REDSTONE RESOURCES LIMITED

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2019 REDSTONE RESOURCES LIMITED ACN 090 169 154

COMPETENT PERSONS STATEMENTS:

The information in this document that relates to drilling and exploration results was authorised by Dr Greg Shirtliff, who is engaged as a Consultant to the Company through Zephyr Professional Pty Ltd. The information in this report that relates to Geophysical exploration results is based on information compiled by Mr Barry Bourne, who is also engaged as a Consultant to the Company through geophysical consultancy Terra Resources Pty Ltd. Mr Bourne is a fellow of the Australian Institute of Geoscientists and a member of the Australian Society of Exploration Geophysicists and Dr Shirtliff is a Member of the Australian Institute of Mining and Metallurgy. Both Mr Bourne and Dr Shirtliff have sufficient experience of relevance to the tasks with which they were engaged to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Both Mr Bourne and Dr Shirtliff consent to the inclusion in the report of matters based on information in the form and context in which it appears.

FORWARD LOOKING STATEMENTS:

This report contains certain forward-looking statements. Forward-looking statements are subject to a variety of risks and uncertainties beyond the Company’s ability to control or predict which could cause actual events or results to differ materially from those anticipated in such forward-looking statements.

ADDITIONAL INFORMATION:

This report does not include reference to all available information on the Company or its Projects and should not be used in isolation as a basis to invest in Redstone Resources Limited. Any potential investors should refer to Redstone Resource Limited’s other public releases and statutory reports and consult their professional advisers before considering investing in the Company.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

Contents of Financial Report	Page
Corporate Directory	2
Directors’ Report	3-13
Audit Independence Declaration	14
Corporate Governance Statement	15
Consolidated Statement of Comprehensive Income	16
Consolidated Statement of Financial Position	17
Consolidated Statement of Changes in Equity	18
Consolidated Statement of Cash Flows	19
Notes to the Consolidated Financial Statements	20-49
Directors’ Declaration	50
Independent Audit Report to Members	51-54
Shareholder Information	55-58

REDSTONE RESOURCES LIMITED

ACN 090 169 154

CORPORATE DIRECTORY

DIRECTORS: Mr Richard Homsany (Chairman) Mr Edward van Heemst Mr Brett Hodgins SECRETARY: Ms Miranda Conti REGISTERED AND PRINCIPAL OFFICE: 60 Havelock Street WEST PERTH WA 6005 Tel: +61 8 9328 2552 Fax: +61 8 9328 2660 email: [email protected] POSTAL ADDRESS: PO Box 8646 Perth Business Centre WA 6849 WEBSITE: www.redstone.com.au SHARE REGISTRY: Advanced Share Registry Limited 110 Stirling Highway NEDLANDS WA 6009 PO Box 1156 , NEDLANDS WA 6909 Tel: +61 8 9389 8033 Fax: +61 8 9262 3723 Suite 601, Level 6 225 Clarence Street SYDNEY NSW 2000 PO Box Q1736 QUEEN VICTORIA BUILDING NSW 1230 Tel: +61 2 8096 3502 Website: www.advancedshare.com.au HOME STOCK EXCHANGE: Australian Stock Exchange Limited Level 40, Central Park 152-158 St George’s Terrace PERTH WA 6000 ASX Codes: RDS Tel: +61 8 9224 0000 AUDITOR: Butler Settineri (Audit) Pty Ltd Unit 16, First Floor 100 Railway Road (Cnr Hay Street) SUBIACO WA 6008 Tel: +61 8 9389 5222

ACN 090 169 154

DIRECTORS’ REPORT

The Directors present their report on the Entity consisting of Redstone Resources Limited (‘Redstone’ or the Company) and its controlled entities (‘Entity’) for the financial year ended 30 June 2019.

The names and details of directors in office during the financial year until the date of this report are as follows. Directors were in office for the entire period unless otherwise stated.

Mr Richard Homsany (BCom, LLB (Hons), CPA, Grad Dip FINSIA, F Fin, MAICD, Non-Executive Chairman, Age 49

Mr Homsany is Executive Vice President of Mega Uranium Ltd, a Toronto Stock Exchange listed company and executive Chairman of Toro Energy Limited, an ASX listed uranium company. He is also currently the non-executive chairman of the Health Insurance Fund of Australia Limited.

Prior to this Mr Homsany was a corporate and commercial advisory partner with one of Australia’s leading law firms. He is currently the principal of Cardinals Lawyers and Consultants and has been admitted as a solicitor for over 20 years. Mr Homsany has extensive experience in corporate law, including advising public resources and energy companies on corporate governance, finance, capital raisings, takeovers, mergers, acquisitions, joint ventures and divestments.

Mr Homsany also has significant board experience with publicly listed resource companies and in the resources industry. He has also worked for an ASX top 50-listed internationally diversified resources company in operations, risk management and corporate.

Mr Homsany is a Certified Practising Accountant and is a fellow of the Financial Services Institute of Australasia (FINSIA). He has a Commerce Degree and Honours Degree in Law from the University of Western Australia and a Graduate Diploma in Finance and Investment from FINSIA.

Over the last 3 years Mr Homsany has held a directorship in Toronto Stock Exchange (Venture Exchange) listed Central Iron Ore Limited (TSX-V) (27 October 2010 to present) and ASX Listed Toro Energy Limited (1 December 2013 to present).

Mr Edward van Heemst (BCom, MBA, CA, CPA), Non-Executive Director, Age 73

Mr Edward van Heemst is a prominent Perth businessman with over 40 years experience in the management of a diverse range of activities with large private companies.

Mr van Heemst is currently the Managing Director of Vanguard Press and was the long-time Chairman of Perth Racing (1997 to 2016). Mr van Heemst holds a Bachelor of Commerce degree from the University of Melbourne, an MBA from the University of Western Australia and is a member of the Institute of Chartered Accountants Australia.

Mr van Heemst has an extensive knowledge of capital markets and established mining industry networks .

Over the last 3 years Mr van Heemst has held a directorship in NTM Gold Ltd (14 January 2018 to present).

Mr Brett Hodgins (BSc (Hons), Grad Dip FINSIA) , Non-Executive Director, Age 46

Mr Hodgins has over 20 years of professional experience in the resources sector primarily focused on exploration and mining operations. He began his career as a geologist with Robe River Mining and Rio Tinto Iron Ore. During that time he was involved with the commissioning and development of the West Angelas and Hope Downs operations. Mr Hodgins' recent roles include General Manager Project Development for Iron Ore Holdings and he is President / CEO of Central Iron Ore Ltd, a TSX-V listed company gold and iron ore explorer. He brings a wide range of experience in exploration, feasibility studies, operations, and has a broad knowledge of the resource sector.

Mr Hodgins has completed a Bachelor of Science Degree with Honours in Geology from Newcastle University, Diploma of Management and a Graduate Diploma in Finance and Investment from Financial Services Institute of Australasia.

Over the last 3 years Mr Hodgins has held a directorship in Toronto Stock Exchange (Venture Exchange) listed Central Iron Ore Limited (TSX-V) (27 October 2010 to present).

REDSTONE RESOURCES LIMITED

ACN 090 169 154

DIRECTORS’ REPORT

Company Secretary – Miranda Conti (BCom, CPA , AGIA , ACIS )

Ms Conti is a chartered secretary and certified practising accountant who has been engaged by the Company since March 2006.

Principal Activities

The principal activity of the Entity during the financial year was mineral exploration in Australia.

Review of Operations

The net loss after income tax attributable to members of the Entity for the financial year ended 30 June 2019 amounted to $277,138 (2018: $348,966) and net assets were $6,882,246 (2018: $5,704,409).

WEST MUSGRAVE PROJECT (E69/2450, E69/3456) – 100% REDSTONE

Redstone’s primary focus during the year has been the advancement of the Entity’s West Musgrave Project (“ West Musgrave Project ” or the “ Project”), which includes the Tollu Cu Vein Project (“ Tollu ”).

West Musgrave Project Overview

The Project is located in the West Musgrave region of Western Australia and comprises 214 square kilometres of highly prospective, underexplored ground just 40km east of the world-class Nebo-Babel Ni-Cu deposit. The Project has the right geological and structural setting for large magmatic Ni-Cu deposits such as Nebo Babel or the similar Voiseys Bay deposit in Canada. However, following the drilling and research activities conducted in the 2018 financial year ( 2018 ), Redstone believe the Project area is also prospective for a number of other deposit types and metal commodities, such as Zn and Cu-Au related to Volcanic Hosted Massive Sulphide ( VHMS ) deposits, large continental type Mo -porphyry deposits, strata-bound Au-Ag (silver) deposits, Sn-W mineralisation related to granites, granite stockworks or greissens, intrusion related polymetallic veining, Intrusion Related Gold deposits (IRG) and Iron Ore Copper Gold (IOCG) deposits. The early results of the Redstone research also suggest that epithermal and mesothermal lode gold systems and large Cu±Au Porphyry deposits could also be considered.

Tollu hosts a giant swarm of hydrothermal copper rich veins in a mineralised system covering an area at least 5km[2] . Copper mineralisation is exposed at the surface and forms part of a dilation system within and between two major shears. The drilling and research conducted in 2018 has confirmed an extension of the high grade Cu mineralisation to the east of the main dilation zone, which also extends to and is open at depth. This work has also confirmed not only the potential of Tollu to host a significant Cu orebody within itself and its extensions but also the extent of the hydrothermal mineralising systems that may be operating elsewhere on the Redstone West Musgrave Project property.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

DIRECTORS’ REPORT

Work Completed 2019

During the year the Company conducted a ground electromagnetic ( EM ) survey over 12 of its airborne EM (VTEMmax) targets, including the already drilled EM1 target. The ground EM survey comprised a fixed loop EM survey over target EM1 for a 1.6 line km over two lines. The survey was acquired at 1Hz and utilised a 600x200m fixed loop with a receiver line spacing of 150m and a station spacing of 50m. A moving loop EM survey was conducted over 11 of the remaining airborne EM (VTEMmax) targets consisting of approximately 18 line km over 18 lines. The moving loop survey was acquired at 0.5-1Hz using a 200m x 200m moving loop slingram configuration and a station spacing of 100m. The ground EM survey has enabled Redstone to penetrate deeper around all 12 EM targets and further delineate targets for drilling.

The two best targets confirmed from the ground EM survey are EM2 and EM6. They have been modelled as weak to moderately conductive features (150-200S) with a depth to the top of 265m/ 200m respectively. These targets along with the near surface ground EM features present at EM3, EM4 and EM5, are considered to be genuine geophysical targets that warrant further exploration especially considering that the high grade Cu mineralisation at Tollu did not present as ‘conductive’ in the airborne EM (VTEMmax) survey. Targets EM2, EM3 and EM4 occur along strike to the north and south of Tollu, while targets EM5 and EM6 are associated with discrete magnetic anomalies ( Figure 1 ).

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Figure 1 – Prioritised EM Targets EM1 to EM6 and airborne EM anomalies. Ground EM locations on reduced to pole magnetic image on the West Musgrave Project tenements E69/2450 and E69/3456. Ground EM lines are shown in purple. Historical drilling and Tollu Project shown in green.

