Prospectus - Kingsrose Mining

More documents

Recommendations

Info

Section 9 Investigating Accountant’s Report 31 October 2007 The Directors Kingsrose Mining Limited Suite 3 16 Kearns Crescent APPLECROSS WA 6153 2nd floor, 35 Havelock Street, West Perth WA 6005 Po Box 609, West Perth WA 6872 Telephone: (08) 9322 2798 Dear Directors INVESTIGATING ACCOUNTANT’S REPORT ON HISTORICAL AND PRO FORMA FINANCIAL INFORMATION 1. Introduction This investigating accountant’s report has been prepared at your request to report on certain historical and pro forma financial information in respect of Kingsrose Mining Limited. The report has been prepared for inclusion in a prospectus ("the prospectus") to be dated on or about 31 October 2007 relating to the proposed issue by Kingsrose Mining Limited of 30,000,000 ordinary shares at 20 cents each to raise a total of $6,000,000. 2. Basis of Preparation This investigating accountant’s report has been prepared to provide investors with information on historical results and assets and liabilities of Kingsrose Mining Limited. The historical and pro forma financial information is presented in an abbreviated form and does not include all of the disclosures required by the Australian Accounting Standards applicable to annual financial reports in accordance with the Corporations Act 2001. The financial information has been prepared in accordance with the Australian Equivalents to International Financial Reporting Standards (AIFRS). This report does not address the rights attaching to the securities to be issued in accordance with the prospectus, nor the risks associated with investment. Mack & Co has not been requested to consider the prospectus for Kingsrose Mining Limited, the securities on offer and related invoicing issues, nor the merits and risks associated with becoming a shareholder and accordingly, has not done so, nor purports to do so. Mack & Co accordingly takes no responsibility for these matters or for any matter or omission in the prospectus, other than responsibility for this report. 3. Background The company was incorporated as Kingsrose Pty Ltd on 6 January 2005. On 25 October 2005 the company changed its name to Kingsrose Mining Pty Ltd. On 12 July 2007 the company converted from a private company to a public company with the name of Kingsrose Mining Limited and a new constitution. From 11 January 2005 to 25 May 2007 the company acted as trustee for the Kingsrose Unit Trust. On 25 May 2007 the company was removed as trustee of the trust and was replaced by a new trustee. On and since incorporation and up to the date of this report the Company has issued the following shares: • Issue of 1 fully paid subscriber share on incorporation. This was redeemed on 10 January 2005. • Issue of 20 ordinary fully paid shares on 10 January 2005 for $20. • Issue of 8,800,000 fully paid ordinary shares on 3 October 2007 for $63,000. Page 38
Under the terms of an asset sale agreement dated October 2007 the Company will acquire certain assets and liabilities of the Kingsrose Unit Trust based on the financial statements prepared for the trust at 20 April 2007 for a consideration of $10,000 to be satisfied by the issue of 20,000,000 fully paid ordinary shares in the Company. The agreement is subject to the seller obtaining the prior written consent of parties to a joint venture agreement to which the seller is a party to have the Company stand in its place and the Company completing a capital raising under the IPO prospectus and receiving conditional approval for admission to the official list of the Australian Securities Exchange by 31 December 2007 or such later date as the parties agree in writing. Details of the assets and liabilities the subject of this agreement are set out in appendix 1. Under the amended terms of the farm-in and joint venture agreement in order for Kingsrose to have a share of the tenement interests transferred to its name the joint venture must produce not less than 25,000 ounces of gold by 31 May 2009. The operations carried on by the Kingrose Unit Trust have continued from 20 April 2007 and have been accounted for from that date as if they were carried on by Kingsrose Mining Limited. The data set out in Appendix 2 under the heading “Unaudited 31 August 2007” is a summary of these operations for the period 20 April 2007 to 31 August 2007 and the balance sheet as at 31 August 2007. 4. Scope We have conducted an independent review of the following: 4.1 The income statement of Kingsrose Unit Trust for the period from 11 January 2005 to 30 June 2005, the year ended 30 June 2006 and the period 1 July 2006 to 20 April 2007. 