Management Information - Medusa Mining Limited - Case Study Example

Name: Lecturer: Course name: Course code: Date Introduction Medusa Mining Limited is an Australia public corporation that deals in gold mining. The company is listed on Australian stock exchange ASX) and focus majorly in Philippine due to high gold reserves. The company has entered into a merger agreement with philsaga mining limited which owned the high rate grade underneath narrow vein co-O gold mine. The existing company’s mineral mining is registered under the guideline of the JORC code 2012 (Australian regulations for Report of Exploration Results, Minerals resource as well as Ore deposits) Management information 1.1. Key management personnel Managing executive Mr. Peter Hepburn-Brown was chosen as a chief executive for the company in the year June 2011, Peter got into the board of medusa on September n15th 2009 as an Chief manager, he is a mining expert with 35 years of practical knowledge in a diverse assortment of mining circumstances. Chief Manager Mr. Raul Conde Villanueva was appointed as a Chief Manager of medusa on 24th Jan 2013; He brings an attentive move toward to enhancing the functional process well as proficiency of the business due to numerous experiences in bylaw and also administrating business hence he will additionally bring into line the purpose of medusa limited. Company secretary Mr. peter alphonso is the company’s secretary since December 2007, with over 35 years of practical experience, Mr. peter is answerable for the company secretarial duties of the business as well as his duties expands to helping the senior accountant with entire monetary as well as constitutional obligations of reporting and directing financial aspects of the business overseas operations. 1.2 Remuneration report throughout the fiscal year the company didn’t have whichever individual other than the executives as well the directors within the definition of key managing persons for the purpose of the AASB124 and business administrative (300A of the corporate act 2001).The details of remuneration to directors of the business are disclosed in section (1B) (a) of the company’s act. The act describes corporation executives to exclusively comprise of a secretary of the business. The company didn’t lend loans to its key directors during the financial year as well as there is no transaction balance with major executives other than those revealed in the statement. Name Base salary $ Superannuation Contributions $ Totals $ Peter Hepburn-Brown 746,800 12,968 759,768 Raul Villanueva 174,348 0 174,348 Peter Alphonso 285,363 12,711 298,074 Roy Daniel 603,480 25,000 628,480 Samuel Afdal 210,945 0 210,945 1.3. Accounting policy The accounting policy adopted by the company during the financial year 2013 is disclosed in the annual report as footnote. Further analysis of the accounting policy adopted by the company can be analyzed below. Dividends The company didn’t approve nor declared a dividend in the financial year 2013 .This due to the fact that the company has a huge capital investment of constructing the new mill plant as well as the L8 shaft while at the same time striving to maintain he gold production on target Property plant and accounting policy Every class of asset is recorded at cost less depreciated and impaired amount. Subsequent cost included in the asset carrying amount as and recognized as distinct asset. This is relevant where it is likely that anticipated economic advantage connected with the item will be realized in the business as well as the cost of the item can be ascertained reliably. Repair and maintenance cost are accounted for in the income statement of the company during the financial year in which the expense were incurred. Depreciation Property plant and equipment are depreciated on a straight line basis over the anticipated useful life of the asset starting from the time the asset was used. The approach to depreciation is reviewed yearly by the company for relevance and appropriateness of the method, where changes to the depreciation method are made, the adjustment must be reflected in the present and anticipated periods only. Table of depreciation rates for every class of depreciable asset Class of assets Depreciation rate(straight line) Plant and equipment 20-33% Office furniture and fittings 7.5-20% 1.5. Superannuation Disclosures Superannuation Disclosures includes the defined benefit responsibility and the fair price of the assets. The company has a defined benefit plan. The Superannuation expense of the company stands at a discount rate of 2.9% per annum while the probable standard wages add to rate over the life of the plan is 5% per annum. Defined benefit obligation Discount rate is 4.2% per annum while the predictable standard wages amplify the rate over the life of the plan is at 4% per annum. Employee benefit The company made a provision for liability on employees benefit consequential from service rendered during the financial year. Employees anticipated to be settled within one year together the entitlement consequential from salary and wages as well as annual leave. All these amounts are expected to be paid within when the liability is settled together with linked expenses. Other workers benefits payable after one year have been ascertained at present worth of the anticipated value money outflows to be made for those advantages. Contribution