Notably, the high priority EM1 target, drilled in 2018, intersected a 100m thick zone of high grade hydrothermal pyrite mineralisation with anomalous trace elements and represents another major zone of hydrothermal sulphide mineralisation just 2.5-3km to the NW of the Tollu Copper Vein Project. EM1 and the five identified ground EM targets confirm the potential for conductors indicative of the mineralisation Redstone consider as exploration targets on the Project, inclusive of Ni-Cu sulphides.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

DIRECTORS’ REPORT

The Company has completed all requisite heritage clearances and approvals for an RC program designed to drill test the five confirmed ground EM targets, EM2 through to EM6, which is expected to take place in the December 2019 quarter.

Additionally, following the ground EM survey results and in preparation and planning for the 2019 exploration and RC program the Company’s technical consultants have also undertaken further geological and geophysical analysis of the Project data, the results of which have given Redstone additional areas to consider as potentially prospective for future exploration and testing.

These potentially prospective areas are being evaluated by the Company’s technical consultants, and have further enhanced Redstone’s confidence that the most prospective areas of the Project have not yet been tested outside of the already defined JORC compliant Copper and Cobalt resource at Tollu.

Re-evaluation of Tollu Copper Vein Project

During the year a detailed re-examination of the Tollu Copper Vein Project was undertaken, which included the re-logging and interpretation of core from the three historical diamond drill holes, TD1, TD2 and TD3, and a large proportion of the pre-2015 RC drilling samples (over 40 holes). Re-logging concentrated on the interrelationships between quartz veining, copper mineralisation, the mineralising fluid and the nature of the related structures.

Of particular interest to the study was the relevance of sulphide mineralisation visible in the deepest sections of the diamond holes beneath the Tollu copper veins. To better understand the spatial relationship of mineralisation to structure and geology the geochemical database was re-examined and the copper and cobalt mineralisation was modelled three dimensionally with multiple cut-offs in LeapFrog®.

This ongoing work will enable the Company to:

better understand the origin of the copper mineralisation at Tollu and its relevance to other potential deposits elsewhere on the Project;
determine any further potential for Tollu style copper mineralisation on the Project; and
aid in targeting further mineralisation at Tollu.

In addition to the re-examination of historical drilling a detailed interpretation of the company’s magnetic geophysical data has given Redstone further insight into the complex structural setting of the mineralisation at Tollu, which is not only aiding in exploration within the Tollu Copper Vein system but also along the large Project-wide Tollu fault system.

Exploration Incentive Scheme Co-funded Drilling Grant

In December 2018 the Company was successfully awarded the Round 18 EIS co-funding grant (applicable to 31 December 2019) for up to the value of $150,000, to assist with three diamond drill holes totalling approximately 2,100m at three of the EM targets on the Project.

Amongst other things, the diamond drill holes have the potential for Redstone to re-interpret the tectonic setting for the West Musgrave region and the Tollu Sub-basin, which, if proved correct, would dramatically expand the types of deposits (currently it is just magmatic Ni-Cu-Co sulphide deposits) that should be targeted for exploration within the area. The decision to proceed with a diamond drill program will be dependent on initial RC drilling.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

DIRECTORS’ REPORT

CORPORATE

Fundraising – Entitlement Offer and Shortfall Offer

On 31 August 2018 the Company lodged a Prospectus (along with a Supplementary Prospectus on 3 September 2018) with ASIC and ASX (together the 2018 Prospectus ) for a partially underwritten pro rata non renounceable entitlement offer to raise up to $2,152,960 (before costs) to eligible shareholders. The Entitlement Offer was made on the basis of one (1) New Share for every three (3) shares held at an issue price of $0.017 per New Share. Eligible Shareholders and investors were also invited to apply for New Shares in excess of their entitlement through an Additional New Shares Offer.

Shareholders also received one (1) free attaching listed option (ASX: RDSOB), exercisable at $0.035 on or before 30 April 2021 for every two (2) New Shares subscribed for and issued under the Entitlement Offer and Additional New Shares Offer (together the Offer ).

The Offer, which closed on 3 October 2018, raised a total of $1,451,500 (before costs). Accordingly, the Company issued 85,382,485 New Shares and 42,691,267 RDSOB listed options, these being a new class of quoted security.

Additionally, a further $147,009 (before costs) was raised from the issue of 8,647,560 New Shares and 4,323,781 free attaching RDSOB listed options under the Shortfall Offer pursuant to the terms of the 2018 Prospectus.

Research and Development Incentive – FY2018

During the financial year the Company completed and lodged a Research and Development Incentive claim (the R&D Rebate ) for the 2018 financial year pursuant to the Australian Taxation Office’s self-assessment system, with the final amount of $264,000 (before fees) received by Redstone in April 2019.

Extension of Term Application – E69/2450

Tenement E69/2450 held by the Company was due to expire on 18 September 2018, however an extension of term application for E69/2450 for a further two year period to 18 September 2020 was granted by the Department of Minerals, Industry, Regulation and Safety ( DMIRS ) on 28 September 2018.

Dividends

No dividends were paid during the year and the directors recommend that no dividends be paid or declared for the financial year ended 30 June 2019.

Significant Changes in State of Affairs

There have been no significant changes in the state of affairs of the Entity to the date of this report.

Significant Events after Balance Date

There has not been any matter or circumstance that has arisen after balance date that has significantly affected, or may significantly affect, the operations of the Entity, the results of those operations, or the state of affairs of the Entity in future financial periods.

ACN 090 169 154

REDSTONE RESOURCES LIMITED

DIRECTORS’ REPORT

Likely Developments

Likely developments in the operations of the Entity and the expected results of those operations have not been included in this report as the Directors believe, on reasonable grounds, that the inclusion of such information would be likely to result in unreasonable prejudice to the Entity.

Environmental Issues

The Entity’s operations are subject to significant environmental regulation under the law of the Commonwealth and State. The Directors of the Company monitor compliance with environmental regulations. The Directors are not aware of any significant breaches during the period covered by this Report.

Share Options

As at the date of this report, 71,015,048 (2018: 24,000,000) options over unissued ordinary shares in the Company have been granted.

During the period to the date of this report, 47,015,048 listed options (ASX: RDSOB) were issued in accordance with the 2018 Prospectus. No options expired or were exercised during the period.

	Number	Exercise Price	Listed/Unlisted	Expiry Date
	47,015,048	$0.035	Listed	30 April 2021
	10,000,000	$0.015	Unlisted	28 February 2020
	10,000,000	$0.020	Unlisted	28 February 2020
	2,000,000	$0.015	Unlisted	31 January 2020
	2,000,000	$0.020	Unlisted	31 January 2020
TOTAL	75,015,048

The options do not entitle the holder to participate in any share issue of the Company.

Directors’ Interests

The relevant interests of directors held, directly, indirectly or beneficially, by each specified director including their personally-related entities, in the share capital and unissued shares of the Company as at the date of this report is as follows:

Director	Fully Paid	Ordinary	Listed Share	Options	Unlisted Share Options	Unlisted Share Options
	Shares
	Directly	Indirectly	Directly	Indirectly	Directly	Indirectly
Richard Homsany	-	59,039,778	-	8,021,471	-	-
Edward van Heemst	-	67,788,237	-	6,914,707	-	-
Brett Hodgins	-	4,389,429	-	882,353	-	-

REDSTONE RESOURCES LIMITED

ACN 090 169 154

DIRECTORS’ REPORT

Meetings of Directors

During the financial year, the following meetings of directors were held:

	Directors’	meetings
	Number eligible	Number
	to attend	attended
Mr Richard Homsany	3	3
Mr Edward van Heemst	3	3
Mr Brett Hodgins	3	3

There are no board committees.

Remuneration Report (audited)

This report details the nature and amount of remuneration for each director and key management personnel, including their personally-related entities, of the Company.

- Remuneration Policy

The Board of directors is responsible for determining and reviewing compensation arrangements for the directors and the executive team. The Board assesses the appropriateness of the nature and amount of remuneration of such officers on a periodic basis by reference to relevant employment conditions, with the overall objective of ensuring maximum stakeholder benefit from the retention of a high quality Board and executive team.

The Board acts as the Remuneration Committee and assesses the nature and amount of compensation of key management personnel.

All remuneration paid to directors and executives is valued at cost to the Entity and expensed. Options granted to directors are valued using the Black-Scholes option pricing model. Directors are also eligible to participate in the Company’s Employee Share Option Plan ( ESOP ). Any such options to be offered to Directors under the terms of the ESOP require shareholders’ approval. These Options are issued for nil consideration and do not have performance conditions attached other than continued employment with the Entity.

The Board policy is to remunerate non-executive directors at market rates for time, commitment and responsibilities. The Board determines payments to the non-executive directors and will review their remuneration annually, based on market practice, duties and accountability and to ensure their remuneration is competitive in attracting, retaining and motivating people with appropriate skills and experience. Independent external advice is sought where required.

The maximum amount of fees that can be paid to non-executive directors is subject to approval by shareholders at the Annual General Meeting. Fees for non-executive directors are currently fixed at up to $250,000 and are not linked to the performance of the Company. However, to align directors’ interests with shareholder interests, the directors are encouraged to hold shares in the Company.

Options have been and will be issued to directors of the Company. The purpose of issuing options to directors as part of a remuneration package is to be able to attract, retain and motivate people of the highest calibre to oversee management of the Company's operations by providing them with an opportunity to participate in the company's future growth and give them an incentive to contribute to that growth. The issue of options as a part of remuneration packages is a well-established practice of public listed companies and, in the case of the Company, has the benefit of conserving cash whilst properly rewarding the directors.

- Performance based remuneration

The Board seeks to align the interests of shareholders and executive directors through a performance related incentive package where applicable. No performance based amounts have been paid or determined to be paid to executives at this stage of the Company’s development.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

DIRECTORS’ REPORT

Remuneration Report (audited) (continued)

Company Performance, Shareholder Wealth and Director/Executive Remuneration

The Company’s policy is to promote company performance and shareholder wealth by issuing options to directors with the purpose of:

aligning the interests of directors with shareholders;
rewarding capability and experience;
providing competitive reward for contribution to shareholder wealth;
providing a clear structure for earning rewards; and
providing recognition for contribution.
Details of Remuneration

Year ended 30 June 2019

	Cash	Other –	Superannuation	Share		Total	Performance
Directors	Salary	Motor	($)	Options		($)	Related
	and fees	Vehicle		($)			($)
	($)	($)
Richard Homsany
Non-Executive Chairman	60,000	-	1,710		-	61,710	-
Edward van Heemst
Non-Executive Director	18,000	-	-		-	18,000	-
Brett Hodgins
Non-Executive Director	12,000	-	-		-	12,000	-

Year ended 30 June 2018

	Cash	Other –	Superannuation	Share		Total	Performance
Directors	Salary	Motor	($)	Options		($)	Related
	and fees	Vehicle		($)			($)
	($)	($)
Richard Homsany
Non-Executive Chairman	60,000	-	1,710		-	61,710	-
Edward van Heemst
Non-Executive Director	36,000	-	-		-	36,000	-
Brett Hodgins
Non-Executive Director	12,000	-	-		-	12,000	-

There are no performance conditions attached to remuneration paid during the current or previous financial year.

