Rand Mining Limited ABN 41 004 669 658

Annual Report - 30 June 2012

Rand Mining Limited Corporate directory 30 June 2012

Rand Mining Limited 30 June 2012 Corporate directory
Directors	Otakar Demis - Chairman
	Anthony Billis
	Gordon Sklenka
Company secretaries	Otakar Demis
	Roland Berzins
Notice of annual general meeting	The annual general meeting	of Rand Mining Limited:
	will be held at	Kalgoorlie Town Hall
		316 Hannan Street
		Kalgoorlie WA 6430
	time	09:30 AM
	date	Friday 30 November 2012
Registered office	Suite G1, 49 Melville Parade
	South Perth WA 6151
	Tel: +61 (8) 9474 2113
	Fax: +61 (8) 9367 9386
Principal place of business	Suite G1, 49 Melville Parade
	South Perth WA 6151
	Correspondence address:
	PO Box 307
	West Perth WA 6872
Share register	Advanced Share Registry Services Limited
	150 Stirling Highway
	Nedlands WA 6009
	Tel: +61 (8) 9389 8033
	Fax: +61 (8) 9389 7871
Auditor	Grant Thornton Audit Pty Ltd
	PO Box 570
	Perth WA 6872
Bankers	ANZ Bank
	77 St George's Terrace
	Perth WA 6000
Stock exchange listing	Rand Mining Limited shares	are listed on the Australian Securities
	Exchange (ASX code: RND)
Website address	www.randmining.com.au

Rand Mining Limited Review of Operations 30 June 2012

East Kundana Joint Venture

The East Kundana Joint Venture (‘EKJV’) is located 25km West North West of Kalgoorlie and 47km North East of Coolgardie.

The EKJV is between Rand Mining Limited (‘Rand’) (12.25%), Tribune Resources Limited (‘Tribune’) (36.75%) and Gilt-Edged Mining NL (51%) a wholly owned subsidiary of Barrick Australia Pacific Limited.

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KUNDANA PROJECT Location Map

Note: The Joint Venture deposits are located within the blue shaded area. Other deposits indicated on this map do not belong to either Rand Mining or the Joint Venture.

Rand Mining Limited Review of Operations 30 June 2012

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EAST KUNDANA JOINT VENTURE Deposit Locations

Note: The Joint Venture deposits are located within the blue shaded area. Other deposits indicated on this map do not belong to either Rand Mining or the Joint Venture.

Rand Mining Limited Review of Operations 30 June 2012

Mining

During the year ending 30 June 2012, 244,799 tonnes of ore were extracted from the 6202 and 6034 to 5654 stopes and development headings spanning 5671 to 5614 levels of the Raleigh Underground mine. The grade was 14.8 g/t.

Rand’s entitlement to the ore extracted was 30,600 tonnes, compared to 40,398 tonnes the previous year.

Year	Raleigh Production	Raleigh Production	Raleigh Production
	Mined (t)	Grade (g/t)	Gold (oz)
06/07 07/08 08/09 09/10 10/11	239,700 234,400 308,512 339,660 323,182	16.6 11.9 12.6 13.4 13.4	127,700 89,800 124,962 146,670 139,060
11/12	244,799	14.8	116,921
RAND’S ENTITLEMENT	30,600	14.8	14,615

The sequence of stoping and mine development until mid 2016 in the current LOM plan is shown below, where dark grey represents all stoping and development completed at 30 June 2012, light grey last half of 2012, green 2013, blue 2014, red 2015 and orange 2016.

The stoping front is advanced at a diagonal to minimise the impact of the high regional stress field at depth.

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Rand Mining Limited Review of Operations 30 June 2012

Rubicon/Hornet

During the year ending 30 June 2012, ore development and stoping commenced at the Rubicon/Hornet Underground mine. 78,229 tonnes of ore were extracted from the 6225,6195 and 6175 stopes and development headings spanning 6225 to 6095 levels of the Rubicon ore body and development headings spanning 6165 to 6105 levels of the Hornet ore body. The grade was 9.6 g/t.

Rand’s entitlement to the ore extracted was 9,583 tonnes.

Year	Rubicon/Hornet Production	Rubicon/Hornet Production	Rubicon/Hornet Production
	Mined (t)	Grade (g/t)	Gold (oz)
11/12	78,229	9.6	17,028
RAND’S ENTITLEMENT	9,583	9.6	2,953

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Processing

During the year ending 30 June 2012, 151,237 tonnes of Rand and Tribune Group’s share of EKJV ore was processed in four campaigns at the Greenfields Plant located near Coolgardie.

Rand	and Tribune Group Processing	and Tribune Group Processing	and Tribune Group Processing
Campaign	From	To	Processed (t)
19 20 21 22	27 Jul 11 16 Sep 11 21 Jan 12 08 May 12	05 Aug 11 28 Sep 11 14 Feb 12 31 May 12	38,994 24,182 48,934 39,127
	01 Jul 11 01 Jul 10 01 Jul 09 01 Jul 08 01 Jul 07 01 Jul 06 01 Jul 05	30 Jun 12 30 Jun 11 30 Jun 10 30 Jun 09 30 Jun 08 30 Jun 07 30 Jun 06	151,237 171,291 184,349 99,272 146,531 101,208 52,400

During the year ending 30 June 2012, 61,864.674 ounces of gold and 15,841.588 ounces of silver were credited to the Rand and Tribune Group Bullion Account.

Rand Mining Limited Review of Operations 30 June 2012

Rand’s share of the gold bullion was 15,466.162 ounces compared to 16,179.000 ounces the previous year.

Rand and Tribune Group Bullion	Rand and Tribune Group Bullion	Rand and Tribune Group Bullion	Rand and Tribune Group Bullion		Rand’s Share
To	From	Gold (oz)	Silver (oz)		Gold (oz)
01 Jul 11 01 Jul 10 01 Jul 09 01 Jul 08 01 Jul 07 01 Jul 06 01 Jul 05	30 Jun 12 30 Jun 11 30 Jun 10 30 Jun 09 30 Jun 08 30 Jun 07 30 Jun 06	61,864.674 64,716 77,624 32,478 59,638 49,335 25,599	15,841.588 8,639 12,019 4,649 8,048 6,640 3,951		15,466.162 16,179 19,406 8,119 14,909 12,333 6,399

Exploration

During the financial year ending 30 June 2012, drilling programmes were conducted at the Wards Prospect and the Hornet Mary Prospect (results reported in the December Quarterly Report) and more recently at the Pegasus Prospect and along the Raleigh Corridor have commenced (results reported in the ASX release in September).

Three drilling programmes have been recently planned:

1) K2 Shear Prospects (Hornet, Rubicon, Pegasus, Drake) Resource Definition drilling for Pegasus and Hornet Extensions, Advanced Exploration drilling for Drake, Rubicon Extensions, Hornet Deeps and HRPD Ultra Deeps;
2) Advanced Exploration drilling at Golden Hind (on the same fault line as Raleigh); and 3) Advanced Exploration drilling for Startrek (close to Pegasus).

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Seven Mile Hill (50%)

Discussions to farm out the Seven Mile Hill tenements are continuing.

Wongan Hills (100%)

A drilling programme to test previously reported anomalies has been planned and will start when a drill rig is available.

Tapeta Iron Ore Project, Liberia, West Africa

Rand has been granted an Option to acquire all of the issued share capital in Iron Resources Limited (‘IRL’), a wholly owned subsidiary of Resource Capital Ltd (‘RCL’), from RCL. IRL is the registered holder of a mineral exploration license over a 599.82km² area located in Northern-Central Liberia, West Africa, (Tapeta Iron Ore Project).

Rand Mining Limited Review of Operations 30 June 2012

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Location of Tapeta Iron Ore Project
(shown over SRTM terrain model of Liberia)
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Work completed on the Tapeta Iron Ore Project to date suggests that the total area of iron formation outcrop within the project could exceed 9km[2] . Based on the possible outcrop sizes and the disposition of the iron formations, the Tapeta Iron Ore Project has the potential to host a deposit of “moderate” size on a world scale. Supplementary to the original granting of the option to acquire, IRL has agreed to grant Rand a licence to access the Tapeta Iron Ore Project Area during the period of the Option to conduct a drilling programme and all activities associated with the programme including construction of roads and structures.

Rand proposes to complete up to 12,000 metres of RC drilling. The drilling will be directed at two prominent iron formations, the Bwee Ridge and the Giant Main Outcrop. Both areas encompass outcrops of haematitic itabirite grading + 60% Fe, with good potential for the discovery of deposits of high grade direct shipping ore, located within 70 km of working rail and port infrastructure.

Rand Mining Limited Review of Operations 30 June 2012

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Regional Aeromagnetic Image of Liberia
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Subsequent to 30 June 2012 Rand has substantially advanced the construction of the infrastructure and the permitting to enable the drilling programme to commence. Any significant drill results from the drilling programme will be released to the market as they are received.

Rand Mining Limited Review of Operations 30 June 2012

Resources & Reserves

Resources & Reserves
	MINERAL RESOURCES including ORE RESERVES on EKJV LEASES at 30					JUNE 2012(subject to rounding errors)
	ENTITLEMENT	MEASURED		INDICATED		INFERRED		TOTAL RESOURCE

	(%)	(t)	Au(g/t)	(t)	Au(g/t)	(t)	Au(g/t)	(t)	Au(g/t)	Au(oz)
Raleigh Underground
M16/157	0.0	13,000	17.6	2,000	12.3	-	-	15,000	16.9	8,139
M15/993	12.5	394,000	21.6	108,000	13.0	113,000	20.5	615,000	19.9	392,682
Hornet Open Pit	12.25	-	-	169,000	3.7	3,000	1.6	172,000	3.6	20,173
Hornet Underground	12.25	-	-	448,000	13.9	174,000	12.5	622,000	13.5	270,714
Rubicon Underground	12.25	53,000	19.1	229,000	7.8	423,000	6.1	705,000	7.6	173,159
Pegasus Open Pit	12.25	-	-	820,000	3.2	86,000	2.6	906,000	3.2	92,493
Pegasus Underground	12.25	-	-	17,000	11.4	47,000	9.2	64,000	9.8	20,144
Total Mineral Resource on EKJV Leases		460,000	21.2	1,793,000	7.2	846,000	9.2	3,099,000	9.8	977,504
The Competent Persons’ Consents in the form and context i		n which it appears in the Annual Report.

	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012	MINERAL RESOURCES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012
	ENTITLEMENT	MEASURED		INDICATED		INFERRED		TOTAL RESOURCE
	(%)	(t)	Au (g/t)	(t)	Au (g/t)	(t)	Au (g/t)	(t)	Au (g/t)	Au (oz)
Moonbeam Stockpile	25.0	-	-	-	-	-	-	-	-	-
Greenfields Stockpiles	25.0	41,800	12.2	-	-	-	-	41,800	12.2	16,406
Rand’s Entitlement	EKJV Leases	55,700	21.3	219,700	7.2	103,900	9.2	379,300	9.8	119,729
	Leases + Stockpiles	66,150	19.8	219,700	7.2	103,900	9.2	389,750	9.9	123,830
The Competent Persons’ Consents in the form and context in which it appearsin the Annual Report.

Rand Mining Limited Review of Operations 30 June 2012

ORE RESERVES on EKJV LEASES at 30 JUNE 2012 (subject to rounding errors)

Rand Mining Limited Review of Operations 30 June 2012	Rand Mining Limited Review of Operations 30 June 2012	Rand Mining Limited Review of Operations 30 June 2012	Rand Mining Limited Review of Operations 30 June 2012	Rand Mining Limited Review of Operations 30 June 2012	Rand Mining Limited Review of Operations 30 June 2012	Rand Mining Limited Review of Operations 30 June 2012	Rand Mining Limited Review of Operations 30 June 2012	Rand Mining Limited Review of Operations 30 June 2012
ORE RESERVES on EKJV LEASES at 30 JUNE 2012(subject to rounding errors)
	ENTITLEMENT	PROVED		PROBABLE		PROVED + PROBABLE
	(%)	(t)	Au (g/t)	(t)	Au (g/t)	(t)	Au (g/t)	Au (oz)
Raleigh Underground
M16/157	0.0	15,000	6.2	-	-	15,000	6.2	3,002
M15/993	12.5	464,000	13.6	31,000	5.9	495,000	13.1	208,374
Hornet Open Pit	12.25	-	-	165,000	3.9	165,000	3.9	20,480
Rubicon-Hornet Underground	12.25	56,000	18.6	770,000	8.4	826,000	9.1	242,482
Total Ore Reserve on EKJV Leases		535,000	13.9	966,000	7.6	1,501,000	9.8	474,338
The Competent Persons’ Consents in the form and context in which it appears in the Annual Report.


ORE RESERVES including ORE in MOONBEAM and GREENFIELDS STOCKPILES at 30 JUNE 2012
	ENTITLEMENT	PROVED		PROBABLE		PROVED + PROBABLE
	(%)	(t)	Au (g/t)	(t)	Au (g/t)	(t)	Au (g/t)	Au (oz)
Moonbeam Stockpile	25.0	-	-	-	-	-	-	-
Greenfields Stockpiles	25.0	41,800	12.2	-	-	41,800	12.2	16,406
Rand’s Entitlement	EKJV Leases	64,900	14.1	118,400	7.6	183,300	9.9	58,260
	Leases + Stockpiles	75,350	13.8	118,400	7.6	193,750	10.0	62,361
The Competent Persons’ Consents in the form and context in which it appears in the Annual Report.

Notes to tables:

The gold price used for Raleigh UG, Rubicon-Hornet UG and Pegasus Open Pit Resources was US$1650/oz. The gold price used for Pegasus UG Resources was US$1400/oz.
The gold price used for Hornet Open Pit Resources and Reserves was US$1200/oz. The gold price used for Raleigh UG and Rubicon-Hornet UG Reserves was US$1500/oz.
Raleigh Ore mined from M15/993 is subject to an Ore Division Agreement whereby the Raleigh Ore is divided equally between Gilt Edged Mining NL (Barrick) and the R&T Group.

Rand Mining Limited Directors' report 30 June 2012

The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'consolidated entity') consisting of Rand Mining Limited (referred to hereafter as the 'company' or 'parent entity') and the entities it controlled for the year ended 30 June 2012.

Directors

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

Otakar Demis - Chairman Anthony Billis Gordon Sklenka

Principal activities

The principal activities of the consolidated entity during the year were exploration, development and production activities at the consolidated entity’s East Kundana Joint Venture tenements.

Dividends

There were no dividends paid or declared during the current or previous financial year.

Review of operations

The profit for the consolidated entity after providing for income tax amounted to $3,153,278 (30 June 2011: $5,424,466).

Refer to 'Review of operations' report for detailed commentary which precedes this directors' report.

Significant changes in the state of affairs

Revisions to the proposed acquisition of the Tapeta Iron Ore Project, located in Northern Central Liberia, West Africa. On 1 September 2011, the company announced the parties agreed to vary the Option and Share Purchase Agreement annexed in the Option Agreement by entering a Deed of Variation.

A summary of the material amendments to the Option and Share Purchase Agreement are set out below:

Resource Capital Limited ('RCL') agreed to extend the term of the option by 12 months to 23 September 2012 ('Expiry Date') in exchange for the company paying a non-refundable option fee of $100,000;
the company may exercise the option at any time prior to the Expiry Date by providing written notice to RCL. On exercise of the option, the company is obliged to transfer 8 million fully paid ordinary shares in Tribune Resources Limited ('Tribune shares') to RCL;
In the event that completion of the acquisition of RCL does not occur, RCL must retransfer the Tribune Shares back to the company forthwith;
Iron Resources Limited ('IRL') has agreed to grant the company a licence to access the Project Area during the option period to conduct a drilling programme and all activities associated with the programme;
the company is responsible for the costs of the drilling program up to $2.5 million. This includes payment of the rent and any minimum expenditure or work obligations required in order to keep the mineral exploration licence in good standing; and
the remaining terms of the Option and Share Purchase Agreement are otherwise unaltered, including the conditions precedent to completion of the acquisition and the consideration payable to RCL.

Ore development

Ore development commenced at Hornet and Rubicon on 1 August 2011.

Rand Mining Limited Directors' report 30 June 2012

Securing a clean energy future – the Australian Government’s climate change plan

On 10 July 2011, the Commonwealth Government announced the "Securing a Clean Energy Future – the Australian Government’s Climate Change Plan”. Whilst the announcement provides further details of the framework for a carbon pricing mechanism, uncertainties continue to exist on the impact of any carbon pricing mechanism on the consolidated entity as legislation must be voted on and passed by both houses of Parliament. In addition, as the consolidated entity will not fall within the "Top 500 Australian Polluters", the impact of the Carbon Scheme will be through indirect effects of increased prices on many production inputs and general business expenses as suppliers subject to the carbon pricing mechanism are likely to pass on their carbon price burden to their customers in the form of increased prices. The directors expect that this will not have a significant impact upon the operation costs within the business, and therefore will not have an impact upon the valuation of assets and/or going concern of the business.

There were no other significant changes in the state of affairs of the consolidated entity during the financial year.

Matters subsequent to the end of the financial year

Revisions to the proposed acquisition of the Tapeta Iron Ore project, located in Northern Central Liberia, West Africa. Further to previous ASX announcements by Rand Mining Limited ('Rand') dated 24 December 2010, 25 February 2011, 23 May 2011 and 1 September 2011 relating to Rand’s option to acquire Iron Resources Limited ('IRL') from Resource Capital Limited ('RCL') ('the Option Agreement'). By way of deed of variation, the parties have today agreed to vary the Option Agreement whereby RCL has agreed to extend the term of the option by 12 months to 23 September 2013 ('Expiry Date') in exchange for Rand paying a non-refundable option fee of USD$50,000.

In addition, the Share Purchase Agreement has been varied by amending the terms of the Additional Consideration (as defined in the Share Purchase Agreement) to be issued upon satisfaction of the Milestones set out in the Share Purchase Agreement. Accordingly, the terms of the Additional Consideration will be as follows:

• Subject to Completion, the Purchaser will issue to the Vendor 72,000,000 Purchaser Shares and 36,000,000 Purchaser Options with an exercise price of $0.75 each and expiry date of 5 years from the date of issue, upon an independently calculated Inferred Resource (as defined in the JORC Code) of greater than 500,000,000 tonnes of 'iron ore being determined by the Purchaser within the Project Area ('First Milestone');

• Following the First Milestone, the Purchaser will issue to the Vendor a further 72,000,000 Purchaser Shares and 36,000,000 Purchaser Options with an exercise price of $0.75 each and expiry date of 5 years from the date of issue, upon an independently calculated Inferred Resource of greater than 1,000,000,000 tonnes of iron ore being determined by the Purchaser within the Project Area ('Second Milestone');

• Following the Second Milestone, the Purchaser will issue to the Vendor a further 72,000,000 Purchaser Shares and 36,000,000 Purchaser Options with an exercise price of $0.75 each and expiry date of 5 years from the date of issue, upon an independently calculated Inferred Resource of greater than 1,500,000,000 tonnes of iron ore being determined by the Purchaser within the Project Area ('Third Milestone'); and

• Following the Third Milestone, the Purchaser will issue to the Vendor a further 72,000,000 Purchaser Shares and 36,000,000 Purchaser Options with an exercise price of $0.75 each and expiry date of 5 years from the date of issue, upon an independently calculated Inferred Resource of greater than 2,000,000,000 tonnes of iron ore being determined by the Purchaser within the Project Area ('Fourth Milestone').

