
Paradigm NSW Pty Limited	Australia	100	100
Paradigm Queensland Pty Limited	Australia	100	100
Tungsten NSW Pty Limited	Australia	100	-

Tungsten NSW Pty Limited was registered on 9 January 2007. Directors of the Company are Graham Carman and Stephen Lonergan. Paradigm Metals Ltd is the only shareholder.

Transactions with related parties	PARENT	ENTITY
	2007	2006
Subsidiaries	$	$
Paradigm Metals Limited paid/received exploration expenses/repayments	(41,465)	69,197
on behalf/from Paradigm NSW Pty Ltd
Amount due from Paradigm NSW Pty Ltd	1,627,340	1,668,805
Provision for impairment of amount due from Paradigm NSW Pty Ltd	(1,627,340)	(1,668,805)
Paradigm Metals Limited paid exploration expenses on behalf of Paradigm	85,660	184,186
Queensland Pty Ltd
Amount due from Paradigm Queensland Pty Limited	928,898	843,238
Provision for impairment of amount due from Paradigm Queensland Pty Ltd	(928,898)	(843,238)
Paradigm Metals Limited paid exploration expenses on behalf of Tungsten	1,672,542	-
NSW Pty Limited
Amount due from Tungsten NSW Pty Limited	1,672,542	-
Provision for impairment of amount due from Tungsten NSW Pty Ltd	(1,672,542)	-
Other related parties
Payment of Directors' fees to Dick Austen and Associates Pty Limited	42,500	40,000
Sub-lease rent received from John Gaskell (Director)	3,477	3,184

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 15: FINANCIAL INSTRUMENTS

Financial Risk Management

The Group's financial instruments consist of deposits with banks, tenement deposits, accounts receivable and payable and loans to and from subsidiaries.

The main risks the Group is exposed to through its financial instruments are interest rate risk, liquidity risk and credit risk.

Interest Rate Risk

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

2007 Consolidated Entity Weighted Average Interest Rate Non Interest Bearing 1 Year or Less 1 to 5 Years Floating Interest Rate $ $ $ $ Financial Assets Cash assets 5.9% 46,004 2,126,883 - - Receivables 173,298 - - Total Financial Assets 219,302 2,126,883 - - Financial Liabilities Trade and sundry payables - 23,845 - - - Total Financial Liabilities 23,845 - - - Net Financial Assets 195,457 2,126,883 - - Reconciliation of Net Financial Assets to Net Assets Net Financial Assets as above Plant and Equipment Capitalised Exploration Expenditure Provisions Net Assets as per Balance Sheet	Non Interest Bearing 1 Year or Less 1 to 5 Years Floating Interest Rate $ $ $ $ 46,004 2,126,883 - - 173,298 - -	Total $ 2,172,887 173,298
	219,302 2,126,883 - -	2,346,185
	23,845 - - -	23,845
	23,845 - - -	23,845
	195,457 2,126,883 - -	2,322,340
		2,322,340 36,781 3,004,079 (6,500)
		5,356,700

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 15: FINANCIAL INSTRUMENTS (CONTINUED)

2006 Consolidated Entity Weighted Average Interest Rate Non-Interest Bearing 1 Year or Less 1 to 5 Years Floating Interest Rate $ $ $ $ Financial Assets Cash assets 5.39% 24,337 1,144,757 - - Receivables - 67,445 74,000 - - Total Financial Assets 91,782 1,218,757 - - Financial Liabilities Trade and sundry payables - 46,650 - - - Total Financial Liabilities 46,650 - - - Net Financial Assets 45,132 1,218,757 - - Reconciliation of Net Financial Assets to Net Assets Net Financial Assets as above Plant and Equipment Capitalised Exploration Expenditure Provisions Net Assets as per Balance Sheet 2007 Parent Entity Weighted Average Interest Rate Non-Interest Bearing 1 Year or Less 1 to 5 Years Floating Interest Rate $ $ $ $ Financial Assets Cash assets 5.9% 46,004 2,126,883 - - Receivables 85,798 - - - Total Financial Assets 131,802 2,126,883 - - Financial Liabilities Trade and sundry payables - 65,310 - - - Total Financial Liabilities 65,310 - - - Net Financial Assets 66,492 2,126,883 - - Reconciliation of Net Financial Assets to Net Assets Net Financial Assets as above Plant and Equipment Financial assets Provisions Net Assets as per Balance Sheet	Non-Interest Bearing 1 Year or Less 1 to 5 Years Floating Interest Rate $ $ $ $ 24,337 1,144,757 - - 67,445 74,000 - -	Total $ 1,169,094 141,445
	91,782 1,218,757 - -	1,310,539
	46,650 - - -	46,650
	46,650 - - -	46,650
	45,132 1,218,757 - -	1,263,889
		1,263,889 23,650 1,725,744 (6,500)
		3,006,783
		Total $ 2,172,887 85,798
	131,802 2,126,883 - -	2,258,685
	65,310 - - -	65,310
	65,310 - - -	65,310
	66,492 2,126,883 - -	2,193,375
		2,193,375 36,781 3 (6,500)
		2,223,659