- Options Granted as Remuneration

There were no options over ordinary shares in the Company granted to directors and/or specified executives during the current and prior reporting periods.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

DIRECTORS’ REPORT

Remuneration Report (audited) (continued)

Non-Executive Directors

Mr Homsany and his related entity Cardinals Corporate Pty Ltd, of which he is a director was paid an annual director’s fee of $61,710 (inclusive of applicable superannuation) for director services for the financial year to 30 June 2019.

Mr van Heemst and his related entity, Troyward Pty Ltd, is entitled to, and accrued, an annual director fee of $18,000 (inclusive of applicable superannuation) for the financial year ended 30 June 2019.

Mr Hodgins and his related entity, Jaybre Consulting Pty Ltd has accrued fees of $12,000 (inclusive of applicable superannuation) for director services for the financial year to 30 June 2019.

Non-Executive directors may charge consulting fees at commercial rates. Consulting fees paid to directors are separate from any responsibility they may have to the Company or the role they perform as a result of their appointment as a Director of the Company.

Transactions with Key Management Personnel

During the financial year, Cardinals Corporate Pty Ltd, a company of which Mr Homsany is a director, undertook legal, consulting and underwriting services for the Company totalling $105,861 excluding GST, in addition to the amount which has been disclosed as remuneration in the Directors’ Report. Services from Cardinals Corporate Pty Ltd were provided on arm’s length terms.

During the financial year the Entity occupied the office premises of a director-related entity of Mr Homsany on a monthly tenancy for an agreed gross commercial rent inclusive of car bay of $2,300 per month. The monthly tenancy may be terminated by either party giving at least one month’s written notice to the other party.

During the financial year the Entity received $42,000 excluding GST from Toro Energy Ltd, a director -related entity of Mr Homsany, for the hire of exploration equipment.

During the 2016 financial year, a related entity of Mr Ted van Heemst advanced the Entity $100,100 to assist in working capital requirements. The loan, which was interest free and had no set date of repayment, was repaid by way of debt offset pursuant to the Company’s 2018 Prospectus during the financial year.

There were no other loans outstanding to or from key management personnel during the year.

Option Holdings

The movement during the reporting period in the number of options over ordinary shares in the Company held directly, indirectly or beneficially, by each specified director and specified executive, including their personallyrelated entities, is as follows:

	Held		Granted as	Entitlement	Exercised	Sold		Held as at
	1 July		remuneration	Issue – Listed				30 June
	2018		– Unlisted	Options				2019
			Options	(ASX: RDSOB)
Director
Richard Homsany		-	-	8,021,471	-	-	-	8,021,471
Non-Executive
Chairman
Edward van Heemst		-	-	6,914,707	-	-	-	6,914,707
Non-Executive Director
Brett Hodgins		-	-	882,353	-	-	-	882,353
Non-Executive Director

All options are exercisable from the date of issue.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

DIRECTORS’ REPORT

Equity Holdings and Transactions

The movement during the reporting period in the number of ordinary shares of the Company held directly, indirectly or beneficially, by each specified director and specified executive, including their personally-related entities is as follows:

	Held at	Received	Entitlement	Acquired/	Other		Held as at
	1 July 2018	on Exercise	Issue	(Disposed)	changes		30 June 2019
		of Options		on Market
Directors
Richard Homsany	34,668,392	-	16,042,942	6,831,114		-	57,542,448
Non-Executive Chairman
Edward van Heemst	51,750,001	-	13,829,413	1,500,000		-	67,079,414
Non-Executive Director
Brett Hodgins	2,624,723	-	1,764,706	-		-	4,389,429
Non-Executive Director

Exercise of options granted as remuneration

During the period there were no shares issued on the exercise of any options granted as remuneration.

** End of Remuneration Report ****

ACN 090 169 154

REDSTONE RESOURCES LIMITED

DIRECTORS’ REPORT

Indemnification and insurance of Officers

The Company currently has Directors and Officers insurance. The Company has entered into deeds with each director indemnifying each director against liabilities arising out of their conduct while acting in the capacity of a director of the Company to the full extent permitted by law.

The insurance premium relates to liabilities that may arise from an Officer’s position, with the exception of conduct involving a wilful breach of duty or improper use of information or position to gain personal advantage.

The Officers covered by the insurance policies are the Directors and the Company Secretary.

The contract of insurance prohibits the disclosure of the nature of the liabilities and the amount of the premium.

Auditor

Butler Settineri (Audit) Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.

There were no non-audit services provided by the Entity’s auditor during the financial year.

Auditors’ Independence Declaration

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

Legal Proceedings

No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings.

Signed in accordance with a resolution of the Board of Directors.

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R Homsany Chairman Perth, Western Australia

Dated this 27[th] day of September 2019

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AUDITOR’S INDEPENDENCE DECLARATION

As lead auditor for the audit of Redstone Resources Limited for the year ended 30 June 2019, 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.

The declaration is in respect of Redstone Resources Limited and the entities it controlled during the year.

BUTLER SETTINERI (AUDIT) PTY LTD

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LUCY P GARDNER Director

Note	Consolidated 2019 $ 2018 $
Cash flows from operating activities Payments to suppliers and employees Interest received Interest paid Income tax paid Other income Other income - Net R&D concession Net cash flows used in operating activities 23 Cash flows from investing activities Exploration expenditure Net R&D tax concession Net cash flows used in investing activities Cash flows from financing activities Proceeds from issue of securities Payment of security issue costs Net cash flows from financing activities Net increase/(decrease) in cash held Cash at the beginning of the financial year Cash at end of financial year 5	(186,196) (187,169) 4,107 359 - - - - 42,000 - 29,979 124,027
	(110,110) (62,783)
	(203,085) (574,341) 186,170 131,372
	(16,915) (442,969)
	923,511 4,110 (152,878) -
	770,633 4,110
	643,608 (501,642) 122,818 624,460
	766,426 122,818

The accompanying notes form part of these financial statements.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

1. Corporate information

The financial report of Redstone Resources Limited and its controlled entities (the Entity or Group) for the year ended 30 June 2019 was authorised for issue in accordance with a resolution of the directors of the Entity’s parent entity, Redstone Resources Limited, on 27 September 2019.

Redstone Resources Limited (Redstone or the Company) is a company limited by shares incorporated and domiciled in Australia whose shares commenced public trading on the Australian Stock Exchange on 3 August 2006. The nature of operations and principal activities of the Entity are described in the Directors’ Report.

The Group is a for-profit entity for the purpose of preparing financial statements.

2. Summary of significant accounting policies

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

a)

Basis of preparation

The financial report is a general purpose financial report which has been prepared in accordance with the requirements of the Corporations Act 2001, applicable Australian Accounting Standards, Accounting Interpretations and other mandatory professional reporting requirements. The financial report has been prepared on a historical cost basis and is presented in Australian dollars.

b)

Statement of compliance

The financial report complies with Australian Accounting Standards, which include Australian equivalents to International Financial Reporting Standards (AIFRS).

Australian Accounting Standards that have recently been issued or amended but are not yet effective have not been adopted for the annual reporting period ended 30 June 2019.

c) Adoption of new and revised standards

The Entity has also reviewed all new Standards and Interpretations that have been issued and are effective for the year ended 30 June 2019. As a result of this review the Directors have determined that there is no material impact or otherwise, of the new and revised Standards and Interpretations on its business and, therefore, no change necessary to the Entity’s accounting policies.

d) New accounting standards not yet implemented

The AASB has issued new, revised and amended standards and interpretations that have mandatory application dates for future reporting periods. A discussion of those future requirements and their impact on the Entity follows:

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

d) New accounting standards not yet implemented (continued)
AASB 16: Leases (applicable for annual reporting periods commencing on or after 1 January 2019). Initial application of this standard is expected to be in the financial year ending 30 June 2020.

AASB 16 removes the classification of leases as either operating leases or finance leases for the lessee, effectively treating all leases as finance leases. Short term leases (less than 12 months) and leases of low value are exempt from the lease accounting requirements. Lessor accounting remains similar to current practice.

This standard is not expected to have a material impact on the financial statements when first adopted.

AASB 2014-10 : Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (applicable for annual reporting periods commencing on or after 1 January 2022). Initial application of this standard is expected to be in the financial year ending 30 June 2023.

This amendment addresses a current inconsistency between AASB10: Consolidated Financial Statements and AASB 128: Investments in Associates and Joint Ventures (2011) . The amendment clarifies that, on sale or contribution of assets to a joint venture or associate or on a loss of control when joint control or significant influence is retained in a transaction involving an associate or a joint venture, any gain or loss recognised will depend on whether the assets or subsidiary constitute a business, as defined in AASB 3: Business Combinations . Full gain or loss is recognised when the assets or subsidiary constitute a business.

The standard is not expected to have a material impact on the financial statements when first adopted.

AASB 2017-4 : Amendments to Australian Accounting Standards – Uncertainty over Income Tax Treatments (applicable for annual reporting periods commencing on or after 1 January 2019). Initial application of this standard is expected to be in the financial year ending 30 June 2020.

AASB 2017-4 amends AASB 1 First Time Adoption of Australian Accounting Standards to add paragraphs arising AASB Interpretation 23 Uncertainty over Income Tax Treatments .

The standard is not expected to have a material impact on the financial statements when first adopted.

Interpretation 23 Uncertainty Over Income Tax Treatments (applicable for annual reporting periods commencing on or after 1 January 2019). Initial application of this standard is expected to be in the financial year ending 30 June 2020.

Interpretation 23 clarifies how the recognition and measurement requirements of AASB 112 Income Taxes are applied when there is uncertainty over income tax treatments.

The standard is not expected to have a material impact on the financial statements when first adopted.

AASB 2017-7 : Amendments to Australian Accounting Standards – Long-term Interests in Associates and Joint Ventures (applicable for annual reporting periods commencing on or after 1 January 2019). Initial application of this standard is expected to be in the financial year ending 30 June 2020.

AASB 2017-7 amends AASB 128 Investments in Associates and Joint Ventures to clarify that an entity is required to account for long-term interests in an associate or joint venture, which in substance form part of the net investment in the associate or joint venture but to which the equity method is not applied, using AASB 9 Financial Instruments before applying the loss allocation or impairment requirements in AASB 128 .

The standard is not expected to have a material impact on the financial statements when first adopted.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

d) New accounting standards not yet implemented (continued)

AASB 2018-1 : Annual Improvements to IFRS Standards 2015-2017 Cycle (applicable for annual reporting periods commencing on or after 1 January 2019). Initial application of this standard is expected to be in the financial year ending 30 June 2020.

AASB 2018-1 makes a number of relatively minor amendments to AASB 3 Business Combinations , AASB 111 Joint Arrangements , AASB 112 Income Taxes and AASB 123 Borrowing Costs .