No other matter or circumstance has arisen since 30 June 2012 that has significantly affected, or may significantly affect the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future financial years.

Likely developments and expected results of operations

The consolidated entity intends to continue its exploration, development and production activities on its existing projects and to acquire further suitable projects for exploration as opportunities arise.

Rand Mining Limited Directors' report 30 June 2012

Environmental regulation

The consolidated entity is subject to and compliant with all aspects of environmental regulation of its exploration and mining activities. The directors are not aware of any environmental law that is not being complied with.

Greenhouse gas and energy data reporting requirements

The consolidated entity is subject to the reporting requirements of both the Energy Efficiency Opportunities Act 2006 and the National Greenhouse and Energy Reporting Act 2007.

The Energy Efficiency Opportunities Act 2006 requires the consolidated entity to assess its energy usages, including the identification, investigation and evaluation of energy saving opportunities, and to report publicly on the assessments undertaken, including what action the consolidated entity intends to take as a result. Due to this Act, the consolidated entity, via its participation in the EKJV has registered with the Department of Resources, Energy and Tourism as a participant entity and reports the results from its assessments.

The National Greenhouse and Energy Reporting Act 2007 require the consolidated entity, via its participation in the EKJV, to report its annual green house gas emissions and energy use. The consolidated entity has previously implemented systems and processes for the collection and calculation of data.

Information on directors

Information on directors
Name:	Otakar Demis
Title:	Executive Chairman and Joint Company Secretary
Experience and expertise:	Otakar is a private investor and businessman with several years experience as a
	director of the company.
Other current directorships:	Executive Chairman and Company Secretary of Tribune Resources Limited
Former directorships (in the
last 3 years):	None
Special responsibilities:	None
Interests in shares:	26,629,601 ordinary shares (4,800 directly and 26,624,801 indirectly)
Interests in options:	1,000,000 options over ordinary shares (indirectly)
Name:	Anthony Billis
Title:	Executive Director
Experience and expertise:	Anthony has over 27 years' experience in gold exploration within the mining industry
	in Western Australia. He has been involved in the exploration and development of
	the Kundana project for over 22 years.
Other current directorships:	Executive Director of Tribune Resources Limited
Former directorships (in the
last 3 years):	None
Special responsibilities:	None
Interests in shares:	41,286,148 ordinary shares (14,000 directly and 41,272,148 indirectly)
Interests in options:	2,000,000 options over ordinary shares (indirectly)

Rand Mining Limited Directors' report 30 June 2012

Rand Mining Limited Directors' report 30 June 2012
Name:	Gordon Sklenka
Title:	Non-Executive Director
Qualifications:	B.Comm
Experience and expertise:	Gordon has worked in Chartered Accounting, Stockbroking and Corporate Advisory
	in both Perth and Sydney and has in excess of 15 years' experience in corporate
	finance in the resources and technology industries predominantly focusing on capital
	raisings, IPOs, acquisitions and project finance.
Other current directorships:	Non-Executive Director of Tribune Resources Limited, Non-Executive Director of
	AXG Mining Limited, Non-Executive Director of Advance Energy Ltd, and Non-
	Executive Director of Kilgore Oil and Gas Ltd
Former directorships (in the
last 3 years):	Non-Executive Director of Vector Resources Limited (resigned on 11 January 2011)
Special responsibilities:	None
Interests in shares:	26,576,764 ordinary shares (indirectly)
Interests in options:	1,000,000 options over ordinary shares (indirectly)

'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships in all other types of entities, unless otherwise stated.

'Former directorships (in the last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and excludes directorships in all other types of entities, unless otherwise stated.

Company secretaries

Roland Berzins (B.Comm, ACPA, FFIN, TA) as joint company secretary has over 20 years' experience in the mining industry. He was previously chief accountant for 6 years at Kalgoorlie Consolidated Gold Mines Pty Ltd ('Kalgoorlie Super Pit'). In addition, Roland has worked as a Senior Mining Analyst for the former BHP iron ore division and has worked for the Mt Newman, Koolan and Cockatoo iron ore project. Since 1996 Roland has been company secretary for a variety of ASX listed companies, and has also had experience in retail, merchant banking, venture capital and SME business advisory. Details of Mr Otakar Demis as joint company secretary can be found in the 'Information of directors' section above.

Meetings of directors

The number of meetings of the company's Board of Directors held during the year ended 30 June 2012, and the number of meetings attended by each director were:

	Full Board
	Attended	Held
O Demis	7	7
A Billis	7	7
G Sklenka	6	7

Held: represents the number of meetings held during the time the director held office.

The function of the Nomination and Remuneration Committee was undertaken by the Full Board.

Remuneration report (audited)

The remuneration report, which has been audited, outlines the director and key management personnel remuneration arrangements for the consolidated entity and the company, in accordance with the requirements of the Corporations Act 2001 and its Regulations.

The remuneration report is set out under the following main headings: A Principles used to determine the nature and amount of remuneration

B Details of remuneration

C Service agreements D Share-based compensation

Rand Mining Limited Directors' report 30 June 2012

A Principles used to determine the nature and amount of remuneration

The objective of the consolidated entity's and company's executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation of value for shareholders, and conforms with the market best practice for delivery of reward. The Board of Directors ('the Board') ensures that executive reward satisfies the following key criteria for good reward governance practices:

competitiveness and reasonableness
acceptability to shareholders
performance linkage / alignment of executive compensation
● transparency

The Board is responsible for determining and reviewing remuneration arrangements for its directors and executives. The performance of the consolidated entity and company depends on the quality of its directors and executives. The remuneration philosophy is to attract, motivate and retain high performance and high quality personnel.

The Board has structured an executive remuneration framework that is market competitive and complementary to the reward strategy of the consolidated entity and company.

Alignment to shareholders' interests:

has economic profit as a core component of plan design
attracts and retains high calibre executives

Alignment to program participants' interests:

rewards capability and experience
reflects competitive reward for contribution to growth in shareholder wealth
provides a clear structure for earning rewards

In accordance with best practice corporate governance, the structure of non-executive directors and executive remunerations are separate.

Non-executive directors remuneration

Fees and payments to non-executive directors reflect the demands which are made on, and the responsibilities of, the directors. Non-executive directors' fees and payments are reviewed annually by the Board. The Board may seek the advice of independent remuneration consultants to ensure non-executive directors' fees and payments are appropriate and in line with the market, see 'use of remuneration consultants' below. There are no termination or retirement benefits for non ‐ executive directors other than statutory superannuation.

ASX listing rules requires that the aggregate non-executive directors remuneration shall be determined periodically by a general meeting. The most recent determination was at the Annual General Meeting held on 30 November 2005, where the shareholders approved an aggregate remuneration of $160,000.

Executive remuneration

The consolidated entity and company aims to reward executives with a level and mix of remuneration based on their position and responsibility, which is both fixed and variable.

The executive remuneration and reward framework has four components:

base pay and non-monetary benefits
short-term performance incentives
share-based payments
other remuneration such as superannuation and long service leave

Rand Mining Limited Directors' report 30 June 2012

The combination of these comprises the executive's total remuneration.

Fixed remuneration, consisting of base salary, superannuation and non-monetary benefits, are reviewed annually by the Board, based on individual and business unit performance, the overall performance of the consolidated entity and comparable market remunerations.

Executives can receive their fixed remuneration in the form of cash or other fringe benefits (for example motor vehicle benefits) where it does not create any additional costs to the consolidated entity and adds additional value to the executive.

The short-term incentives ('STI') program is designed to align the targets of the business units with the targets of those executives in charge of meeting those targets. STI payments are granted to executives based on specific annual targets and key performance indicators ('KPI') being achieved. KPI’s include profit contribution, customer satisfaction, leadership contribution and product management.

The long-term incentives ('LTI') currently consists of long service leave.

Consolidated entity performance and link to remuneration

The directors' remuneration levels are not directly dependent upon the consolidated entity or company's performance or any other performance conditions. However, practically, whether shareholders vote for or against an increase in the aggregate director remuneration will depend upon, amongst other things, how the consolidated entity and company have performed.

The Board is of the opinion that the continued improved results can be attributed in part to the adoption of performance based compensation and is satisfied that this improvement will continue to increase shareholder wealth if maintained over the coming years.

Use of remuneration consultants

During the financial year ended 30 June 2012, the company did not engage remuneration consultants, to review its existing remuneration policies and provide recommendations on how to improve both the short-term incentives ('STI') program and long-term incentives ('LTI') program.

Voting and comments made at the company's 2011 Annual General Meeting ('AGM')

At the last AGM 76% of the shareholders voted to adopt the remuneration report for the year ended 30 June 2011. The company did not receive any specific feedback at the AGM regarding its remuneration practices.

B Details of remuneration

Amounts of remuneration

Details of the remuneration of the directors, other key management personnel (defined as those who have the authority and responsibility for planning, directing and controlling the major activities of the consolidated entity) and specified executives of Rand Mining Limited are set out in the following tables.

The key management personnel of the consolidated entity consisted of the directors of Rand Mining Limited and the following executives:

Roland Berzins - Joint Company Secretary
John Andrews - Manager of Kalgoorlie Operations

Rand Mining Limited Directors' report 30 June 2012

30 June 2012
G Sklenka Executive Directors: O Demis 2012 J Andrews Other Key Management Personnel: Name A Billis Non-Executive Directors: R Berzins	Cash salary Non- and fees Bonus monetary * $ $ $ 20,000 - - 20,000 - - 30,000 - - 109,566 - 51,579 139,566 - 51,579 60,000 - - 82,836 8,250 4,218 142,836 8,250 4,218 302,402 8,250 55,797 Short-term benefits			Post- employment benefits Super- annuation $ -	Long-term benefits Long service leave $ -	Share-based payments Equity- settled $ -	Total $ 20,000
	20,000	-	-	-	-	-	20,000
	30,000 109,566	- -	- 51,579	2,700 25,000	- -	- -	32,700 186,145
	139,566	-	51,579	27,700	-	-	218,845
	60,000 82,836	- 8,250	- 4,218	- 25,000	- -	- -	60,000 120,304
	142,836	8,250	4,218	25,000	-	-	180,304

	302,402	8,250	55,797	52,700	-	-	419,149

Includes car and housing plus applicable fringe benefits tax payable on benefits

Rand Mining Limited Directors' report 30 June 2012

30 June 2012
R Berzins O Demis A Billis 2011 Other Key Management Personnel: J Andrews G Sklenka Executive Directors: Non-Executive Directors: Name	Cash salary Non- and fees Bonus monetary * $ $ $ 20,000 - - 20,000 - - 20,000 - - 75,000 - 41,672 95,000 - 41,672 60,000 - - 65,000 - - 125,000 - - 240,000 - 41,672 Short-term benefits			Post- employment benefits Super- annuation $ -	Long-term benefits Long service leave $ -	Share-based payments Equity- settled $ -	Total $ 20,000
	20,000	-	-	-	-	-	20,000
	20,000 75,000	- -	- 41,672	1,800 25,000	- -	- -	21,800 141,672
	95,000	-	41,672	26,800	-	-	163,472
	60,000 65,000	- -	- -	- 25,000	- -	- -	60,000 90,000
	125,000	-	-	25,000	-	-	150,000

	240,000	-	41,672	51,800	-	-	333,472

Includes car and housing plus applicable fringe benefits tax payable on benefits

The proportion of remuneration linked to performance and the fixed proportion are as follows:

	Fixed remuneration	Fixed remuneration	At risk - STI	At risk - STI		At risk - LTI	At risk - LTI
Name	2012	2011	2012	2011		2012	2011
Non-Executive Directors:
G Sklenka	100%	100%		- %	- %		- %	- %
Executive Directors:
O Demis	100%	100%		- %	- %		- %	- %
A Billis	100%	100%		- %	- %		- %	- %
Other Key Management
Personnel:
R Berzins	100%	100%		- %	- %		- %	- %
J Andrews	100%	100%		- %	- %		- %	- %

There was a cash bonus of $8,250 paid during the financial year ended 30 June 2012 (2011: $nil).

Rand Mining Limited Directors' report 30 June 2012

C Service agreements

Remuneration and other terms of employment for key management personnel are formalised in service agreements. Details of these agreements are as follows:

Name:	Otakar Demis
Title:	Executive Chairman and Joint Company Secretary
Term of agreement:	Ongoing subject to re‐election at Annual General Meetings every 2 years
Details:	Base salary, inclusive of superannuation, for the year ending 30 June 2012 of
	$32,700.
Name:	Anthony Billis
Title:	Executive Director and Managing Director
Term of agreement:	Ongoing
Details:	Base salary, inclusive of superannuation, for the year ended 30 June 2012 of
	$134,566 to be reviewed annually by the board of directors. The company also
	provides housing and motor vehicle benefits to Mr Billis.
Name:	Roland Berzins
Title:	Joint Company Secretary
Term of agreement:	Ongoing
Details:	Base fees, for the year ended 30 June 2012 of $60,000.
Name:	John Andrews
Title:	Manager of Kalgoorlie Operations
Term of agreement:	Ongoing
Details:	Base salary, inclusive of superannuation for the year ended 30 June 2012 of
	$116,000 plus motor vehicle benefit.

Key management personnel have no entitlement to termination payments in the event of removal for misconduct.

D Share-based compensation

Issue of shares

There were no shares issued to directors and other key management personnel as part of compensation during the year ended 30 June 2012.

Options

There were no options issued to directors and other key management personnel as part of compensation that were outstanding as at 30 June 2012.

There were no options granted to or exercised by directors and other key management personnel as part of compensation during the year ended 30 June 2012.

This concludes the remuneration report, which has been audited.

Shares under option

Unissued ordinary shares of Rand Mining Limited under option at the date of this report are as follows:

		Exercise	Number
Grant date	Expiry date	price	under option
26 October 2007	26 October 2012	$0.60	4,000,000

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

Rand Mining Limited Directors' report 30 June 2012

Shares issued on the exercise of options

There were no shares of Rand Mining Limited issued on the exercise of options during the year ended 30 June 2012.

Shares issued on the exercise of performance rights

There were no shares of Rand Mining Limited issued on the exercise of performance rights during the year ended 30 June 2012.

Indemnity and insurance of officers

The company has indemnified the directors and executives of the company for costs incurred, in their capacity as a director or executive, for which they may be held personally liable, except where there is a lack of good faith.

During the financial year, the company paid a premium in respect of a contract to insure the directors and executives of the company against liabilities that may arise from an officers’ position with the exception of insolvency, conduct involving a wilful breach in relation to the company, or a contravention of section 182 or 183 of the Corporations Act 2001, an entity that is involved in any joint venture or, partnership or enterprise carried on in common with the company, outside directorships, any outside entity or non-profit outside entity or any vehicle or entity established to conduct such joint venture partnership or enterprise. The contract of insurance prohibits disclosure of the nature of liability and the amount of the premium.

Indemnity and insurance of auditor

The company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the company or any related entity against a liability incurred by the auditor.

During the financial year, the company has not paid a premium in respect of a contract to insure the auditor of the company or any related entity.

Proceedings on behalf of the company

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

Non-audit services

Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the auditor are outlined in note 33 to the financial statements.

The directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another person or firm on the auditor's behalf), is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001.

The directors are of the opinion that the services as disclosed in note 33 to the financial statements do not compromise the external auditor’s independence for the following reasons:

all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of the auditor, and
none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants issued by the Accounting Professional and Ethical Standards Board, including reviewing or auditing the auditor’s own work, acting in a management or decisionmaking capacity for the company, acting as advocate for the company or jointly sharing economic risks and rewards.

Officers of the company who are former audit partners of Grant Thornton Audit Pty Ltd

There are no officers of the company who are former audit partners of Grant Thornton Audit Pty Ltd.

Rand Mining Limited Directors' report 30 June 2012

Auditor's independence declaration

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

Auditor

Grant Thornton Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.

This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act 2001.

On behalf of the directors

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________ Anthony Billis Director

28 September 2012 Perth

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Grant Thornton Audit Pty Ltd ABN 94 269 609 023

10 Kings Park Road West Perth WA 6005 PO Box 570 West Perth WA 6872

T +61 8 9480 2000 F +61 8 9322 7787 E [email protected] W www.grantthornton.com.au

Auditor’s Independence Declaration To the Directors of Rand Mining Limited

In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Rand Mining Limited for the year ended 30 June 2012, I declare that, to the best of my knowledge and belief, there have been:

a no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
b no contraventions of any applicable code of professional conduct in relation to the audit.

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GRANT THORNTON AUDIT PTY LTD Chartered Accountants

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C A Becker Partner – Audit & Assurance

Perth, 28 September 2012

Grant Thornton Australia Limited is a member firm within Grant Thornton International Ltd. Grant Thornton International Ltd and the member firms are not a worldwide partnership. Grant Thornton Australia Limited, together with its subsidiaries and related entities, delivers its services independently in Australia.

Liability limited by a scheme approved under Professional Standards Legislation

Rand Mining Limited Statement of corporate governance 30 June 2012

The Board of Directors of Rand Mining Limited is responsible for the corporate governance of the consolidated entity. The Board guides and monitors the business and affairs of Rand Mining Limited on behalf of the shareholders by whom they are elected and to whom they are accountable.

The table below summarises the company's compliance with the ASX Corporate Governance Council's Revised Principles and Recommendations.

Principles and Recommendations.	Principles and Recommendations.
Principles and Recommendations		Compliance	Comply
Principle 1 – Lay solid foundations for management and oversight
1.1	Establish the functions reserved to the Board of Directors (‘Board’) of Rand Mining Limited (‘Company’) and those delegated to manage and disclose those functions.	The Board is responsible for the overall corporate governance of the Company. The Board has adopted a Board charter that formalises its roles and responsibilities and defines the matters that are reserved for the Board and specific matters that are delegated to management. The Board has adopted a Delegations of Authority that sets limits of authority for senior executives. On appointment of a Director, the Company issues a letter of appointment setting out the terms and conditions of appointment to the Board.	Complies.
1.2	Disclose the process for evaluating the performance of senior executives.	Senior executives prepare strategic objectives that are reviewed and signed off by the Board. These objectives must then be met by senior executives as part of their key performance targets. The Chief Executive Officer (‘CEO’) then reviews the performance of the senior executives against those objectives. The Board reviews the CEO’s compliance against his and the Company’s objectives. These reviews occur annually.	Complies.
1.3	Provide the information indicated in_Guide to_ reporting on Principle 1.	A Board charter has been disclosed on the Company’s website and is summarised in this Corporate Governance Statement. A performance evaluation process is included in the Board Charter, which has been disclosed on the Company’s website and is summarised in this Corporate Governance Statement. The Board conducted a performance evaluation for senior executives in the financial year in accordance with the process above.	Complies. Complies. Complies.