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

2006 Parent Entity Weighted Average Interest Rate Non-Interest Bearing 1 Year or Less 1 to 5 Years Floating Interest Rate $ $ $ $ Financial Assets Cash assets 5.39% 24,337 1,144,757 - - Receivables - 32,445 - - - Total Financial Assets 56,782 1,144,757 - - Financial Liabilities Trade and sundry payables - 46,650 - - - Total Financial Liabilities 46,650 - - - Net Financial Assets 10,132 1,144,757 - - Reconciliation of Net Financial Assets to Net Assets Net Financial Assets as above Plant and Equipment Capitalised Exploration Expenditure Financial assets Provisions Net Assets as per Balance Sheet	Non-Interest Bearing 1 Year or Less 1 to 5 Years Floating Interest Rate $ $ $ $ 24,337 1,144,757 - - 32,445 - - -	Total $ 1,169,094 32,445
	56,782 1,144,757 - -	1,201,539
	46,650 - - -	46,650
	46,650 - - -	46,650
	10,132 1,144,757 - -	1,154,889
		1,154,889 23,650 64,048 2 (6,500)
		1,236,089

Liquidity Risk

The group manages liquidity risk by monitoring forecast cash flows.

Credit Risk

The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial assets, is the carrying amount net of any provision for impairment of those assets, as disclosed in the balance sheet and notes to the financial statements. The consolidated entity does not have any material credit risk exposure to a single receivable or group of receivables under financial instruments entered into by the consolidated entity.

Net Fair Values

The net fair values of assets and other liabilities approximate their carrying value. The aggregate net fair values and carrying amounts of financial assets and financial liabilities are disclosed in the balance sheet and the notes to the financial statements.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 16: COMMITMENTS FOR EXPENDITURE

CONSOLIDATED ENTITY PARENT ENTITY

(a) Exploration expenditure commitments

Within 1 year 1-5 years >5 years	2007 2006 $ $ 472,000 314,000 315,000 256,000 - - 787,000 570,000	2007 2006 $ $ - - - - - -
		- -

Tenement holdings and related commitments are regularly reviewed, and there is no certainty that a tenement will be held for the full period of its grant. The Company is required to meet minimum committed expenditure requirements to maintain current rights of tenure on exploration tenements. These obligations may be subject to renegotiation, may be farmed out or may be relinquished. The expenditure commitments shown cover commitments for all current tenement holdings and farm-in agreements for a period of 2 years from reporting date.

Jaguar Minerals Farm-in agreement

Paradigm Metals Ltd (formerly Paradigm Gold Ltd) withdrew from its farm-in agreement with Jaguar Minerals Ltd at the Mt David project in NSW on 1 March 2007.

(b) Operating Lease Commitments

The property lease is a non-cancelable lease with a term of two years, commencing April 2006. The lease allows for subletting of all lease areas.

	CONSOLIDATED	ENTITY	PARENT	ENTITY
	2007	2006	2007	2006
	$	$	$	$
Within 1 year	33,057	39,486	33,057	39,486
1-5 years	-	33,057	-	33,057
	33,057	72,543	33,057	72,543

NOTE 17: SEGMENT INFORMATION

The consolidated entity operates predominantly in the mining exploration industry throughout New South Wales and Queensland.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 18: EARNINGS PER SHARE (a) Reconciliation of earnings to net Loss Net loss after tax Loss used in the calculation of basic EPS and dilutive EPS (b) Weighted average number of ordinary shares outstanding during the year used in the calculation of basic EPS Weighted average number of options outstanding Weighted average number of ordinary shares outstanding during the year used in the calculation of dilutive EPS	CONSOLIDATED ENTITY 2007 2006 $ $ (1,022,845) (504,665)
	(1,022,845) (504,665)
	48,050,234 44,132,178 - -
	48,050,234 44,132,178