The standard is not expected to have a material impact on the financial statements when first adopted.

AASB 2018-6 : Amendments to Australian Accounting Standards – Definition of a Business (applicable for annual reporting periods commencing on or after 1 January 2020). Initial application of this standard is expected to be in the financial year ending 30 June 2021.

AASB 2018-6 amends AASB 3 Business Combinations to clarify the definition of a business assisting entities to determine whether a transaction should be accounted for as a business combination or as an asset acquisition.

The standard is not expected to have a material impact on the financial statements when first adopted.

AASB 2018-7 : Amendments to Australian Accounting Standards – Definition of Material (applicable for annual reporting periods commencing on or after 1 January 2020). Initial application of this standard is expected to be in the financial year ending 30 June 2021.

AASB 2018-7 principally amends AASB 101 Presentation of Financial Statements and AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors by refining the definition of material in AASB 101. The amendments clarify the definition of material and its application by improving the wording and aligning the definition across the Australian Accounting Standards and other publications.

The standard is not expected to have a material impact on the financial statements when first adopted.

AASB 2019-1 : Amendments to Australian Accounting Standards – References to the Conceptual Framework (applicable for annual reporting periods commencing on or after 1 January 2020). Initial application of this standard is expected to be in the financial year ending 30 June 2021.

AASB 2019-1 amends Australian Accounting Standards, Interpretations and other pronouncements to reflect this issuance of the revised Conceptual Framework for Financial Reporting (Conceptual Framework).

The application of the Conceptual Framework is limited to:

For profit entities that have public accountability;
Other for-profit entities that voluntarily elect to apply the Conceptual Framework

The standard is not expected to have a material impact on the financial statements when first adopted.

The adoption of the various Australian Accounting Standards and Interpretations in issue but not yet effective will not impact the Entity’s reported results and financial position as they do not result in any changes to the Entity’s accounting policies. Adoption, will however, result in changes to information currently disclosed in the financial statements. The Entity does not intend to adopt any of these pronouncements before their effective dates.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

e) Parent entity information

The financial information for the Parent Entity, Redstone Resources Limited, disclosed in note 25 has been prepared on the same basis as the consolidated financial statements.

f) Significant accounting judgments, estimates and assumptions

The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk of causing material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period are:

Capitalisation of exploration and evaluation expenditure

Under AASB 6 Exploration for and Evaluation of Mineral Resources the Entity has the option to either expense exploration and evaluation expenditure as incurred or to capitalise such expenditure provided that certain conditions are satisfied. The Entity applies the latter policy as outlined in note 2(n).

Impairment of plant and equipment

Plant and equipment are reviewed for impairment if there is any indication that the carrying amount may not be recoverable.

Where a review for impairment is conducted, the recoverable amount is assessed by reference to the higher of ‘value in use’ (being net present value of expected future cash flows of the relevant cash generating unit) and ‘fair value less costs to sell’.

Share based payment transactions

The Entity measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using either BlackScholes or binomial methodology.

g) Revenue Recognition

Revenues are recognised to the extent that it is probable that the economic benefit will flow to the Entity and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue can be recognised.

(i) Sale of goods

Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer and the costs incurred or to be incurred in respect of the transaction can be measured reliably. Risks and rewards of ownership are considered passed to the buyer at the time of delivery of the goods to the customer.

(ii) Rendering of services

Revenue from the rendering of services is recognised by reference to the stage of completion of the contract. Contracts with customers for the provision of exploration equipment are invoiced monthly in arrears for a predetermined rate.

(iii) Interest income

Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the financial asset.

(iv) Dividends

Revenue is recognised when the Entity’s right to receive the payment is established.

(v) R&D Incentive

Research and Development (R&D) Incentive revenue is recognised upon lodgement of the Entity’s annual Company Tax return with the Australian Taxation Office, which includes the amount of R&D incentive rebate determined as per the annual R&D Incentive application.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

h) Borrowing costs

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

All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

i) Cash and cash equivalents

Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Bank overdrafts are shown within borrowings in current liabilities in the Consolidated Statement of Financial Position.

For the purposes of the Consolidated Statement of Cash Flows, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts.

j) Trade and other receivables

Trade receivables are measured on initial recognition at fair value and are subsequently measured at amortised cost using the effective interest rate method, less credit loss allowances. Trade receivables are generally due for settlement within 30 days.

Credit loss allowances of trade receivables are continually reviewed and those that are considered to be uncollectible are written off by reducing the carrying amount directly. A credit loss allowance account is used when there is objective evidence that the Entity will not be able to collect all amounts due according to the original contractual terms. Factors considered by the Entity in making this determination include known significant financial difficulties of the debtor, review of financial information and significant delinquency in making contractual payments to the Entity. The credit loss allowance is set equal to the difference between the carrying amount of the receivable and the present value of estimated future cash flows, discounted at the original effective interest rate. Where receivables are short-term, discounting is not applied in determining the allowance.

The amount of the credit loss allowance is recognised in the consolidated statement of comprehensive income within other expenses. When a trade receivable for which a credit loss allowance had been recognised becomes uncollectible in a subsequent period, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against other income in the consolidated statement of comprehensive income.

k) Financial Assets

Financial assets in the scope of AASB 139 Financial Instruments: Recognition and Measurement are classified as either financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, as appropriate. When financial assets are recognised initially, they are measured at fair value, plus, in the case of investments not at fair value through profit or loss, directly attributable transactions costs. The Entity determines the classification of its financial assets after initial recognition and, when allowed and appropriate, re-evaluates this designation at each financial year-end.

All regular way purchases and sales of financial assets are recognised on the trade date i.e. the date that the Entity commits to purchase the asset. Regular way purchases or sales are purchases or sales of financial assets under contracts that require delivery of the assets within the period established generally by regulation or convention in the marketplace.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

k) Financial Assets (continued)

(i) Financial assets at fair value through profit or loss

Financial assets classified as held for trading are included in the category ‘financial assets at fair value through profit or loss’. Financial assets are classified as held for trading if they are acquired for the purpose of selling in the near term. Derivatives are also classified as held for trading unless they are designated as effective hedging instruments. Gains or losses on investments held for trading are recognised in profit or loss.

(ii) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are carried at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired, as well as through the amortisation process.

l) Income tax

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

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

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

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

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

when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
Unrecognised deferred income tax assets are reassessed at each balance date and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

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

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

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

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

m) Goods and services tax (GST)

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

Receivables and payables in the consolidated statement of financial position are shown inclusive of GST. The net amount of GST recoverable or payable is included as a current asset or current liability in the consolidated statement of financial position. Cash flows are included in the consolidated statement of cash flows on a gross basis. The GST components of cash flows arising from investing and financing activities which are recoverable or payable are classified as operating cash flows.

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

n) Exploration and evaluation expenditure

Exploration and evaluation expenditure incurred is accumulated in respect of each separate area of interest.

Exploration and evaluation costs are carried forward where right of tenure of the area of interest is current and they are expected to be recouped through sale or successful development and exploitation of the area of interest, or, where exploration and evaluation activities in the area of interest have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves.

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

o) Plant and equipment

Each class of plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation and impairment losses. Plant and equipment is measured on a cost basis.

Depreciation

The depreciable amount of all fixed assets is depreciated on a diminishing balance basis over their useful lives to the Entity commencing from the time the asset is held ready for use. The depreciation rates used for each class of depreciable assets are:

Class of fixed asset	Depreciation rate
Office furniture & equipment	7.5% to 20%
Exploration & digital equipment	10% to 20%

Derecognition and disposal

An item of plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

Any gain of loss arising on derecognition of the asset (calculated as the difference between the net disposal and the carrying amount of the asset) is included in the profit and loss in the year the asset is derecognised.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

p) Derecognition of financial assets and liabilities

(i) Financial assets

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when:

the rights to receive cash flows from the asset have expired;
the Entity retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a ‘pass-through’ arrangement; or
the Entity has transferred its rights to receive cash flows from the asset and either:
(a) has transferred substantially all the risks and rewards of the asset, or
(b) has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Entity has transferred its rights to receive cash flows from an asset and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of the Entity’s continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration received that the Entity could be required to repay.

When continuing involvement takes the form of a written and/or purchased option (including a cash-settled option or similar provision) on the transferred asset, the extent of the Entity’s continuing involvement is the amount of the transferred asset that the Entity may repurchase, except that in the case of a written put option (including a cash-settled option or similar provision) on an asset measured at fair value, the extent of the Entity’s continuing involvement is limited to the lower of the fair value of the transferred asset and the option exercise price.

(ii) Financial liabilities

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in profit or loss.

q) Impairment

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

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

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

q) Impairment (continued)

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

r) Goodwill

Goodwill acquired in a business combination is initially measured at its cost, being the excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised. Goodwill is subsequently measured at its cost less any impairment losses.

s) Trade and other payables

Liabilities for trade creditors and other amounts are carried at cost, which is the fair value of the consideration to be paid in the future for goods and services received, whether or not billed to the Entity.

t) Employee benefits

i. Wages and salaries, annual leave and sick leave

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

ii. Long service leave

The liability for long service leave expected to be settled within 12 months of the reporting date is recognised in the provision for employee benefits and is in accordance with i. above. The liability for long service leave expected to be settled more than 12 months from the reporting date is recognised in the provision for employee benefits and 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. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on national government bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.

iii. Superannuation

Contributions are made by the Entity to employee superannuation funds and are charged as expenses when incurred.

u) Interest-Bearing Loans and Borrowings

All loans and borrowings are initially recognised at the fair value of the consideration received less directly attributable transaction costs.

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the effective interest method.

Gains and losses are recognised in profit or loss when the liabilities are derecognised.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

w) Share-based payment transactions

The Entity provides incentives to employees (including directors) of the Entity in the form of share-based payment transactions, whereby employees render services in exchange for shares or rights over shares (‘equity-settled transactions’).

The Company has in place an Employee Share Option Plan (ESOP) which provides benefits to directors, senior executives and key employees. Key terms of the ESOP are as follows:

The ESOP is available to eligible persons who will be determined by the Board but must be persons who are Directors or employees of the Entity;
Options are issued for nil consideration;
The exercise price is determined by the Board with regard to the market value of the Company’s shares at the time it resolves to offer the options;
Options will be issued subject to certain conditions that must be satisfied for them to be exercised to be determined by the Board when it resolves to offer the Options and in accordance with the purpose of the ESOP;
The expiry date of the Options will be determined by the Board prior to the offer of the relevant options, subject to any restrictions in the Corporations Act, but in any event no longer than 5 years from the date of issue;
Options will lapse if the eligible person ceases to be an eligible person for any reason other than retirement, permanent disability, redundancy or death;
Options are not transferable;
Any shares issued will rank equally with the Company’s then existing issued shares;
The issue of Options to Directors will require shareholder approval in accordance with the ASX Listing Rules and the Corporations Act.

The cost of these equity-settled transactions with employees is measured by reference to the fair value at the date at which they are granted. The fair value is determined by an external valuer using Black-Scholes and binomial methods.