Rand Mining Limited Corporate Governance Statement 30 June 2012

Rand Mining Limited Corporate Governance Statement 30 June 2012	Rand Mining Limited Corporate Governance Statement 30 June 2012
Principles and Recommendations		Compliance	Comply
Principle 2 – Structure the Board to		add value
2.1	A majority of the Board should be independent directors.	The majority of the Board’s directors are not independent as a majority of the Board are either a substantial shareholder or are executive directors of the Company. Gordon Sklenka is a Non-Executive Director, but not independent due to being an indirect substantial shareholder. Otakar Demis is an Executive Director and not independent as he is an indirect substantial shareholder. Anthony Billis is an Executive Director.	The majority of directors do not comply only due to their indirect share holding as a director of a related entity in the Company. However the skills and experience of both the independent and non-independent directors allow the Board to act in the best interests of shareholders.
2.2	The Chair should be an independent director.	Otakar Demis is an Executive Director of the Board.	Does not comply. However the skills and experience of Mr Demis allows the Board to act in the best interests of shareholders.
2.3	The roles of Chair and Chief Executive Officer should not be exercised by the same individual.	Otakar Demis is the Chairman and Anthony Billis the Chief Executive Officer.	Complies.
2.4	The Board should establish a nomination committee.	The Company has established a Nomination and Remuneration Committee. The Board supports the nomination and re- election of the directors at the Company’s forthcoming Annual General Meeting.	Does not comply. The Board considers that the Company is currently not of a size to justify a separate Nomination and Remuneration Committee. The Board as a whole undertakes the process of reviewing the skill base, experience and remuneration of existing directors to enable identification of attributes required in new directors.
2.5	Disclose the process for evaluating the performance of the Board, its committees and individual directors.	The Company conducts the process for evaluating the performance of the Board, its committees and individual directors as outlined in the Board Charter which is available on the Company’s website. The Board’s induction program provides incoming directors with information that will enable them to carry out their duties in the best interests of the Company. This includes supporting ongoing education of directors for the benefit of the Company.	Complies.

Rand Mining Limited Corporate Governance Statement 30 June 2012

Rand Mining Limited Corporate Governance Statement 30 June 2012	Rand Mining Limited Corporate Governance Statement 30 June 2012
Principles and Recommendations		Compliance	Comply
2.6	Provide the information indicated in the_Guide to_ reporting on Principle 2.	This information has been disclosed (where applicable) in the Directors’ Report attached to this Corporate Governance Statement. Gordon Sklenka is considered an independent director of the Company. A director is considered independent when he substantially satisfies the test for independence as set out in the ASX Corporate Governance Recommendations. Members of the Board are able to take independent professional advice at the expense of the Company. Otakar Demis, Executive Chairman, was appointed to the Board in November 1985. Anthony Billis, Managing Director and Chief Executive Officer, was appointed to the Board in January 2003. Gordon Sklenka, Non-Executive Director, was appointed to the Board in August 2004. The Board as a whole undertakes the functions normally associated with a Nominations and Remuneration Committee. The Board has undertaken a review of the mix of skills and experience on the Board in light of the Company’s principal activities and direction, and has considered diversity in succession planning. The Board considers the current mix of skills and experience of members of the Board and its senior management is sufficient to meet the requirements of the Company. In accordance with the information suggested in_Guide to Reporting on Principle 2_, the Company has disclosed full details of its Directors in the Director’s Report attached to this Corporate Governance Statement. Other disclosure material on the Structure of the Board has been made available on the Company’s website.	Complies. The full Board operates the Nomination and Remuneration Committee. In addition, the Board does not consist of a majority of independent directors (see 2.1 above) however the skills and experience of both the independent and non- independent directors allow the Board to act in the best interests of shareholders.
Principle 3 – Promote ethical and responsible decision making
3.1	Establish a code of conduct and disclose the code or a summary of the code.	The Board has adopted a code of conduct and the code establishes a clear set of values that emphasise a culture encompassing strong corporate governance, sound business practices and good ethical conduct. The code is available on the Company’s website.	Complies.

Rand Mining Limited Corporate Governance Statement 30 June 2012

Rand Mining Limited Corporate Governance Statement 30 June 2012	Rand Mining Limited Corporate Governance Statement 30 June 2012
Principles and Recommendations		Compliance	Comply
3.2	Companies should establish a policy concerning diversity and disclose the policy or a summary of that policy. The policy should include requirements for the Board to establish measurable objectives for achieving gender diversity and for the board to assess annually both the objectives and progress in achieving them.	The Board has undertaken a review of the mix of skills and experience on the Board in light of the Company’s principal activities and direction. The Board will prepare a Diversity Policy that considers the benefits of diversity, ways to promote a culture of diversity, factors to be taken into account in the selection process of candidates for board and senior management positions in the Company, education programs to develop skills and experience in preparation for board and senior management positions, processes to include review and appointment of directors, and identify key measurable diversity performance objectives for the Board, CEO and senior management.	Due to the size and nature of the firm, the Company does not comply, however the Board has committed the Company to review and prepare a Diversity Policy that considers all aspects of diversity in accordance with corporate governance guidelines.
3.3	Provide the information indicated in_Guide to_ reporting on Principle 3.	On completion and acceptance of a Diversity Policy, the Company will report in each annual report the measurable objectives for achieving gender diversity set by the Board. The Company has included the proportion of women employees and their positions held within the Company at the end of this Corporate Governance Statement, under the section ‘Diversity’.	Due to the size and nature of the firm, the Company does not comply, however the Board has committed the Company to review and prepare a Diversity Policy that considers all aspects of diversity in accordance with corporate governance guidelines. Does not comply.
Principle 4 – Safeguard integrity in financial reporting
4.1	The Board should establish an audit committee.	The Board believes the Company is not currently of a sufficient size, nor its financial affairs of such complexity to justify the formation of an audit committee. The Board as a whole undertakes the functions normally associated with an audit committee.	Does not comply.
4.2	The audit committee should be structured so that it consists of only non- executive directors, a majority of independent directors, is chaired by an independent chair who is not chair of the Board and have at least 3 members.	The audit and risk committee did not comply with Recommendation 4.2 in that the committee: �did not consist of only non-executive directors; �did not consist of a majority of independent directors; and �was not chaired by an independent chair.	Does not comply due to the composition of the Board. However, the Board considers the directors to be the most appropriate members to constitute the audit and risk committee given their technical, finance and accounting expertise and broad knowledge of the industry in which the Company operates within.

Rand Mining Limited Corporate Governance Statement 30 June 2012

Rand Mining Limited Corporate Governance Statement 30 June 2012	Rand Mining Limited Corporate Governance Statement 30 June 2012
Principles and Recommendations		Compliance	Comply
4.3	The audit committee should have a formal charter.	The Board has not adopted an audit and risk charter.	Does not comply. However, the Board considers the directors to be the most appropriate members to constitute the audit and risk committee given their technical, finance and accounting expertise and broad knowledge of the industry in which the Company operates within, and as such, the full board participates.
4.4	Provide the information indicated in_Guide to_ reporting on Principle 4.	In accordance with the information suggested in_Guide to Reporting on Principle 4,_this has been disclosed in the Directors’ Report attached to this Corporate Governance Statement The audit and risk charter, and information on procedures for the selection and appointment of the external auditor, and for the rotation of external audit engagement partners (which is determined by the audit committee), is available on the Company’s website.	Complies.
Principle 5 – Make timely and balanced disclosure
5.1	Establish written policies designed to ensure compliance with ASX Listing Rules disclosure requirements and to ensure accountability at a senior executive level for that compliance and disclose those policies or a summary of those policies.	The Company has adopted a continuous disclosure policy, to ensure that it complies with the continuous disclosure regime under the ASX Listing Rules and the Corporations Act 2001. This policy is available on the Company’s website.	Complies.
5.2	Provide the information indicated in the_Guide to_ reporting on Principle 5.	The Company’s continuous disclosure policy is available on the Company’s website.	Complies.
Principle 6 – Respect the rights of shareholders
6.1	Design a communications policy for promoting effective communication with shareholders and encouraging their participation at general meetings and disclose that policy or a summary of that	The Company has adopted a shareholder communications policy. The Company uses its website (www.randmining.com.au), interim report, annual report, market announcements, media disclosures and webcasting to communicate with its shareholders, as well as encourages participation at general meetings.	Complies.

Rand Mining Limited Corporate Governance Statement 30 June 2012

Rand Mining Limited Corporate Governance Statement 30 June 2012	Rand Mining Limited Corporate Governance Statement 30 June 2012
Principles and Recommendations		Compliance	Comply
	policy.	This policy is available on the Company’s website.
6.2	Provide the information indicated in the_Guide to_ reporting on Principle 6.	The Company’s shareholder communications policy is available on the Company’s website.	Complies.
Principle 7 – Recognise and manage risk
7.1	Establish policies for the oversight and management of material business risks and disclose a summary of these policies.	The Company has adopted a risk management statement within the audit and risk committee charter. Board is responsible for managing risk. The risk management policy is available on the Company’s website and is summarised in this Corporate Governance Statement.	Complies.
7.2	The Board should require management to design and implement the risk management and internal control system to manage the Company’s material business risks and report to it on whether those risks are being managed effectively. The Board should disclose that management has reported to it as to the effectiveness of the Company’s management of its material business risks.	The Company has identified key risks within the business. In the ordinary course of business, management monitor and manage these risks. Key operational and financial risks are presented to and reviewed by the Board at each Board meeting.	Complies.
7.3	The Board should disclose whether it has received assurance from the Chief Executive Officer and Chief Financial Officer that the declaration provided in accordance with section 295A of the Corporations Act is founded on a sound system of risk management and internal control and that the system is operating efficiently and effectively in all material respects in relation to the financial reporting risks.	The Board has received a statement from the Chief Executive Officer and Chief Financial Officer that the declaration provided in accordance with section 295A of the Corporations Act 2001 is founded on a sound system of risk management and internal control and that the system is operating efficiently and effectively in all material respects in relation to the financial reporting risks.	Complies.

Rand Mining Limited Corporate Governance Statement 30 June 2012

Rand Mining Limited Corporate Governance Statement 30 June 2012	Rand Mining Limited Corporate Governance Statement 30 June 2012
Principles and Recommendations		Compliance	Comply
7.4	Provide the information indicated in_Guide to_ reporting on Principle 7.	The Board has adopted an audit and risk charter which includes a statement of the Company’s risk policies. This charter is available on the Company’s website and is summarised in this Corporate Governance Statement. The Company has identified key risks within the business and has received a statement of assurance from the Chief Executive Officer and Chief Financial Officer.	Complies.
Principle 8 – Remunerate fairly and		responsibly
8.1	The Board should establish a remuneration committee.	The Board has not established a nomination committee and has not adopted a remuneration charter. The remuneration committee should : �consists of a majority of independent directors; �be chaired by an independent director; and �have three members.	Does not comply. The Board considers that the Company is currently not of a size to justify the formation of a nomination committee. The Board as a whole undertakes the process of reviewing the skill base, experience and remuneration of existing directors.
8.2	Clearly distinguish the structure of non-executive directors’ remuneration from that of executive directors and senior executives.	The Company complies with the guidelines for executive remuneration packages and non-executive director remuneration. Refer to director’s report for information No senior executive is involved directly in deciding their own remuneration.	Complies.
8.3	Provide the information indicated in_the Guide to_ reporting on Principle 8.	The Board has adopted a Nomination and Remuneration Committee charter. The Company does not have any schemes for retirement benefits other than superannuation for non-executive directors.	Complies.

Rand Mining Limited’s corporate governance practices were in place for the financial year ended 30 June 2012 and to the date of signing the Directors’ Report.

Various corporate governance practices are discussed within this statement. For further information on corporate governance policies adopted by Rand Mining Limited, refer to our website: www.randmining.com.au

Rand Mining Limited Corporate Governance Statement 30 June 2012

Board functions

The role of the Board of Rand Mining Limited is as follows:

representing and serving the interests of shareholders by overseeing and appraising the strategies, policies and performance of the Company. This includes overviewing the financial and human resources the Company has in place to meet its objectives and the review of management performance;
protecting and optimising Company performance and building sustainable value for shareholders in accordance with any duties and obligations imposed on the Board by law and the Company’s constitution and within a framework of prudent and effective controls that enable risk to be assessed and managed;
responsible for the overall Corporate Governance of Rand Mining Limited and its controlled entities, including monitoring the strategic direction of the Company and those entities, formulating goals for management and monitoring the achievement of those goals;
setting, reviewing and ensuring compliance with the Company’s values (including the establishment and observance of high ethical standards); and
ensuring shareholders are kept informed of the Company’s performance and major developments affecting its state of affairs.

Responsibilities/functions of the Board include:

selecting, appointing and evaluating from time to time the performance of, determining the remuneration of, and planning for the successor of, the Chief Executive Officer (‘CEO’);
reviewing procedures in place for appointment of senior management and monitoring of its performance, and for succession planning. This includes ratifying the appointment and the removal of the Chief Financial Officer and the Company Secretary;
input into and final approval of management development of corporate strategy, including setting performance objectives and approving operating budgets;
reviewing and guiding systems of risk management and internal control and ethical and legal compliance. This includes reviewing procedures in place to identify the main risks associated with the Company’s businesses and the implementation of appropriate systems to manage these risks;
monitoring corporate performance and implementation of strategy and policy;
approving major capital expenditure, acquisitions and divestitures, and monitoring capital management;
monitoring and reviewing management processes in place aimed at ensuring the integrity of financial and other reporting;
monitoring and reviewing policies and processes in place relating to occupational health and safety, compliance with laws, and the maintenance of high ethical standards; and
performing such other functions as are prescribed by law or are assigned to the Board.

In carrying out its responsibilities and functions, the Board may delegate any of its powers to a Board committee, a director, employee or other person subject to ultimate responsibility of the directors under the Corporations Act 2001.

Matters, if applicable, which are specifically reserved for the Board or its committees include the following:

appointment of a Chair;
appointment and removal of the CEO;
appointment of directors to fill a vacancy or as additional directors;
establishment of Board committees, their membership and delegated authorities;
approval of dividends;
development and review of corporate governance principles and policies;
approval of major capital expenditure, acquisitions and divestitures in excess of authority levels delegated to management;
calling of meetings of shareholders; and
any other specific matters nominated by the Board from time to time.

Rand Mining Limited Corporate Governance Statement 30 June 2012

Structure of the Board

The Company’s constitution governs the regulation of meetings and proceedings of the Board.

The Board determines its size and composition, subject to the terms of the constitution. The Board does not believe that it should establish a limit on tenure other than stipulated in the company constitution.

While tenure limits can help to ensure that there are fresh ideas and viewpoints available to the Board, they hold the disadvantage of losing the contribution of directors who have been able to develop, over a period of time, increasing insight in the Company and its operation and, therefore, an increasing contribution to the Board as a whole. It is intended that the Board should comprise a majority of independent non-executive directors and comprise directors with a broad range of skills, expertise and experience from a diverse range of backgrounds. It is also intended that the Chair should be an independent Non-Executive Director. The Board regularly reviews the independence of each director in light of the interests disclosed to the Board.

The Board only considers directors to be independent where they are independent of management and free of any business or other relationship that could materially interfere with, or could reasonably be perceived to interfere with, the exercise of their unfettered and independent judgment. The Board has adopted a definition of independence based on that set out in Principle 2 of the ASX Corporate Governance Revised Principles and Recommendations. The Board will review the independence of each director in light of interests disclosed to the Board, including their participation in board activities associated with related entities, from time to time.

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

Name Position Gordon Sklenka Non-Executive Director

There are procedures in place, agreed by the Board, to enable directors in furtherance of their duties to seek independent professional advice at the Company's expense.

The appointment date of each director in office at the date of this report is as follows:

Name	Position	Appointment Date
Otakar Demis	Executive Director, Chairman	Appointed 26 July 1990
Anthony Billis	Executive Director	Appointed 22 January 2003
Gordon Sklenka	Non-Executive Director	Appointed 16 August 2004

Further details on each director can be found in the Directors’ Report attached to this Corporate Governance Statement.

Securities trading policy

Under the Company's Guidelines for Dealing in Securities Policy, directors, officers and employees of the Company should not trade in the Company’s securities when he or she is in possession of price sensitive information that is not generally available to the market.

Directors and senior management are likely to be in possession of unpublished price sensitive information concerning the Company by virtue of their position within the Company. Therefore those persons are restricted from dealing in the Company’s securities in the thirty day period immediately preceding the release of price sensitive information to the ASX (Non-Trading Period).

In addition, directors, officers and employees can only deal in the Company’s securities after having first obtained clearance from the Company , and must notify the Company Secretary when a trade has occurred.

As required by the ASX Listing Rules, the Company notifies the ASX of any transaction conducted by directors in the securities of the Company within five business days of the transaction taking place.

The Securities Trading Policy has been issued to ASX and can be found on the Company’s website

Rand Mining Limited Corporate Governance Statement 30 June 2012

Audit and Risk Committee

The Board may, subject to the Company being of the size and nature to warrant the establishment of a select committee, establish an Audit and Risk Committee which would operates under a Charter approved by the Board. It is the Board's responsibility to ensure that an effective internal control framework exists within the entity. The full Board deputises for the Audit and Risk Committee in the interim period. This includes internal controls to deal with both the effectiveness and efficiency of significant business processes, the safeguarding of assets, the maintenance of proper accounting records, and the reliability of financial information as well as non-financial considerations such as the benchmarking of operational key performance indicators.

Risk

The responsibility of overseeing risk falls within the charter of the Audit and Risk Committee. The Company identifies areas of risk within the Company and management and the Board continuously undertake a risk assessment of the Company’s operations, procedures and processes. The risk assessment is aimed at identifying the following:

a culture of risk control and the minimisation of risk throughout the Company, which is being done through natural or instinctive process by employees of the Company;
a culture of risk control that can easily identify risks as they arise and amend practices;
the installation of practices and procedures in all areas of the business that are designed to minimise an event or incident that could have a financial or other effect on the business and its day to day management; and
adoption of these practices and procedures to minimise many of the standard commercial risks, i.e. taking out the appropriate insurance policies, or ensuring compliance reporting is up to date.

The full board deputises for the Audit and Risk Committee in the interim period.

CEO and CFO certification

The Chief Executive Officer and Chief Financial Officer have given a written declaration to the Board required by section 295A of the Corporations Act 2001 that in their view:

the Company's financial report is founded on a sound system of risk management and internal compliance and control which implements the financial policies adopted by the Board; and
the Company's risk management and internal compliance and control system is operating effectively in all material respects.

Performance

The performance of the Board and key executives is reviewed regularly using both measurable and qualitative indicators.

On an annual basis, directors will provide written feedback in relation to the performance of the Board against a set of agreed criteria.

feedback will be collected by the chair of the Board, or an external facilitator, and discussed by the Board, with consideration being given as to whether any steps should be taken to improve performance of the Board;
the Chief Executive Officer will also provide feedback from senior management in connection with any issues that may be relevant in the context of Board performance review; and
where appropriate to facilitate the review process, assistance may be obtained from third party advisers.

