for personal use only 2009 - asx · 2009. 9. 28. · financial year 2009 was a year of two halves...

20092009

2009A N N U A L R E P O R TF O R T H E Y E A R E N D E D 3 0 J U N E 2 0 0 9A B N 4 8 1 3 4 2 6 8 8 2 1

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Chairman’s Letter 3

Managing Director’s Report 5

Directors’ Report 12

Auditor’s Independence Declaration 21

Income Statement 22

Balance Sheet 23

Statement of Changes in Equity 24

Cash Flow Statement 25

Notes to the Financial Statements 26

Directors’ Declaration 45

Independent Auditor’s Report 46

Corporate Governance 48

Stock Exchange Information 51

Corporate Directory 54

CONTENTS

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Dear Investor,

It is with great pleasure that I write to you in our first annual report to shareholders for the Global Resource Masters Fund.

Financial year 2009 was a year of two halves for the commodities markets. Following the sharp falls in the first half of the financial year, courtesy of the global financial crisis, commodity markets began to stabilise and then recover in the second half, as the resumption of demand from emerging Asia, and China in particular, began to take hold. Indeed, perhaps the most surprising aspect of the past year for commodity markets was not so much the speed with which they collapsed in the first half, astounding as that was, but rather how solidly commodity markets have recovered in the second half and just how resilient Asian demand growth for natural resources has proved to be despite the global turmoil.

As long term investors, we saw the collapse in the global commodity markets in the first half of the year as a very attractive opportunity to enter into the commodity markets. Hence, despite the obvious difficulty of seeking to raise money not only during the traditionally quiet Christmas and New Year’s holiday season but also during the worst financial crisis in the past 70 years, we decided to proceed with the IPO of the Global Resource Masters Fund.

We did not take the decision lightly. There was tremendous anxiety in the global markets, and we could not discount the real possibility that we were going too soon, that prices would fall further, perhaps significantly more so. On the other hand, commodity prices had already collapsed 50 to 70 percent from their recent peak levels, and the valuations for many of the world’s leading natural resources companies were at what we considered to be generationally low levels. Weighing all this, we felt at the time that the risk / reward proposition was firmly in favour of the long term investor. We successfully listed the Company on the ASX on 3rd February 2009.

Our primary goal in creating the Company was to give Australian investors an avenue to gaining exposure to the global natural resources sector, including investments in natural resource companies and physical commodities. In this we feel we have been successful. As at 30 June 2009, the Company had investments in over 500 global natural resource companies and numerous physical commodities.

While the aftershocks of the global financial crisis will be felt for several years to come, we continue to believe in the investment thesis for the global natural resources sector. Key forces driving the sector, such as the rise of China, the end of the era of cheap oil, and climate change, are secular in nature, meaning the current natural resources cycle will likely take years, and possibly a decade or more, to mature.

While these forces will underwrite a long term positive trend for commodity prices, the role of exchange rates, especially the US dollar, has to be taken into account. With commodity prices set globally in US dollars, the sharp depreciation of the US currency against most currencies including the Australian dollar had a significant adverse effect on our Company’s bottom line. The exchange rate factor is examined in more detail by Managing Director, Alex MacLachlan, in his note to shareholders.

In closing, I would like to take this opportunity on behalf of the entire board of the Global Resource Masters Fund to thank you for your continued support and reiterate to you our full commitment to doing our best in investing in the global natural resources sector on your behalf.

Mr Maximilian Sean Walsh CHAIRMAN 28 August 2009

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1. OVERVIEWWelcome to the Global Resource Masters Fund’s inaugural annual report to shareholders.

We launched the Company with the primary objective of giving investors exposure to global hard assets, whether that be in the form of actual physical commodities, such as oil, copper, gold or wheat, or the companies that produce those commodities, and to do so by accessing the best fund products and managers from around the world. Further, we sought to do this while reducing risk and preserving capital.

More broadly speaking, we believe exposure to global hard assets when structured this way provides a particularly attractive complement to most investors’ diversified portfolio of cash, fixed income, and equities.

Since listing, we have assembled what we consider to be a best-in-class portfolio, consisting of investments in the world’s leading natural resource companies and exposure to all the major physical commodity markets around the world. Please see our detailed holdings in the next section; I’m sure you will agree with me.

The timing of the launch of the Company proved, in hindsight, excellent. The Company listed on the ASX on 3rd February 2009. Major commodity indices such as the Dow Jones UBS Commodity Index and the Reuters/Jefferies CRB Index bottomed on 3rd March.

In US dollar terms, the value of the Company’s portfolio (including physical commodities, equities, and cash) in the five months since listing has increased by 22%. This compares with the Dow Jones UBS Commodity Index’s gain of 12%, the MSCI World Energy Index’s 10%, and the MSCI World Materials Index’s 32%.

