Given that annual reports are meant to be more fulsome in...

Given that annual reports are meant to be more fulsome in disclosure, it is nice to see the increase in disclosure surrounding cash in the half year report. I had commented on their requirement to make such disclosures for some time and this is the first time it has been included in their accounts, those past ones were audited as well and obviously they weren't pushed to include disclosure of this key bit of information previously in their more fulsome annual report (!)..... Just in case a reference is handy, this is basically a black and white disclosure requirement under AASB 107 paragraphs 48&49, where material (it would be hard to justify it isn’t given the exchange controls that operate in this jurisdiction).




Perhaps auditors read some of our HotCopper posts from time to time J.
In the next year’s annual report they will also need to include a long form audit report and I would sincerely hope to see the auditor to confirm certain procedures in addressing Key Audit Matters and confirm they have personally visited all of the sites and carried out physical existence testing of plant and equipment and inventory holdings and obtained assurance via positive statement confirmations of all third party asset balances (cash, receivables etc….), having maintained complete control of the process. I would want the lead partner signing the piece of paper to have seen this with their own eyes and not using an affiliate firm in country etc….. If I saw this, then, and only then, might I consider taking a punt on whether they can work with the disclosed exchange restrictions to ever return a cent in cold hard cash to an Australian resident investor - remember: if they can’t ever get round those restrictions into perpetuity the stock by definition would be worth zero.
Actually, while we’re at it they might as well confirm the title and other aspects of the almost $50m in assets held in the associate that they hold 27% of and made a loss last year. While we’re at it, perhaps a bit more disclosure surrounding the level of related party transactions might not go amiss either. Directors paying for millions of dollars of expenses personally and then being reimbursed appears quite unusual. A public company shouldn’t be used as a personal piggy bank and I would like to know what interest rate this particular director paid on their $1,79m short term advance; unfortunately information about this and further explanation to satisfy investors as to why this type of activity is appropriate isn’t forthcoming..…It’s hard to understand why the stock is a little unloved…