Rand Mining Limited Corporate Governance Statement 30 June 2012

Remuneration

It is the Company's objective to provide maximum stakeholder benefit from the retention of a high quality Board and Executive team by remunerating directors and key executives fairly and appropriately with reference to relevant employment market conditions. To assist in achieving this objective, the Board, in assuming the responsibilities of assessing remuneration to employees, links the nature and amount of executive directors' and officers' remuneration to the Company's financial and operational performance. The expected outcomes of the remuneration structure are:

retention and motivation of key executives;
attraction of high quality management to the Company; and
performance incentives that allow executives to share in the success of Rand Mining Limited.

For a more comprehensive explanation of the Company's remuneration framework and the remuneration received by directors and key executives in the current period, please refer to the Remuneration Report, which is contained within the Directors' Report.

There is no scheme to provide retirement benefits to non-executive (or executive) directors.

The Nomination and Remuneration Committee, currently undertaken by the Full Board is responsible for determining and reviewing compensation arrangements for the directors themselves and the Chief Executive Officer and Executive team.

Diversity

The Company does not have a formal diversity policy and is therefore not disclosing any measurable objectives for achieving gender diversity.

The participation of women in the company and consolidated entity at 30 June 2012 was as follows:

Women employees in the consolidated entity
Women in senior management positions
Women on the board
20%
0%
0%

Rand Mining Limited Financial report 30 June 2012

Contents
	Page
Financial report
Statement of comprehensive income	34
Statement of financial position	36
Statement of changes in equity	37
Statement of cash flows	38
Notes to the financial statements	39
Directors' declaration	85
Independent auditor's report to the members of Rand Mining Limited	86

General information

The financial report covers Rand Mining Limited as a consolidated entity consisting of Rand Mining Limited and the entities it controlled. The financial report is presented in Australian dollars, which is Rand Mining Limited's functional and presentation currency.

The financial report consists of the financial statements, notes to the financial statements and the directors' declaration.

Rand Mining Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business is:

Suite G1, 49 Melville Parade South Perth WA 6151

A description of the nature of the consolidated entity's operations and its principal activities are included in the directors' report, which is not part of the financial report.

The financial report was authorised for issue, in accordance with a resolution of directors, on 28 September 2012. The directors have the power to amend and reissue the financial report.

Rand Mining Limited Statement of comprehensive income For the year ended 30 June 2012

Note 5 6 7 8 8 9 10 29 Profit after income tax expense from continuing operations Profit after income tax expense from discontinued operations Other comprehensive income Profit after income tax expense for the year attributable to the owners of Rand Mining Limited Income tax expense Other income Revenue from continuing operations Share of profits of associates accounted for using the equity method Impairment of available-for-sale assets Depreciation and amortisation expense Administration expenses Mining expenses Impairment of equity accounted investments Processing expenses Royalty expenses Finance costs Expenses Changes in inventories Employee benefits expense Management fees Impairment of exploration and evaluation Available-for-sale financial assets - reclassification to profit or loss Share of other comprehensive income of associates and joint ventures Available-for-sale financial assets - current year losses Other comprehensive income for the year, net of tax Total comprehensive income for the year attributable to the owners of Rand Mining Limited Tax movement on disposal of land and buildings Profit before income tax expense from continuing operations	2012 2011 $ $ 15,385,846 13,205,248 2,614,353 2,941,169 12,114 84,056 5,984,793 4,699,962 (570,038) (540,764) (421,301) (361,085) (3,694,128) (1,624,882) (118,001) (75,804) (607,925) (215,447) (2,489,167) - (1,316,877) (731,724) (7,077,614) (7,088,598) (1,771,655) (1,926,669) (691,593) (640,573) (337,650) (94,745) 4,901,157 7,630,144 (1,747,879) (2,664,456) 3,153,278 4,965,688 - 458,778 3,153,278 5,424,466 (305,064) (58,770) 115,751 79,015 (95,434) 52,517 - 127,694 (284,747) 200,456 2,868,531 5,624,922 Consolidated	2012 2011 $ $ 15,385,846 13,205,248 2,614,353 2,941,169 12,114 84,056 5,984,793 4,699,962 (570,038) (540,764) (421,301) (361,085) (3,694,128) (1,624,882) (118,001) (75,804) (607,925) (215,447) (2,489,167) - (1,316,877) (731,724) (7,077,614) (7,088,598) (1,771,655) (1,926,669) (691,593) (640,573) (337,650) (94,745) 4,901,157 7,630,144 (1,747,879) (2,664,456) 3,153,278 4,965,688 - 458,778 3,153,278 5,424,466 (305,064) (58,770) 115,751 79,015 (95,434) 52,517 - 127,694 (284,747) 200,456 2,868,531 5,624,922 Consolidated
	4,901,157 (1,747,879)	7,630,144 (2,664,456)
	3,153,278 -	4,965,688 458,778
	3,153,278 (305,064) 115,751 (95,434) -	5,424,466 (58,770) 79,015 52,517 127,694
	(284,747)	200,456
	2,868,531	5,624,922

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

Rand Mining Limited Statement of comprehensive income For the year ended 30 June 2012

Rand Mining Limited For the year ended 30 June 2012 Statement of comprehensive income
		Consolidated
	Note	2012	2011
		$	$
		Cents	Cents
Earnings per share from continuing operations attributable to the
owners of Rand Mining Limited
Basic earnings per share	43	5.18	8.16
Diluted earnings per share	43	5.18	8.16
Earnings per share from discontinued operations attributable to the
owners of Rand Mining Limited
Basic earnings per share	43	-	0.75
Diluted earnings per share	43	-	0.75
Earnings per share for profit attributable to the owners of Rand Mining
Limited
Basic earnings per share	43	5.18	8.92
Diluted earnings per share	43	5.18	8.92
Refer to note 3 for detailed information on restatement of comparatives.

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

Rand Mining Limited Statement of financial position As at 30 June 2012

Note 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Reserves Property, plant and equipment Exploration and evaluation Total liabilities Mine development Liabilities Total non-current assets Current assets Assets Cash and cash equivalents Retained profits Trade and other receivables Inventories Deferred tax Total current liabilities Current liabilities Non-current assets Total current assets Investments accounted for using the equity method Available-for-sale financial assets Total equity Total non-current liabilities Net assets Deferred tax Borrowings Trade and other payables Borrowings Income tax Provisions Total assets Issued capital Equity Non-current liabilities Provisions	2012 2011 $ $ 1,685,256 2,625,332 767,042 634,661 18,197,602 12,212,809 20,649,900 15,472,802 14,308,686 14,278,934 318,194 473,259 2,576,573 2,962,569 - 28,813 8,008,703 5,251,864 209,538 393,377 25,421,694 23,388,816 46,071,594 38,861,618 3,251,117 2,169,454 3,250,000 - 273,354 781,377 135,429 152,946 6,909,900 3,103,777 1,750,000 1,275,000 2,150,784 2,098,755 352,993 344,700 4,253,777 3,718,455 11,163,677 6,822,232 34,907,917 32,039,386 17,573,427 17,573,427 1,960,908 2,245,655 15,373,582 12,220,304 34,907,917 32,039,386 Consolidated	2012 2011 $ $ 1,685,256 2,625,332 767,042 634,661 18,197,602 12,212,809 20,649,900 15,472,802 14,308,686 14,278,934 318,194 473,259 2,576,573 2,962,569 - 28,813 8,008,703 5,251,864 209,538 393,377 25,421,694 23,388,816 46,071,594 38,861,618 3,251,117 2,169,454 3,250,000 - 273,354 781,377 135,429 152,946 6,909,900 3,103,777 1,750,000 1,275,000 2,150,784 2,098,755 352,993 344,700 4,253,777 3,718,455 11,163,677 6,822,232 34,907,917 32,039,386 17,573,427 17,573,427 1,960,908 2,245,655 15,373,582 12,220,304 34,907,917 32,039,386 Consolidated
	20,649,900	15,472,802
	14,308,686 318,194 2,576,573 - 8,008,703 209,538	14,278,934 473,259 2,962,569 28,813 5,251,864 393,377
	25,421,694	23,388,816
	46,071,594	38,861,618
	3,251,117 3,250,000 273,354 135,429	2,169,454 - 781,377 152,946
	6,909,900	3,103,777
	1,750,000 2,150,784 352,993	1,275,000 2,098,755 344,700
	4,253,777	3,718,455
	11,163,677	6,822,232
	34,907,917	32,039,386
	17,573,427 1,960,908 15,373,582	17,573,427 2,245,655 12,220,304
	34,907,917	32,039,386

Refer to note 3 for detailed information on restatement of comparatives.

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

Rand Mining Limited Statement of changes in equity For the year ended 30 June 2012

$ 17,578,448 - - Issued capital	$ 2,752,736 - (507,081) Reserves	$ 6,088,301 5,424,466 707,537 profits Retained	Total equity $ 26,419,485 5,424,466 200,456
- (5,021)	(507,081) -	6,132,003 -	5,624,922 (5,021)
17,573,427	2,245,655	12,220,304	32,039,386
$ 17,573,427 - - capital Issued	$ 2,245,655 - (284,747) Reserves	$ 12,220,304 3,153,278 - Retained profits	Total equity $ 32,039,386 3,153,278 (284,747)
-	(284,747)	3,153,278	2,868,531
17,573,427	1,960,908	15,373,582	34,907,917

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

Rand Mining Limited Statement of cash flows For the year ended 30 June 2012

Note 42 11 Proceeds from borrowings Payments for mine development Cash flows from operating activities Receipts from customers (inclusive of GST) Interest received Payments for property, plant and equipment Payments to suppliers and employees (inclusive of GST) Interest and other finance costs paid Net cash from operating activities Cash and cash equivalents at the beginning of the financial year Cash and cash equivalents at the end of the financial year Cash flows from investing activities Payments for exploration and evaluation Net cash from financing activities Proceeds from sale of property, plant and equipment Payments for investments Income taxes paid Loans repaid to related parties Cash out on deconsolidation of Onslow Resources Limited Net decrease in cash and cash equivalents Loans by other entities Cash flows from financing activities Loans received from related parties Net cash used in investing activities	2012 2011 $ $ 15,285,275 13,055,523 (10,510,296) (11,788,536) 100,574 139,669 (371,666) (244,449) (1,455,791) (626,614) 3,048,096 535,593 (150,000) (75,804) (1,265,661) (1,485,818) (1,560,234) (381,209) (4,773,214) (1,182,827) 35,937 890,000 (7,713,172) (2,235,658) - (495,607) - 256,000 - (160,423) 3,725,000 1,275,000 - (57,189) 3,725,000 817,781 (940,076) (882,284) 2,625,332 3,507,616 1,685,256 2,625,332 Consolidated	2012 2011 $ $ 15,285,275 13,055,523 (10,510,296) (11,788,536) 100,574 139,669 (371,666) (244,449) (1,455,791) (626,614) 3,048,096 535,593 (150,000) (75,804) (1,265,661) (1,485,818) (1,560,234) (381,209) (4,773,214) (1,182,827) 35,937 890,000 (7,713,172) (2,235,658) - (495,607) - 256,000 - (160,423) 3,725,000 1,275,000 - (57,189) 3,725,000 817,781 (940,076) (882,284) 2,625,332 3,507,616 1,685,256 2,625,332 Consolidated
	3,048,096	535,593
	(150,000) (1,265,661) (1,560,234) (4,773,214) 35,937	(75,804) (1,485,818) (381,209) (1,182,827) 890,000
	(7,713,172)	(2,235,658)
	- - - 3,725,000 -	(495,607) 256,000 (160,423) 1,275,000 (57,189)
	3,725,000	817,781
	(940,076) 2,625,332	(882,284) 3,507,616
	1,685,256	2,625,332

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

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies

The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

New, revised or amending Accounting Standards and Interpretations adopted

The consolidated entity has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.

Any new, revised or amending Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.

Any significant impact on the accounting policies of the consolidated entity from the adoption of these Accounting Standards and Interpretations are disclosed in the relevant accounting policy. The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the consolidated entity.

The following Accounting Standards and Interpretations are most relevant to the consolidated entity:

AASB 2010-4 Amendments to Australian Accounting Standards arising from the Annual Improvements Project The consolidated entity has applied AASB 2010-4 amendments from 1 July 2011. The amendments made numerous non-urgent but necessary amendments to a range of Australian Accounting Standards and Interpretations. The amendments provided clarification of disclosures in AASB 7 'Financial Instruments: Disclosures', in particular emphasis of the interaction between quantitative and qualitative disclosures and the nature and extent of risks associated with financial instruments; clarified that an entity can present an analysis of other comprehensive income for each component of equity, either in the statement of changes in equity or in the notes in accordance with AASB 101 'Presentation of Financial Instruments'; and provided guidance on the disclosure of significant events and transactions in AASB 134 'Interim Financial Reporting'.

AASB 2010-5 Amendments to Australian Accounting Standards

The consolidated entity has applied AASB 2010-5 amendments from 1 July 2011. The amendments made numerous editorial amendments to a range of Australian Accounting Standards and Interpretations, including amendments to reflect changes made to the text of International Financial Reporting Standards by the International Accounting Standards Board.

AASB 124 Related Party Disclosures (December 2009)

The consolidated entity has applied AASB 124 (revised) from 1 July 2011. The revised standard simplified the definition of a related party by clarifying its intended meaning and eliminating inconsistencies from the definition. A subsidiary and an associate with the same investor are related parties of each other; entities significantly influenced by one person and entities significantly influenced by a close member of the family of that person are no longer related parties of each other; and whenever a person or entity has both joint control over a second entity and joint control or significant influence over a third party, the second and third entities are related to each other.

AASB 2010-6 Amendments to Australian Accounting Standards - Disclosures on Transfers of Financial Assets The consolidated entity has applied AASB 2010-6 amendments from 1 July 2011. These amendments add and amended disclosure requirements in AASB 7 about transfer of financial assets, including the nature of the financial assets involved and the risks associated with them. Additional disclosures are now required when (i) an asset is transferred but is not derecognised; and (ii) when assets are derecognised but the consolidated entity has a continuing exposure to the asset after the sale.

AASB 1054 Australian Additional Disclosures

The consolidated entity has applied AASB 1054 from 1 July 2011. The standard sets out the Australian-specific disclosures as a result of Phase I of the Trans-Tasman Convergence Project, which are in addition to International Financial Reporting Standards, for entities that have adopted Australian Accounting Standards.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

AASB 2011-1 Amendments to Australian Accounting Standards arising from the Trans-Tasman Convergence Project The consolidated entity has applied AASB 2011-1 amendments from 1 July 2011. These amendments made changes to a range of Australian Accounting Standards and Interpretations for the purpose of closer alignment to International Financial Reporting Standards (’IFRSs’) and harmonisation between Australian and New Zealand Standards. The amendments removed certain guidance and definitions from Australian Accounting Standards for conformity of drafting with IFRSs but without any intention to change requirements.

AASB 1048 Interpretation of Standards (revised)

The consolidated entity has applied AASB 1048 (revised) for the year ended 30 June 2012. The revised standard identifies the Australian Interpretations and classifies them into two groups: those that correspond to an International Accounting Standards Board (‘IASB’) Interpretation (Table 1 – international equivalent), and those that do not (Table 2 – domestic interpretations). The standard has been updated to remove old or superseded interpretations and add new interpretations.

Basis of preparation

These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board ('IASB').

Historical cost convention

The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation of available-for-sale financial assets, financial assets and liabilities at fair value through profit or loss, investment properties, certain classes of property, plant and equipment and derivative financial instruments.

Critical accounting estimates

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

Parent entity information

In accordance with the Corporations Act 2001, these financial statements present the results of the consolidated entity only. Supplementary information about the parent entity is disclosed in note 37.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

Principles of consolidation

The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Rand Mining Limited ('company' or 'parent entity') as at 30 June 2012 and the results of all subsidiaries for the year then ended. Rand Mining Limited and its subsidiaries together are referred to in these financial statements as the 'consolidated entity'.

Subsidiaries are all those entities over which the consolidated entity has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting rights. The effects of potential exercisable voting rights are considered when assessing whether control exists. Subsidiaries are fully consolidated from the date on which control is transferred to the consolidated entity. They are de-consolidated from the date that control ceases.

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

The acquisition of subsidiaries is accounted for using the acquisition method of accounting. Refer to the 'business combinations' accounting policy for further details. A change in ownership interest, without the loss of control, is accounted for as an equity transaction, where the difference between the consideration transferred and the book value of the share of the non-controlling interest acquired is recognised directly in equity attributable to the parent.

Where the consolidated entity loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non-controlling interest in the subsidiary together with any cumulative translation differences recognised in equity. The consolidated entity recognises the fair value of the consideration received and the fair value of any investment retained together with any gain or loss in profit or loss.

Operating segments

Operating segments are presented using the 'management approach', where the information presented is on the same basis as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the allocation of resources to operating segments and assessing their performance.

Revenue recognition

Revenue is recognised when it is probable that the economic benefit will flow to the consolidated entity and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received or receivable.

Sales of gold and silver

Sales of gold and silver revenue is recognised at the point of sale, which is where the customer has taken delivery of the goods, the risks and rewards are transferred to the customer and there is a valid sales contract. Amounts disclosed as revenue are net of sales returns and trade discounts.

Interest

Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset.

Other revenue

Other revenue is recognised when it is received or when the right to receive payment is established.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

Income tax

The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and unused tax losses and the adjustment recognised for prior periods, where applicable.

Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for:

when the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits; or
when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures, and the timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future.

Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

The carrying amount of recognised and unrecognised deferred tax assets are reviewed each reporting date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to recover the asset.

Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on either the same taxable entity or different taxable entity's which intend to settle simultaneously.

Discontinued operations

A discontinued operation is a component of the consolidated entity that has been disposed of or is classified as held for sale and that represents a separate major line of business or geographical area of operations, is part of a single co-ordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively with a view to resale. The results of discontinued operations are presented separately on the face of the statement of comprehensive income.

Cash and cash equivalents

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

Trade and other receivables

Other receivables are recognised at amortised cost, less any provision for impairment.

Inventories

Inventories are stated at the lower of cost and net realisable value on a 'first in first out' basis. Cost comprises direct materials and delivery costs, direct labour, import duties and other taxes, an appropriate proportion of variable and fixed overhead expenditure based on normal operating capacity, and, where applicable, transfers from cash flow hedging reserves in equity. Costs of purchased inventory are determined after deducting rebates and discounts received or receivable.

Cost is determined on the following basis:

gold on hand is valued on an average total production cost method;
ore stockpiles are valued at the average cost of mining and stockpiling the ore, including haulage; and
a proportion of related depreciation and amortisation charge is included in the cost of inventory.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

Associates

Associates are entities over which the consolidated entity has significant influence but not control or joint control. Investments in associates are accounted for using the equity method. Under the equity method, the share of the profits or losses of the associate is recognised in profit or loss and the share of the movements in equity is recognised in other comprehensive income. Investments in associates are carried in the statement of financial position at cost plus post-acquisition changes in the consolidated entity's share of net assets of the associates. Dividends received or receivable from associates reduce the carrying amount of the investment.