However, due to the strength of the Australian dollar, which has risen significantly against major currencies over the period, including the US dollar by 24%, the value of the portfolio when converted back to Australian dollars was reduced to a 1.3% loss.

The Company has a policy of not entering into currency hedging transactions, as the fund was set up to gain exposure to global hard assets. This is a policy that we believe is the right strategy for long-term investors in the global natural resources sector. But it also means that in the short term currency effects can work against us, as they have during this period. Please see section 6 for a more detailed discussion of our philosophy and policies on currency hedging.

We are proud of the performance we have been able to deliver to shareholders since listing. We believe we have successfully delivered on our goal of providing investors with global exposure to the natural resources sector through high quality investments while reducing risk and preserving capital.

And, most importantly, we are totally committed to continuing to manage the Company in the best interests of all shareholders.

MANAGING DIRECTOR’S REPORT

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GLOBAL RESOURCE MASTERS FUND LIMITED • ANNUAL REPORT 2009

2. PORTFOLIO POSITIONINGAs at 30 June 2009, the aggregate sector allocation of the invested portfolio was:

The Company was 70% invested, with investments spread across 19 fund managers and products. These investments are presented below:

FUND % INVESTED ASSET CLASSRESOURCES

FOCUS

PIMCO Global Commodity Real Return Fund 10% Physical Broad

Schroders Alternative Strategies Commodity Fund 9% Physical Broad

Martin Currie Global Resources Fund 9% Equity Broad

Market Vectors Agribusiness ETF 6% Equity Agriculture

Invesco Energy Fund 4% Equity Energy

Blackrock Small Cap Energy Fund 4% Equity Energy

Tocqueville Gold Fund 4% Equity Precious

Market Vectors Gold Miners ETF 3% Equity Precious

iShares S&P Global Materials Index Fund 3% Equity Materials

iShares S&P Global Energy 2% Equity Energy

Vanguard Energy ETF 2% Equity Energy

Energy Select Sector SPDR 2% Equity Energy

iShares DJ US Equipment & Services Index Fund 2% Equity Energy

iShares DJ Oil and Gas Index Fund 2% Equity Energy

SPDR Oil & Gas Equipment & Services ETF 2% Equity Energy

Energy (49%)

Precious Metals (15%)

Agriculture (17%)

Metals & Mining (11%)

Alternative & Other (8%)

8%

11%

17%

15%

49%

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ETFS Physical Gold 2% Physical Precious

MarketVectors Global Alternative Energy 1% Equity Alternative

Powershares Global Water Resources ETF 1% Equity Alternative

Powershares Water Resources US ETF 1% Equity Alternative

Investments 70%

Cash 30%

Total 100%

The Company’s equity investment portfolio was broadly diversified across the energy, agriculture, precious metals, metals & mining, and alternatives sectors, with the top 50 holdings representing nearly 50% of the total equity portfolio.

