COPY OF FINAL PROSPECTUS - Mirabela Nickel

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MIRABELA NICKEL LIMITED NOTES TO FINANCIAL STATEMENTS (Continued) For the year ended 30 June 2006 1. SIGNIFICANT ACCOUNTING POLICIES (Continued) labour, the initial estimate, where relevant, of the costs of dismantling and moving the items and restoring the site on which they are located, and an appropriate proportion of production overheads. Mining property and development assets include costs transferred from exploration and evaluation assets once technical feasibility and commercial viability of an area of interest are demonstrable and subsequent costs to develop the mine to the production phase. (ii) Subsequent costs The consolidated entity recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such an item when that cost is incurred if it is probable that the future economic benefits embodied within the item will flow to the consolidated entity and the cost of the item can be measured reliably. All other costs are recognised in the income statement as an expense as incurred. (iii) Depreciation With the exception of freehold land and mining property and development assets, depreciation is charged to the income statement using a diminishing value method over the estimated useful lives of each part of an item of property, plant and equipment. Land is not depreciated. Mining property and development assets are depreciated on the units of production basis over the life of the economically recoverable reserves. The estimated useful lives in the current and comparative periods are as follows: Plant and equipment 2.5 to 10 years The residual value, the useful life and the depreciation method applied to an asset are reassessed at least annually. (f) Exploration Expenditure Exploration and evaluation costs, which are all intangible costs, including the costs of acquiring licences, are capitalised as exploration and evaluation assets on an area of interest basis. Costs incurred before the consolidated entity has obtained the legal rights to explore an area are recognised in the income statement. Exploration and evaluation assets are only recognised if the rights of the area of interest are current and either: (i) the expenditures are expected to be recouped through successful development and exploitation of the area of interest; or (ii) activities in the area of interest have not at the reporting date, reached a stage which permits a reasonable assessment of the existence or other wise of economically recoverable reserves and active and significant operations in, or in relation to, the area of interest are continuing. Exploration and evaluation assets are assessed for impairment if (i) sufficient data exists to determine technical feasibility and commercial viability, and (ii) facts and circumstances suggest that the carrying amount exceeds the recoverable amount (see impairment accounting policy (i)). For the purposes of impairment testing, exploration and evaluation assets are allocated to cash-generating units to which the exploration activity relates. The cash generating unit shall not be larger than the area of interest. Once the technical feasibility and commercial viability of the extraction of mineral resources in an area of interest are demonstrable, exploration and evaluation assets attributable to that area of interest are first tested for impairment and then reclassified from intangible assets to mining property and development assets within property, plant and equipment. (g) Other receivables Other receivables are recorded at amounts due less any allowance for doubtful debts. (h) Cash and cash equivalents Cash and cash equivalents comprise cash balances, short term bills and call deposits. Bank overdrafts that are repayable on demand and form an integral part of the consolidated entity’s cash management are included as a component of cash and cash equivalents for the purpose of the statement of cash flows. (i) Impairment The carrying amounts of the consolidated entity’s assets, other than exploration assets (see accounting policy f), and deferred tax assets, are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated (see accounting policy (i)). F-10
MIRABELA NICKEL LIMITED NOTES TO FINANCIAL STATEMENTS (Continued) For the year ended 30 June 2006 1. SIGNIFICANT ACCOUNTING POLICIES (Continued) For goodwill, assets that have an indefinite useful life and intangible assets that are not yet available for use, the recoverable amount is estimated at each balance sheet date. An impairment loss is recognised whenever the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognised in the income statement unless the asset has previously been revalued, in which case the impairment loss is recognised as a reversal to the extent of that previous revaluation with any excess recognised through profit or loss. Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to the cash-generating unit (group of units) and then, to reduce the carrying amount of the other assets in the unit (group of units) on a pro rata basis. (i) Calculation of recoverable amount The recoverable amount of the consolidated entity’s investments in held-to-maturity securities and receivables carried at amortised cost is calculated as the present value of estimated future cash flows, discounted at the original effective interest rate (i.e. the effective interest rate computed at initial recognition of these financial assets). Receivables with a short duration are not discounted. Impairment of receivables is not recognised until objective evidence is available that a loss event has occurred. Significant receivables are individually assessed for impairment. Impairment testing of significant receivables that are not assessed as impaired individually is performed by placing them into portfolios of significant receivables with similar risk profiles and undertaking a collective assessment of impairment. Non-significant receivables are not individually assessed. Instead, impairment testing is performed by placing non-significant receivables in portfolios of similar risk profiles, based on objective evidence from historical experience adjusted for any effects of conditions existing at each balance date. The recoverable amount of other assets is the greater of their fair value less costs to sell and value in use. 