Speciality Metals International Limited Annual Report 2019

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Page | 47 • The Company also still holds two (2) gold prospects in NSW and twenty (20) exploration concessions within Northern Chile as part of its exploration work for lithium and other valuable minerals. The Company has also maintained its two tungsten focused Exploration Permits (EPM 14871 & EPM 14872) located at Mt Carbine, North Queensland which were both renewed for a further term of 5 years to December 2020. EPM 14872 contains both the Iron Duke and Petersen’s Lode prospects whilst EPM 14871 features the Mt Holmes tin-tungsten prospect. The Company believes that EPM 14872 holds significant exploration upside given that the tungsten grades indicated in the sampling of the Iron Duke and Petersen’s Lode are extensively higher than the estimated global average grade in the present open-pit resource within the Mt Carbine Mining Leases. These unencumbered, greenfield sites also offer the added advantage of having minimal environmental legacy issues. Based on the above, Directors’ have assessed there to be no indication of impairment during the 2018-2019 financial year. COMBINED DEFERRED EXPENDITURE, PLANT AND EQUIPMENT AND FINANCIAL ASSETS 2019 2018 Non-current assets $ $ Receivables 770,021 771,521 770,021 771,521 Plant and equipment Plant and equipment – at cost 1,776,719 7,923 Accumulated depreciation (1,445,045) (4,062) 331,674 3,861 Inventory Quarry Inventory 7,545,413 - 7,545,413 - Deferred exploration and evaluation expenditure Exploration and evaluation expenditure 6,834,416 596,066 6,834,416 596,066 TOTAL 15,481,524 1,371,448 Reconciliation of the carrying amount of Mt Carbine assets at the beginning and end of the current and previous financial year Combined assets carrying amount at the beginning of the year 1,371,448 1,315,378 Additions – Plant & Equipment 342,323 58,160 Additions – Inventory (Quarry) 7,545,413 - Capitalised exploration and evaluation expenses 347,919 - Capitalised exploration and evaluation expenses recognised upon MCQ acquisition 255,100 Impairment reversal 5,635,331 - Receivables reduction – In-active EPM financial assurance refund (1,500) - Disposals - (989) Plant and equipment written down - - Exploration and evaluation expenditure written down - - Depreciation expense (14,510) (1,101) TOTAL 15,481,524 1,371,448