RANK NAMETOTAL PORTFOLIO

% EQUITY PORTFOLIO

% SECTOR

1 Exxon Mobil Corp 1.5% 3.1% Integrated Oil

2 Chevron Corp 1.1% 2.2% Integrated Oil

3 Schlumberger Ltd 1.1% 2.1% Services

4 Occidental Petroleum Corp 0.8% 1.6% Oil & Gas E&P

5 Southwestern Energy Co 0.7% 1.5% Oil & Gas E&P

6 Goldcorp Inc 0.7% 1.4% Precious Metals

7 ConocoPhillips 0.7% 1.3% Integrated Oil

8 Anadarko Petroleum Corp 0.6% 1.3% Oil & Gas E&P

9 BP PLC 0.6% 1.3% Integrated Oil

10 Halliburton Co 0.6% 1.2% Services

11 Marathon Oil Corp 0.6% 1.2% Integrated Oil

12 Potash Corp of Saskatchewan Inc 0.6% 1.2% Agribusiness

13 Newmont Mining Corp 0.5% 1.1% Precious Metals

14 Syngenta AG 0.5% 1.0% Agribusiness

15 Randgold Resources Ltd 0.5% 1.0% Precious Metals

16 Devon Energy Corp 0.5% 1.0% Oil & Gas E&P

17 BHP Billiton 0.5% 1.0% Mining & Materials

18 National Oilwell Varco 0.5% 0.9% Services

19 Suncor Energy Inc 0.5% 0.9% Oil & Gas E&P

20 Apache Corp 0.5% 0.9% Oil & Gas E&P

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% EQUITY PORTFOLIO

% SECTOR

21 Plains Exploration & Production 0.5% 0.9% Oil & Gas E&P

22 Mosaic Co 0.5% 0.9% Agribusiness

23 Vestas Wind Systems 0.4% 0.9%Water &

Renewables

24 Monsanto Co 0.4% 0.9% Agribusiness

25 PetroHawk Energy Corp 0.4% 0.9% Oil & Gas E&P

26 XTO Energy Inc 0.4% 0.8% Oil & Gas E&P

27 Baker Hughes Inc 0.4% 0.8% Services

28 Barrick Gold Corp 0.4% 0.8% Precious Metals

29 Peabody Energy Corp 0.4% 0.8% Coal

30 IAMGOLD Corp 0.4% 0.8% Precious Metals

31 Consol Energy Inc 0.4% 0.7% Coal

32 Weatherford International 0.4% 0.7% Services

33 Hess Corp 0.4% 0.7% Integrated Oil

34 Cameron International 0.4% 0.7% Services

35 Archer-Daniels-Midland 0.3% 0.7% Agribusiness

36 Kinross Gold Corp 0.3% 0.7% Precious Metals

37 Massey Energy Co 0.3% 0.7% Coal

38 Wilmar International Ltd 0.3% 0.7% Agribusiness

39 Deere & Co 0.3% 0.6% Agribusiness

40 Total SA 0.3% 0.6% Integrated Oil

41 Yara International ASA 0.3% 0.6% Agribusiness

42 Royal Dutch Shell PLC 0.3% 0.6% Integrated Oil

43 Komatsu Ltd 0.3% 0.6% Agribusiness

44 Petrofac Ltd 0.3% 0.6% Services

45 Cia de Minas Buenaventura SA 0.3% 0.6% Precious Metals

46 ArcelorMittal 0.3% 0.6% Mining & Materials

47 E.ON AG 0.3% 0.5% Utilities

48 Noble Energy Inc 0.3% 0.5% Oil & Gas E&P

49 Kubota Corp 0.3% 0.5% Mining & Materials

50 Oceaneering International 0.3% 0.5% Services

TOTAL 23.9% 48.3%

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Similarly, the Company’s physical commodity investments were well diversified across the various sector segments, with the top 20 holdings representing just over 90% of the total physical commodity portfolio.


% PHYSICAL PORTFOLIO

% SECTOR

1 Crude Oil 3.6% 18.2% Energy

2 Gold 3.2% 15.9% Precious Metals

3 Copper 1.3% 6.7% Metals and Mining

4 Natural Gas 1.2% 5.9% Energy

5 Soybeans 1.1% 5.7% Agriculture

6 Sugar 0.9% 4.5% Agriculture

7 Gasoline 0.8% 4.0% Energy

8 Corn 0.8% 3.8% Agriculture

9 Heating Oil 0.7% 3.4% Energy

10 Aluminium 0.6% 3.1% Metals and Mining

11 Wheat 0.6% 2.9% Agriculture

12 Coffee 0.5% 2.6% Agriculture

13 Live Cattle 0.5% 2.4% Agriculture

14 Zinc 0.5% 2.3% Metals and Mining

15 Nickel 0.4% 1.9% Metals and Mining

16 Silver 0.3% 1.6% Precious Metals

17 Soybean Oil 0.3% 1.6% Agriculture

18 Cotton 0.3% 1.6% Agriculture

19 Lean Hogs 0.3% 1.5% Agriculture

20 Lead 0.2% 1.1% Metals and Mining

TOTAL 18.1% 90.7%

3. PERFORMANCE OVERVIEWThe NAV (Net Asset Value) for the Company decreased by $0.02 per share, or 1.3%, to $1.51 per share as at 30 June 2009, down from $1.53 per share as at listing on 3 February 2009.

On a monthly basis, the NAV since listing ranged from +2% ($1.56 per share in May) to -1.3% ($1.51 per share in June), while the traded price for the Company ranged from a low of $1.60 per share (listing price) to a high of $1.65 per share, with the most recently traded price as at 30 June 2009 of $1.62 per share.

Encouragingly, the Company consistently traded at a modest premium to its NAV.

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4. MARKET OVERVIEWThe relatively stable performance of the Company since listing masks the considerable swings that took place in underlying commodity markets during FY 2009.

The global destocking that took place in late calendar 2008 to early calendar 2009 in response to the global financial crisis and the collapse in global industrial activity had a dramatic effect on commodity markets. When the fall came, it proved significant, with some physical and equity commodity markets halving in less than three months.

However, after bottoming in February and March 2009, commodity markets more recently have shown rather solid gains, albeit still well off their highs. Improving economic data, continued strong fiscal and monetary stimulus by government’s around the world, and Chinese restocking (for example in June China recorded its fifth consecutive record month for copper imports) drove strong commodity prices during the later months of FY 2009.

Financial flows into commodities also recovered significantly, with estimates of the amount of money under management in indexed investments rising to US$125 billion at the end of 30 June 2009, from a low of US$80 billion in February 2009.

5. MARKET PERSPECTIVESWhere we stand today, it would appear that the initial phase of Chinese restocking that provided such significant tail winds to the commodities markets during the recovery of the past several months has largely played itself out for the time being.