NOTE 19: NOTES TO THE CASH FLOW STATEMENT

(a) Reconciliation of cash and cash equivalents Cash at bank Rental Bond (b) Reconciliation of cash flows from operations with loss after income tax Loss after income tax Non cash flows in loss Depreciation Lease Incentive Provision for impairment of receivables from wholly owned subsidiaries Tenement deposits written off Exploration expenditure written off Share option expense Changes in Assets and Liabilities Decrease (increase) in other assets Increase/(decrease) in other payables Increase/(decrease) in other provisions Net cash used in operating activities	CONSOLIDATED ENTITY 2007 2006 $ $ 2,162,552 1,158,759 10,335 10,335 2,172,887 1,169,094 (1,022,845) (504,665) 1,877 6,087 - (3,981) - - 15,000 - 456,652 98,107 5,182 - (53,353) 1,400 (22,805) 9,288 - - (620,292) (393,764)	PARENT ENTITY 2007 2006 $ $ 2,162,552 1,158,759 10,335 10,335
		2,172,887 1,169,094
		(2,343,727) (711,022) 1,877 6,087 - (3,981) 1,705,288 253,385 - - 71,111 - 5,182 - (53,353) (26,100) (22,805) 9,288 - -
		(636,427) (472,343)

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

NOTE 20: SUPERANNUATION COMMITMENTS

The consolidated entity contributes to industry based superannuation plans which provide accumulated benefits to permanent employees. The level of contributions is determined by Superannuation Guarantee legislation. The consolidated entity has no responsibility for the administration or performance of these industry based funds.

NOTE 21: CONTINGENT LIABILITIES

Paradigm purchased the tenement site of White Rock during the year from Copper Strike Limited and Sherwood Ventures Pty Limited (“the vendors”). The purchase agreement includes terms obliging Paradigm to pay the vendors $0.5 million on the announcement to the ASX of a defined Indicated Mineral Resource, and $1.5 million after the first of (i) completion of a positive Project Feasibility Study, or (ii) a decision to mine.

NOTE 22: SUBSEQUENT EVENTS

There are no significant events to disclose subsequent to the reporting date of 30 June 2007.

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ DECLARATION

FOR THE YEAR ENDED 30 JUNE 2007

The Directors of the Company declare that:

the attached financial statements and notes thereto comply with Accounting Standards;
the attached financial statements and notes thereto give a true and fair view of the financial position and performance of the Company;
in the Directors’ opinion, the attached financial statements and notes thereto are in accordance with the Corporations Act 2001 ;
in the Directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; and
the Directors have been given the declarations required by section 295A of the Corporations Act 2001

This Directors’ Declaration is made in accordance with a resolution of the Board of Directors made pursuant to section 295(5) of the Corporations Act 2001 .

On behalf of the Directors

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Graham D Carman

Dated: 27 September 2007

Sydney

PARADIGM METALS LIMITED INDEPENDENT AUDIT REPORT

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INDEPENDENT AUDITOR’S REPORT

To the members Paradigm Metals Limited

Report on the Financial Report and AASB 124 remuneration disclosures contained in the Directors’ report.

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

We have also audited the remuneration disclosures contained in the directors’ report. As permitted by the Corporations Regulations 2001, the Company has disclosed information about remuneration of Directors and executives (‘remuneration disclosures’) required by Accounting Standard AASB 124 Related Party Disclosures, under the heading “remuneration report” in pages 15 to 16 of the Directors’ report and not in the financial report .

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 establishing 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. 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 to also express an opinion on the remuneration disclosures contained in the Directors’ report based on our audit.

Tel: 61 2 9251 4100 | Fax: 61 2 9240 9821 | www.pkf.com.au PKF | ABN 83 236 985 726

Level 10, 1 Margaret Street | Sydney | New South Wales 2000 | Australia

DX 10173 | Sydney Stock Exchange | New South Wales Liability limited by a scheme approved under Professional Standards Legislation

PARADIGM METALS LIMITED INDEPENDENT AUDIT REPORT

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

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

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 Paradigm Metals 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 .