In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price of the shares of Redstone Resources Limited (‘market conditions’).

The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (‘vesting date’).

Where the Entity acquires some form of interest in an exploration tenement and the consideration comprises share based payment transactions, the fair value of the equity instruments granted is measured at the grant date. The cost of the equity securities is recognised within capitalised exploration expenditure together with a corresponding increase in equity.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

w) Share-based payment transactions (continued)

The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the extent to which the vesting period has expired and (ii) the number of awards that, in the opinion of the directors of the company, will ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the determination of fair value at grant date. Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not been modified. In addition, an expense is recognised for any increase in the value of the transaction as a result of the modification, as measured at the date of modification.

Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the original award, as described in the previous paragraph.

The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per share.

x) Share capital

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

y) Earnings per share

Basic earnings per share

Basic earnings per share is determined by dividing net profit after income tax attributable to members of the Entity, excluding any costs of service 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 year.

Diluted earnings per share

Diluted earnings per share adjusts the figure used in the determination of basic earnings per share to take into account the dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to potential ordinary shares.

z) Joint venture arrangements

Jointly controlled operations

Where the Entity is a venturer (and so has joint control) in a jointly controlled operation the Entity recognises the assets that it controls and the liabilities it incurs, along with the expenses that it incurs and the Entity’s share of the income that it earns from the sale of goods and services by the joint venture.

ACN 090 169 154

REDSTONE RESOURCES LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

aa) Comparative figures

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

ab) Foreign currency

Exchange differences are recognised in profit or loss in the period in which they arise except for exchange differences on monetary items receivable from or payable to a foreign operation for which settlement is neither planned nor likely to occur, which form part of the net investment in a foreign operation, and which are recognised in the foreign currency translation reserve and recognised in profit or loss on disposal of the net investment.

The individual financial statements of each group entity are presented in the currency of the primary economic environment in which the entity operates (its functional currency). For the purpose of the consolidated financial statements, the results and financial position of each entity are expressed in Australian dollars, which is the functional currency of the Entity, and the presentation currency for the consolidated financial statements.

ac) Principles of consolidation

The consolidated financial statements incorporate all of the assets, liabilities and results of the parent, Redstone Resources Ltd and all of the subsidiaries (including any structured entities). Subsidiaries are entities the parent controls. The parent controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

ad) Principles of going concern

The Entity recorded a loss of $277,138 for the year ended 30 June 2019 and as at 30 June 2019 had net current assets of $440,155 and exploration commitments of $186,000 for the next year (note 21). The financial report has been prepared on a going concern basis, as the Directors are of the opinion that the Entity will be able to pay its debts as and when they fall due. The Directors contemplate continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

			Consolidated	Consolidated
			2019	2018
			$	$
3.		Revenue and expenses
	(a)	Revenue and Interest
		Revenue
		Exploration hire income	42,000	-
		Other revenue
		Interest income	4,107	359
		Net R&D concession	45,622	124,027
			49,729	124,386
	(b)	Depreciation expense
		Plant and equipment	2,170	3,116
	(c)	Employee and directors’ benefits
		expenses
			202,692	220,369
	(d)	Finance costs
		Other third parties	1,943	1,588
		Interest is expensed as it accrues.
	(e)	Dividends	-	-
		No dividends have been paid or are proposed as at 30 June 2019.
		As at 30 June 2019 the Company has no franking credits available for use in future years.
4.		Income tax
	(a)	The components of tax expense comprise:
		Current tax	-	-
		Deferred tax	-	-
			-	-

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

4. Income tax (continued)

(b) The prima facie tax benefit on loss from ordinary activities before income tax is reconciled to the income tax expense in the financial statements is as follows:

Prima facie tax benefit on loss from ordinary activities before income tax at 30% (2018: 30%) Add/(less) tax effect of: - Revenue losses and other deferred balances not recognised - Other non-deductible items - Other non-assessable items Income tax expense	Consolidated 2019 2018 $ $ (83,141) (104,690) 96,147 135,481 681 6,417 (13,687) (37,208)
	- -

The corporate tax rate for eligible companies will reduce from 30% to 25% by 30 June 2022 providing certain turnover thresholds and other criteria are met. Deferred tax assets and liabilities are required to be measured at the tax rate that is expected to apply in the future income year when the asset is realised or the liability is settled. The Directors have determined that the deferred tax balances be measured at the tax rates stated.

(c) Deferred tax recognised at 30% (2018: 30%):

Deferred tax liabilities: Exploration expenditure Deferred tax assets: Carry forward revenue losses Net deferred tax Unrecognised deferred tax recognised at 30% (2018: 30%): Carry forward revenue losses Carry forward capital losses Other Provisions and accruals	(1,990,590) (1,902,314) 1,990,590 1,902,314 - -
	4,375,215 4,510,682 21,692 21,692 45,861 26,379 20,458 6,258
	4,463,226 4,565,011

(d) Unrecognised deferred tax recognised at 30% (2018: 30%):

These deferred tax assets will only be obtained if:

a) future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised;
b) the Entity continues to comply with the conditions for deductibility imposed by tax legislation; and
c) no changes in the income tax legislation adversely affect the Entity in realising the benefit from the deduction of the loss.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

4. Income tax (continued)

It is considered that it is not probable that the Entity will utilise all its carry forward tax losses in the foreseeable future, hence it is not expected to pay tax in the foreseeable future. The deferred tax balances noted above have therefore not been accounted for in the consolidated statement of financial position.

Redstone Resources Limited and its controlled entities have not elected to form a tax consolidation group.

5. Cash and cash equivalents Cash at bank Cash on deposit 6. Trade and other receivables Current GST receivable 7. Deferred exploration expenditure Exploration costs brought forward Expenditure incurred on exploration assets Reimbursement of capitalised costs Impaired exploration costs recovered/(written off) Carrying amount at the end of the year	Consolidated 2019 $ 2018 $ 252,633 112,818 513,793 10,000
	766,426 122,818
	20,417 928
	6,341,048 5,900,934 294,251 559,270 (198,386) (119,156) - -
	6,346,913 6,341,048

The ultimate recoupment of costs carried forward in relation to exploration expenditure is dependent on the successful development and commercial exploitation or sale of the areas of interest at an amount at least equal to the carrying value.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

8. Plant and equipment At cost Accumulated depreciation Total written down value Reconciliation A reconciliation of the carrying amounts of plant and equipment at the beginning and end of the current financial period. Plant and equipment Carrying amount at beginning of year Depreciation expense Total plant and equipment 9. Other assets Current Prepayments 10. Trade and other payables Current Trade creditors (i) Other creditors (ii) Total current trade and other payables	Consolidated 2019 $ 2018 $ 144,940 144,940 (139,762) (137,592)
	5,178 7,348
	7,348 10,464 (2,170) (3,116)
	5,178 7,348
	4,266 5,102
	273,889 65,468 60,035 689,963
	333,924 755,431

Terms and conditions relating to the above financial instruments:

(i) Trade creditors are non-interest bearing and are normally settled on 14-30 days terms, other than for related party creditors of the Entity totalling $127,294 (2018: $3,529) which, by mutual agreement with the Entity, currently have no set term for payment.

(ii) Other creditors are non-interest bearing and have an average term of 30 days, other than for related party creditors of the Entity totalling $30,000 (2018: $670,800) which, by mutual agreement with the Entity, currently have no set term for payment.

Trade and other payables include $136,016 (2018: $67,465) relating to exploration expenditure.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

11. Provisions Employee entitlements Opening balance at 1 July 2018 Provision additions Amounts used/paid out Balance as at 30 June 2019 Current	Consolidated 2019 $ 2018 $ 17,404 10,809 14,859 8,793 (15,233) (2,198)
	17,030 17,404
	17,030 17,404

Provision for employee entitlements relates to the Group’s liability for annual leave and long service leave.

12. Issued Capital

(a) Issued and paid up capital 473,964,306 (2018: 379,934,261) ordinary shares fully paid Listed $0.035 options (ASX: RDSOB) expiring 30 April 2021 – 47,015,048 (2018: Nil)	25,200,714 23,745,739 - -
	25,200,714 23,745,739

Changes to the then Corporations Law abolished the authorised capital and par value concept in relation to share capital from 1 July 1998. Therefore the company does not have a limited amount of authorised share capital and issued shares do not have a par value.

The Offer, which closed on 3 October 2018, raised a total of $1,451,500 (before costs). Accordingly, the Company issued 85,382,485 New Shares and 42,691,267 RDSOB options, these being a new class of quoted security.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

12. Issued Capital (continued)

(b) Movements in fully paid ordinary shares during the year were as follows:

Movements in shares on issue Opening balance Prorata non renounceable 1:3 Entitlement Offer – 9 October 2018 Prorata non renounceable 1:3 Entitlement Offer Shortfall – 18 December 2018 Prorata non renounceable 1:3 Entitlement Offer Shortfall – 3 January 2019 Prorata non renounceable 1:3 Entitlement Offer Shortfall - 29 March 2019 Conversion of $0.03 listed options to Issued Capital (ASX: RDSOA) – 7 August 2017 Share issue costs Closing balance	2019 2018 No. of Shares $ No. of Shares $ 379,934,261 23,745,739 379,797,245 23,741,629 85,382,485 1,451,502 - - 5,059,324 86,009 - - 588,236 10,000 - - 3,000,000 51,000 - - - - 137,016 4,110 - (143,536) - -
	473,964,306 25,200,714 379,934,261 23,745,739

Movements in shares on issue
Opening balance
Prorata non renounceable 1:3
Entitlement Offer – 9 October 2018
Prorata non renounceable 1:3
Entitlement Offer Shortfall – 18
December 2018
Prorata non renounceable 1:3
Entitlement Offer Shortfall – 3 January
2019
Prorata non renounceable 1:3
Entitlement Offer Shortfall - 29 March
2019
Conversion of $0.03 listed options to
Issued Capital (ASX: RDSOA) – 7
August 2017
Share issue costs
Closing balance

2019
2018
No. of
Shares
$
No. of
Shares
$
379,934,261
23,745,739
379,797,245
23,741,629
85,382,485
1,451,502
-
-
5,059,324
86,009
-
-
588,236
10,000
-
-
3,000,000
51,000
-
-
-
-
137,016
4,110
-
(143,536)
-
-

473,964,306
25,200,714
379,934,261
23,745,739

(c) Movements in options issued during the year were as follows:

Movements in listed options on issue Opening balance Prorata non renounceable 1:3 Entitlement Offer (ASX: RDSOB) – 9 October 2018 Prorata non renounceable 1:3 Entitlement Offer Shortfall (ASX: RDSOB) – 18 December 2018 Prorata non renounceable 1:3 Entitlement Offer Shortfall (ASX: RDSOB) – 3 January 2019 Prorata non renounceable 1:3 Entitlement Offer Shortfall (ASX: RDSOB) - 29 March 2019 Option expiry (ASX: RDSOA) – 31 July 2018 Transfer to Issued Capital (ASX: RDSOA) – 7 August 2018 Closing balance	2019 2018
	No. of Listed Options (RDSOB) $ No. of Listed Options (RDSOA) $
	- - 55,631,193 - 42,691,267 - - - 2,529,663 - - - 294,118 - - - 1,500,000 - - - - - (55,494,177) - - - (137,016) -
	47,015,048 - - -

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

12. Issued Capital (continued)

(c) Movements in options issued during the year (continued):

Movements in unlisted options on issue

During the financial year no unlisted options over ordinary shares were issued, expired or converted into ordinary shares.