However, more broadly speaking, our view on the commodity markets continues to be positive. Materials-intensive growth from emerging markets, in particular China and India, coupled with ongoing asset depletion and underinvestment in productive capacity will continue to positively skew the supply/demand equation in favour of commodity prices for the medium to longer term. Issues such as rising resource nationalism and climate change are only likely to further compound this dynamic.

And finally there is the inflation question and concerns that government responses to the global financial crisis around the world will ultimately prove inflationary. If investors see the balance of scales tipping towards inflation, interest in the commodities sector may accelerate, as investors search for inflation protection and diversification.

In summary, while near term prices are still vulnerable to further setbacks – the economic situation remains challenging – we view short term sell-off’s in the commodities sector as long term buying opportunities, and we continue to manage the Company accordingly.

6. CURRENCY COMMENTGiven the significant moves in currency markets we have experienced during the Global Financial Crisis, and in particular the historically high impact this has had on commodity market returns, I thought I would briefly comment on the Company’s currency philosophy and review our policies for you.

We have assembled a truly global portfolio of natural resources exposure. For example, the underlying equities that the Company owns are traded on over 30 stock exchanges across a range of currencies around the world.

However, one issue that naturally arises with such a global portfolio is the question of what to do with currency hedging.

Our corporate policy is not to engage in any currency hedging. We are seeking long-term capital growth through investments in global hard assets. We do not seek to overlay currency positions onto our investments.

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We are, however, very mindful of the impact that currency movements can have on commodity returns.

Historically, the positive correlation between the Australian dollar and commodities has meant that, while an unhedged commodity portfolio would return less in a bull market, it would also lose less in a bear market. The converse has also applied; while a hedged commodity portfolio would make more in bull markets, it would also lose more in bear markets. In fact, over the long-term, it’s been a pretty even proposition as to which way you go – the ratio of what you gain / lose in returns has been offset by what you lose / gain in volatility.

And given that choice, we would rather make less than lose more.

As Australian domiciled investors, some years this will work for us, some years against us. This year, as noted above, our NAV decreased by 1.3% in Australian dollars in the five months between listing and financial year end 2009, while in US dollars, we were up 22% (and for those interested, in British pounds we were up 7%, in Euros up 14%, and in Japanese yen up 32%).

However, it is worth remembering that less than 12 months ago it went the other way, and quite dramatically so. A hedged portfolio would have lost 24% more in energy equities than an unhedged portfolio, lost 17% more in materials equities, and lost 21% more in physical commodities.

Commodity and currency markets are impacted by a multitude of factors – some overlapping, many not – and these factors change over time. How commodity markets and currency markets will correlate into the future is an open question. But, for better or for worse, this is one area we will not be speculating on.

7. ANNUAL GENERAL MEETINGOur annual general meeting will be held on 27th October 2009 at the National Convention Centre in Canberra. Details will be sent to you in a separate Notice of Meeting and Explanatory Memorandum.

I look forward to seeing you there.

Mr Alexander Gen MacLachlan MANAGING DIRECTOR 28 August 2009

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Your directors present their report together with the financial report of Global Resource Masters Fund Limited (“the Company”) for the financial year ended 30 June 2009.

DIRECTORSThe names of the directors in office at any time during, or since the end of, the year are:

Mr Maximilian Sean Walsh – Non Executive Chairman (Appointed 20/11/2008)

Mr Daryl Albert Dixon – Non Executive Director (Appointed 20/11/2008)

Mr Alan Cochrane Dixon – Non Executive Director (Appointed 20/11/2008)

Mr Alexander Gen MacLachlan – Managing Director (Appointed 20/11/2008)

Mr Jeffrey Robert Whalan – Non Executive Director (Appointed 20/11/2008)

Mr Nirav Gautam Desai – Non Executive Director (Appointed 04/12/2008)

COMPANY SECRETARYThe name of the Company Secretary in office at the date of this report and throughout the year is:

Mr Graham Chee

PRINCIPAL ACTIVITIESThe principal activities of the Company during the financial year were to provide Australian investors the opportunity to gain access to leading global fund products and managers specialising in the natural resources sector.

The Company was incorporated and listed in the current financial year. There were no significant changes in the nature of these activities of the Company that occurred during the year.

OPERATING RESULTSThe profit of the Company for the financial year after providing for income tax amounted to $23,951. The Company is in a strong position with total assets of $49million and no debt.

DIVIDENDS PAID OR RECOMMENDEDNo dividends were paid during the year.

The directors do not recommend the payment of a dividend.

REVIEW OF OPERATIONSThe company was listed on the ASX on 3rd February 2009 at $1.60 per share, with an NTA of $1.53 per share. As at 30 June 2009, the NTA of the Company before tax was $1.51 per share, representing a decrease of 1.3%.

