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Notes to the

financial statements

for the year ended 30 September 2015


4. Summary of significant accounting

policies (continued)

For assets and liabilities that are recognised in the

financial statements on a recurring basis, the Company

determines whether transfers have occurred between

levels in the hierarchy by reassessing categorisation

(based on the lowest level input that is significant to the

fair value measurement as a whole) at the end of each

reporting period.

Related parties

A party is considered to be related to the Company if:

a. the party is a person or a close member of that

person’s family and that person

i. has control or joint control over the Company;

ii. has significant influence over the Company; or

iii. is a member of the key management personnel of

the Company or of a parent of the Company;


b. the party is an entity where any of the following

conditions applies:

i. the entity and the Company are members of the

same group;

ii. one entity is an associate or joint venture of the

other entity (or of a parent, subsidiary or fellow

subsidiary of the other entity);

iii. the entity and the Company are joint ventures of

the same third party;

iv. one entity is a joint venture of a third entity and the

other entity is an associate of the third entity;

v. the entity is a post-employment benefit plan for

the benefit of employees of either the Company or

an entity related to the Company;

vi. the entity is controlled or jointly controlled by

a person identified in (a); and

vii. a person identified in (a)(i) has significant

influence over the entity or is a member of the

key management personnel of the entity (or of

a parent of the entity).

Property, plant and equipment and depreciation

Items of property, plant and equipment are stated at

cost less accumulated depreciation and any impairment

losses. The cost of an item of property, plant and

equipment comprises its purchase price and any directly

attributable costs of bringing the asset to its working

condition and location for its intended use. Expenditure

incurred after items of property, plant and equipment

have been put into operation, such as repairs and

maintenance, is normally charged to the profit or loss

in the period in which it is incurred. In situations where

the recognition criteria are satisfied, the expenditure for

a major inspection is capitalised in the carrying amount

of the asset as a replacement. Where significant parts

of property, plant and equipment are required to be

replaced at intervals, the Company recognises such

parts as individual assets with specific useful lives and

depreciates them accordingly.

Depreciation is calculated on a straight-line basis to write

off the cost or valuation of each item of property, plant

and equipment to its residual value over its estimated

useful life. The principal annual rates used for this

purpose are as follows:

Leasehold improvements Over the lease terms

Plant and machinery

20% to 33%

The gain or loss on disposal of items of property, plant

and equipment is the difference between the net sales

proceeds and the carrying amount of the relevant asset

and is recognised in profit or loss.

The assets’ residual values, useful lives and the

depreciation method are reviewed, and adjusted if

appropriate, at least at each financial year end.

Mineral exploration expenditure

Mineral exploration, evaluation and development

expenditures incurred are capitalised in respect of

each identifiable area of interest. These costs are only

capitalised to the extent that they are expected to be

recovered through the successful development of the

area or where activities in the area have not yet reached

a stage that permits reasonable assessment of the

existence of economically recoverable reserves.

Accumulated costs in relation to an abandoned area are

written off in full against profit or loss in the year in which

the decision to abandon the area is made.