Westgold Resources Limited Annual Report 2021

continued FINANCIAL REPORT INDEPENDENT AUDITOR’S REPORT 100 Westgold Resources Limited Annual Report 2021 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation PT:DA:WESTGOLD:011 We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial report section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial report. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial report. 1. Amortisation of assets Why significant How our audit addressed the key audit matter As at 30 June 2021 the Group had capitalised mine properties and development costs amounting to $407.3 million (refer to Note 17 of the financial report). Calculating amortisation requires considerable judgement and estimation in relation to reserves and resources (used as the denominator in a “units-of- production” calculation) of the mines and the assessment of future costs (included in the numerator in a “units-of-production” calculation) required to extract these reserves and resources for each underground mine. Accordingly, this creates a risk the amortisation rates are inappropriate, resulting in the expense profile that does not reflect the pattern of consumption of the assets’ future economic benefits. This was considered to be a key audit matter due to the judgment and estimation involved. We evaluated the assumptions and methodologies used by the Group in their calculation of amortisation. Our audit procedures included the following: • Assessed the qualifications, competence and objectivity of the Group’s internal experts, the work of whom, formed the basis of the Group’s estimates on the reserves and resources and the future costs used in the amortisation calculation • Assessed the application of reserves and resources in the amortisation models by comparing them to the latest published statement and underlying mining records • Assessed the reasonableness of the future costs included in the calculation with reference to historical costs incurred and the mine plans approved by the Group’s internal experts • Evaluated the consistency of application of the Group’s amortisation methodology on its capitalised mine properties and development assets across the mine sites • Tested the mathematical accuracy of the amortisation models • Assessed the adequacy of the Group's disclosures relating to amortisation. 2. Rehabilitation and restoration provisions Why significant How our audit addressed the key audit matter As a consequence of its operations, the Group incurs obligations to restore and rehabilitate the environment. Rehabilitation activities are governed by a combination of legislative requirements and Group policies. As at 30 June 2021 the Group’s consolidated statement of financial position includes provisions of $74.8 million in respect of such obligations (refer to Note 22 of the financial report). We evaluated the assumptions and methodologies used by the Group in determining their rehabilitation obligations. Our audit procedures included the following: • Assessed the qualifications, competence and objectivity of the Group’s internal and external experts, the work of whom, formed the basis of the Group’s rehabilitation cost estimates