Auditor’s opinion on the AASB 124 remuneration disclosures contained in the Directors’ report

In our opinion the remuneration disclosures that are contained in pages 15 to 16 of the Directors’ report comply with Accounting Standard AASB 124.

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PKF

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Tim Sydenham

Dated 27[th] September 2007 Sydney

PARADIGM METALS LIMITED

CORPORATE GOVERNANCE STATEMENT

The following sets out how the Company is implementing the ASX “Principles of Good Corporate Governance and Best Practice Recommendations” dated March 2003.

Principle 1: Lay solid foundations for management and oversight

The Board has formally retained all functions except those delegated from time to time to the Managing Director. Currently, the following functions are so delegated;

1 Management of the Company’s exploration program consistent with the plans and budgets approved by the Board.
2 Management of the Company’s financial records.
3 Compliance with all ASIC and ASX reporting requirements, subject to prior Board approval.
4 Representation and promotion of the Company to the investment markets.
5 Engagement (subject to prior Board approval) of employees and supervision of employees and contractors.
6 Management of the Company’s occupational health and safety and environmental protection obligations.
7 Identification, development and presentation of business development opportunities consistent with the Company’s commitments to its stakeholders

A letter of appointment has been entered into between each Director and the Company.

Principle 2: Structure the board to add value

It is recommended by the ASX Guidelines that majority of the Board should be independent Directors. The Company has one substantial shareholder, Phillian Pty Ltd (5.48%), a company associated with Mr Richard Austen.

In terms of the ASX Guidelines, Mr Austen is not therefore an independent Director but other Board members (Messrs Gaskell and Lonergan) are independent Directors.

The letter of appointment for each Director confers the right to seek independent legal advice at the Company’s expense, subject to prior agreement of the Chairman which will not be unreasonably refused.

The independent Directors meet from time to time to discuss issues relating the Company without management being present.

The Chairman is not an independent Director in terms of the ASX Guidelines. The Directors believe that any disadvantage in Mr Austen not being technically independent is more than outweighed by the skills and experience he brings to the Company.

The roles of Chairman and Managing Director are exercised by different persons as recommended by the ASX Guidelines.

The Board has not established a Nominations Committee as it considers that there is no current need for such committee. Should a Board vacancy arise, the Board as a whole will meet to decide on an appointee.

The term of office held by each Director as at the date of this report is as follows:

	Date of appointment	Retire by rotation
Mr Austen	12 December 2002	2008AGM
MrGaskell	07 November 2002	2007 AGM
MrCarman	18November 2002	Notrequired toretire
Mr Lonergan	07 November 2002	2008AGM

Principle 3: Promote ethical and responsible decision-making

The Company has adopted a Code of Conduct and a policy on trading in the Company’s securities and these are available on the Company’s web site.

PARADIGM METALS LIMITED CORPORATE GOVERNANCE STATEMENT

Principle 4: Safeguard integrity in financial reporting

The Board has adopted a policy requiring the Managing Director to state in writing to the Board that the Company’s financial reports present a true and fair view, in all material respects, of the Company’s financial condition and operational results are in accordance with relevant accounting standards. In addition, standard audit procedures require management to provide a Management Representation Letter relating to these matters. The Board has established a practice of meeting periodically with the Company’s Auditors, without management being present, to enable the auditors to freely express any concerns in this area.

The Company has established an Audit Committee comprising the independent Directors being John Gaskell (Chairman) and Stephen Lonergan. The Audit Committee has met twice during the year.

The formal charter of the Audit Committee is to give assurance to the Board that all financial statements and reports to be adopted by the Board are consistent with all applicable reporting requirements and are, in all respects, accurate and not misleading. Additionally, the Audit Committee is the mechanism through which the Company’s Auditors will interface with the Board.

Principle 5: Make timely and balanced disclosure

The Company has adopted a formal Continuous Disclosure Policy and this is available on the Company’s website.

Principle 6: Respect the rights of shareholder

The Company maintains a website to facilitate shareholder communication and participation and the Company’s auditor will attend the Annual General Meeting and be available to answer shareholder questions about the conduct of the audit and the preparation and content of the auditors report.

