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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
for the year ended 30 June 2008
t) Critical Accounting Estimates and Judgement
... continued
The carrying amounts of certain assets and
liabilities are often determined based on
management’s judgement regarding estimates and
assumptions of future events. The reasonableness
of estimates and underlying assumptions are
reviewed on an ongoing basis.
The key judgements, estimates and assumptions
that have a significant risk of causing a material
adjustment to the carrying amount of certain assets
and liabilities within the annual reporting period are:
Exploration and evaluation
The consolidated entity’s policy for exploration and
evaluation is discussed at note 3(c). The application
of this policy requires management to make
certain estimates and assumptions as to future
events and circumstances. Any such estimates
and assumptions may change as new information
becomes available. If, after having capitalised
exploration and evaluation expenditure, management
concludes that the capitalised expenditure
is unlikely to be recovered by future sale or
exploitation, then the relevant capitalised amount
will be written off through the income statement.
Consolidated
Company
2008 2007 2008 2007
$ $ $ $
4 INCOME TAX
a) The components of income tax expense comprise:
Current tax expense - - - -
Deferred tax expense/(income) relating to the origination and
reversal of temporary differences 203,858 - 203,858 -
Total tax expense/(income) - -
b) The prima facie income tax expense on the loss before
income tax reconciles to the tax expense/(income) in the
financial statements as follows:
Loss from continuing operations (3,229,820) (68,859) (3,229,820) (68,859)
Income tax income calculated at 30% (968,946) (20,658) (968,946) (20,658)
Add/(less) Tax effect of:
– Immediate write/off of tenement expenditure (966,267) (36,731) (38,794) (36,731)
– other allowable/(non-allowable) items 443,905 1,174 (618,914) 1,174
Tax expense/(income) (522,362) (56,214) (388,826) (56,214)
Tax effect of capital raising costs not meeting the
recognition criteria 203,858 - 203,858 -
Tax effect tax losses not brought to account as they do not
meet the recognition criteria 522,362 56,214 388,826 56,214
Income tax attributable to operating loss 203,858 - 203,858 -
c) Unused tax losses and for which no deferred tax asset
has been recognised at 30% 578,576 56,214 445,040 56,214
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