IGO Interactive Annual Report 2019

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 30 JUNE 2019 Notes to the consolidated financial statements 30 June 2019 (continued) Group structure This section of the notes provides information which will help users understand how the group structure affects the financial position and performance of the Group. 22 Subsidiaries (a) Significant investments in subsidiaries The consolidated financial statements incorporate the assets, liabilities and results of Independence Group NL and the subsidiaries listed in the following table: Name of entity Note Country of incorporation Equity holding 2019 % 2018 % Independence Long Pty Ltd (a),(b) Australia - 100 Independence Newsearch Pty Ltd Australia 100 100 Independence Stockman Parent Pty Ltd Australia 100 100 Independence Stockman Project Pty Ltd Australia 100 100 Independence Windward Pty Ltd Australia 100 100 Flinders Prospecting Pty Ltd Australia 100 100 Independence Europe Pty Ltd Australia 100 100 Independence Nova Holdings Pty Ltd (a) Australia 100 100 Independence Nova Pty Ltd (a) Australia 100 100 Independence Group Europe AB Sweden 100 100 IGO Downstream Technologies Pty Ltd Australia 100 - (a) These subsidiaries have been granted relief from the necessity to prepare financial reports in accordance with ASIC Corporations (Wholly-owned Companies) Instrument 2016/785 issued by the Australian Securities and Investments Commission. For further information refer to note 28. (b) Independence Long Pty Ltd was disposed of on 31 May 2019. (b) Sale of Independence Long Pty Ltd On 23 May 2019, the Company announced that it had entered into an agreement with Mincor Resources NL (Mincor) to divest the Long Operation for a total consideration of up to $9,500,000. The consideration comprised $3,500,000 in Mincor shares on completion of the transaction and an additional $6,000,000 in payments contingent upon future production from the mine. The transaction was completed on 31 May 2019. The sale of the Long Operation resulted in a net gain on sale before tax of $3,010,000, which is included in Other income in profit or loss. (c) Sale of Independence Jaguar Pty Ltd In the previous financial year, the Company divested its Jaguar Operation to CopperChem Limited (CopperChem) for a total consideration of $73,200,000. The consideration comprised $25,000,000 in cash on completion of the transaction and an additional $48,200,000 in deferred cash payments. The discounted values (using a discount rate of 3.5%) of the outstanding cash proceeds of $15,519,000 (2018: $15,520,000) and $14,994,000 (2018: $29,480,000) are shown in current and non-current receivables respectively. The sale of the Jaguar Operation resulted in a net loss on sale before tax of $423,000 (2018: profit of $2,541,000), which is included in Other income in profit or loss. Net cash proceeds of $16,764,000 (2018: $23,140,000) are shown as Net cash proceeds on sale of Jaguar Operation in investing activities in the Statement of cash flows. Independence Group NL 48 Notes to the consolidated financial statements 30 June 2019 (continued) 22 Subsidiaries (continued) (d) Principles of consolidation Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entities. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. The acquisition method of accounting is used to account for business combinations by the Group (refer to note 30(c)(i)). Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. IGO ANNUAL REPORT 2019 — 109