Unlisted share options	As at 30 June 2018 Issued/ (lapsed) As at 30 June 2019 Exercise price Exercisable from Expiry
Unlisted options Unlisted options Unlisted options Unlisted options Total options Weighted average exercise price (cents/share) Weighted average exercise price of lapsed options (cents/share) Weighted average exercise price of issued options (cents/share)	10,000,000 - 10,000,000 0.015 28 Feb 17 28 Feb 20 10,000,000 - 10,000,000 0.020 28 Feb 17 28 Feb 20 2,000,000 - 2,000,000 0.015 7 Mar 18 31 Jan 20 2,000,000 - 2,000,000 0.020 7 Mar 18 31 Jan 20
	24,000,000 - 24,000,000
	0.0175 0.0175 - -

The weighted average remaining contractual life of unlisted options on issue as at 30 June 2019 is 0.65 years (2018: 1.65 years). The exercise prices of unlisted options on issue range from $0.015 per share to $0.020 per share.

(d) Terms and conditions of contributed equity

Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of shares held. At shareholders meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands.

Option holders do not have the right to receive dividends nor are they entitled to vote at a meeting of the company.

(e) Employee Share Option Plan (ESOP)

Key terms relating to the Employee Share Option Plan (ESOP) are set out in note 2(w).

During the financial year no options were issued to eligible persons pursuant to the ESOP (2018: nil) and no options lapsed or expired (2018: nil).

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

13. Reserves

Share option reserve (i)	Consolidated 2019 $ 2018 $ 138,256 138,256

(i) This reserve is used to record the value of equity benefits provided to employees and directors as part of their remuneration and as consideration for other equity settled transactions.

Movements in reserves are set out in the Statement of Changes in Equity.

14. Loss per share

Basic loss per share (cents per share) Weighted average number of ordinary shares on issue used in the calculation of basic earnings per share Earnings used in the calculation of basic loss per share	Consolidated 2019 2018 (0.06) (0.09)
	448,486,913 379,919,916 (277,138) (348,966)

As the Entity made a loss for the year, diluted earnings per share is the same as basic earnings per share.

15. Key management personnel disclosures

(a) Key management personnel

The directors of Redstone Resources Limited during the financial year were:

Richard Homsany ( BCom, LLB (Hons), CPA, Grad. Dip. FINSIA, F Fin, MAICD) - Non-Executive Chairman

Edward van Heemst (B Com, MBA, CA, CPA) – Non-Executive Director Brett Hodgins ( BSc (Hons), Grad Dip FINSIA ) – Non-Executive Director

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

15. Key management personnel disclosures (continued)

(b) Remuneration of key management personnel

Refer to the Remuneration Report included on pages 9 to 12 for details of remuneration paid to directors and the specified executives.

Options granted as remuneration to key management personnel

2019 Directors R Homsany E van Heemst B Hodgins	Balance at start of year Granted as compensation Exercised/ (Expired) Other Changes Balance at end of year
	- - - - - - - - - - - - - - -
	- - - - -

No options were granted as remuneration to key management personnel or vested during the 2019 financial year.

2018 Directors R Homsany E van Heemst B Hodgins	Balance at start of year Granted as compensation Exercised/ (Expired) Other Changes Balance at end of year
	500,000 - (500,000) - - 1,500,000 - (1,500,000) - - - - - - -
	2,000,000 - (2,000,000) - -

(c) Share holdings of key management personnel

	Held as at	Acquired/	Acquired/	Entitlement	Other		Held as at
2019	1 July	(Disposed)	(Disposed)	Issue/	Changes		30 June 2019
	2018	on Market	off Market	Underwriting
Directors
R Homsany	34,668,392	6,831,114	-	16,042,942		-	57,542,448
E van Heemst	51,750,001	1,500,000	-	13,829,413		-	67,023,914
B Hodgins	2,624,723	-	-	1,764,706		-	4,389,429

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

15. Key management personnel disclosures (continued)

(c)	*holdings of key*	*management*	*personnel(continued)*	*personnel(continued)*
	Held as at	Acquired/	Acquired/	Entitlement		Other		Held as at
2018	1 July 2017	(Disposed)	(Disposed)	Issue		Changes		30 June
		on Market	off Market					2018
Directors
R Homsany	32,571,768	2,096,624	-		-		-	34,668,392
E van Heemst	50,500,001	1,250,000	-		-			51,750,001
B Hodgins	2,624,723	-	-		-		-	2,624,723

All equity transactions with key management personnel, other than those arising from the exercise of remuneration options, have been entered under terms and conditions no more favourable than those the Company would have adopted if dealing at arm’s length.

(d) Transactions with key management personnel

Refer to the Remuneration Report included on pages 9 to 12 for details of transactions with key management personnel.

16. Employee benefits Aggregate liability for employee benefits Current Trade and other payables Employee entitlement provision Non-Current Employee entitlement provision	Consolidated 2019 $ 2018 $ 19,799 27,904 17,030 17,404
	36,829 45,308
	- -
	- -

The Entity has in place an employee share option plan (ESOP) for the granting of non-transferable options to certain directors, senior executives and key employees, further details of which are provided in note 2(w).

17. Auditors remuneration Amounts received or due and receivable by the auditors of the Entity for: - an audit or review of the financial statements of the Entity - non audit services	22,142 23,620 - -
	22,142 23,620

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

18. Subsequent events

19. Segment Reporting

The Entity has one operating segment being the distinct geographical location of its Area of Interest in Australia (the Entity’s primary basis of segmentation).

20. Related Party Transactions

Controlled entities

During the year no loans were provided to controlled entities. Loans to controlled entities are made in the ordinary course of business and are unsecured and interest free with no fixed term of repayment.

Other than disclosed above and in note 15 there were no other related party transactions during the financial year.

21. Expenditure commitments

Exploration expenditure commitments

Australian tenements

In order to maintain current rights of tenure over its Australian mineral tenement leases, the Entity will be required to outlay amounts in respect of rent and to meet minimum expenditure requirements of the Department of Mines, Industry, Regulation and Safety ( DMIRS ). Further, those tenements for which access agreements have been signed require annual access payments to be paid to the traditional owners.

The annual expenditure commitments (including access fees) on granted tenements as at 30 June 2019 amount to $186,000 (2018: $28,000).

In September 2018 the Department of Minerals, Industry, Regulation and Safety ( DMIRS ) granted an extension of term for exploration licence E69/2450 for a further two year period to 18 September 2020. The annual expenditure commitment for the extended term is $123,000.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

The future exploration commitment (including access payments) of the Entity relating to granted tenements is as follows:

Cancellable operating lease commitments for exploration tenements Within one year One year or later and no later than five years Later than five years	Consolidated 2019 $ 2018 $ 186,000 28,000 59,375 84,000 - 3,375 245,375 115,375

These obligations may vary from time to time, are subject to approval and are expected to be fulfilled in the normal course of operations by the relevant entity. Further, these obligations are subject to the possibility of adjustment to the amount and timing of such obligations or extinguished upon any surrender of the tenement.

Operating lease commitments

Cancellable operating lease commitments Within one year One year or later and no later than five years Later than five years	Consolidated 2019 $ 2018 $ 2,300 4,300 - - - -
	2,300 4,300

Capital Commitments

The Entity does not have any capital commitments as at balance date.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

22. Financial Risk Management

(a) Overview

The Entity has exposure to the following risks from use of their financial instruments

credit risk
liquidity risk
market risk

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

The Board of directors has overall responsibility for the establishment and oversight of the risk management framework.

(b) Credit risk

Credit risk is the risk of financial loss to the Entity if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Entity’s receivables from customers and investments.

(c) Liquidity risk

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

Ultimate responsibility for liquidity risk management rests with the Board of directors, who have built an appropriate liquidity risk management framework for the management of the Entity’s short, medium and long-term funding and liquidity management requirements. The Entity manages liquidity risk by maintaining adequate reserves by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.

It is the Entity’s objective is to ensure that it has sufficient cash on demand to meet expected operational expenses for a period of 60 days (excluding those amounts due to related party creditors of the Entity), including the servicing of financial obligations.

The contractual maturities of the financial liabilities referred to in note 10 to the financial report for the Entity at reporting date are less than 3 months, other than for related party creditors of the Entity ($157,294), which by mutual agreement currently have no set date for payment.

(d) Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Entity’s income or the value of its holdings of financial instruments.

(i) Price Risk

The Entity has no exposure to price risk.

(ii) Currency risk

The Entity is exposed to currency risk on purchases and investments that are denominated in a currency other than their functional currency, namely the Australian dollar (AUD). The currencies in which these transactions primarily are denominated are the United States dollar (USD).

To date, currency risk has not been material to the Entity.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

22. Financial Risk Management (continued)

(d) Market risk (continued)

(iii) Interest rate risk

The cash balance of $766,426 as at 30 June 2019 is sensitive to interest rate risk whereby a 1% per annum movement in interest rates would impact the consolidated statement of comprehensive income and net equity by $7,664. This risk is not considered to be material.

At reporting date the Entity does not have any short term borrowings.

(e) Capital risk management

Management’s policy is to control the capital of the Company in order to maintain a strong capital base so as to maintain investor, creditor and market confidence and to ensure that the Entity can fund its operations and continue as a going concern.

The Entity’s capital includes ordinary share capital and financial liabilities, comprising trade and other payables totalling $333,924 (2018: $755,431) and financial assets of $786,843 (2018: $123,746). The financial liabilities of $333,924 include related party creditors of the Entity totalling $157,294, which by mutual agreement currently have no set date for payment.

Financial risk management objectives and policies

The Entity’s principal financial instrument is cash. The main purpose of these financial instruments is to provide working capital for operations.

The Entity has various other financial assets and liabilities such as receivables and trade payables, which arise directly from its operations. The main risks currently arising from the Entity’s financial instruments are interest rate risk and credit risk.

It is not expected that the Entity will be undertaking transactions denominated in foreign currencies, hence exposures to exchange rate fluctuations are not expected to arise.

Significant accounting policies

Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis for measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset, financial liability and equity instrument are disclosed in note 2 to the financial statements.

Credit risk

The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial assets is the carrying amount, net of any credit loss allowances of those assets, as disclosed in the statement of financial position and the notes to the consolidated financial statements.

The Entity does not have any material credit risk exposure to debtors under financial instruments it has entered into.

As at 30 June 2019, financial assets comprise cash held with reputable financial institutions and is therefore not considered to present material credit risk.