When the consolidated entity’s share of losses in an associate equals or exceeds its interest in the associate, including any unsecured long-term receivables, the consolidated entity does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

Joint ventures

A joint venture is a contractual arrangement whereby two or more parties undertake an economic activity that is subject to joint control. Investments in joint ventures are accounted for in the consolidated financial statements using the equity method. Under the equity method, the share of the profits or losses of the joint venture is recognised in profit or loss and the share of the movements in equity is recognised in other comprehensive income. Income earned from joint venture entities is recognised as revenue in the parent entity’s profit or loss, whilst in the consolidated financial statements they reduce the carrying amount of the investment.

Investments and other financial assets

Investments and other financial assets are measured at either amortised cost or fair value depending on their classification. Classification is determined based on the purpose of the acquisition and subsequent reclassification to other categories is restricted. The fair values of quoted investments are based on current bid prices. For unlisted investments, the consolidated entity establishes fair value by using valuation techniques. These include the use of recent arms length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis, and option pricing models.

Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the consolidated entity has transferred substantially all the risks and rewards of ownership.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are carried at amortised cost using the effective interest rate method. Gains and losses are recognised in profit or loss when the asset is derecognised or impaired.

Available-for-sale financial assets

Available-for-sale financial assets are non-derivative financial assets, principally equity securities, that are either designated as available-for-sale or not classified as any other category. After initial recognition, fair value movements are recognised directly in the available-for-sale reserve in equity. Cumulative gain or loss previously reported in the available-for-sale reserve is recognised in profit or loss when the asset is derecognised or impaired.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

Impairment of financial assets

The consolidated entity assesses at the end of each reporting period whether there is any objective evidence that a financial asset or group of financial assets is impaired. Objective evidence includes significant financial difficulty of the issuer or obligor; a breach of contract such as default or delinquency in payments; the lender granting to a borrower concessions due to economic or legal reasons that the lender would not otherwise do; it becomes probable that the borrower will enter bankruptcy or other financial reorganisation; the disappearance of an active market for the financial asset; or observable data indicating that there is a measurable decrease in estimated future cash flows.

The amount of the impairment allowance for loans and receivables carried at amortised cost is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. If there is a reversal of impairment, the reversal cannot exceed the amortised cost that would have been had the impairment not been recognised and is reversed to profit or loss.

Available-for-sale financial assets are considered impaired when there has been a significant or prolonged decline in value below initial cost. Subsequent increments in value are recognised directly in the available-for-sale reserve.

Property, plant and equipment

Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment over their expected useful lives as follows:

Plant and equipment	2.7-6.7 years
Mining plant and equipment	2.7-6.7 years

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

Leasehold improvements and plant and equipment under lease are depreciated over the unexpired period of the lease or the estimated useful life of the assets, whichever is shorter.

An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the consolidated entity. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss. Any revaluation surplus reserve relating to the item disposed of is transferred directly to retained profits.

Mining plant and equipment and capital work in progress

Mining plant and equipment and capital work in progress is carried at cost which includes acquisition, transportation, installation, and commissioning costs. Costs also include present value of decommissioning costs and finance charges capitalised during the construction period where such expenditure is financed by borrowings. Costs are not depreciated until such time as the asset has been completed ready for use.

Subsequent costs are included in the asset’s carrying amount only when it is probable that future economic benefits associated with the item will flow to the consolidated entity, and the cost of the item can be measured reliably. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

Leases

The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement and requires an assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset.

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

Finance leases are capitalised. A lease asset and liability are established at the fair value of the leased assets, or if lower, the present value of minimum lease payments. Lease payments are allocated between the principal component of the lease liability and the finance costs, so as to achieve a constant rate of interest on the remaining balance of the liability.

Leased assets acquired under a finance lease are depreciated over the asset's useful life or over the shorter of the asset’s useful life and the lease term if there is no reasonable certainty that the consolidated entity will obtain ownership at the end of the lease term.

Operating lease payments, net of any incentives received from the lessor, are charged to profit or loss on a straightline basis over the term of the lease.

Exploration and evaluation assets

Exploration and evaluation expenditure in relation to separate areas of interest for which rights of tenure are current is carried forward as an asset in the statement of financial position where it is expected that the expenditure will be recovered through the successful development and exploitation of an area of interest, or by its sale; or exploration activities are continuing in an area and activities have not reached a stage which permits a reasonable estimate of the existence or otherwise of economically recoverable reserves. Where a project or an area of interest has been abandoned, the expenditure incurred thereon is written off in the year in which the decision is made.

A regular review is undertaken by the Board of Directors of each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area of interest. Where uncertainty exists as to the future viability of certain areas, the value of the area of interest is written off to profit or loss or provided against.

Mine development assets

Capitalised mine development costs include expenditures incurred to develop new ore bodies to define further mineralisation in existing ore bodies, to expand the capacity of a mine and to maintain production. Mine development also includes costs transferred from exploration and evaluation phase once production commences in the area of interest.

Amortisation of mine development is computed by the units of production basis over the estimated proved and probable reserves. Proved and probable mineral reserves reflect estimated quantities of economically recoverable reserves which can be recovered in the future from known mineral deposits. These reserves are amortised from the date on which production commences. The amortisation is calculated from recoverable proven and probable reserves and a predetermined percentage of the recoverable measured, indicated and inferred resource. This percentage is reviewed annually.

Restoration costs expected to be incurred are provided for as part of development phase that give rise to the need for restoration.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

Impairment of non-financial assets

Goodwill and exploration and evaluation that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount.

Recoverable amount is the higher of an asset’s fair value less costs to sell and value-in-use. The value-in-use is the present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a cash-generating unit.

The carrying value of capitalised exploration and evaluation is assessed for impairment at the area of interest level whenever facts and circumstances suggest that the carrying amount of the asset may exceed its recoverable amount.

Trade and other payables

These amounts represent liabilities for goods and services provided to the consolidated entity prior to the end of the financial year and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition.

Borrowings

Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method.

Where there is an unconditional right to defer settlement of the liability for at least 12 months after the reporting date, the loans or borrowings are classified as non-current.

Finance costs

Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in the period in which they are incurred, including: - interest on short-term and long-term borrowings

Provisions

Provisions are recognised when the consolidated entity has a present (legal or constructive) obligation as a result of a past event, it is probable the consolidated entity will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. If the time value of money is material, provisions are discounted using a current pre-tax rate specific to the liability. The increase in the provision resulting from the passage of time is recognised as a finance cost.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

Employee benefits

Wages and salaries and annual leave

Liabilities for wages and salaries, including non-monetary benefits, and annual leave expected to be settled within 12 months of the reporting date are recognised in current liabilities in respect of employees' services up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled.

Long service leave

The liability for long service leave is recognised in current and non-current liabilities, depending on the unconditional right to defer settlement of the liability for at least 12 months after the reporting date. The liability is measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on national government bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.

Defined contribution superannuation expense

Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred.

Share-based payments

Equity-settled share-based compensation benefits are provided to employees.

Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the rendering of services.

The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined using the Binomial option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the consolidated entity receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions.

The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous periods.

If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit as at the date of modification.

If the non-vesting condition is within the control of the consolidated entity or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the consolidated entity or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.

If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a modification.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

Issued capital

Ordinary shares are classified as equity.

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

Business combinations

The acquisition method of accounting is used to account for business combinations regardless of whether equity instruments or other assets are acquired.

The consideration transferred is the sum of the acquisition-date fair values of the assets transferred, equity instruments issued or liabilities incurred by the acquirer to former owners of the acquiree and the amount of any noncontrolling interest in the acquiree. For each business combination, the non-controlling interest in the acquiree is measured at either fair value or at the proportionate share of the acquiree's identifiable net assets. All acquisition costs are expensed as incurred to profit or loss.

On the acquisition of a business, the consolidated entity assesses the financial assets acquired and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic conditions, the consolidated entity's operating or accounting policies and other pertinent conditions in existence at the acquisition-date.

Where the business combination is achieved in stages, the consolidated entity remeasures its previously held equity interest in the acquiree at the acquisition-date fair value and the difference between the fair value and the previous carrying amount is recognised in profit or loss.

Contingent consideration to be transferred by the acquirer is recognised at the acquisition-date fair value. Subsequent changes in the fair value of contingent consideration classified as an asset or liability is recognised in profit or loss. Contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity.

The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-controlling interest in the acquiree and the fair value of the consideration transferred and the fair value of any pre-existing investment in the acquiree is recognised as goodwill. If the consideration transferred and the pre-existing fair value is less than the fair value of the identifiable net assets acquired, being a bargain purchase to the acquirer, the difference is recognised as a gain directly in profit or loss by the acquirer on the acquisition-date, but only after a reassessment of the identification and measurement of the net assets acquired, the non-controlling interest in the acquiree, if any, the consideration transferred and the acquirer's previously held equity interest in the acquirer.

Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the provisional amounts recognised and also recognises additional assets or liabilities during the measurement period, based on new information obtained about the facts and circumstances that existed at the acquisition-date. The measurement period ends on either the earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the information possible to determine fair value.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

Earnings per share

Basic earnings per share

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

Diluted earnings per share

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

Goods and Services Tax ('GST') and other similar taxes

Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of the expense.

Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of financial position.

Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the tax authority, are presented as operating cash flows.

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

New Accounting Standards and Interpretations not yet mandatory or early adopted

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the consolidated entity for the annual reporting period ended 30 June 2012. The consolidated entity's assessment of the impact of these new or amended Accounting Standards and Interpretations, most relevant to the consolidated entity, are set out below.

AASB 9 Financial Instruments, 2009-11 Amendments to Australian Accounting Standards arising from AASB 9, 20107 Amendments to Australian Accounting Standards arising from AASB 9 and AASB 2012-6 Amendments to Australian Accounting Standards – Mandatory Effective Date of AASB 9 and Transition Disclosures

This standard and its consequential amendments are applicable to annual reporting periods beginning on or after 1 January 2015 and completes phase I of the IASB's project to replace IAS 39 (being the international equivalent to AASB 139 'Financial Instruments: Recognition and Measurement'). This standard introduces new classification and measurement models for financial assets, using a single approach to determine whether a financial asset is measured at amortised cost or fair value. To be classified and measured at amortised cost, assets must satisfy the business model test for managing the financial assets and have certain contractual cash flow characteristics. All other financial instrument assets are to be classified and measured at fair value. This standard allows an irrevocable election on initial recognition to present gains and losses on equity instruments (that are not held-for-trading) in other comprehensive income, with dividends as a return on these investments being recognised in profit or loss. In addition, those equity instruments measured at fair value through other comprehensive income would no longer have to apply any impairment requirements nor would there be any 'recycling' of gains or losses through profit or loss on disposal. The accounting for financial liabilities continues to be classified and measured in accordance with AASB 139, with one exception, being that the portion of a change of fair value relating to the entity’s own credit risk is to be presented in other comprehensive income unless it would create an accounting mismatch. The consolidated entity will adopt this standard from 1 July 2015 but the impact of its adoption is yet to be assessed by the consolidated entity.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

AASB 2010-8 Amendments to Australian Accounting Standards- Deferred Tax: Recovery of Underlying Assets These amendments are applicable to annual reporting periods beginning on or after 1 January 2012 and a practical approach for the measurement of deferred tax relating to investment properties measured at fair value, property, plant and equipment and intangible assets measured using the revaluation model. The measurement of deferred tax for these specified assets is based on the presumption that the carrying amount of the underlying asset will be recovered entirely through sale, unless the entity has clear evidence that economic benefits of the underlying asset will be consumed during its economic life. The consolidated entity is yet to quantify the tax effect of adopting these amendments from 1 July 2012.

AASB 10 Consolidated Financial Statements

This standard is applicable to annual reporting periods beginning on or after 1 January 2013. The standard has a new definition of 'control'. Control exists when the reporting entity is exposed, or has the rights, to variable returns (e.g. dividends, remuneration, returns that are not available to other interest holders including losses) from its involvement with another entity and has the ability to affect those returns through its 'power' over that other entity. A reporting entity has power when it has rights (e.g. voting rights, potential voting rights, rights to appoint key management, decision making rights, kick out rights) that give it the current ability to direct the activities that significantly affect the investee’s returns (e.g. operating policies, capital decisions, appointment of key management). The consolidated entity will not only have to consider its holdings and rights but also the holdings and rights of other shareholders in order to determine whether it has the necessary power for consolidation purposes. The adoption of this standard from 1 July 2013 may have an impact where the consolidated entity has a holding of less than 50% in an entity, has de facto control, and is not currently consolidating that entity.

AASB 11 Joint Arrangements

This standard is applicable to annual reporting periods beginning on or after 1 January 2013. The standard defines which entities qualify as joint ventures and removes the option to account for joint ventures using proportional consolidation. Joint ventures, where the parties to the agreement have the rights to the net assets will use equity accounting. Joint operations, where the parties to the agreements have the rights to the assets and obligations for the liabilities will account for the assets, liabilities, revenues and expenses separately, using proportionate consolidation. The adoption of this standard from 1 July 2013 will not have a material impact on the consolidated entity.

AASB 12 Disclosure of Interests in Other Entities

This standard is applicable to annual reporting periods beginning on or after 1 January 2013. It contains the entire disclosure requirement associated with other entities, being subsidiaries, associates and joint ventures. The disclosure requirements have been significantly enhanced when compared to the disclosures previously located in AASB 127 'Consolidated and Separate Financial Statements', AASB 128 'Investments in Associates', AASB 131 'Interests in Joint Ventures' and Interpretation 112 'Consolidation - Special Purpose Entities'. The adoption of this standard from 1 July 2013 will significantly increase the amount of disclosures required to be given by the consolidated entity such as significant judgements and assumptions made in determining whether it has a controlling or non-controlling interest in another entity and the type of non-controlling interest and the nature and risks involved.

AASB 13 Fair Value Measurement and AASB 2011-8 Amendments to Australian Accounting Standards arising from AASB 13

This standard and its consequential amendments are applicable to annual reporting periods beginning on or after 1 January 2013. The standard provides a single robust measurement framework, with clear measurement objectives, for measuring fair value using the 'exit price' and it provides guidance on measuring fair value when a market becomes less active. The 'highest and best use' approach would be used to measure assets whereas liabilities would be based on transfer value. As the standard does not introduce any new requirements for the use of fair value, its impact on adoption by the consolidated entity from 1 July 2013 should be minimal, although there will be increased disclosures where fair value is used.

AASB 127 Separate Financial Statements (Revised)

AASB 128 Investments in Associates and Joint Ventures (Reissued)

These standards are applicable to annual reporting periods beginning on or after 1 January 2013. They have been modified to remove specific guidance that is now contained in AASB 10, AASB 11 and AASB 12. The adoption of these revised standards from 1 July 2013 will not have a material impact on the consolidated entity.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

AASB 119 Employee Benefits (September 2011) and AASB 2011-10 Amendments to Australian Accounting Standards arising from AASB 119 (September 2011)

This revised standard and its consequential amendments are applicable to annual reporting periods beginning on or after 1 January 2013. The amendments eliminate the corridor approach for the deferral of gains and losses; streamlines the presentation of changes in assets and liabilities arising from defined benefit plans, including requiring remeasurements to be presented in other comprehensive income; and enhances the disclosure requirements for defined benefit plans. The amendments also change the definition of short-term employee benefits, from 'due to' to 'expected to' be settled within 12 months and will require annual leave that is not expected to be wholly settled within 12 months to be discounted allowing for expected salary levels in the future period when the leave is expected to be taken. The adoption of the revised standard from 1 July 2013 is expected to reduce the reported annual leave liability and increase disclosures of the consolidated entity.

AASB 2011-4 Amendments to Australian Accounting Standards to Remove Individual Key Management Personnel Disclosure Requirement

These amendments are applicable to annual reporting periods beginning on or after 1 July 2013, with early adoption not permitted. They amend AASB 124 'Related Party Disclosures' by removing the disclosure requirements for individual key management personnel ('KMP'). The adoption of these amendments from 1 July 2013 will remove the duplication of information relating to individual KMP in the notes to the financial statements and the directors report. As the aggregate disclosures are still required by AASB 124 and during the transitional period the requirements may be included in the Corporations Act or other legislation, it is expected that the amendments will not have a material impact on the consolidated entity.

AASB 2011-7 Amendments to Australian Accounting Standards arising from the Consolidation and Joint Arrangements Standards

The amendments are applicable to annual reporting periods beginning on or after 1 January 2013. The amendments make numerous consequential changes to a range of Australian Accounting Standards and Interpretations, following the issuance of AASB 10, AASB 11, AASB 12 and revised AASB 127 and AASB 128. The adoption of these amendments from 1 July 2013 will not have a material impact on the consolidated entity.

AASB 2011-9 Amendments to Australian Accounting Standards - Presentation of Items of Other Comprehensive Income

These amendments are applicable to annual reporting periods beginning on or after 1 July 2012. The amendments requires grouping together of items within other comprehensive income on the basis of whether they will eventually be 'recycled' to the profit or loss (reclassification adjustments). The change provides clarity about the nature of items presented as other comprehensive income and the related tax presentation. The adoption of the revised standard from 1 July 2012 will impact the consolidated entity’s presentation of its statement of comprehensive income.

AASB 2012-2 Amendments to Australian Accounting Standards - Disclosures - Offsetting Financial Assets and Financial Liabilities

The amendments are applicable to annual reporting periods beginning on or after 1 January 2013. The disclosure requirements of AASB 7 'Financial Instruments: Disclosures' (and consequential amendments to AASB 132 'Financial Instruments: Presentation') have been enhanced to provide users of financial statements with information about netting arrangements, including rights of set-off related to an entity's financial instruments and the effects of such rights on its statement of financial position. The adoption of the amendments from 1 July 2013 will increase the disclosures by the consolidated entity.

AASB 2012-3 Amendments to Australian Accounting Standards - Offsetting Financial Assets and Financial Liabilities The amendments are applicable to annual reporting periods beginning on or after 1 January 2014. The amendments add application guidance to address inconsistencies in the application of the offsetting criteria in AASB 132 'Financial Instruments: Presentation', by clarifying the meaning of "currently has a legally enforceable right of set-off"; and clarifies that some gross settlement systems may be considered to be equivalent to net settlement. The adoption of the amendments from 1 July 2014 will not have a material impact on the consolidated entity.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 1. Significant accounting policies (continued)

AASB 2012-5 Amendments to Australian Accounting Standards arising from Annual Improvements 2009-2011 Cycle The amendments are applicable to annual reporting periods beginning on or after 1 January 2013. The amendments affect five Australian Accounting Standards as follows: Confirmation that repeat application of AASB 1 (IFRS 1) 'Firsttime Adoption of Australian Accounting Standards' is permitted; Clarification of borrowing cost exemption in AASB 1; Clarification of comprehensive information requirements when an entity provides a third balance sheet in accordance with AASB 101 'Presentation of Financial Statements'; Clarification that servicing of equipment is covered by AASB 116 'Property, Plant and Equipment', if such equipment is used for more than one period; AASB 132 'Financial Instruments: Presentation' Clarification of the tax effect of distributions to holders of an equity instrument is recognised in the income statement; and clarification of the financial reporting requirements in AASB 134 'Interim Financial Reporting' and the disclosure requirements of segment assets and liabilities. The adoption of the amendments from 1 July 2013 will not have a material impact on the consolidated entity.

