NORTH077 Annual Report 2020 V5.2 DIGITAL

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82 NORTHERN MINERALS _ ANNUAL REPORT 2021 NORTHERN MINERALS LIMITED NOTES TO THE FINANCIAL STATEMENTS 10. Non-financial Assets and Liabilities (continued) (b) Inventories Current 2021 $ <strong>2020</strong> $ Diesel fuel and consumables 885,842 992,099 Inventories are valued at the lower of cost and net realisable value. Cost is determined using weighted average costs. (c) Provisions 2021 $ Current Employee benefits 1,071,946 1,106,518 Non-Current Rehabilitation 5,129,440 4,977,310 <strong>2020</strong> $ (i) Movements in provisions 2021 Employee Rehabilitation Total benefits $ $ $ Balance at the beginning of year 1,106,518 4,977,310 6,083,828 Amounts expensed for the year 735,798 152,130 887,928 Utilisation (770,370) - (770,370) Balance at the end of year 1,071,946 5,129,440 6,201,386 Employee benefits Liabilities for unpaid wages and salaries are recognised in sundry creditors. Current entitlements to annual leave accrued for services up to the reporting date are recognised in the provision for employee benefits and are measured at the amounts expected to be paid. Entitlements to non-accumulating sick leave are recognised when the leave is taken. The current liability for long service leave (for which settlement within 12 months of the reporting date cannot be deferred) is recognised in the current provision for employee benefits and is measured in accordance with annual leave described above. The non-current liability for long service leave is recognised in the non-current provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date. Consideration is given to current wage and salary levels to match as closely as possible, the estimated future cash outflows. Rehabilitation The mining, exploration and construction activities of the Group give rise to obligations for site closure and rehabilitation. Closure and rehabilitation works can include facility decommissioning and dismantling, removal of waste materials, site and land rehabilitation. Provisions for the cost of each closure and rehabilitation programme are recognised at the time the environmental disturbance occurs. When the extent of disturbance increases over the life of an operation, the provision is increased accordingly. Costs included in the provision encompass all closure and rehabilitation activity expected to occur progressively over the life of the operation and at, or after, the time of closure, for disturbance existing at the reporting date. Routine operating costs that may 50
83 NORTHERN MINERALS LIMITED NOTES TO THE FINANCIAL STATEMENTS 10. Non-financial Assets and Liabilities (continued) impact the ultimate closure and rehabilitation activities, are not included in the provision. Costs arising from unforeseen circumstances, are recognised as an expense and liability when the event gives rise to an obligation which is probable and capable of reliable estimation. The timing of the actual closure and rehabilitation expenditure is dependent upon a number of factors such as the life and nature of the asset, the operating licence conditions and the environment in which they operate. Expenditure may occur before and after closure and can continue for an extended period of time dependent on closure and rehabilitation requirements. Closure and rehabilitation provisions are measured at the expected value of future cash flows, discounted to their present value. Significant judgements and estimates are involved in forming expectations of future activities and the amount and timing of associated cash flows. When provisions for closure and rehabilitation are initially recognised, the corresponding cost is capitalised as an asset, representing part of the cost of acquiring the future economic benefits of the operation, to the extent that the activity in which the provision is related to is capitalised. The capitalised cost of rehabilitation and closure activities is recognised in property, plant and equipment accordingly. The value of the provision is progressively increased over time due to the effect of discounting unwinding creating an expense recognised in finance expenses. Where the activity in which the provision relates is expensed in accordance with the exploration and evaluation expenditure, the provision expense is also expensed. Closure and rehabilitation provisions are also adjusted for changes in costs and estimates. Those adjustments are accounted for as a change in the corresponding capitalised cost, except where a reduction in the provision is greater than the undepreciated capitalised cost of the related assets, in which case the capitalised cost is reduced to nil and the remaining adjustment is recognised first against other items in property, plant and equipment and subsequently to the consolidated statement of profit or loss. Changes to the capitalised cost result in an adjustment to future depreciation. Adjustments to the estimated amount and timing of future closure and rehabilitation cash flows are a normal occurrence in light of significant judgements and estimates involved. 51 NORTHERN MINERALS _ ANNUAL REPORT 2021
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2021 ANNUAL REPORT
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1 Chairman’s Report NORTHERN MINE
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3 CEO’S Report NORTHERN MINERALS
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5 Ore Sorter: The ore sorting syste
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7 ENVIROMMENT, SOCIAL & GOVERNANCE
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9 field team to conduct pre-clearan
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11 Executive Team Our executive tea
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13 COO Report NORTHERN MINERALS _ A
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15 Commissioned: The ore sorter cir
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17 rare earths into groups of produ
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19 EXPLORATION & GEOLOGY REPORT The
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21 The high-grade mineralisation oc
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23 Figure 5: Banshee Prospect Drill
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25 Browns Range Northern Territory
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27 Ore Reserve and Mineral Resource
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29 Mineral Resource The Mineral Res
Page 33 and 34: 31 Comparison with previous years O
Page 35 and 36: 33 NORTHERN MINERALS LIMITED DIRECT
Page 47 and 48: 45 4. Service agreements NORTHERN M
Page 57 and 58: 55 NORTHERN MINERALS LIMITED CONSOL
Page 59 and 60: 57 NORTHERN MINERALS LIMITED CONSOL
Page 61 and 62: 59 2. Basis of Preparation (continu
Page 63 and 64: 61 NORTHERN MINERALS LIMITED NOTES
Page 65 and 66: 63 7. Income Tax Expense NORTHERN M
Page 75 and 76: 73 9. Financial Risk Management (co
Page 79 and 80: 77 9. Financial Risk Management (co
Page 83: 81 NORTHERN MINERALS LIMITED NOTES
Page 87 and 88: 85 11. Equity (continued) (i) Ordin
Page 95 and 96: 93 17. Share-based Payments (contin
Page 99 and 100: 97 19. Earnings per share NORTHERN
Page 101 and 102: 99 21. Segment Information NORTHERN
Page 105 and 106: 103 Auditor’s independence declar
Page 107 and 108: 105 Key audit matter How our audit
Page 109 and 110: 107 From the matters communicated w
Page 111 and 112: 109 Project Location Tenement ID St
Page 113 and 114: 111 b) Twenty largest shareholders
Page 115 and 116: 113 CORPORATE DIRECTORY Northern Mi
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NORTH077 Annual Report 2020 V5.2 DIGITAL

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