Net fair values

The carrying amount of financial assets and financial liabilities approximate their net fair values at balance date.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

22. Financial Risk Management (continued)

Interest rate risk

The following table sets out the carrying amount and maturity of the financial instruments exposed to interest rate risk:

Consolidated – 2019 Category Financial assets: Cash Cash Trade and other receivables Total financial assets Financial liabilities Trade creditors and other payables* Total financial liabilities	Time Period Interest Bearing (Floating) Non- Interest Bearing Total Carrying Amount as per the consolidated statement of financial position Weighted Average Effective Interest Rate %
	<1 year 632,925 - 632,925 0.98% <1 year - 133,501 133,501 - <1 year - 20,417 20,417 -
	632,925 153,918 786,843
	<1 year - 333,924 333,924 -
	- 333,924 333,924

*Trade creditors and other payables include $157,294 payables or accrued amounts owing to director related parties of the entity which have no set date of repayment.

Consolidated – 2018 Category Financial assets: Cash Cash Trade and other receivables Total financial assets Financial liabilities Trade creditors and other payables* Total financial liabilities	Time Period Interest Bearing (Floating) Non- Interest Bearing Total Carrying Amount as per the consolidated statement of financial position Weighted Average Effective Interest Rate %
	<1 year 122,818 - 122,818 0.24% <1 year - - - - <1 year - 928 928 -
	122,818 928 123,746
	<1 year - 755,431 755,431 -
	- 755,431 755,431

*Trade creditors and other payables include $674,329 payables or accrued amounts owing to director related parties of the entity which have no set date of repayment.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

23. Cash flow information Loss from ordinary activities after income tax Depreciation Non cash payments Share-based payments Changes in operating assets and liabilities (Decrease)/increase in provisions (Decrease)/increase in trade creditors and accruals (Increase)/decrease in sundry receivables and prepayments Net cash flow used in operating activities	Consolidated 2019 $ 2018 $ (277,138) (348,966)
	2,170 3,116 574,900 - - 20,600 (374) 6,595 (391,110) 233,377 (18,558) 22,495
	(110,110) (62,783)

Non-Cash Transactions

During the financial year payments totalling $675,000 were made by way of debt offset pursuant to the Company’s 2018 Prospectus. In accordance with the terms of the Underwriting Agreement and Sub-Underwriting Agreements to the 2018 Prospectus, the obligations of the Underwriter (if any), were able to be relieved or satisfied by the Underwriter and/at its sole and absolute discretion offsetting such obligations against debts owed by the Entity to persons (including the Underwriter and other Related Parties) up to the amount of $675,000, and/or against all or part the underwriting fee the Underwriter is entitled to receive under the Underwriting Agreement.

Accordingly, 39,705,885 fully paid ordinary shares in the Company and 19,852,943 listed options (ASX: RDSOB) were issued in accordance with terms of the 2018 Prospectus in settlement of amounts owed to the Underwriter and other Related Parties totalling $675,000.

24. Contingent Assets and Liabilities

Financial year ending 30 June 2019

Provision for Foreign Subsidiary Obligations

During the 2014 financial year, the Entity recognised a provision for foreign subsidiary obligations relating to estimated amounts that may be required to settle outstanding obligations arising from a winding-up of the Entity’s investment in its Brazilian subsidiary, Redstone Mineraco Do Brasil Ltd ( Redstone Brazil ).

However, as at 30 June 2015, the Entity considered that it was more likely that a present obligation no longer existed for any of these amounts and that it was more likely that no economic outflow would be required. Further the timing and amount of any potential economic outflow is uncertain. Accordingly, there may be a contingent liability for potential obligations required to be paid in any eventual winding up of Redstone Brazil for which the timing is uncertain and amount cannot be measured reliably. The Entity considers that its position on these potential foreign subsidiary obligations remains unchanged as at 30 June 2019.

ACN 090 169 154

REDSTONE RESOURCES LIMITED

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

25. Parent Information

25. Parent Information
	Parent Entity 2019 $ 2018 $
Current assets Non-current assets Total Assets Current liabilities Total Liabilities Net Assets Equity Issued capital Reserves Accumulated losses Total RDS equity Net loss for the year before other comprehensive income Total comprehensive income for the year Earnings per share (EPS) – (cents per share)	791,109 128,848 6,442,091 6,348,396
	7,233,200 6,477,244
	350,954 772,835
	350,954 772,835

	6,882,246 5,704,409
	25,200,714 23,745,739 138,256 138,256 (18,456,724) (18,179,586)
	6,882,246 5,704,409
	(277,138) (348,966)
	(277,138) (348,966)
	(0.06) (0.09)

Controlled entities

Redstone Resources Limited is the ultimate parent entity of the controlled entities.

Particulars in relation to controlled entities	Country of	2019	2018
	incorporation	Ownership %	Ownership %
Allhawk Nominees Pty Ltd	Australia	100	100
Minex Services Pty Ltd	Australia	100	100
Westmin Exploration Pty Ltd	Australia	100	100
River Gold Exploration Pty Ltd	Australia	100	100
Redstone Mineracao Do Brasil Ltda1	Brazil	98	98

1 Redstone Mineraco Do Brasil Ltda is 98% owned by the Company. The remaining 2% shareholding is held by a previous consultant of the Entity, who is a Brazilian citizen and is holding these shares on trust for the Company. The Board and shareholding structure is in accordance with Brazilian law.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

25. Parent Information (continued)

(b) Contribution to consolidated result

The results of the controlled entities inclusion in the consolidated statement of comprehensive income is nil (2018: nil).

26. Share based payments

The impact of share based payments on the consolidated statement of comprehensive income for the financial year ended 30 June 2019 is as follows:

financial year ended 30 June 2019 is as follows:
Net loss after income tax and including share based payments Add: share based payments expense Net loss after income tax excluding share based payments	Consolidated 2019 $ 2018 $ (277,138) (348,966) - 20,600
	(277,138) (328,366)

During the financial year no share options were granted for nil consideration (2018: 4,000,000). Share-based payments relating to prior financial years were valued using either Black Scholes or binomial methodology as detailed in note 2(w). The value of existing options for the year ending 30 June 2019 is as follows:

$
10,000,000 Consultant and Employee Options granted on 28 February 2017. Exercise
62,042 price $0.015 exercisable from 28 February 2017 and expiring 28 February 2020.
10,000,000 Consultant and Employee Options granted on 28 February 2017. Exercise
55,614 price $0.020 exercisable from 28 February 2017 and expiring 28 February 2020.
2,000,000 Consultant Options granted on 7 March 2018. Exercise price $0.015 exercisable
11,200 from 7 March 2018 and expiring 31 January 2020.
2,000,000 Consultant Options granted on 7 March 2018. Exercise price $0.020 exercisable
9,400 from 7 March 2018 and expiring 31 January 2020.
138,256 Total Options 24,000,000

The option valuations adopted above are calculated using the following assumptions:

Options granted in financial year ending 30 June 2018

Underlying security spot price of $0.012 Dividend rate of nil Volatility factor of 100% Risk free interest rate of 1.997%

The weighted average exercise price is $0.0175 and the weighted average expiry period is 1.90 years. The weighted average value per option as at the measurement date is $0.0052 per option.

Options granted in financial year ending 30 June 2017

Underlying security spot price of $0.011 Dividend rate of nil Volatility factor of 100% Risk free interest rate of 1.97% The weighted average exercise price is $0.0175 and the weighted average expiry period is 3 years. The weighted average value per option as at the measurement date is $0.0059 per option.

ACN 090 169 154

REDSTONE RESOURCES LIMITED

DIRECTORS’ DECLARATION

In the directors’ opinion:

a) the financial statements and notes set out on pages 20 to 49 are in accordance with the Corporations Act 2001, including:
(i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; and
(ii) giving a true and fair view of the Entity’s financial position as at 30 June 2019 and its performance for the financial year ended on that date and
b) there are reasonable grounds to believe that the Entity will be able to pay its debts as and when they become due and payable.

The directors have been given the declarations by the chief executive officer and chief financial officer required by s295A of the Corporations Act 2001 .

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

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R Homsany Chairman Perth, Western Australia

Dated this 27[th] day of September 2019

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INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF REDSTONE RESOURCES LIMITED

Report on the Financial Report

Opinion

We have audited the financial report of Redstone Resources Limited (the Company) and its controlled entities (“the Group”), which comprises the consolidated statement of financial position as at 30 June 2019, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors’ declaration.

In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:

i) giving a true and fair view of the Group’s financial position as at 30 June 2019 and of its financial performance for the year then ended; and
ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.

Basis for Opinion

We have conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report.

We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our ethical requirements in accordance with the Code.

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period.

These matters were addressed in the context of our audit of the financial report as a while, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key Audit Matter

How our audit addressed the key audit matter

Deferred exploration expenditure ( refer note 7)

The Group operates as an exploration entity and as such its primary activities entail expenditure focussed on the exploration for and evaluation of economically viable mineral deposits. These activities are currently focused on West Musgrave Project.

All exploration and evaluation expenditure incurred has been capitalised and recognised as an asset in the Statement of Financial Position. The closing value of this asset is $6,436,913 as at 30 June 2019.

The carrying value of deferred exploration assets is subjective and is based on the Group’s intention and ability, to continue to explore the asset. The carrying value may also be affected by the results of ongoing exploration activity indicating that the mineral reserves and resources may not be commercially viable for extraction. This creates a risk that the asset value included within the financial statements may not be recoverable.

Our audit procedures included the following:

ensuring the Group’s continued right to explore for minerals in the relevant project areas including assessing documentation such as exploration and mining licences;
enquiring of management and the directors as to the Group’s intentions and strategies for future exploration activity and reviewing budgets and cash flow forecasts;
assessing the results of recent exploration activity to determine whether there are any indicators suggesting a potential impairment of the carrying value of the asset;
assessing the Group’s ability to finance the planned exploration and evaluation activity; and
assessing the adequacy of the disclosures made by the Group in the financial report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Group’s annual report for the year ended 30 June 2019 but does not include the financial report and the auditor’s report thereon.

Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Directors’ Responsibilities 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 the Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine 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.

In preparing the financial report, the directors are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

Auditor’s Responsibilities for the Audit of the Financial Report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial report.

As part of an audit in accordance with the Australia Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

Identify and assess risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit 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 Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the directors, we determine those matters that were of most significant in the audit of the financial report of the current period and are therefore key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh public interest benefits of such communication.

Report on the Remuneration Report

Opinion

We have audited the Remuneration Report included on pages 9 to 12 of the directors’ report for the year ended 30 June 2019.

In our opinion, the Remuneration Report of Redstone Resources Limited, for the year ended 30 June 2019 complies with section 300A of the Corporations Act 2001.

Responsibilities

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.

BUTLER SETTINERI (AUDIT) PTY LTD

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LUCY P GARDNER Director

Perth Date: 27 September 2019

REDSTONE RESOURCES LIMITED

ACN 090 169 154

SHAREHOLDER INFORMATION AS OF 24 SEPTEMBER 2019

A. CORPORATE GOVERNANCE

A statement disclosing the extent to which the Company has followed the best practice recommendations set by the ASX Corporate Governance Council during the reporting period can be found on the Company’s website at www.redstone.com.au/corporate_governance.html.

