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WESTERN DESERT RESOURCES LIMITED ABN 48 122 301 848
3 SIGNIFICANT ACCOUNTING POLICIES
Statement of compliance
The financial report is a general purpose financial
report which has been prepared in accordance with the
Corporations Act 2001, Accounting Standards and
Interpretations, and complies with other requirements
of the law. The financial report includes the
separate financial statements of the company and the
consolidated financial statements of the Group.
Accounting Standards include Australian equivalents to
International Financial Reporting Standards (‘A-IFRS’).
Compliance with A-IFRS ensures that the financial
statements and notes of the company and the Group
comply with International Financial Reporting
Standards (‘IFRS’).
The financial statements were authorised for issue by
the directors on 30 September 2008.
Basis of preparation
The financial report has been prepared on the basis
of historical cost, except for the revaluation of certain
non-current assets and financial instruments. Cost is
based on the fair values of the consideration given
in exchange for assets. All amounts are presented in
Australian dollars, unless otherwise noted.
In the application of the Group’s accounting policies,
which are described below, management is required
to make judgements, estimates and assumptions about
carrying values of assets and liabilities that are not
readily apparent from other sources. The estimates
and associated assumptions are based on historical
experience and various other factors that are believed
to be reasonable under the circumstances, the results
of which form the basis of making the judgements.
Actual results may differ from these estimates.
The estimates and underlying assumptions are
reviewed on an on-going basis. Revisions to accounting
estimates are recognised in the period in which the
estimate is revised if the revision affects only that
period, or in the period of the revision and future periods
if the revision affects both current and future periods.
a) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand,
cash in banks and bank deposits.
b) Employee benefits
A liability is recognised for benefits accruing to
employees in respect of wages and salaries,
annual leave, long service leave, and sick leave
when it is probable that settlement will be required
and they are capable of being measured reliably.
Liabilities recognised in respect of employee
benefits, expected to be settled within 12 months,
are measured at their nominal values using the
remuneration rate expected to apply at the time of
settlement. Liabilities recognised in respect of
employee benefits which are not expected to be
settled within 12 months are measured at the
present value of the estimated future cash outflows
to be made by the consolidated entity in respect of
services provided by employees up to reporting date.
Contributions to accumulated benefit
superannuation benefit plans are expensed
when incurred.
c) Exploration and Evaluation Expenditure
Exploration and evaluation expenditures in relation
to each separate area of interest, are recognised
as an exploration and evaluation asset in the year
in which they are incurred where the following
conditions are satisfied:
i) the rights to tenure of the area of interest are
current; and
ii) at least one of the following conditions is
also met:
• the exploration and evaluation expenditures
are expected to be recouped through
successful development and exploration of
the area of interest, or alternatively, by its
sale; or
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