DIRECTORS’ REPORT

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During the quarter to 31 March, the Manager completed its initial shortlist of potential investments, with members of the Investment Committee undertaking an overseas due diligence trip covering 7 cities and over 30 meetings with leading funds managers, investment strategists, and research analysts across North America and Europe. As at 30 June 2009, the Company was 70% invested.

The investment portfolio of the Company has been constructed with the goal of balancing exposure across the asset classes, sectors, investment styles, and underlying investments that the Manager believes to be most attractive. As at 30 June, the investment portfolio of the Company included 19 funds with underlying holdings of over 500 global natural resource company equities and 30 physical commodities.

SIGNIFICANT CHANGES IN STATE OF AFFAIRSThe Company was incorporated and listed in the current financial year. There were no significant changes in the state of affairs of the Company which occurred during the financial year ended 30 June 2009.

AFTER BALANCE DATE EVENTS

CAPITAL RAISING

The Company has completed a placement of 15,189,890 ordinary shares at an issue price of A$1.63 raising $24,759,520. This capital raising was to sophisticated and professional investors and did not require a disclosure document under the Corporations Act 2001 (s708(8) and s708(11)).

In accordance with ASX Listing Rule 7.1, a total of 4,183,000 ordinary shares has been issued without the need for shareholder approval (representing 15% of the issued capital of the Company). This represents approximately $6.8million. On 29 July 2009, the Company called an extraordinary general meeting of shareholders at which approval was obtained for the issue of the additional 11,006,890 ordinary shares.

The funds raised will be used to opportunistically secure additional fund investments at fundamentally cheap valuation levels and will allow the Company to further diversify its portfolio.

Certain directors of the Company had indicated that they wished to take up an aggregate of 156,000 new ordinary shares in the Company on the same terms as the Placement. This required shareholder approval under Listing Rule 10.11 to allow the issue of shares to directors of the Company. Shareholder approval was obtained at the general meeting held on 29 July 2009 for the approval of the second tranche of shares under the Placement.

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FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIESThe Company will continue to undertake its activities described in this report.

Likely developments in the operations of the Company and the expected results of those operations in future financial years have not been included in this report as the inclusion of such information is likely to result in unreasonable prejudice to the Company.

ENVIRONMENTAL ISSUESThe Company’s operations are not regulated by any significant environmental regulation under a law of the Commonwealth or of a State or Territory.

OPTIONSNo options over issued shares or interests in the Company were granted during or since the end of the financial year and there were no options outstanding at the date of this report.

INDEMNIFYING OFFICERS OR AUDITORIndemnities have been given and insurance premiums paid during the year for all directors of the Company.

No indemnities have been given or insurance premiums paid, during or since the end of the financial year, for the auditor of the Company.

PROCEEDINGS ON BEHALF OF COMPANY No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The Company was not a party to any such proceedings during the year.

DIRECTORS’ REPORT CONT

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INFORMATION ON DIRECTORS

MAXIMILIAN SEAN WALSH AM, BEC(SYDNEY)Non-Executive Chairman of Directors and Chairman of the Investment Committee

Maximilian is regarded as one of Australia’s leading economics and business journalists. He has specialised in the areas of business, economics and politics in a journalistic career spanning nearly 50 years. He has been Editor and Managing Editor of The Australian Financial Review and Editor-in-Chief of The Bulletin. He has also served on the boards of Northern Star TV (predecessor to Channel Ten) and Ruleburst Holdings Limited and is presently Deputy Chairman of Dixon Advisory and Superannuation Services Pty Limited.

Max is also Chairman of Asian Masters Fund Limited and Chairman of its Investment Committee, and Chairman of Australian Masters Corporate Bond Fund No 1 Limited, Australian Masters Corporate Bond Fund No 2 Limited, Australian Masters Corporate Bond Fund No 3 Limited and Australian Masters Corporate Bond Fund No 4 Limited.

• Appointedasdirectorandnon-executivechairmanon20November2008.

• Directlyholds1andbeneficiallyholds210,000fullypaidordinarysharesinthecapital of the Company.

• DuringthepastthreeyearshasactedasnonexecutiveChairmanandasanonexecutivedirector of other Australian listed public companies as follows:- - Asian Masters Fund Limited since 10 October 2007

DARYL ALBERT DIXON MA (HONS)(CAMBRIDGE), BA (HONS) (UQ)Non-Executive Director

Daryl is a graduate in economics of Cambridge and Queensland Universities. Daryl has extensive experience in the areas of taxation, retirement incomes and social welfare policy. He is known in Australia as a leading financial expert, particularly in the area of superannuation.

Daryl is the Executive Chairman of Dixon Advisory Limited, the financial advisory firm he founded in 1986 which has now over $2.5 billion of funds under administration. He has special expertise in personal and self managed super fund strategies, as well as extensive experience as a direct share investor in his own right.