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. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs. (ii) Reversals of impairment Impairment losses, other than in respect of goodwill, are reversed when there is an indication that the impairment loss may no longer exist and there has been a change in the estimate used to determine the recoverable amount. An impairment loss in respect of goodwill is not reversed. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. (j) Share capital (i) Dividends Dividends on redeemable preference shares are recognised as a liability and expressed on an effective interest yield basis. Other dividends are recognised as a liability in the period in which they are declared. (ii) Transaction costs Transaction costs of an equity transaction are accounted for as a deduction from equity, net of any related income tax benefit. (k) Employee Benefits (i) Share-based payment transactions The directors may, at their discretion, issue options to employees or consultants of the Company or consolidated entity as part of their compensation arrangement. The fair value of options granted is recognised as an employee or consultant’s expense with a corresponding increase in equity. The fair value is measured at grant date and spread over the period during which the employees become unconditionally entitled to the options. The fair value of the options granted is measured using a binomial option-pricing model, taking into account the terms and conditions upon which the options were granted. The amount recognised as an expense is adjusted to reflect the actual number of share options that vest except where forfeiture is only due to share prices not achieving the threshold for vesting. F-11
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ABN 23 108 161 593 Ground⋅Floor,
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(continued from cover) Unless other
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FORWARD-LOOKING STATEMENTS This pro
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PROSPECTUS SUMMARY The following is
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Recent Developments: Drilling and E
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Summary of Financial Information: M
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CORPORATE STRUCTURE Mirabela Nickel
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The Santa Rita Project The Santa Ri
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which a final exploration report ha
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and R$4.2 million, payable in insta
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esources by holders of mining conce
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Management believes this mineraliza
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THE NICKEL MARKET The following sum
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27MAR200712114903 Source: World Bur
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A mining concession may only be gra
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Property Description The Santa Rita
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Accessibility, Climate, Local Resou
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25MAR200710211038 The ultramafic zo
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completed in October 2006. The RC d
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sample of approximately two kilogra
Page 41 and 42: Metallurgy The Santa Rita deposit c
Page 43 and 44: Operating Costs GRD Minproc estimat
Page 45 and 46: Fazenda Palestina Intrusion The Faz
Page 47 and 48: The Ponto Novo project area consist
Page 49 and 50: elating to the Shares computed in a
Page 51 and 52: wish to change registers and trade
Page 53 and 54: Selected Annual Financial Informati
Page 55 and 56: The carrying value of mineral prope
Page 57 and 58: Finance Activities, Liquidity and C
Page 59 and 60: Disclosure of Shareholding Informat
Page 61 and 62: PRICE RANGE AND TRADING VOLUME OF S
Page 63 and 64: Management The following is a brief
Page 65 and 66: faith with a view to the best inter
Page 67 and 68: Aggregated Options Exercised During
Page 69 and 70: markets and may also be terminated
Page 71 and 72: Mirabela currently depends heavily
Page 73 and 74: disposal of solid and hazardous was
Page 75 and 76: Stock Exchange Prices The market pr
Page 77 and 78: MATERIAL CONTRACTS Except for contr
Page 79 and 80: GLOSSARY OF TECHNICAL TERMS The fol
Page 81 and 82: mackinawite ............. magmatic
Page 83 and 84: Mirabela Nickel Limited Consolidate
Page 85 and 86: AUDITOR’S REPORT IN RESPECT OF CO
Page 87 and 88: MIRABELA NICKEL LIMITED STATEMENTS
Page 89 and 90: MIRABELA NICKEL LIMITED STATEMENTS
Page 91: MIRABELA NICKEL LIMITED NOTES TO FI
Page 95 and 96: MIRABELA NICKEL LIMITED NOTES TO FI
Page 121 and 122: MIRABELA NICKEL LIMITED INCOME STAT
Page 123 and 124: MIRABELA NICKEL LIMITED BALANCE SHE
Page 127 and 128: CERTIFICATE OF THE COMPANY Dated: A
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COPY OF FINAL PROSPECTUS - Mirabela Nickel

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