B. SHAREHOLDING

1. Substantial Shareholders

The names of the substantial shareholders listed on the company’s register:

Shareholder

Number

MR EDWARD VAN HEEMST & MRS MARILYN ELAINE VAN HEEMST 61,191,178 CARDINALS CORPORATE PTY LTD 56,877,773 GREYHOUND INVESTMENTS PTY LTD 27,128,954 VYSCARD PTY LTD 24,690,417

2. Number of holders in each class of equity securities and the voting rights attached

There are 1,576 holders of ordinary shares. Each shareholder is entitled to one vote per share held. On a show of hands every shareholder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote.

There are 6 holders of unlisted options (details of which are set out in section 7 below). There are no voting rights attached to these options. There are no other unquoted securities of the Company.

Distribution schedule of the number of holders in each class is.

				Holders of	Number of
				Ordinary	Ordinary
				Shares	Shares	%
1	-		1,000	97	47,917	0.01
1,001	-		5,000	294	899,300	0.19
5,001	-		10,000	251	2,058,563	0.43
10,001	-	100,000		622	23,182,415	4.89
100,001	and over			312	447,776,111	94.47
TOTALS				1,576	473,964,306	100.00

4. Marketable Parcel

There are 1,156 shareholders with less than a marketable parcel.

Twenty largest holders of each class of quoted equity security

The names of the twenty largest holders of each class of quoted equity security, the number of equity security each holds and the percentage of capital each holds are as follows:

REDSTONE RESOURCES LIMITED

ACN 090 169 154

SHAREHOLDER INFORMATION

Fully Paid Ordinary Shares – ASX: RDS

		No. of
		Ordinary
Rank	Name	Shares	%
1	MR EDWARD VAN HEEMST & MRS MARILYN ELAINE VAN HEEMST <LYNWARD SUPER F	61,191,178	12.91
2	CARDINALS CORPORATE PTY LTD	56,877,773	12.00
3	GREYHOUND INVESTMENTS PTY LTD	27,128,954	5.72
4	VYSCARD PTY LTD	24,690,417	5.21
5	INSPIRE INVESTMENTS PTY LTD	23,011,047	4.86
6	MR CHEE NAM LIEW & MRS LEE CHIN LIEW	14,189,879	2.99
7	ACEDAY INVESTMENTS PTY LTD	9,000,000	1.90
8	MR GREGORY BRUCE DUDLEY + MR RICHARD STONE < WPG SECURITIES PTY LTD A/C	7,370,292	1.56
9	GRAHAM JOHN FISHER PTY LTD	6,184,588	1.30
10	HORN NOMINEES PTY LTD	5,912,350	1.25
11	TROYWARD PTY LTD	5,888,236	1.24
12	HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED	5,540,001	1.17
13	MR NICHOLAS MILENTIS	5,380,000	1.14
14	MR THOMAS DUDLEY HOUSTON & MRS ZOE ANNE HOUSTON <THE HOUSTON SUPER F	5,115,074	1.08
15	MEMPHIS HOLDINGS PTY LTD	4,717,504	1.00
16	KERIMI INVESTMENTS PTY LTD	4,350,000	0.92
17	SVAGELJ INVESTMENTS PTY LTD	4,086,640	0.86
18	TOM & ILONA PTY LTD	4,000,000	0.84
19	JAYBRE GEOLOGICAL CONSULTING PTY LTD	3,986,929	0.84
20	HORN RESOURCESPTY LTD	3,937,650	0.83
		282,558,512	59.62

Listed Options – ASX: RDSOB

Listed	Options – ASX: RDSOB
		No. of Listed
		RDSOB
Rank	Name	Options	%
1	CARDINALS CORPORATE PTY LTD	8,021,471	17.06
2	GAZUMP RESOURCES PTY LTD	5,774,511	12.28
3	INSPIRE INVESTMENTS PTY LTD	4,034,412	8.58
4	MR EDWARD VAN HEEMST & MRS MARILYN ELAINE VAN HEEMST <LYNWARD SUPER F	3,970,589	8.45
5	TROYWARD PTY LTD	2,944,118	6.26
6	HORN NOMINEES PTY LTD	2,941,175	6.26
7	HORN RESOURCES PTY LTD	2,058,825	4.38
8	MR ANTHONY EDWIN JOHN	1,666,666	3.54
9	MR ZHONGMING HONG	1,500,000	3.19
10	MR GREG NICHOLAS POLAK	1,440,736	3.06
11	MR THOMAS DUDLEY HOUSTON & MRS ZOE ANNE HOUSTON <THE HOUSTON SUPER F	1,029,412	2.19
12	JAYBRE GEOLOGICAL CONSULTING PTY LTD	882,353	1.88
13	MR ROBERT PETER VAN DER LAAN	882,350	1.88
14	HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED	716,251	1.52
15	MEMPHIS HOLDINGS PTY LTD	589,688	1.25
16	MR BRETT JAMES RUDD	557,563	1.19
17	SVAGELJ INVESTMENTS PTY LTD	510,830	1.09
18	GRAHAM JOHN FISHER PTY LTD	500,000	1.06
19	MR CHEE NAM LIEW & MRS LEE CHIN LIEW	500,000	1.06
20	FRANDEN PTY LTD	400,825	0.85
		40,921,775	87.04

6. Details of Restricted Securities

No securities are subject to escrow.

REDSTONE RESOURCES LIMITED

ACN 090 169 154

SHAREHOLDER INFORMATION

Details of Unlisted Options

% or No. Options Name / Class of Option No. holders

4 10,000,000 Options Exercise price $0.015 from 28 February 2017 and expiring 28 February 2020 10,000,000 Options Exercise price $0.020 from 28 February 2017 and expiring 28 February 2020 2 2,000,000 Options Exercise price $0.015 from 7 March 2018 and expiring 31 January 2020 2,000,000 Options Exercise price $0.020 from 7 March 2018 and expiring 31 January 2020 6 24,000,000 Total Unlisted Options

C. OTHER DETAILS

Company Secretary

The name of the company secretary is Miranda Conti.

Address and telephone details of the entity’s registered and administrative office

60 Havelock Street West Perth WA 6005 Tel: + 61 8 9328 2552 Fax: + 61 8 9328 2660 email: [email protected]

Address and telephone details of the office at which a register of securities is kept.

Advanced Share Registry Limited Website: www.advancedshare.com.au

Western Australia – Main Office

110 Stirling Highway, NEDLANDS WA 6009 PO Box 1156, NEDLANDS WA 6909 Tel: +61 8 9389 8033 Fax: +61 8 9262 3723

New South Wales - Branch Suite 601, Level 6 225 Clarence Street SYDNEY NSW 2000

PO Box Q1736 Queen Victoria Building SYDNEY NSW 1230 Tel: + 61 2 8906 3502

Victoria

Tel: +61 3 9018 7102

Queensland

Tel: +61 7 3103 3838

ACN 090 169 154

REDSTONE RESOURCES LIMITED

SHAREHOLDER INFORMATION

Stock exchange on which the Company’s securities are quoted

The Company’s listed equity securities are quoted on the Australian Stock Exchange (ASX: RDS and RDSOB).

5. Review of Operations

A review of operations is contained in the Directors’ Report.

D. TENEMENT SUMMARY

Following is a list of the Entity’s tenements which are live or active as at the date of this report.

West Musgrave, Australia

Project	Tenement	Registered Holder Applicant	Holder Interest	Consolidated Entity Interest	Grant Date/ (Application Date)	Expiry	Blocks	Area km2
Tollu Milyuga Milyuga Milyuga	E 69/2450 E 69/3456 E 69/3568 E 69/3750	Redstone Resources Limited Redstone Resources Limited Redstone Resources Limited Westmin Exploration PtyLimited	100% 100% 0% 0%	100% 100% 0% 0%	19/09/2008 14/08/2017 (10/05/2018) (17/09/2019)	18/09/2020 13/08/2022 N/A N/A	41 28 27 107	126.4 86.4 83.2 330.0
							203	626.0

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REGISTERED AND PRINCIPAL OFFICE

60 Havelock street West Perth WA 6005 Tel: +61 8 9328 2552 Fax: +61 8 9328 2660 Email: [email protected]

POSTAL ADDRESS

PO Box 8646

Perth Business Centre WA 6849

WEBSITE

www.redstone.com.au

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ACN 090 169 154

AI assistant

REDSTONE RESOURCES LIMITED — Annual Report 2019

65676_rns_2019-10-28_24b8d512-935f-424f-a02b-fe25d9e831c0.pdf

COMPETENT PERSONS STATEMENTS:

FORWARD LOOKING STATEMENTS:

ADDITIONAL INFORMATION:

CORPORATE DIRECTORY

REDSTONE RESOURCES LIMITED

DIRECTORS’ REPORT

DIRECTORS’ REPORT

Company Secretary – Miranda Conti (BCom, CPA , AGIA , ACIS )

Principal Activities

Review of Operations

WEST MUSGRAVE PROJECT (E69/2450, E69/3456) – 100% REDSTONE

West Musgrave Project Overview

DIRECTORS’ REPORT

Work Completed 2019

DIRECTORS’ REPORT

Re-evaluation of Tollu Copper Vein Project

Exploration Incentive Scheme Co-funded Drilling Grant

DIRECTORS’ REPORT

CORPORATE

Fundraising – Entitlement Offer and Shortfall Offer

Research and Development Incentive – FY2018

Extension of Term Application – E69/2450

Dividends

Significant Changes in State of Affairs

Significant Events after Balance Date

REDSTONE RESOURCES LIMITED

DIRECTORS’ REPORT

Likely Developments

Environmental Issues

Share Options

Directors’ Interests

DIRECTORS’ REPORT

Meetings of Directors

Remuneration Report (audited)

- Remuneration Policy

- Performance based remuneration

DIRECTORS’ REPORT

Remuneration Report (audited) (continued)

Year ended 30 June 2019

Year ended 30 June 2018

- Options Granted as Remuneration

DIRECTORS’ REPORT

Remuneration Report (audited) (continued)

Non-Executive Directors

Transactions with Key Management Personnel

Option Holdings

DIRECTORS’ REPORT

Equity Holdings and Transactions

Exercise of options granted as remuneration

REDSTONE RESOURCES LIMITED

DIRECTORS’ REPORT

Indemnification and insurance of Officers

Auditor

Auditors’ Independence Declaration

Legal Proceedings

AUDITOR’S INDEPENDENCE DECLARATION

REDSTONE RESOURCES LIMITED

CORPORATE GOVERNANCE STATEMENT

REDSTONE RESOURCES LIMITED

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 30 JUNE 2019

REDSTONE RESOURCES LIMITED

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

REDSTONE RESOURCES LIMITED

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

REDSTONE RESOURCES LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2019

1. Corporate information

2. Summary of significant accounting policies

a)

Basis of preparation

b)

Statement of compliance

c) Adoption of new and revised standards

d) New accounting standards not yet implemented

REDSTONE RESOURCES LIMITED Annual Report 2019