Principle 7: Recognise and manage risk

Risk faced by the Company is a standing agenda item for Board meetings. The suite of risks faced by the Company as a mining exploration entity are comparatively limited and for this reason a formal risk management policy has not yet been adopted. The Board actively discusses specific risks, and puts in place provisions to deal with these risks. An example is that the Company has addressed the risk of being exposed to fraud, and adapted its banking procedures to minimise exposure to this risk. The Company has also put in place insurance to cover this risk. The Board has adopted a requirement that the Managing Director should state to the Board in writing that:

the statement given in accordance with best practice recommendation 4.1 (the integrity of financial statements) is founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the Board, and;
the Company’s risk management and internal compliance and control system is operating efficiently and effectively in all material respects.

It should be noted that the Company does not maintain a Risk Management Committee because of the simplicity of its operations solely as a mining exploration entity. This function remains with the Board.

Principle 8: Encourage enhanced performance

Each Director has a letter of appointment signed by the Chairman of the Company and, in the case of the Chairman, a letter signed by two Directors each letter includes among other matters, in broad terms, the expertise which relevant Director is expected to contribute to the Board. Annual performance evaluations for the past year have been conducted by reference to attendance, conflict management, performance in the area of expertise, active participation, independent thinking and compliance with Board policies.

PARADIGM METALS LIMITED

CORPORATE GOVERNANCE STATEMENT

Principle 9: Remunerate fairly and responsibly

The main remuneration issues relate to the salary of the Managing Director, Directors fees, and rates paid to consultants and contractors relating to the provision of their services. These terms are set by reference to market terms paid by similar companies.

The only senior executive employed by the Company is the Managing Director whose remuneration package is currently as follows:

gross salary of $185,000 per annum inclusive of superannuation effective from 1 January 2007 and reviewed annually;
the contract has no specified term but may be terminated with three months notice on either side;
expenses incurred in the performance of Company business are refunded;
the employment contract has no provision for non-monetary components such as share option benefits, salary bonuses, or non-cash benefits.

The fees paid to Directors are considered appropriate compared with market, the size of the Company, and the requirements for Directors to inform and involve themselves in the affairs of the Company. The aggregate amount payable as Directors fees in any year is a fixed amount (up to $150,000) approved by shareholders.

Remuneration paid to Directors during the past year is set out in the Remuneration Report contained in the Financial Statements included in this Annual Report.

The Directors consider that the Company does not require a formal Remuneration Committee as it has only one senior employee, the Managing Director.

Non-executive Directors’ remuneration is clearly distinguished from that of executives .

No equity based remuneration is provided to any Director or employee.

Principle 10: Recognise the legitimate interests of stakeholders

The Company has adopted a Continuous Disclosure Policy, a Code of Conduct and an Environmental Policy. While the Company does not otherwise have explicit codes of conduct, the small team of Directors are experienced and well aware of their obligations in this regard. As well, the Company is subject to scrutiny and questioning by the auditors and by shareholders at general meetings. It is therefore considered that additional policies are not required at this time.

PARADIGM METALS LIMITED ADDITIONAL SHAREHOLDER INFORMATION

FOR THE YEAR ENDED JUNE 2007

Paradigm Metals Limited Analysis of Holdings as at 20 September 2007

(a). Security Holdings

Distribution of Share and Option holders

Paradigm Metals Limited Analysis of Holdings as at 20-09-2007	Paradigm Metals Limited Analysis of Holdings as at 20-09-2007


Security Classes	Holdings Ranges	Holders	Total units	%
Fully Paid Ordinary Shares	1-1,000 1,001-5,000 5,001-10,000 10,001-100,000 100,001-99,999,999,999 Totals	15 57 178 470 118 838	2,491 214,253 1,666,405 18,928,166 43,356,267 64,167,582	0.004 0.334 2.597 29.498 67.567 100.000

Paradigm Metals Limited Analysis of Holdings as at 20-09-2007	Paradigm Metals Limited Analysis of Holdings as at 20-09-2007


Security Classes	Holdings Ranges	Holders	Total units	%
Options - 18.05.08 @ 25c	1-1,000 1,001-5,000 5,001-10,000 10,001-100,000 100,001-99,999,999,999 Totals	6 114 61 188 51 420	4,382 518,101 508,481 7,311,836 21,663,353 30,006,153	0.015 1.727 1.695 24.368 72.196 100.000

PARADIGM METALS LIMITED ADDITIONAL SHAREHOLDER INFORMATION

FOR THE YEAR ENDED JUNE 2007

(b) Unmarketable Holdings

There are currently 40 holders with less than a marketable parcel of 3,700 shares.