Interpretation 20 Stripping Costs in the Production Phase of a Surface Mine and AASB 2011-12 Amendments to Australian Accounting Standards arising from Interpretation 20

This interpretation and its consequential amendments are applicable to annual reporting periods beginning on or after 1 January 2013 The Interpretation clarifies when production stripping costs should lead to the recognition of an asset and how that asset should be initially and subsequently measured. The Interpretation only deals with waste removal costs that are incurred in surface mining activities during the production phase of the mine. The adoption of the interpretation and the amendments from 1 July 2013 will not have a material impact on the consolidated entity.

Note 2. Critical accounting judgements, estimates and assumptions

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

Provision for impairment of inventories

The provision for impairment of inventories assessment requires a degree of estimation and judgement. The level of the provision is assessed by taking into account the recent sales experience, the ageing of inventories and other factors that affect inventory obsolescence.

Estimation of useful lives of assets

The consolidated entity determines the estimated useful lives and related depreciation and amortisation charges for its property, plant and equipment and finite life intangible assets. The useful lives could change significantly as a result of technical innovations or some other event. The depreciation and amortisation charge will increase where the useful lives are less than previously estimated lives, or technically obsolete or non-strategic assets that have been abandoned or sold will be written off or written down.

Income tax

The consolidated entity is subject to income taxes in the jurisdictions in which it operates. Significant judgement is required in determining the provision for income tax. There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The consolidated entity recognises liabilities for anticipated tax audit issues based on the consolidated entity’s current understanding of the tax law. Where the final tax outcome of these matters is different from the carrying amounts, such differences will impact the current and deferred tax provisions in the period in which such determination is made.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 2. Critical accounting judgements, estimates and assumptions (continued)

Recovery of deferred tax assets

Deferred tax assets are recognised for deductible temporary differences only if the consolidated entity considers it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Note 3. Restatement of comparatives

Restatement of capitalised exploration and evaluation costs

In the consolidated entity's joint venture, East Kundana Joint Venture, it was found that certain expenses in relation to exploration and evaluation had been expensed to profit or loss and not capitalised as part of the asset. As a result of this, the consolidated entity has restated the financials for the adjustment of $36,149 to correct the balances. An extract of the adjustment and its effect of the statement of comprehensive income and statement of financial position is shown below.

Earnings per share and diluted earnings per share for the financial year ended 30 June 2011 were restated from 8.86 cents to 8.92 cents.

Earnings per share and diluted earnings per share from continuing operations for the financial year ended 30 June 2011 were restated from 8.10 cents to 8.16 cents.

Statement of comprehensive income

2011 $ Reported (7,124,747)	$ Adjustment 36,149 Consolidated	2011 $ Restated (7,088,598)
7,593,995 (2,664,456)	36,149 -	7,630,144 (2,664,456)
4,929,539 458,778	36,149 -	4,965,688 458,778
5,388,317 200,456	36,149 -	5,424,466 200,456
5,588,773	36,149	5,624,922

Statement of financial position at the beginning of the earliest comparative period

When there is a restatement of comparatives, it is mandatory to provide a third statement of financial position at the beginning of the earliest comparative period, being 1 July 2010. However, as there were no adjustments made as at 1 July 2010, the consolidated entity has elected not to show the 1 July 2010 statement of financial position.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 3. Restatement of comparatives (continued)

Statement of financial position at the end of the earliest comparative period

2011 $ Reported 2,926,420	$ Adjustment 36,149 Consolidated	2011 $ Restated 2,962,569
23,352,667	36,149	23,388,816
38,825,469	36,149	38,861,618
6,822,232	-	6,822,232
32,003,237	36,149	32,039,386
12,184,155	36,149	12,220,304
32,003,237	36,149	32,039,386
32,003,237	36,149	32,039,386

Note 4. Operating segments

Identification of reportable operating segments

The consolidated entity has one operating segment. Based on the internal reports that are reviewed and used by the Board of Directors (who are identified as the Chief Operating Decision Makers ('CODM')) in assessing performance and in determining the allocation of resources.

Major customers

During the year ended 30 June 2012 approximately 100% (2011: 99%) of the consolidated entity's external revenue was derived from sales to one customer.

Operating segment

As the consolidated entity only has one segment the information relating to this segment is detailed throughout the financial statements.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 5. Revenue

Note 5. Revenue
- - - - Revenue from continuing operations Sales revenue Interest Sales of gold Other revenue Sales of silver From continuing operations	2012 2011 $ $ 15,285,272 13,005,085 - 50,438 15,285,272 13,055,523 100,574 149,725 15,385,846 13,205,248 Consolidated
	15,285,272	13,055,523
	100,574	149,725
	15,385,846	13,205,248

Note 6. Share of profits of associates accounted for using the equity method

Share of profit - associates	2012 2011 $ $ 2,614,353 2,941,169 Consolidated

Note 7. Other income

- - Net gain on disposal of investments Other income Other income	2012 2011 $ $ 2,250 241 9,864 83,815 12,114 84,056 Consolidated	2012 2011 $ $ 2,250 241 9,864 83,815 12,114 84,056 Consolidated
	12,114	84,056

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 8. Expenses

Note 8. Expenses
- - - - Superannuation expense Profit before income tax from continuing operations includes the following specific expenses: Total depreciation and amortisation Total depreciation Mining plant and equipment Interest and finance charges paid/payable Amortisation Mine development Plant and equipment Depreciation Finance costs Rental expense relating to operating leases Minimum lease payments Defined contribution superannuation expense	2012 2011 $ $ 2,314 3,390 1,657,676 515,694 1,659,990 519,084 2,034,138 1,105,798 3,694,128 1,624,882 337,650 94,745 6,813 6,926 63,621 61,034 Consolidated
	1,659,990	519,084
	2,034,138	1,105,798
	3,694,128	1,624,882
	337,650	94,745
	6,813	6,926
	63,621	61,034

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 9. Income tax expense

- - - - - - - - - - - - - - - - - - - - Deferred tax included in income tax expense comprises: Decrease/(increase) in deferred tax assets (note 19) Aggregate income tax expense Adjustment recognised for prior periods Numerical reconciliation of income tax expense and tax at the statutory rate Profit from continuing operations Deferred tax - origination and reversal of temporary differences Tax at the statutory tax rate of 30% Acquisition costs on Liberia Increase in deferred tax liabilities (note 25) Current tax Income tax expense is attributable to: Income tax expense Profit before income tax expense from continuing operations Amounts charged/(credited) directly to equity Sundry items Adjustment recognised for prior periods Deferred tax assets (note 19) Profit before income tax expense from discontinued operations Aggregate income tax expense Loss from discontinued operations Tax effect amounts which are not deductible/(taxable) in calculating taxable income: Income tax expense Deferred tax - origination and reversal of temporary differences	2012 2011 $ $ 1,545,622 1,804,797 224,425 729,252 (22,168) 58,384 1,747,879 2,592,433 1,747,879 2,664,456 - (72,023) 1,747,879 2,592,433 172,396 (63,841) 52,029 793,093 224,425 729,252 4,901,157 7,630,144 - 386,755 4,901,157 8,016,899 1,470,347 2,405,070 286,517 - 13,183 128,979 1,770,047 2,534,049 (22,168) 58,384 1,747,879 2,592,433 11,443 (69,655) Consolidated	2012 2011 $ $ 1,545,622 1,804,797 224,425 729,252 (22,168) 58,384 1,747,879 2,592,433 1,747,879 2,664,456 - (72,023) 1,747,879 2,592,433 172,396 (63,841) 52,029 793,093 224,425 729,252 4,901,157 7,630,144 - 386,755 4,901,157 8,016,899 1,470,347 2,405,070 286,517 - 13,183 128,979 1,770,047 2,534,049 (22,168) 58,384 1,747,879 2,592,433 11,443 (69,655) Consolidated
	1,747,879	2,592,433
	1,747,879 -	2,664,456 (72,023)
	1,747,879	2,592,433
	172,396 52,029	(63,841) 793,093
	224,425	729,252
	4,901,157 -	7,630,144 386,755
	4,901,157	8,016,899
	1,470,347 286,517 13,183	2,405,070 - 128,979
	1,770,047 (22,168)	2,534,049 58,384
	1,747,879	2,592,433
	11,443	(69,655)

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 10. Discontinued operations

Description

Due to a change in capital of Onslow Resources Ltd ('ORL'), a public company not listed on the Australian Securities Exchange, ORL is no longer a wholly-owned subsidiary of Rand Mining Limited but is now an investment held-for-sale as Rand Mining Limited's ownership changed from 100% to 6.35% in the financial year ended 30 June 2011.

As a result of this, the consolidated entity recognised a profit on disposal of the business of $626,831 and accounted for the remaining investment of $17,902 as an available-for-sale-financial asset in the comparative period.

Financial performance information

- - - - - - - - - - - - - - - - - - - - - - Gain on disposal before income tax Loss after income tax benefit Profit after income tax expense from discontinued operations Gain on disposal before income tax Net liabilities before deemed disposal Gain on disposal after income tax Income tax expense Total revenue Gain on disposal after income tax expense Total expenses Finance costs Loss before income tax benefit Income tax expense Income tax benefit Administration expenses Employee benefits expense Impairment of exploration and evaluation Depreciation and amortisation expense Revenue Less: net assets after deemed disposal Details of the disposal	2012 2011 $ $ - 189 - 189 - (9,037) - (312) - (132,424) - (80,403) - (18,089) - (240,265) - (240,076) - 72,023 - (168,053) - 626,831 - - - 626,831 - 458,778 2012 2011 $ $ - 608,926 - 17,905 - 626,831 - - - 626,831 Consolidated Consolidated	2012 2011 $ $ - 189 - 189 - (9,037) - (312) - (132,424) - (80,403) - (18,089) - (240,265) - (240,076) - 72,023 - (168,053) - 626,831 - - - 626,831 - 458,778 2012 2011 $ $ - 608,926 - 17,905 - 626,831 - - - 626,831 Consolidated Consolidated
	- -	626,831 -
	-	626,831

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 11. Current assets - cash and cash equivalents

Note 11. Current assets - cash and cash equivalents
- - Cash on deposit Cash on hand Cash at bank	2012 2011 $ $ 200 200 1,499,836 2,439,912 185,220 185,220 1,685,256 2,625,332 Consolidated
	1,685,256	2,625,332

Note 12. Current assets - trade and other receivables

Note 12. Current assets - trade and other receivables
- - Loans from related parties Prepaid drilling (refer Note 36) Other receivables Goods and services tax receivable	2012 2011 $ $ 138,594 111,220 3,821 50,665 - 472,776 624,627 - 767,042 634,661 Consolidated
	767,042	634,661

Impairment of receivables

Movements in the provision for impairment of receivables are as follows:

- - Deconsolidation of Onslow Resources Limited Closing balance Opening balance	2012 2011 $ $ - 80,143 - (80,143) - - Consolidated	2012 2011 $ $ - 80,143 - (80,143) - - Consolidated
	-	-

Past due but not impaired

There were no past due but not impaired receivables at 30 June 2012 or 30 June 2011.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 13. Current assets - inventories

Note 13. Current assets - inventories
- - Ore stockpiles Gold on hand Gold in transit	2012 2011 $ $ 3,312,189 1,650,606 627,573 - 14,257,840 10,562,203 18,197,602 12,212,809 Consolidated
	18,197,602	12,212,809

Gold on hand at 30 June 2012 has a net realisable value of $99,260,879 (2011: $20,795,667) measured at spot rate of $1,573.15 (2011: $1,420.66). Gold in transit had a net realisable value of $4,341,756 (2011: $nil) measured at spot rate of $1,573.15 (2011: $1,452.15).

Note 14. Non-current assets - investments accounted for using the equity method

Note 14. Non-current assets - investments accounted for using the equity method
- - Less: provision for impairment Investment in associate - Tribune Resources Limited	2012 2011 $ $ 19,074,193 16,555,274 (4,765,507) (2,276,340) 14,308,686 14,278,934 Consolidated
	14,308,686	14,278,934

Refer to note 39 for further information on investments in associates.

Refer to note 40 for further information on interests in joint ventures.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 15. Non-current assets - available-for-sale financial assets

- - - - Refer to note 31 for further information on financial instruments. Revaluation decrements Additions Opening fair value Revaluation increments Closing fair value Reconciliation Impairment of assets Write off of assets Reconciliation of the fair values at the beginning and end of the current and previous financial year are set out Listed securities - at fair value Unlisted securities - at fair value	2012 2011 $ $ 318,194 455,357 - 17,902 318,194 473,259 473,259 438,322 150,000 93,705 - 20,157 (187,064) - (118,001) (75,803) - (3,122) 318,194 473,259 Consolidated	2012 2011 $ $ 318,194 455,357 - 17,902 318,194 473,259 473,259 438,322 150,000 93,705 - 20,157 (187,064) - (118,001) (75,803) - (3,122) 318,194 473,259 Consolidated
	318,194	473,259
	473,259 150,000 - (187,064) (118,001) -	438,322 93,705 20,157 - (75,803) (3,122)
	318,194	473,259

Note 16. Non-current assets - property, plant and equipment

Note 16. Non-current assets - property, plant and equipment
- - - - - - - - Mining plant and equipment - at cost Construction work in progress - at cost Less: Accumulated depreciation Plant and equipment - at cost Less: Accumulated depreciation	2012 2011 $ $ 296,214 294,086 (290,998) (288,684) 5,216 5,402 6,107,505 4,499,248 (4,024,194) (2,976,706) 2,083,311 1,522,542 488,046 1,434,625 488,046 1,434,625 2,576,573 2,962,569 Consolidated
	5,216	5,402
	6,107,505 (4,024,194)	4,499,248 (2,976,706)
	2,083,311	1,522,542
	488,046	1,434,625
	488,046	1,434,625
	2,576,573	2,962,569

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 16. Non-current assets - property, plant and equipment (continued)

Reconciliations

Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below:

$ - - - - - - - - - - - $ - - - - - - - - - Balance at 30 June 2011 Balance at 30 June 2012 Consolidated Reconciliations of the written down values at out below: Balance at 1 July 2010 Note 17. Non-current assets - exploration Exploration and evaluation - at cost Additions Additions Transfers in/(out) Disposals Impairment of assets Reconciliations Disposals Additions Transfers in/(out) Transfers in/(out) Depreciation expense Additions Depreciation expense Balance at 30 June 2011 Balance at 1 July 2010 Consolidated Disposals Balance at 30 June 2012 Impairment of assets	$ 890,000 - (890,000) - - buildings Land and	$ 18,767 4,973 (14,636) - (3,702) Plant and equipment	$ 18,767 4,973 (14,636) - (3,702) Plant and equipment	$ 18,767 4,973 (14,636) - (3,702) Plant and equipment	Total $ 2,900,783 1,485,818 (904,636) - (519,396)
	- - - - -	5,402 2,128 - - (2,314)	1,522,542 11,142 (28,743) 2,236,046 (1,657,676)	1,434,625 1,464,934 - (2,411,513) -	2,962,569 1,478,204 (28,743) (175,467) (1,659,990)
	-	5,216	2,083,311	488,046	2,576,573

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 18. Non-current assets - mine development

Note 18. Non-current assets - mine development
- - Less: Accumulated amortisation Mine development - at cost	2012 2011 $ $ 16,712,968 11,783,937 (8,704,265) (6,532,073) 8,008,703 5,251,864 Consolidated
	8,008,703	5,251,864

Reconciliations

Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below:

$ $ $ $ - - - - - - - - - - - - Additions Transfers in/(out) Balance at 30 June 2012 Amortisation expense Consolidated Additions Balance at 30 June 2011 Amortisation expense Balance at 1 July 2010	$ 5,008,870 1,348,792 (1,105,798) development Mine	Total $ 5,008,870 1,348,792 (1,105,798)
	5,251,864 4,586,697 204,280 (2,034,138)	5,251,864 4,586,697 204,280 (2,034,138)
	8,008,703	8,008,703

Included in Mine Development is $183,729 in capitalised borrowing expenses. During the year $17,764 of borrowing costs were capitalised in the month of July. This represents 100% of costs incurred in the month of July. Rubicon started production on 1 August 2012.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 19. Non-current assets - deferred tax

- - - - - - - - Credited/(charged) to profit or loss (note 9) Closing balance Opening balance Movements: Trade payables Other Accrued expenses Note 20. Current liabilities - trade and other payables Credited/(charged) to equity Capitalised mine development costs Amounts recognised in equity: Deferred tax asset Amounts recognised in profit or loss: Transaction costs on share issue Provisions Accrued expenses Deferred tax asset comprises temporary differences attributable to:	2012 2011 $ $ - 6,675 146,526 149,295 - 160,175 4,800 7,577 151,326 323,722 58,212 69,655 58,212 69,655 209,538 393,377 393,377 259,881 (172,396) 63,841 (11,443) 69,655 209,538 393,377 2012 2011 $ $ 3,198,534 2,130,952 52,583 38,502 3,251,117 2,169,454 Consolidated Consolidated	2012 2011 $ $ - 6,675 146,526 149,295 - 160,175 4,800 7,577 151,326 323,722 58,212 69,655 58,212 69,655 209,538 393,377 393,377 259,881 (172,396) 63,841 (11,443) 69,655 209,538 393,377 2012 2011 $ $ 3,198,534 2,130,952 52,583 38,502 3,251,117 2,169,454 Consolidated Consolidated
	3,251,117	2,169,454

Refer to note 31 for further information on financial instruments.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 21. Current liabilities - borrowings

Bank loans	2012 2011 $ $ 3,250,000 - Consolidated

Refer to note 24 for further information on assets pledged as security and financing arrangements and note 31 for further information on financial instruments.

Note 22. Current liabilities - income tax

Note 22. Current liabilities - income tax
Total secured liabilities Provision for income tax Note 24. Non-current liabilities - borrowings Bank loans Refer to note 31 for further information on financial instruments. Employee benefits Note 23. Current liabilities - provisions	2012 2011 $ $ 273,354 781,377 2012 2011 $ $ 135,429 152,946 2012 2011 $ $ 1,750,000 1,275,000 Consolidated Consolidated Consolidated

The total secured liabilities (current and non-current) are as follows:

	Consolidated	Consolidated
	2012	2011
	$	$
Bank loans	5,000,000	1,275,000

Assets pledged as security

The bank loans are secured over specified East Kundana Joint Venture Tenements.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 24. Non-current liabilities - borrowings (continued)

Financing arrangements

Unrestricted access was available at the reporting date to the following lines of credit:

-
-
Note 26. Non-current liabilities - provisions
Unused at the reporting date
Capitalised mining development
Capitalised exploration
Total facilities
Note 25. Non-current liabilities - deferred tax
Rehabilitation
Investment in associate
Other
Deferred tax liability comprises temporary differences
attributable to:
Bank loans
Opening balance
Movements:
Bank loans
Amounts recognised in profit or loss:
Bank loans
Used at the reporting date
Closing balance
Deferred tax liability
Charged to profit or loss (note 9)

2012
2011
$
$
5,000,000
5,000,000
5,000,000
1,275,000
-
3,725,000
2012
2011
$
$
2,093,021
2,084,095
-
8,644
32,420
-
25,343
6,016
2,150,784
2,098,755
2,098,755
1,305,662
52,029
793,093
2,150,784
2,098,755
2012
2011
$
$
352,993
344,700
Consolidated
Consolidated
Consolidated

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 26. Non-current liabilities - provisions (continued)

Rehabilitation

The provision is in respect of consolidated entity’s obligation to rehabilitate the Raleigh Underground mine site upon cessation of production in accordance with the state environmental regulatory requirements. The consolidated entity has been assured that the site would be restored using technology and materials that are available currently.