are made by the company to diverse worker superannuation as well as are accounted in respect of definite benefit arrangement, the expense of giving the benefit is concluded on a yearly foundation. Deliberation is given to every event that might affect the capitals to the end of the financial year were an interim assessment is executed at in advance time. The amounted documented in the balance sheet depicts the present value of the defined benefit responsibility accustomed for any undocumented actuarial /service gain or loss 1.4. Shareholders information Top 20 shareholders of the corporation The order of listing follows the following sequences; Name of the company number, shares it holds and equivalent percentage level of shareholding r 1. HSBC Custody Nominees (Australia) Limited 37,724,045 19.97% 2. National Nominees Limited 28,296,772 14.98% 3. JP Morgan Nominees Australia Limited 9,729,728 5.15% 4. Citicorp Nominees Pty Limited 9,105,039 4.82% 5. HSBC Custody Nominees (Australia) Limited-GSCO ECA 9,041,208 4.79% 6. JP Morgan Nominees Australia Limited 8,302,714 4.40% 7. ABN Amro Clearing Sydney Nominees Pty Ltd 4,654,753 2.46% 8. Forty Traders 3,296,881 1.75% 9. Cedardale Holdings Pty Ltd 3,187,673 1.69% 10. Mr William Douglas Goodfellow 3,141,925 1.66% 11. Merrill Lynch (Australia) Nominees Pty Limited 3,024,509 1.60% 12. UCA Growth Fund Limited 2,850,000 1.51% 13. Zero Nominees Pty Ltd 2,300,000 1.22% 14. Barclayshare Nominees Limited 1,872,130 0.99% 15. L R Nominees Limited 1,753,877 0.93% 16. Nortrust Nominees Limited 1,741,046 0.92% 17. TD Direct Investing Nominees (Europe) Limited 1,622,271 0.86% 18. Vidacos Nominees Limited 1,561,800 0.83% 19. State Street Nominees Limited 1,500,000 0.79% 20. CS Fourth Nominees Pty Ltd 1,415,537 0.75% Total 136,121,908 72.06% The graph of the share prices Share based payment The fair worth of equity that workers befall permitted is ascertained at funding time as well as recognized as expenditure with an equivalent enhancement to an equity account. The fair price of the options is determined using the black-schole pricing replica. The quantity of shares as well as options are anticipated to vest is appraised as well as changed at every report date such that the sum recognized for service acknowledged as contemplation for equity instrument settled shall be assumed on the quantity of equity instrument that finally vest. Defined benefit account. The business has financed non-contributory sequestration arrangement for its works in Philippines. The expense providing benefit is ascertained using the anticipated unit credit approach which reflect services delivered by workers at valuation date as well as incorporate hypothesis concerning workers anticipated salaries, The retirement befit obligation recognized in the financial statement depicts the present worth of the defined commitment as amended for unrealized previous service charge as well as condensed by fair worth of the plan asset. The financial support guiding principle is to add to a sum assumed on the actuarial statement which is performed at a usual interval. 1.5. Audit information Grant Thornton Audit Pty Ltd is the registered audit firm that perform audit test on the company’s books of account. The auditors independence declaration for the financial year 2013 has been received and depicts that the company’s financial statement has been prepared in accord with the auditing and accounting standards act 2001 and is free from material misstatement, the company’s financial performance depicts a true and fair view of the company’s business situation hence, the going concern assumption of the company can be relied upon. Audit remuneration 2014 2013 $000 $000 auditing or appraising the financial statement 149 158 other services supplied by associated assessors taxation as well as conformity 15 14 sum auditor’s pay 175 180 fee of other auditors of the corporation’s Philippines subsidiaries for assessing or examining the financial statement 67 67 additional services offered by associated practice of auditor - permissible as well as duty/charge 13 132 Total audit fee 80 199 (e) Income levy The income levy/duty expenditure for the fiscal year encompasses the existing income tax outlay as well as the deferred tax expenditure. Present income tax cost accounted for in the income statement is the tax owed on taxable proceeds worked out using appropriate income tax rates ratified, and or ratified as at reporting date. Existing tax responsibility are consequently ascertained at the value anticipated be remunerated to the appropriate taxation board. Delayed proceeds duty expenditure depicts activities in deferred tax asset as well as deferred tax liability balances during the financial year and unutilized tax losses. Current and deferred income tax cost is charged in the income statement when the tax recount to items that are recognized outside the income statement. The company paid income tax worth of $4, 000, while accounted for deferred tax totaling $141,000 for the financial year June 2014. Operating rents Rent imbursement for operating rents, where considerably the entire threats and advantage stay with the lessor, are accounted for as straight line over the time-span of the rent agreement. Rent inducement under operating rents are recognized as a responsibility and amortized on a straight-line basis over the useful life of the rent tenure. Read More