4.2 The balance sheet of Kingsrose Unit Trust as at 30 June 2005, 30 June 2006 and 20 April 2007. 4.3 The balance sheet of Kingsrose Mining Limited as at 31 August 2007 and the income statement from 20 April 2007 to 31 August 2007 prepared on the basis that the company conducted the business for this period and had acquired the assets and assumed the liabilities set out in the asset sale agreement. 4.4 The pro-forma income statement, balance sheet and statement of changes in equity of Kingsrose Mining Limited at 31 August 2007 which adjusts these statements to include the financial effects of: (a) the proposed issue pursuant to the prospectus of 30,000,000 fully paid ordinary shares to raise $6,000,000. (b) the estimated capital raising costs of the issue of $400,000. (c) the issue on 3 October 2007 of 8,800,000 fully paid ordinary shares for $63,000 cash. (d) the proposed issue of $2,200,000 of convertible notes to retire loans owed by the company. (e) the proposed issue of 6,250,000 fully paid ordinary shares in satisfaction of $1,250,000 of loans owed by the company. (f) the proposed payment by cash from the proceeds of the issue of the balance of the loan accounts totalling $631,472. (g) the proposed payment by cash from the proceeds of the issue of the bank equipment loans of $251,212. (h) the proposed payment of the estimated stamp duty on the asset sale agreement of $144,000. The company data has been presented using the going concern basis. This basis assumes that expenses incurred and revenues earned in the ordinary course of business will be paid and received on a timely basis. Accordingly receivables and payables of this nature have not been included in the proforma adjustments listed above. All of the financial information referred to above has not been audited. The directors of Kingsrose Mining Limited are responsible for the preparation and presentation of the historical and Proforma financial information including the determination of the pro-forma transactions. Our review has been conducted in accordance with Australian Auditing and Assurance Standard ASRE 2410 and was limited to inquiries and discussions with the directors of Kingsrose Mining Limited, reading of directors minutes and relevant contracts, review of publicly available information and review of work papers, accounting records and other documents for Kingsrose Mining Limited and the Kingsrose Unit Trust. Page 39
Page 1 and 2: Kingsrose Mining Limited ABN 49 112
Page 3 and 4: Table of Contents Section 1 Key Poi
Page 5 and 6: Section 2 Chairman’s Letter Dear
Page 7 and 8: Application of Proceeds at Full Sub
Page 9 and 10: 4.4 Application for Shares Applicat
Page 11 and 12: Section 5 Company and Project Overv
Page 13 and 14: Section 6 Directors and Corporate G
Page 15 and 16: As the Company’s activities devel
Page 17 and 18: Additionally, tenements are subject
Page 19 and 20: Potential Acquisitions As part of i
Page 21 and 22: In addition, GIPL made independent
Page 23 and 24: Figure 2. Regional Geology 1. Intro
Page 25 and 26: Figure 3. Project Geology and Tenem
Page 27 and 28: 6. Past Exploration up to 1998 The
Page 29 and 30: 1. Proving up gold resources to the
Page 31 and 32: Table 3. Significant Results The su
Page 33 and 34: Holla, L.A., 2001. Geological setti
Page 35 and 36: Conduits Conglomerate Country rock
Page 37 and 38: Lava Limestone Lineament Lithologic
Page 39: Stockwork Stratabound Stratigraphy
Page 43 and 44: APPENDIX 1 ASSETS BEING ACQUIRED AN
Page 45 and 46: To be read in conjunction with the
Page 47 and 48: APPENDIX 2 STATEMENT OF CASH FLOWS
Page 49 and 50: (b) (c) (d) (e) (f) (g) Income tax
Page 51 and 52: Unaudited Proforma 31 August 2007 U
Page 53 and 54: $ $ 10. CONVERTIBLE NOTES - UNSECUR
Page 55 and 56: 2.1 Western Australia Tenements in
Page 57 and 58: included a revised threshold test f
Page 59 and 60: • Compensation may have to be agr
Page 61 and 62: Notes: 1. The tenement is subject t
Page 63 and 64: expenditure will be borne by the pa
Page 65 and 66: Section 12 Additional Information 1
Page 67 and 68: Rights on Winding Up Subject to the
Page 69 and 70: Early Redemption by Noteholder The
Page 71 and 72: Section 13 Director’s Responsibil
Page 73 and 74: Application This Application Form r
Page 75 and 76: Application This Application Form r
Page 77 and 78: Airleg miner boring a level drive f

Prospectus - Kingsrose Mining

Create successful ePaper yourself

Delete template?

Save as template?