The provision for site restoration has been calculated using a discount rate of 0% as adjustments to present value are not material.

Movements in provisions

Movements in each class of provision during the current financial year, other than employee benefits, are set out below:

$ $ $ $ - - - - Additional provisions recognised Carrying amount at the start of the year Carrying amount at the end of the year Consolidated - 2012	Rehabilitation $ 344,700 8,293
	352,993

Note 27. Equity - issued capital

2012 2011 Shares Shares 60,841,209 60,841,209 No of shares 60,841,209 - 60,841,209 60,841,209 Consolidated	2012 2011 $ $ 17,573,427 17,573,427 Issue price $ 17,578,448 (5,021) 17,573,427 17,573,427 Consolidated	2012 2011 $ $ 17,573,427 17,573,427 Issue price $ 17,578,448 (5,021) 17,573,427 17,573,427 Consolidated
No of shares 60,841,209 -	Issue price	$ 17,578,448 (5,021)
60,841,209		17,573,427
60,841,209		17,573,427

Ordinary shares

Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value.

On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

Share buy-back

There is no current on-market share buy-back.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 27. Equity - issued capital (continued)

Share options

At 30 June 2012 there were 4,000,000 (2011: 4,000,000) options issued over ordinary shares.

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

Capital risk management

The consolidated entity's objectives when managing capital are to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the consolidated entity may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

The consolidated entity would look to raise capital when an opportunity to invest in a business or company was seen as value adding relative to the current parent entity's share price at the time of the investment. The consolidated entity is not actively pursuing additional investments in the short term as it continues to integrate and grow its existing businesses in order to maximise synergies.

The consolidated entity is subject to certain financing arrangements covenants and meeting these are given priority in all capital risk management decisions. There have been no events of default on the financing arrangements during the financial year.

The capital risk management policy remains unchanged from the 2011 Annual Report.

Note 28. Equity - reserves

Note 28. Equity - reserves
- - Share-based payments reserve Available-for-sale reserve	2012 2011 $ $ 542,108 826,855 1,418,800 1,418,800 1,960,908 2,245,655 Consolidated
	1,960,908	2,245,655

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 28. Equity - reserves (continued)

Note 28. Equity - reserves (continued)
$ $ - - - - Share of revaluation movement for investment in associate Balance at 30 June 2012 Balance at 30 June 2011 Write-off revaluation on disposal of land and buildings Impairment to profit or loss Balance at 1 July 2010 Revaluation - net of tax Revaluation - net of tax surplus Impairment to profit or loss Revaluation Consolidated Share of revaluation movement for investment in associate	$ 579,843 - - (579,843) - surplus Revaluation	$ 754,093 (58,770) 79,015 - 52,517 Available- for-sale	$ 1,418,800 - - - - payments Share-based	Total $ 2,752,736 (58,770) 79,015 (579,843) 52,517
	- - - -	826,855 (305,064) 115,751 (95,434)	1,418,800 - - -	2,245,655 (305,064) 115,751 (95,434)
	-	542,108	1,418,800	1,960,908

Revaluation surplus reserve

The reserve is used to recognise increments and decrements in the fair value of land and buildings, excluding investment properties.

Available-for-sale reserve

The reserve is used to recognise increments and decrements in the fair value of available-for-sale financial assets.

Share-based payments reserve

The reserve is used to recognise the value of equity benefits provided to employees and directors as part of their remuneration, and other parties as part of their compensation for services.

Note 29. Equity - retained profits

- - - - Gain on disposal of land and buildings Retained profits at the beginning of the financial year Retained profits for 2011 have been restated (refer Note 3). Profit after income tax expense for the year Retained profits at the end of the financial year	2012 2011 $ $ 12,220,304 6,088,301 3,153,278 5,424,466 - 707,537 15,373,582 12,220,304 Consolidated	2012 2011 $ $ 12,220,304 6,088,301 3,153,278 5,424,466 - 707,537 15,373,582 12,220,304 Consolidated
	15,373,582	12,220,304

Note 30. Equity - dividends

Dividends

There were no dividends paid or declared during the current or previous financial year.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 30. Equity - dividends (continued)

Franking credits Franking credits available for subsequent financial years based on a tax rate of 30%	2012 2011 $ $ 8,026,833 6,190,044 Consolidated

The above amounts represent the balance of the franking account as at the end of the financial year, adjusted for: ● franking credits that will arise from the payment of the amount of the provision for income tax at the reporting date
franking debits that will arise from the payment of dividends recognised as a liability at the reporting date
franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date

Note 31. Financial instruments

Financial risk management objectives

The consolidated entity's activities expose it to a variety of financial risks: market risk (including price risk and interest rate risk) and liquidity risk. The consolidated entity's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the consolidated entity. The consolidated entity uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in the case of interest rate and other price risks.

Risk management is carried out by senior finance executives ('finance') under policies approved by the Board of Directors ('Board'). These policies include identification and analysis of the risk exposure of the consolidated entity and appropriate procedures, controls and risk limits. Finance identifies, evaluates and hedges financial risks within the consolidated entity's operating units. Finance reports to the Board on a monthly basis.

Market risk

Foreign currency risk

The consolidated entity is not exposed to any significant foreign currency risk.

Price risk

The consolidated entity is exposed to equity securities price risks and bullion price risk. This arises from investments held by the consolidated entity and classified on the statement of financial position as available ‐ for ‐ sale financial assets and bullion held as inventory.

The policy of the consolidated entity is to sell gold at spot price and has not entered into any hedging contracts. The consolidated entity's revenues were exposed to fluctuation in the price of gold. If the average selling price of gold of US$1671.82 (2011: US$1,370) for the financial year had increased/decreased by 10% the change in the profit before income tax for the consolidated group would have been an increase /decrease of A$1,546,582 (2011: A$1,215,852).

If there was a 10% increase or decrease in market price of gold, the net realisable value of bullion on hand would increase/(decrease) by $3,295,591 (2011: $2,079,560) and the bullion in transit would increase/(decrease) by $147,148 (2011: $nil). As gold on hand is held at cost there would be no impact on profit or loss.

Interest rate risk

The consolidated entity's main interest rate risk arises from cash equivalents and loans and other receivables with variable interest rates.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 31. Financial instruments (continued)

As at the reporting date, the consolidated entity had the following variable rate borrowings and interest rate swap contracts outstanding:

	2012	2012	2011	2011
	Weighted		Weighted
	average		average
	interest rate	Balance	interest rate	Balance
	%	$	%	$
Consolidated
Bank overdraft and bank loans	8.49	(5,000,000)	8.98	(1,275,000)
Cash at bank	3.89	1,499,836	4.00	2,439,912
Deposits at call	3.89	185,220	4.88	185,220
Net exposure to cash flow interest rate risk		(3,314,944)		1,350,132

An official increase/decrease in interest rates of one (2011: one) percentage point would have an adverse/favourable effect on profit before tax of $33,149 (2011: $13,501) per annum. The percentage change is based on the expected volatility of interest rates using market data and analysts forecasts.

For the consolidated entity the bank loans outstanding, totalling $5,000,000 (2011: $1,275,000), are principal and interest payment loans. Monthly cash outlays of approximately $32,000 (2011: $38,000) per month are required to service the interest payments.

Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the consolidated entity. The consolidated entity has a strict code of credit, including obtaining agency credit information, confirming references and setting appropriate credit limits. The consolidated entity obtains guarantees where appropriate to mitigate credit risk. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial statements. The consolidated entity does not hold any collateral.

The consolidated entity has a credit risk exposure with the carrying amount of receivables. For some receivables the consolidated entity obtains agreements which can be called upon if the counterparty is in default under the terms of the agreement.

Liquidity risk

Vigilant liquidity risk management requires the consolidated entity to maintain sufficient liquid assets (mainly cash and cash equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable.

The consolidated entity manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.

Financing arrangements

Unused borrowing facilities at the reporting date:

Consolidated	Consolidated
2012	2011
$	$
-	3,725,000

Bank loans

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 31. Financial instruments (continued)

Remaining contractual maturities

The following tables detail the consolidated entity's remaining contractual maturity for its financial instrument liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ from their carrying amount in the statement of financial position.

1 year or less $ 3,198,534 3,536,538	Between 1 and 2 years $ - 1,824,288	Between 2 and 5 years $ - -	Over 5 years $ - -	Remaining contractual maturities $ 3,198,534 5,360,826
6,735,072	1,824,288	-	-	8,559,360
1 year or less $ 2,130,952 114,495	Between 1 and 2 years $ - 1,332,248	Between 2 and 5 years $ - -	Over 5 years $ - -	Remaining contractual maturities $ 2,130,952 1,446,743
2,245,447	1,332,248	-	-	3,577,695

The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above.

Fair value of financial instruments

The following tables detail the consolidated entity's fair values of financial instruments categorised by the following levels:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities

Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices)

Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs)

Listed securities - equity Assets Total assets Consolidated - 2012	Level 1 $ 318,194	Level 2 $ -	Level 3 $ -	Total $ 318,194
	318,194	-	-	318,194

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 31. Financial instruments (continued)

Note 31. Financial instruments (continued)
Assets Total assets Consolidated - 2011 Listed securities - equity Unlisted securities	Level 1 $ 455,357 -	Level 2 $ - 17,902	Level 3 $ - -	Total $ 455,357 17,902
	455,357	17,902	-	473,259

There were no transfers between levels during the financial year.

Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value. The carrying amounts of trade receivables and trade payables are assumed to approximate their fair values due to their short-term nature. The fair value of financial liabilities is estimated by discounting the remaining contractual maturities at the current market interest rate that is available for similar financial instruments.

Note 32. Key management personnel disclosures

Directors

The following persons were directors of Rand Mining Limited during the financial year:

Otakar Demis Executive Chairman and Joint Company Secretary Anthony Billis Executive Director and Managing Director Gordon Sklenka Non-Executive Director

Other key management personnel

The following persons also had the authority and responsibility for planning, directing and controlling the major activities of the consolidated entity, directly or indirectly, during the financial year:

Roland Berzins Joint Company Secretary John Andrews Manager of Kalgoorlie Operations

Compensation

The aggregate compensation made to directors and other members of key management personnel of the consolidated entity is set out below:

- - Post-employment benefits Short-term employee benefits	2012 2011 $ $ 366,449 281,672 52,700 51,800 419,149 333,472 Consolidated	2012 2011 $ $ 366,449 281,672 52,700 51,800 419,149 333,472 Consolidated
	419,149	333,472

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 32. Key management personnel disclosures (continued)

Shareholding

The number of shares in the parent entity held during the financial year by each director and other members of key management personnel of the consolidated entity, including their personally related parties, is set out below:

Balance at the start of the year 26,629,601 41,282,848 26,576,764	Received as part of remuneration - - -	Additions - 3,300 -	Disposals/ other - - -	Balance at the end of the year 26,629,601 41,286,148 26,576,764
94,489,213	-	3,300	-	94,492,513
Balance at the start of the year 26,629,601 41,282,848 26,576,764	Received as part of remuneration - - -	Additions - - -	Disposals/ other - - -	Balance at the end of the year 26,629,601 41,282,848 26,576,764
94,489,213	-	-	-	94,489,213

Option holding

The number of options over ordinary shares in the parent entity held during the financial year by each director and other members of key management personnel of the consolidated entity, including their personally related parties, is set out below:

G Sklenka A Billis Options over ordinary shares O Demis 2012*	Balance at the start of the year 1,000,000 2,000,000 1,000,000	Granted - - -	Exercised - - -	Expired/ forfeited/ other - - -	Balance at the end of the year 1,000,000 2,000,000 1,000,000
	4,000,000	-	-	-	4,000,000

Resource Capital holds 1,000,000 options on trust for Mr Otakar Demis. This 1,000,000 have previously formed part of Mr Billis's indirect holdings as he is a related party of Resource Capital due to his directorship.

Options over ordinary shares 2012 A Billis O Demis G Sklenka	Vested and exercisable 1,000,000 2,000,000 1,000,000	Vested at the end of the year - 1,000,000 - 2,000,000 - 1,000,000 - 4,000,000 Vested and unexercisable	Vested at the end of the year - 1,000,000 - 2,000,000 - 1,000,000 - 4,000,000 Vested and unexercisable
	4,000,000	-	4,000,000

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 32. Key management personnel disclosures (continued)

A Billis O Demis G Sklenka 2011* Options over ordinary shares	Balance at the start of the year 1,000,000 2,000,000 1,000,000	Granted - - -	Exercised - - -	Expired/ forfeited/ other - - -	Balance at the end of the year 1,000,000 2,000,000 1,000,000
	4,000,000	-	-	-	4,000,000

Resource Capital holds 1,000,000 options on trust for Mr Otakar Demis. This 1,000,000 have previously formed part of Mr Billis's indirect holdings as he is a related party of Resource Capital due to his directorship.

Related party transactions Related party transactions are set out in note 36. G Sklenka O Demis Options over ordinary shares 2011 A Billis	Vested and exercisable 1,000,000 2,000,000 1,000,000	Vested at the end of the year - 1,000,000 - 2,000,000 - 1,000,000 - 4,000,000 unexercisable Vested and	Vested at the end of the year - 1,000,000 - 2,000,000 - 1,000,000 - 4,000,000 unexercisable Vested and
	4,000,000	-	4,000,000

Note 33. Remuneration of auditors

During the financial year the following fees were paid or payable for services provided by Grant Thornton Audit Pty Ltd, the auditor of the company:

- - Audit or review of the financial statements Other services - related practices of Grant Thornton Audit Pty Ltd Tax compliance services Audit services - Grant Thornton Audit Pty Ltd	2012 2011 $ $ 62,280 81,450 34,005 7,800 96,285 89,250 Consolidated	2012 2011 $ $ 62,280 81,450 34,005 7,800 96,285 89,250 Consolidated
	34,005	7,800
	96,285	89,250

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 34. Contingent liabilities

Native title claims have been made with respect to areas which include tenements in which the consolidated entity has interests. The consolidated entity is unable to determine the prospects for success or otherwise of the claims and, in any event, whether or not and to what extent the claims may significantly affect the consolidated entity or its projects.

The consolidated entity has the following performance guarantees with the Minister for State Development:

- - ML15/993 Performance guarantees: ML16/309	2012 2011 $ $ 55,370 55,370 129,850 81,707 185,220 137,077 Consolidated	2012 2011 $ $ 55,370 55,370 129,850 81,707 185,220 137,077 Consolidated
	185,220	137,077

There is currently a dispute between the Joint Venture participants in regards to the management fee for the 2011 calendar year. The expense and liability amounts recorded in the financial statements have not been agreed and are subject to determination by an independent expert. The ultimate outcome of the matter cannot presently be determined, therefore, no adjustments to the management fees expense and liability that may result have been included in the financial statements.

Note 35. Commitments

- - - - Committed at the reporting date but not recognised as liabilities, payable: One to five years Within one year Within one year Committed at the reporting date but not recognised as liabilities, payable: Commitment for Liberia expenditure Within one year Lease commitments - operating One to five years Capital commitments - Property, plant and equipment Committed at the reporting date but not recognised as liabilities, payable:	2012 2011 $ $ 3,226,754 10,482,321 3,695,365 11,707,130 6,922,119 22,189,451 95,311 128,007 381,244 640,036 476,555 768,043 880,000 2,500,000 Consolidated	2012 2011 $ $ 3,226,754 10,482,321 3,695,365 11,707,130 6,922,119 22,189,451 95,311 128,007 381,244 640,036 476,555 768,043 880,000 2,500,000 Consolidated
	6,922,119	22,189,451
	95,311 381,244	128,007 640,036
	476,555	768,043
	880,000	2,500,000

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 35. Commitments (continued)

Capital commitments relate to mining capital expenditure commitments relating to the East Kundana joint venture Raleigh underground mine.

Operating lease commitments includes contracted amounts for mining tenement leases. In order to maintain current rights of tenure to mining tenements, the consolidated entity will be required to outlay the following funds in respect of tenement lease rentals and to meet minimum expenditure requirements of the Western Australian Mines Department. These obligations are expected to be fulfilled in the normal course of operations.

Note 36. Related party transactions

Parent entity

Rand Mining Limited is the parent entity.

Subsidiaries

Interests in subsidiaries are set out in note 38.

Associates

Interests in associates are set out in note 39.

Joint ventures

Interests in joint ventures are set out in note 40.

Key management personnel

Disclosures relating to key management personnel are set out in note 32 and the remuneration report in the directors' report.

Transactions with related parties

The following transactions occurred with related parties:

	Consolidated	Consolidated
	2012	2011
	$	$
Payment for other expenses:
Payment of royalties to Lake Grace Exploration NL, a
company related to the director Anthony Billis.	30,101	39,697
Payment for executive accommodation fees to Lake Grace
Exploration Pty Ltd, a company related to the director
Anthony Billis.	14,861	11,250
Payment for administration fees to Lake Grace Exploration
NL, a company related to the director Anthony Billis.	6,800	12,000
Payment for consulting fees to Lake Grace Exploration Pty
Ltd, a company related to the director Anthony Billis.	1,000	1,000
Option fees paid to Resources Capital, a director related
entity.	100,000	30,000

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 36. Related party transactions (continued)

At 30 June 2012, the consolidated entity held 2,819,998 (2011: 2,819,998) ordinary shares in Regal Resources Ltd, a company previously related to the director Gordon Sklenka.

At 30 June 2012, the consolidated entity held 28,916,412 (2011: 3,360,857) ordinary shares in AXG Mining Ltd. During the year 25,555,555 shares were purchased at a cost of $150,000. Gordon Sklenka and Roland Berzins were directors of AXG Mining Ltd during the year.

At 30 June 2012, the consolidated entity held 1,000,000 (2011: 1,000,000) ordinary shares in Palace Resources Ltd, a company previously related to the director Gordon Sklenka. During the year 750,000 options expired. The shares were acquired in the year ended 30 June 2004 for $100,000.

At 30 June 2012, the consolidated entity held 10,000 (2011: 10,000) shares in Vector Resources Limited, a company previously related to the director Gordon Sklenka.