Paradigm Metals Limited
Security Classes	Holdings Ranges	Holders	Total units	%
Fully Paid Ordinary Shares	1-3,700 3,701-99,999,999 Totals	40 798 838	70,345 64,097,237 64,167,582	0.110 99.890 100.000

(c) The names of substantial shareholders listed in the holding Company’s register as at 20 September 2007 are:

Shareholder

PHILLIAN PTY LTD

Number of ordinary shares 3,513,260

(d) Voting Rights

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

Ordinary shares: Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or by proxy has one vote on a show of hands.
Options: Do not have voting rights attached.

(e) Restricted Securities

The Company gave notice to the ASX on 13 October 2005 that in accordance with Listing Rule 3.10A, 10,531,605 fully paid ordinary shares (PDMAO) and 1,025,006 options expiring 18 May 2008 exercisable at $0.25 (PDMAQ) would be released from trading restriction on 18 November 2005. Trading restrictions on these shares and options were removed on or about that date.

PARADIGM METALS LIMITED ADDITIONAL SHAREHOLDER INFORMATION

FOR THE YEAR ENDED JUNE 2007

f) 20 Largest Share Holders

Paradigm Metals Limited Fully Paid Ordinary Shares Top 20 Holdings as at 20-09-2007

Holder Name	Balance at 20-09-2007	%
PHILLIAN PTY LTD	3,513,260	5.475
MR GRAHAM DONALD CARMAN	3,083,300	4.805
MIXAM HOLDINGS PTY LIMITED <COOMBES SUPER FUND
A/C>	1,637,500	2.552
MRS SANDRA ANNE COOMBES	1,388,750	2.164
MR NICHOLAS CHARLES RICHARDS	1,100,938	1.716
BARON NOMINEES PTY LIMITED	1,091,595	1.701
GASKELL SUPERANNUATION PTY LIMITED	1,041,675	1.623
GREGORACH PTY LTD	975,000	1.519
MR GEORGE PANAGAKIS & MRS ANASTASIA PANAGAKIS
	950,000	1.480
DIAMOND T & BAR PASTORAL CO PTY LTD	937,500	1.461
SETERA PTY LIMITED	925,000	1.442
KAZAKCO PTY LIMITED	800,000	1.247
MR ALISTAIR BELL	713,550	1.112
SERLETT PTY LTD	624,328	0.973
MR RAUL USED	600,000	0.935
MR ALAN BROWN	593,750	0.925
MR STEPHEN LONERGAN	562,500	0.877
MRS ANNETTE MIZON	500,000	0.779
COPPER STRIKE LTD	500,000	0.779
PANSTYN INVESTMENTS PTY LTD	491,698	0.766
	22,030,344	34.333
	64,167,582

PARADIGM METALS LIMITED ADDITIONAL SHAREHOLDER INFORMATION FOR THE YEAR ENDED JUNE 2007

g) 20 Largest Option Holders

Paradigm Metals Limited Options - 18.05.08 @ 25c Top 20 Holdings as at 20-09-2007

Holder Name	Balance at 20-09-2007	%
MIXAM HOLDINGS PTY LIMITED <COOMBES SUPER
FUND A/C>	1,807,500	6.024
MRS SANDRA ANNE COOMBES	1,625,750	5.418
SHELL COVE CAPITAL MANAGEMENT PTY LTD <BLACK
MARLIN A/C>	1,265,131	4.216
PHILLIAN PTY LTD	1,240,152	4.133
MR RAUL USED	902,500	3.008
MRS SANDRA ANNE COOMBES	887,000	2.956
MR TAI TRAN	825,500	2.751
MADISONS PTY LTD	750,000	2.499
COLIN JOHN HOUGH	700,000	2.333
ASHFIELD CAPITAL PTY LTD	683,333	2.277
MR GRAHAM DONALD CARMAN	683,330	2.277
KAZAKCO PTY LIMITED <KENT FAMILY SUPER FUND
A/C>	600,000	2.000
TRICOM NOMINEES PTY LTD	537,500	1.791
SERLETT PTY LTD	528,328	1.761
PANSTYN INVESTMENTS PTY LTD	473,154	1.577
MR ANDREW ALEXANDER LOCKHART	400,000	1.333
BARON NOMINEES PTY LIMITED	381,682	1.272
BARON NOMINEES PTY LIMITED	373,127	1.244
MR NICHOLAS CHARLES RICHARDS	350,188	1.167
NOVASC PTY LTD	336,250	1.121
	15,350,425	51.158
	30,006,153

PARADIGM METALS LIMITED ADDITIONAL SHAREHOLDER INFORMATION

FOR THE YEAR ENDED JUNE 2007

(h) Granted tenements and applications held in a wholly owned subsidiary as at 26 September 2007.