He is also a director of HCF Life Limited, Asian Masters Fund Limited, Australian Masters Corporate Bond Fund No 1 Limited, Australian Masters Corporate Bond Fund No 2 Limited, Australian Masters Corporate Bond Fund No 3 Limited and Australian Masters Corporate Bond Fund No 4 Limited and has worked previously for the International Monetary Fund, the Federal Treasury, Department of Finance and the Social Welfare Policy Secretariat. He was a member of the Fraser Government’s Occupational Superannuation Task Force.

• Appointedasnon-executivedirectoron20November2008.

• Beneficiallyholds327,500fullypaidordinarysharesinthecapitaloftheCompany.

• Overthepastthreeyearshasactedasanon-executivedirectorofotherAustralian listed public companies as follows: - Drillsearch Energy Limited from 24 October 2006 – 17 October 2008 - Asian Masters Fund Limited since 10 October 2007

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ALAN COCHRANE DIXON BCOM (ANU), CA Non-Executive Director

Alan has been providing financial advisory services to corporations, institutions and individuals for the last 14 years. Until December 2000, he worked for various investment banks, including ABN AMRO (where he was the Associate Director in Mergers and Acquisitions and Equity Capital Markets) and Ord Minnett Corporate Finance. Since January 2001, he has operated as Managing Director of Dixon Advisory Limited. Dixon Advisory provides a complete suite of financial services, employs over 240 staff and has over $2.5 billion of funds under administration across over 2,700 self managed superannuation funds.

Alan has a Bachelor of Commerce from the Australian National University and is a member of the Institute of Chartered Accountants in Australia and a SPAA Accredited SMSF Specialist Advisor.

Alan has also served on the board of Ruleburst Holdings Limited and is a non-executive director of Asian Masters Fund Limited, Australian Masters Corporate Bond Fund No 1 Limited, Australian Masters Corporate Bond Fund No 2 Limited, Australian Masters Corporate Bond Fund No 3 Limited and Australian Masters Corporate Bond Fund No 4 Limited.

• Appointedasnon-executivedirectoron20November2008.


• Duringthepastthreeyearshasactedasanon-executivedirectorofotherAustralianlistedpublic companies as follows:- - Asian Masters Fund Limited since 10 October 2007.

ALEXANDER GEN MACLACHLAN BA (CORNELL), MBA (WHARTON)Managing Director and Member of Investment Committee

Alex MacLachlan is Managing Director of Global Resource Masters Fund Limited and Managing Director, Funds Management of Dixon Advisory and Superannuation Services Pty Limited. He is also director of Australian Masters Corporate Bond Fund No 3 Limited and Australian Masters Corporate Bond Fund No 4 Limited. Prior to joining Dixon Advisory, Alex was an investment banker specialising in the natural resources sector, most recently serving as Head of Energy, Australasia, for UBS AG in Sydney and prior to that as an investment banker with Credit Suisse First Boston. During his career as an investment banker, Alex advised many of Australia’s and the world’s leading natural resources companies, working on over $100 billion in announced mergers and acquisitions and capital markets transactions for over 30 leading Australian and international natural resources companies including BHP, Woodside and Santos.

Before specialising in natural resources investment banking, Alex worked in the Japanese Government Bond derivatives markets in London, New York and Sydney. Alex has a Bachelor of Arts from Cornell University and a Masters of Business Administration from The Wharton School, University of Pennsylvania.

• Appointedasmanagingdirectoron20November2008.


• DuringthepastthreeyearshasnotactedasdirectorofanyotherAustralianlisted public company.


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NIRAV GAUTAM DESAI BA (UNIVERSITY OF MICHIGAN), MBA (WHARTON)Independent Director and Member of Investment Committee

Nirav is currently the Managing Director of Sparta Group LLC, an ultra high net worth private family investment office based outside of Boston, Massachusetts (USA). He is responsible for managing a global investment portfolio across asset classes including hedge funds, private equity, direct investments, real assets, and public securities. Prior to Sparta Group LLC, Nirav was a principal investor at a US-based private equity fund focused on middle market transactions and homeland security and clean technologies. In addition, he has experience as an investment banker and naval intelligence officer. Nirav has a BA from the University of Michigan, Ann Arbor and a Masters of Business Administration from The Wharton School, University of Pennsylvania.

• Appointedasindependentdirectoron4December2008.

• HoldsnosharesinthecapitaloftheCompany.


JEFFREY ROBERT WHALAN AO, BA (UNSW), FAICD, FAIMIndependent Director

Jeffrey is Managing Director of the Executive Intelligence Group Pty Ltd, a specialist human resources company.

Jeffrey has been the Chief Executive of Centrelink, the largest agency of the Australian Public Service, responsible for $70 billion of government outlays and 27,000 staff. Prior to this he was Chief Executive Officer of Medicare Australia.