Receivable from and payable to related parties

The following balances are outstanding at the reporting date in relation to transactions with related parties:

	Consolidated	Consolidated
	2012	2011
	$	$
Current receivables:
Prepayment of drilling expenses to Iron Resources
(Liberia) Ltd, a director related entity.	624,627		-

Loans to/from related parties

The following balances are outstanding at the reporting date in relation to loans with related parties:

	Consolidated	Consolidated
	2012	2011
	$	$
Current receivables:
Cash loan to Iron Resources (Liberia) Ltd, a director
related entity. The loan is non-interest bearing. *	-	472,766

Reclassified as prepayment of drilling expenses in the 2012 financial year.

Terms and conditions

All transactions were made on normal commercial terms and conditions and at market rates.

Note 37. Parent entity information

Set out below is the supplementary information about the parent entity.

Statement of comprehensive income

Total comprehensive income Loss after income tax	2012 2011 $ $ (374,057) (13,928) (374,057) (13,928) Parent	2012 2011 $ $ (374,057) (13,928) (374,057) (13,928) Parent
	(374,057)	(13,928)

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 37. Parent entity information (continued)

Statement of financial position

Total assets Equity Total liabilities Issued capital Accumulated losses Total current assets Total current liabilities Total equity Share-based payments reserve	2012 2011 $ $ 10,740,989 11,621,561 11,377,991 12,299,838 408,783 956,573 408,783 956,573 17,573,427 17,573,427 1,418,800 1,418,800 (8,023,019) (7,648,962) 10,969,208 11,343,265 Parent	2012 2011 $ $ 10,740,989 11,621,561 11,377,991 12,299,838 408,783 956,573 408,783 956,573 17,573,427 17,573,427 1,418,800 1,418,800 (8,023,019) (7,648,962) 10,969,208 11,343,265 Parent
	11,377,991	12,299,838
	408,783	956,573
	408,783	956,573
	17,573,427 1,418,800 (8,023,019)	17,573,427 1,418,800 (7,648,962)
	10,969,208	11,343,265

Guarantees entered into by the parent entity in relation to the debts of its subsidiaries

The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2012 and 30 June 2011.

Contingent liabilities

The parent entity had no contingent liabilities as at 30 June 2012 and 30 June 2011, except for those disclosed in note 34.

Capital commitments - Property, plant and equipment

The parent entity had no capital commitments for property, plant and equipment as at 30 June 2012 and 30 June 2011.

Significant accounting policies

The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed in note 1, except for the following:

Investments in subsidiaries are accounted for at cost, less any impairment.
Investments in associates and joint ventures are accounted for at cost, less any impairment.

Note 38. Subsidiaries

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

		Equity	holding
	Country of	2012	2011
Name of entity	incorporation	%	%
Rand Exploration N.L.	Australia	100.00	100.00

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 39. Investments in associates

Interests in associates are accounted for using the equity method of accounting. Information relating to associates is set out below:

- - - - - - - - Net assets Assets Associate Share of assets and liabilities Share of revenue, expenses and results Expenses Revenue Profit after income tax Total liabilities Liabilities Information relating to the associates is set out below. Tribune Resources Limited Principal activities Total assets	2012 2011 % % 23.70 23.70 2012 2011 $ $ 26,006,239 20,122,159 26,006,239 20,122,159 6,361,019 3,286,490 6,361,019 3,286,490 19,645,220 16,835,669 10,797,773 11,838,468 (8,183,420) (8,897,299) 2,614,353 2,941,169 Percentage interest Consolidated Consolidated	2012 2011 % % 23.70 23.70 2012 2011 $ $ 26,006,239 20,122,159 26,006,239 20,122,159 6,361,019 3,286,490 6,361,019 3,286,490 19,645,220 16,835,669 10,797,773 11,838,468 (8,183,420) (8,897,299) 2,614,353 2,941,169 Percentage interest Consolidated Consolidated
	26,006,239	20,122,159
	6,361,019	3,286,490
	6,361,019	3,286,490
	19,645,220	16,835,669
	10,797,773 (8,183,420)	11,838,468 (8,897,299)
	2,614,353	2,941,169

The market value of listed investment in associates at 30 June 2012 is $14,308,685 (2011: $26,471,067).

At 30 June 2012 the share price of Tribune Resources Ltd fell to $1.20 (2011: $2.22). The investment has been impaired to reflect fair value as the company considers the recoverable amount to be fair value less costs to sell.

Note 40. Interests in joint ventures

Interests in joint ventures are accounted for using the proportionate consolidation method of accounting. Information relating to joint ventures is set out below:

		Consolidated	Consolidated
		Percentage	interest
		2012	2011
Joint venture	Principal activities	%	%
East Kundana Joint Venture	Exploration and mining of gold	12.25	12.25

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 40. Interests in joint ventures (continued)

Information relating to the joint venture partnership is set out below.

- - - - - - - - Current liabilities Total liabilities Share of revenue, expenses and results Current assets Net assets Loss before income tax Expenses Revenue Total assets Share of assets and liabilities Non-current liabilities Non-current assets	2012 2011 $ $ 1,558,019 2,670,874 23,124,789 17,682,562 24,682,808 20,353,436 2,497,198 1,956,676 152,993 144,700 2,650,191 2,101,376 22,032,617 18,252,060 67,733 102,603 (8,730,540) (8,070,552) (8,662,807) (7,967,949) Consolidated	2012 2011 $ $ 1,558,019 2,670,874 23,124,789 17,682,562 24,682,808 20,353,436 2,497,198 1,956,676 152,993 144,700 2,650,191 2,101,376 22,032,617 18,252,060 67,733 102,603 (8,730,540) (8,070,552) (8,662,807) (7,967,949) Consolidated
	24,682,808	20,353,436
	2,497,198 152,993	1,956,676 144,700
	2,650,191	2,101,376
	22,032,617	18,252,060
	67,733 (8,730,540)	102,603 (8,070,552)
	(8,662,807)	(7,967,949)

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 41. Events after the reporting period

Revisions to the proposed acquisition of the Tapeta Iron Ore project, located in Northern Central Liberia, West Africa. Further to previous ASX announcements by Rand Mining Limited ('Rand') dated 24 December 2010, 25 February 2011, 23 May 2011 and 1 September 2011 relating to Rand’s option to acquire Iron Resources Limited ('IRL') from Resource Capital Limited ('RCL') ('the Option Agreement'). By way of deed of variation, the parties have today agreed to vary the Option Agreement whereby RCL has agreed to extend the term of the option by 12 months to 23 September 2013 ('Expiry Date') in exchange for Rand paying a non-refundable option fee of USD$50,000.

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 42. Reconciliation of profit after income tax to net cash from operating activities

- - - - Profit after income tax expense for the year Net cash from operating activities Increase/(decrease) in trade and other payables Decrease in income tax refund due Write off of exploration, evaluation and development costs Impairment of available-for-sale financial assets Share of profit - joint ventures Increase in trade and other receivables Decrease/(increase) in deferred tax assets Increase in deferred tax liabilities Non-cash interest Depreciation and amortisation Income from equity accounted investments Change in operating assets and liabilities: Adjustments for: Net loss/(gain) on disposal of property, plant and equipment Increase/(decrease) in provision for income tax Liberia exploration written off Impairment of equity accounted investments Increase/(decrease) in other provisions Increase in inventories	2012 2011 $ $ 3,153,278 5,424,466 3,694,128 1,625,194 (15,699) 14,636 (2,614,353) (1,405,107) - (1,536,062) 607,925 (14,109) 118,001 75,804 2,489,167 - (34,016) (141,671) 955,055 - (132,351) (711,076) (5,984,793) (4,699,960) - 624,514 183,839 (133,496) 1,093,133 (237,460) (508,023) 781,377 52,029 793,093 (9,224) 75,450 3,048,096 535,593 Consolidated	2012 2011 $ $ 3,153,278 5,424,466 3,694,128 1,625,194 (15,699) 14,636 (2,614,353) (1,405,107) - (1,536,062) 607,925 (14,109) 118,001 75,804 2,489,167 - (34,016) (141,671) 955,055 - (132,351) (711,076) (5,984,793) (4,699,960) - 624,514 183,839 (133,496) 1,093,133 (237,460) (508,023) 781,377 52,029 793,093 (9,224) 75,450 3,048,096 535,593 Consolidated
	3,048,096	535,593

Note 43. Earnings per share

Weighted average number of ordinary shares used in calculating diluted earnings per share Basic earnings per share Earnings per share from continuing operations Profit after income tax attributable to the owners of Rand Mining Limited Weighted average number of ordinary shares used in calculating basic earnings per share Diluted earnings per share	2012 2011 $ $ 3,153,278 4,965,688 Number Number 60,841,209 60,841,209 60,841,209 60,841,209 Cents Cents 5.18 8.16 5.18 8.16 Consolidated	2012 2011 $ $ 3,153,278 4,965,688 Number Number 60,841,209 60,841,209 60,841,209 60,841,209 Cents Cents 5.18 8.16 5.18 8.16 Consolidated
	Number 60,841,209	Number 60,841,209
	60,841,209	60,841,209
	Cents 5.18 5.18	Cents 8.16 8.16

Rand Mining Limited Notes to the financial statements 30 June 2012

Note 43. Earnings per share (continued)

Note 43. Earnings per share (continued)
Weighted average number of ordinary shares used in calculating basic earnings per share Earnings per share for profit Earnings per share from discontinued operations Weighted average number of ordinary shares used in calculating diluted earnings per share Profit after income tax attributable to the owners of Rand Mining Limited Basic earnings per share Basic earnings per share Diluted earnings per share Diluted earnings per share Weighted average number of ordinary shares used in calculating basic earnings per share Weighted average number of ordinary shares used in calculating diluted earnings per share Profit after income tax attributable to the owners of Rand Mining Limited	2012 2011 $ $ - 458,778 Number Number 60,841,209 60,841,209 60,841,209 60,841,209 Cents Cents - 0.75 - 0.75 2012 2011 $ $ 3,153,278 5,424,466 Number Number 60,841,209 60,841,209 60,841,209 60,841,209 Cents Cents 5.18 8.92 5.18 8.92 Consolidated Consolidated
	Number 60,841,209	Number 60,841,209
	60,841,209	60,841,209
	Cents 5.18 5.18	Cents 8.92 8.92

Rand Mining Limited Directors' declaration

In the directors' opinion:

the attached financial statements and notes thereto comply with the Corporations Act 2001, the Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements;
the attached financial statements and notes thereto comply with International Financial Reporting Standards as issued by the International Accounting Standards Board as described in note 1 to the financial statements;
the attached financial statements and notes thereto give a true and fair view of the consolidated entity's financial position as at 30 June 2012 and of its performance for the financial year ended on that date; and
there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

The directors have been given the declarations required by section 295A of the Corporations Act 2001.

Signed in accordance with a resolution of directors made pursuant to section 295(5) of the Corporations Act 2001.

On behalf of the directors

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________ Anthony Billis Director

28 September 2012 Perth

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Grant Thornton Audit Pty Ltd ABN 94 269 609 023

10 Kings Park Road West Perth WA 6005 PO Box 570 West Perth WA 6872

T +61 8 9480 2000 F +61 8 9322 7787 E [email protected] W www.grantthornton.com.au

Independent Auditor’s Report To the Members of Rand Mining Limited

Report on the financial report

We have audited the accompanying financial report of Rand Mining Limited (the ‘Company’), which comprises the statement of financial position as at 30 June 2012, the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information and the directors’ declaration of the consolidated entity comprising the Company and the entities it controlled at the year’s end or from time to time during the financial year.

Directors responsibility for the financial report

The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors determines is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. The Directors also state, in the notes to the financial report, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, the financial statements comply with International Financial Reporting Standards.

Auditor’s responsibility

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

Liability limited by a scheme approved under Professional Standards Legislation

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

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

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

Independence

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

Auditor’s opinion

In our opinion:

a the financial report of Rand Mining 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 2012 and of their performance for the year ended on that date; and
ii complying with Australian Accounting Standards and the Corporations Regulations 2001; and
b the financial report also complies with International Financial Reporting Standards as disclosed in the notes to the financial statements.

Report on the remuneration report

We have audited the remuneration report included in pages 13 to 18 of the directors’ report for the year ended 30 June 2012. The Directors of the Company are responsible for the preparation and presentation of the remuneration report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the remuneration report, based on our audit conducted in accordance with Australian Auditing Standards.

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Auditor’s opinion on the remuneration report

In our opinion, the remuneration report of Rand Mining Limited for the year ended 30 June 2012, complies with section 300A of the Corporations Act 2001.

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GRANT THORNTON AUDIT PTY LTD Chartered Accountants

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C A Becker Partner – Audit & Assurance

Perth, 28 September 2012

Rand Mining Limited Shareholder information

30 June 2012

The shareholder information set out below was applicable as at 17 September 2012.

Distribution of equitable securities

Analysis of number of equitable security holders by size of holding:

- - - - - - Holding less than a marketable parcel 1 to 1,000 1,001 to 5,000 5,001 to 10,000 10,001 to 100,000 100,001 and over	Number of holders of ordinary shares 238 168 53 85 27	Number of holders of options over ordinary shares - - - - 3
	571	3
	255	-

Equity security holders

Twenty largest quoted equity security holders

The names of the twenty largest security holders of quoted equity securities are listed below:

West Coast Brick Co Pty Ltd Auriongold Ltd Lake Grace Exploration Pty Ltd McNeil Nominees Steven Ilkiw Teklink Pty Ltd Mr Henry Kai Tong Au Southam Investments 2003 Raypoint Phatchakorn Wichaikul Trans Global Capital Ltd Tribune Resources Ltd Mr Anthony William Sage JP Morgan Nominees Sierra Gold Ltd HKT Au Pty Ltd Resource Capital Ltd HSBC Custody Nominees Mr Martin Siegel Halkin Pty Ltd	% of total shares Number held issued 26,576,764 43.68 7,899,584 12.98 2,925,360 4.81 2,917,000 4.79 2,339,615 3.85 2,338,843 3.84 2,100,000 3.45 1,854,100 3.05 1,604,500 2.64 1,512,154 2.49 530,000 0.87 510,000 0.84 490,000 0.81 478,660 0.79 372,500 0.61 293,700 0.48 290,000 0.48 286,800 0.47 270,000 0.44 255,000 0.42 55,844,580 91.79 Ordinary shares	% of total shares Number held issued 26,576,764 43.68 7,899,584 12.98 2,925,360 4.81 2,917,000 4.79 2,339,615 3.85 2,338,843 3.84 2,100,000 3.45 1,854,100 3.05 1,604,500 2.64 1,512,154 2.49 530,000 0.87 510,000 0.84 490,000 0.81 478,660 0.79 372,500 0.61 293,700 0.48 290,000 0.48 286,800 0.47 270,000 0.44 255,000 0.42 55,844,580 91.79 Ordinary shares
	55,844,580	91.79

Rand Mining Limited Shareholder information 30 June 2012

Unquoted equity securities

Unquoted equity securities
	Number	Number
	on issue	of holders
Options over ordinary shares issued	4,000,000	3
Substantial holders
Substantial holders in the company are set out below:
	Ordinary	shares
		% of total
		shares
	Number held	issued
Tribune Resources Ltd	26,576,764	43.68
Trans Global Capital Ltd	7,899,584	12.98

Voting rights

The voting rights attached to ordinary shares are set out below:

Ordinary shares

On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

There are no other classes of equity securities.

Tenements

Tenements
Description	Tenement number	Interest owned
Kundana - Kundana	M15/1413	12.25%
Kundana - Kundana	M15/993	12.25%
Kundana - Kundana	M16/181	12.25%
Kundana - Kundana	M16/182	12.25%
Kundana - Kundana	M16/308	12.25%
Kundana - Kundana	M16/309	12.25%
Kundana - Kundana	M16/325	12.25%
Kundana - Kundana	M16/326	12.25%
Kundana - Kundana	M16/421	12.25%
Kundana - Kundana	M16/428	12.25%
Seven Mile Hill - Kurrawang	P15/5184	50.00%
Seven Mile Hill - Kurrawang	P26/3617	50.00%
Seven Mile Hill - Kurrawang	P15/4495	50.00%
Seven Mile Hill - White Lake	P15/5182	50.00%
Seven Mile Hill - White Lake	P15/5183	50.00%
Kalguddering - Kalguddering	E70/3646	100.00%
Larkinville - Larkinville	M15/1290	100.00%

AI assistant

RAND MINING LIMITED — Annual Report 2012

65721_rns_2012-09-27_270ea595-84ac-46c2-b893-84c44d5ff0b6.pdf

Rand Mining Limited ABN 41 004 669 658

Rand Mining Limited Review of Operations 30 June 2012

East Kundana Joint Venture

KUNDANA PROJECT Location Map

Mining

Rubicon/Hornet

Processing

Rand Mining Limited Review of Operations 30 June 2012

Exploration

Seven Mile Hill (50%)

Wongan Hills (100%)

Tapeta Iron Ore Project, Liberia, West Africa

Rand Mining Limited Review of Operations 30 June 2012

Rand Mining Limited Review of Operations 30 June 2012

Resources & Reserves

Rand Mining Limited Review of Operations 30 June 2012

Notes to tables:

Directors

Principal activities

Dividends

Review of operations

Significant changes in the state of affairs

Ore development

Securing a clean energy future – the Australian Government’s climate change plan

Matters subsequent to the end of the financial year

Likely developments and expected results of operations

Environmental regulation

Greenhouse gas and energy data reporting requirements

Information on directors

Company secretaries

Meetings of directors

Remuneration report (audited)

A Principles used to determine the nature and amount of remuneration

Non-executive directors remuneration

Executive remuneration

Consolidated entity performance and link to remuneration

Use of remuneration consultants

Voting and comments made at the company's 2011 Annual General Meeting ('AGM')

B Details of remuneration

Amounts of remuneration

C Service agreements

D Share-based compensation

Issue of shares

Options

This concludes the remuneration report, which has been audited.

Shares under option

Shares issued on the exercise of options

Shares issued on the exercise of performance rights

Indemnity and insurance of officers

Indemnity and insurance of auditor

Proceedings on behalf of the company

Non-audit services

Officers of the company who are former audit partners of Grant Thornton Audit Pty Ltd

Auditor's independence declaration

Auditor

Auditor’s Independence Declaration To the Directors of Rand Mining Limited

Rand Mining Limited Statement of corporate governance 30 June 2012

Board functions

Structure of the Board

Name Position Gordon Sklenka Non-Executive Director

Securities trading policy

Audit and Risk Committee

Risk

CEO and CFO certification

Performance

Rand Mining Limited Corporate Governance Statement 30 June 2012

Remuneration

Diversity

Contents

General information

Rand Mining Limited Statement of comprehensive income For the year ended 30 June 2012

Rand Mining Limited Statement of changes in equity For the year ended 30 June 2012

Rand Mining Limited Statement of cash flows For the year ended 30 June 2012

Note 1. Significant accounting policies

New, revised or amending Accounting Standards and Interpretations adopted

AASB 2010-5 Amendments to Australian Accounting Standards

AASB 124 Related Party Disclosures (December 2009)

RAND MINING LIMITED Annual Report 2012