Good Mining (International) Limited - EY

1 good Mining ( international ) Limited international GAAP . Illustrative financial statements for the year ended 31 December 2011. Based on international Financial Reporting Standards in issue at 30 September 2011. Contents Abbreviations and Introduction ..3. General information ..10. Independent auditors' report to the members of good Mining ( international ) Consolidated statement of comprehensive income ..13. Consolidated statement of financial position ..14. Consolidated statement of changes in equity ..16. Consolidated statement of cash flows ..17. Notes to the consolidated financial statements ..19. 1. Corporate information ..19. Basis of preparation ..19. Significant accounting judgements, estimates and assumptions ..19. Changes in accounting policies and disclosures ..24. Summary of significant accounting policies.

2 26. Standards issued but not yet effective ..55. 3. Business combinations acquisitions ..58. 4. Interests in joint ventures ..59. 5. Operating segments ..60. 6. Operating (loss)/profit ..64. 7. Revenue ..65. 8. Income tax ..65. 9. Earnings per share ..68. 10. Dividends paid and proposed ..68. 11. Exploration and evaluation assets ..69. 12. Mine 13. Property, plant and equipment ..71. 14. Intangible assets ..72. 15. Impairment losses ..72. 16. Pension benefit obligation ..74. 17. Inventories ..76. 18. Trade and other receivables ..76. 19. Cash and cash equivalents ..77. 20. Issued capital ..78. 21. Interest-bearing loans and borrowings ..79. 22. Provisions ..79. 23. Accounts payable and accrued liabilities ..80. 24. Capital commitments and other contingencies ..81. 25. Related party disclosures ..82. 26. Financial risk management objectives and policies.

3 83. 27. Derivatives and financial instruments ..87. 28. Events after the reporting date ..89. Appendix 1 First-time adoption of IFRS ..90. 101. Notes .. 103. good Mining ( international ) Limited 1. Abbreviations and key The following styles of abbreviation are used in this set of international GAAP Illustrative Financial Statements: IAS international Accounting Standard No. 33, paragraph 41. IAS international Accounting Standard No. 1, Basis for Conclusions, paragraph 13. IFRS international Financial Reporting Standard No. 2, paragraph 44. SIC Standing Interpretations Committee Interpretation No. 29, paragraph 6. IFRIC IFRS Interpretations Committee (formerly the international Financial Reporting Interpretations Committee) Interpretation No. 4, paragraph 6. IAS international Accounting Standard 39 Implementation guidance for IAS 39 Section G: Other, paragraph IAS international Accounting Standard 39 Appendix A Application Guidance, paragraph AG71.

4 ISA international Standard on Auditing No. 700, paragraph 25. Commentary The commentary explains how the requirements of IFRS have been implemented in arriving at the illustrative disclosure. GAAP Generally Accepted Accounting Principles / Practice IASB international Accounting Standards Board Interpretations IFRS Interpretations Committee (formerly the international Financial Reporting Interpretations Committee Committee (IFRIC)). SIC Standing Interpretations Committee 2 good Mining ( international ) Limited Introduction This publication contains an illustrative set of consolidated financial statements, prepared in accordance with international Financial Reporting Standards (IFRS), for good Mining ( international ) Limited ( good Mining ), a fictitious group of Mining companies, for the year ended 31 December 2011.

5 Objective This set of illustrative statements is one of many prepared by Ernst & Young to assist you in preparing your own financial statements. The series of model accounts currently available comprises: u good Group ( international ) Limited u good Group ( international ) Limited - Illustrative interim condensed consolidated financial statements u good First-time Adopter ( international ) Limited u good Bank ( international ) Limited u good Insurance ( international ) Limited u good Real Estate Group ( international ) Limited u good Investment Fund Limited (Equity). u good Investment Fund Limited (Liability). u good Petroleum ( international ) Limited u good Construction Group ( international ) Limited good Mining 's activities include mineral exploration, mine development and production. This publication illustrates IFRS. disclosures specific to the Mining industry, rather than by companies in general.

6 Therefore, some commonly found transactions and their disclosures have been deliberately omitted or simplified because they are illustrated in other Ernst & Young illustrative financial statement publications, such as good Group ( international ). Limited 2011. We refer readers to these other publications for a greater understanding of other presentation and disclosure requirements that are not specific to the Mining industry. Exploration, development and production accounting is complex, with a variety of accounting policy choices available to a company to account for transactions in the exploration and evaluation phase. The challenge for the industry is to produce decision-useful financial statements through effective presentation and disclosure. Unfortunately, differences in accounting policies and their application makes comparability more difficult and increases complexity.

7 IFRS prescribes minimum standards of disclosure. It is important to provide additional disclosure to explain any unusual circumstances faced by a Mining industry company. In addition, accounting policy choices made by a company need to be disclosed in detail to aid the reader in comparing companies in the Mining industry. This publication illustrates what we consider to be best practice disclosure and focuses on those areas of IFRS reporting that rely heavily on the professional judgement of management. These illustrative disclosures are not the only acceptable form of presentation, but they reflect leading practice in the Mining industry. They do not take account of country or stock market regulations in any given jurisdiction. It is essential to refer to the relevant accounting standards and/or specific jurisdictional requirements and when necessary, to seek appropriate professional advice where there may be doubt as to the requirements.

8 We hope you will find this a useful guide when preparing your next set of IFRS-based financial statements. If you require any further information on matters included in this publication, please contact your nearest Ernst & Young Mining professional. Basis of preparation and presentation This publication is based on the requirements of IFRS standards and interpretations as issued by the IASB in issue at 30. September 2011 and applicable to financial statements for the year ending 31 December 2011. Details of which standards and interpretations have been adopted, have been included in the notes to these illustrative financial statements. The impact of new accounting standards and interpretations issued but not yet effective, which may apply to good Mining and its subsidiaries (the Group ) at some point in the future, have been included in these illustrative financial statements as appropriate.

9 For details of other standards and interpretations issued but not yet effective which may apply to your particular entity, we refer readers to either the commentary sections contained herein, or to good Group ( international ). Limited 2011 illustrative financial statements, for the details of such and the appropriate illustrative disclosures. Background facts The Group is a gold and copper exploration, development and production company whose activities include the exploration for and development of gold and copper mineral deposits and the production and sale of gold bullion and gold and copper metal concentrate. All its operations are located in Metalville (a fictitious country). good Mining ( international ) Limited 3. international Financial Reporting Standards The abbreviation IFRS is defined in IAS and IAS as Standards and Interpretations issued by the international Accounting Standards Board (IASB).

10 They comprise: u international Financial Reporting Standards u international Accounting Standards u IFRIC Interpretations And u SIC Interpretations Thus, when financial statements are described as complying with IFRS, it means that they comply with the entire hierarchy of pronouncements sanctioned by the IASB. international Accounting Standards Board (IASB). The IASB is the independent standard-setting body of the IFRS Foundation (an independent, not-for-profit private sector organisation working in the public interest). The IASB members (currently 15 full-time members) are responsible for the development and publication of IFRS, including the IFRS for Small and Medium Entities and for approving interpretations of IFRS as developed by the IFRS Interpretations Committee. In fulfilling its standard-setting duties, the IASB follows a due process of which the publication of consultative documents, such as discussion papers and exposure drafts, for public comment, is an important component.