Jeffrey has held Deputy Secretary positions in the Department of Prime Minister and Cabinet, the Department of Defence and the then Department of Family and Community Services. He has also held senior executive positions in the Department of Transport and the Department of Health. He has been a senior executive officer in the Australian Public Service since 1990.

Jeffrey was appointed an Officer in the Order of Australia in 2008 for his work as Chief Executive Officer of Centrelink. Among other things, the award recognised his achievements in “the development of corporate accountability processes”.

Jeffrey is a Fellow of the Australian Institute of Company Directors and a Fellow of the Australian Institute of Management.

• Appointedasindependentdirectoron20November2008.

• Beneficiallyholds60,000fullypaidordinarysharesinthecapitaloftheCompany


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INFORMATION ON COMPANY SECRETARY

GRAHAM CHEE BCOMM, FCPA, MBACOMPANY SECRETARY

Graham gained a Bachelor of Commerce degree in Accounting and Marketing from the University of Wollongong. He also received his MBA in International Business and Marketing from the University of New England. He is a Fellow and Financial Planning Specialist of CPA Australia, a CPA of the Hong Kong Institute of Certified Public Accountants, a registered Tax Agent in Australia and a member of the Australian Institute of Company Directors. Graham also acts as Company Secretary for Asian Masters Fund Limited.

• AppointedasCompanySecretaryon4December2008.

DIRECTORS’ MEETINGSAttendance of individual directors at board meetings held during the year ended 30 June 2009 was as follows:

DIRECTOR MEETINGS HELD MEETINGS ATTENDED

Maximilian Walsh 5 5

Daryl Dixon 5 5

Alan Dixon 5 5

Alexander MacLachlan 5 5

Nirav Desai 5 5

Jeffrey Whalan 5 5

In addition meetings of the investment committee were attended by directors as follows:

DIRECTOR MEETINGS HELD MEETINGS ATTENDED

Maximilian Walsh 6 6

Alexander MacLachlan 6 6

Nirav Desai 6 6

REMUNERATION REPORT

(a) Directors’ Remuneration

Under the Company’s constitution, each Director may be paid remuneration for ordinary services performed as a Director. Under ASX Listing Rules, the maximum fees payable to Directors may not be increased without the prior approval from the Company in general meeting. Directors will seek approval from time to time as deemed appropriate.


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The maximum total remuneration of the Directors has been set at $300,000 per annum, to be divided among them in such proportions as they agree.

Under the Company’s constitution, each Director may be paid remuneration for ordinary services performed as a Director. However, Maximilian Walsh, Daryl Dixon, Alan Dixon and Alexander MacLachlan have agreed not to be paid any remuneration for the services they perform as Director.

The two independent Directors, Nirav Desai and Jeffrey Whalan, will each receive $50,000 per annum.

These fees exclude any additional fee for any service based agreement which may be agreed upon from time to time, and also excludes statutory superannuation and the reimbursement of out of pocket expenses.

Details of remuneration payable at year end to directors and officers are set out in the table below.

DirectorSalary, fees and Commission $

Superannuation Contributions $

Cash bonus $

Non-cash benefits $

Other $ Total $

Maximilian Walsh - - - - - -

Daryl Dixon - - - - - -

Alan Dixon - - - - - -

Alexander MacLachlan - - - - - -

Nirav Desai 31,000 - - - - 31,000

Jeffrey Whalan 31,000 - - - - 31,000

Total 62,000 62,000

(b) Service Agreements

The Company does not presently have formal service agreements or employment contracts with any of the Directors.

(c) Directors Protection Deeds

The Company has agreed to provide access to board papers and minutes to current and former Directors of the Company while they are Directors and for a period of 7 years from when they cease to be Directors.

The Company has agreed to indemnify, to the extent permitted by the Corporations Act, each officer in respect of certain liabilities, which the Director may incur as a result of, or by reason of (whether solely or in part), being or acting as a Director of the Company. The Company has also agreed to maintain in favour of each Director a directors’ and officers’ policy of insurance for the period that he or she is a Director and for a period of 7 years after the officer ceases to be a Director.

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(d) Beneficial and Relevant Interest of Directors in Shares

As at the date of this report, details of Directors who hold shares for their own benefit or who have an interest in holdings through a third party and the total number of such shares held are listed as follows:

DIRECTOR NUMBER OF SHARES

Maximilian Walsh 210,001

Daryl Dixon 327,500

Alan Dixon 526,000

Alexander MacLachlan 93,500

Nirav Desai 0

Jeffrey Whalan 60,000

NON-AUDIT SERVICESDuring the year Moore Stephens Sydney, the Company’s auditor did not perform any other services in addition to their statutory duties for the Company. Moore Stephens Sydney Pty Ltd, a related party of the Company’s auditor, performed taxation review and compliance services for the Company. Details of the amounts paid to the auditors and their related parties are disclosed in Note 3 to the financial statements.

