IGO Interactive Annual Report 2020

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 30 JUNE 2020 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 30 JUNE 2020 Notes to the consolidated financial statements 30 June 2020 (continued) 19 Reserves and retained earnings/(accumulated losses) (a) Reserves 2020 $'000 2019 $'000 Hedging reserve 244 339 Share-based payments reserve 18,645 15,427 Foreign currency translation reserve (15) 11 18,874 15,777 (i) Movements in reserves The following table shows a breakdown of the movements in these reserves during the year. A description of the nature and purpose of each reserve is provided below the table. Hedging reserve $'000 Share- based payments reserve $'000 Foreign currency translation reserve $'000 Total $'000 Balance at 1 July 2019 339 15,427 11 15,777 Revaluation - gross (2,006) - - (2,006) Deferred tax 602 - - 602 Transfer to profit or loss - gross 1,870 - - 1,870 Deferred tax (561) - - (561) Currency translation differences - current period - - (26) (26) Share-based payment expenses - 4,489 - 4,489 Issue of shares under the Employee Incentive Plan - (1,271) - (1,271) Balance at 30 June 2020 244 18,645 (15) 18,874 Balance at 1 July 2018 1,393 13,340 38 14,771 Revaluation - gross 515 - - 515 Deferred tax (154) - - (154) Transfer to profit or loss - gross (2,021) - - (2,021) Deferred tax 606 - - 606 Currency translation differences - current period - - (27) (27) Share-based payment expenses - 3,123 - 3,123 Issue of shares under the Employee Incentive Plan - (1,036) - (1,036) Balance at 30 June 2019 339 15,427 11 15,777 (ii) Nature and purpose of reserves Hedging reserve The hedging reserve is used to record gains or losses on derivatives that are designated and qualify as cash flow hedges and that are recognised in other comprehensive income. Amounts are reclassified to profit or loss when the associated hedged transaction affects profit or loss. Share-based payments reserve The share-based payments reserve is used to record the value of share-based payments provided to employees, including key management personnel, as part of their remuneration. Refer to note 26 for further details of these plans. IGO Limited 36 Notes to the consolidated financial statements 30 June 2020 (continued) 19 Reserves and retained ar ings/(accumulated losses) (continued) (a) Reserves (continued) (ii) Nature and purpose of reserves (continued) Share-bas d p ym nts res ve (continued) Foreign currency translation reserve Exchange differences arising on translation of the foreign controlled entity are recognised in other comprehensive income and accumulated in a separate reserve within equity. The cumulative amount is reclassified to profit or loss when the net investment is disposed of. (b) Retained earnings/(accumulated losses) Movements in retained earnings/(accumulated losses) were as follows: Notes 2020 $'000 2019 $'000 Balance at beginning of financial year (62,572) (115,038) Net profit for the period 155,093 76,085 Dividends paid during the period 20 (82,712) (23,619) Notes to the consolidated financial statements 30 June 2020 (continued) 19 Reserves and retained earnings/(accumulated losses) (continued) (b) Retained earnings/(accumulated losses) Movements in retained earnings/(accumulated losses) were as follows: Notes 2020 $'000 2019 $'000 Balance at beginning of financial year (62,572) (115,038) Net profit for the period 155,093 76,085 Dividends paid during the period 20 (82,712) (23,619) Balance at end of financial year 9,809 (62,572) 20 Dividends paid and proposed (a) Ordinary shares 2020 $'000 2019 $'000 Final dividend for the year ended 30 June 2019 of 8 cents (2018: 2 cents) per fully paid share 47,264 11,809 Interim dividend for the year ended 30 June 2020 of 6 cents (2019: 2 cents) per fully paid share 35,448 11,810 Total dividends paid during the financial year 82,712 23,619 (b) Dividends not recognised at the end of the reporting period 2020 $'000 2019 $'000 In addition to the above dividends, since year end the Directors have recommended the payment of a final unfranked dividend of 5 cents per fully paid ordinary share (2019: 8 cents per fully paid ordinary share, franked to 97%), based on tax paid at 30%. The aggregate amount of the proposed dividend expected to be paid on 25 September 2020 out of retained earnings at 30 June 2020, but not recognised as a liability at year end, is: 29,540 47,264 (c) Franked dividends 2020 $'000 2019 $'000 Franking credits available for subsequent reporting periods based on a tax rate of 30% (2019 - 30%) 13 19,661 The above amounts are calculated from the balance of the franking account as at the end of the reporting period, adjusted for: (a) franking credits that will arise from the payment of the amount of the provision for income tax; (b) franking debits that will arise from the payment of dividends recognised as a liability at the reporting date; and (c) franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date. The dividend recommended by the Directors since the end of the reporting period, but not recognised as a liability at the reporting date, will be unfranked, therefore there will be no impact on the franking account (2019: reduction of $19,648,000). Notes to the consolidated financial statements 30 June 2020 (continued) 20 Dividends paid and proposed (continued) ( ) r i i ' ' r i r it il l f r t r rti ri t r t f ( - ) , The above amounts are calculated from the balance of the franking account as at the end of the reporting period, j t f r: ( ) fr i r it t t ill ri fr t t f t t f t r i i f r i t ; ( ) fr i it t t ill ri fr t t f i i s recognised as a liability at t r rti t ; ( ) fr i r it t t ill ri fr t r i t f i i r i r i l t t r rti t . i i r t ir t r i t f t r rti ri , t t r i li ilit t t r rti t , ill fr , t r f r t r ill i t t fr i t ( : r ti f $19,648,000). (d) Recognition and measurement Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the entity, on or before the end of the reporting period but not distributed at the end of the reporting period. A provision for dividends is not recognised as a liability unless the dividends are declared, determined or publicly recommended on or before the reporting date. 104 — IGO ANNUAL REPORT 2020 IGO ANNUAL REPORT 2020— 105