Project	Interest (%)	Tenement	Location
Frogmore Kangiara Federal Auburn-1 Auburn-2 Auburn-3 Jacktim Bluebush Wynberg-1 Wynberg-2 Wynberg-3 Wynberg-4 Wynberg-5 North Cadia Guyra *Lighthouse Gully	100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100	EL 6590 EL 6274 ELA 3321 EPM 15264 EPM 15296 EPM 15322 EPM 15323 EPM 15324 EPM 15325 EPM 15906 EPM 15931 EPM 16073 EPM 16200 EL 6588 EL 5976 EPM 13878	Boorowa, NSW Boorowa, NSW Boorowa, NSW Mundubbera, QLD Mundubbera, QLD Mundubbera, QLD Mt Isa Region, QLD Mt Isa Region, QLD Mt Isa Region, QLD Mt Isa Region, QLD Mt Isa Region, QLD Mt Isa Region, QLD Mt Isa Region, QLD Orange, NSW Guyra, NSW Taroom, QLD

Note: In respect of tenements marked * the Company is obliged to pay a 2% NSR royalty to Paradigm Geoscience Pty Ltd or its assignee.

AI assistant

IODM LIMITED — Annual Report 2007

65131_rns_2007-09-26_c0631a1d-0d91-406b-aeb3-462da80f8686.pdf

ANNUAL REPORT

PARADIGM METALS LIMITED

CORPORATE DIRECTORY

Directors

Registered Office and principal place of business

Share Registry

Auditors

Stock Exchange Listing

Home Exchange : Sydney

Web Page

TABLE OF CONTENTS

CHAIRMAN’S LETTER

FOR THE YEAR ENDED 30 JUNE 2007

Copper-Base Metals exploration at Frogmore NSW: Paradigm 100%

Tungsten exploration at White Rock NSW: Paradigm 100%

Uranium exploration in the Mt Isa – Cloncurry area QLD: Paradigm 100%

PARADIGM METALS LIMITED

CHAIRMAN’S LETTER

FOR THE YEAR ENDED 30 JUNE 2007

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

Frogmore Copper - Base Metals Project, NSW (PDM 100%)

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

White Rock Tungsten Project, NSW (PDM 100%)

Background on tungsten

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

Uranium Projects, Queensland (PDM 100%)

Cloncurry Project

Blue Bush project

Jacktim Project

Farm-out of Gold Projects, NSW & Queensland

PARADIGM METALS LIMITED

OPERATIONS REPORT

FOR THE YEAR ENDED 30 JUNE 2007

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ REPORT

FOR THE YEAR ENDED 30 JUNE 2007

DIRECTORS

� Richard Austen (Non-Executive Chairman)

Term of office: Non-Executive Chairman since December 2002.

Directorships of other listed companies:

� Graham Carman, PhD (Managing Director)

Term of office: Managing Director since September 2003.

Directorships of other listed companies:

John Gaskell (Non-Executive Director)

Term of office: Director since November 2002.

Directorships of other listed companies:

� Stephen Lonergan (Non-Executive Director and Company Secretary)

Term of office: Director since November 2002.

Directorships of other listed companies:

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ REPORT

FOR THE YEAR ENDED 30 JUNE 2007

� Richard Harvey (Alternate to Richard Austen)

Directorships of other listed companies:

� Ray Soper (Non-Executive Director – Retired as a Director as of 1 February 2007)

PRINCIPAL ACTIVITIES

OPERATING RESULT

REVIEW OF OPERATIONS

DIVIDENDS

CHANGES IN STATE OF AFFAIRS

PARADIGM METALS LIMITED AND CONTROLLED ENTITIES DIRECTORS’ REPORT

FOR THE YEAR ENDED 30 JUNE 2007

SUBSEQUENT EVENTS

IODM LIMITED Annual Report 2007