The Board of Directors are satisfied that the provision of non-audit services during the year is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the services disclosed in Note 3 did not compromise the external auditor’s independence for the following reasons:

• allnon-auditservicesarereviewedandapprovedbytheBoardofDirectorspriortocommencementtoensuretheydo not adversely affect the integrity and objectivity of the auditor; and

• thenatureoftheservicesprovideddonotcompromisethegeneralprinciplesrelatingtoauditorindependenceinaccordance with APES 110: Code of Ethics for Professional Accountants set by the Accounting Professional and Ethical Standards Board.

AUDITOR’S INDEPENDENCE DECLARATIONA copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 21.

Signed in accordance with a resolution of the Board of Directors:

Mr Maximilian Sean Walsh CHAIRMAN

Dated this 28th day of August 2009


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AUDITOR’S INDEPENDENCE DECLARATION

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NOTE 2009 $ 2008 $

Revenue 2 449,395 -

Auditor’s remuneration 3 (23,000) -

Directors' fees 18(b) (62,000) -

Management fee expense (176,632) -

Travelling and research expenses (59,449) -

Legal costs (5,447) -

Listing fees (1,849) -

Company secretarial fees (11,280) -

Other expenses (75,522) -

Profit before income tax 34,216 -

Income tax expense 4 (10,265) -

Profit attributable to members of the company 23,951 -

Basic earnings per share 12 0.001 cents -

Diluted earnings per share 12 0.001 cents -

The accompanying notes form part of these financial statements.

INCOME STATEMENTFOR THE YEAR ENDED 30 JUNE 2009

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BALANCE SHEET

NOTE 2009 $ 2008 $

ASSETS

Current Assets

Cash and cash equivalents 13(a) 14,692,747 -

Trade and other receivables 6 358,760 -

TOTAL CURRENT ASSETS 15,051,507 -

Non-Current Assets

Financial assets 7 33,401,576 -

Deferred tax asset 8 985,520 -

TOTAL NON-CURRENT ASSETS 34,387,096 -

TOTAL ASSETS 49,438,603 -

Current Liabilities

Trade and other payables 9 126,782 -

TOTAL CURRENT LIABILITIES 126,782 -

Non-Current Liabilities

Deferred tax liabilities 10 51,813 -

TOTAL NON-CURRENT LIABILITIES 51,813 -

TOTAL LIABILITIES 178,595 -

NET ASSETS 49,260,008 -

Equity

Issued capital 11 49,943,763 -

Reserves 16 (707,706) -

Retained profit 19 23,951 -

TOTAL EQUITY 49,260,008 -


AS AT 30 JUNE 2009

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STATEMENT OF CHANGES IN EQUITY

Issued Capital (Ordinary Shares)

Asset Revaluation

Reserve

Accumulated Profits

Total

$ $ $ $

At 1 July 2008 - - - -

Profit attributable to shareholders for the year

- - 23,951 23,951

Shares issued on 3 February 2009 44,620,368 - - 44,620,368

Shares issued on 11 June 2009 6,818,290 - - 6,818,290

Issue costs (1,494,895) - - (1,494,895)

Unrealised loss on available-for-sale investments

- (707,706) - (707,706)

Balance at 30 June 2009 49,943,763 (707,706) 23,951 49,260,008


FOR THE YEAR ENDED 30 JUNE 2009

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CASH FLOW STATEMENT

NOTE 2009 $ 2008 $

CASH FLOWS FROM OPERATING ACTIVITIES

Payments to suppliers (474,448) -

Finance Costs - -

Dividends received 1,714 -

Interest Received 274,972 -

Other Income - -

Net cash flows from operating activities 13(b) (197,762) -

CASH FLOWS FROM INVESTING ACTIVITIES

Payments for purchase of investments (34,412,585) -

Proceeds from sales of investments - -

Net cash flows from investing activities (34,412,585) -

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from unitholder applications 51,438,658 -

Redemptions by unitholders - -

Distribution paid - -

Payment of issue costs (2,135,564) -

Net cash flows from financing activities 49,303,094 -

Net increase/decrease in cash held 14,692,747 -

Cash at beginning of year - -

Cash at end of year 13(a) 14,692,747 -


FOR THE YEAR ENDED 30 JUNE 2009

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1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIESThe financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards, including Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001.

The financial report covers Global Resource Masters Fund Limited as an individual entity. Global Resource Masters Fund Limited is a company limited by shares, incorporated and domiciled in Australia.

The financial report has been approved for release by the Board of Directors on 28th August 2009.

The following is a summary of the material accounting policies adopted by the Company in the preparation of the financial report.

BASIS OF PREPARATION

REPORTING BASIS AND CONVENTIONS

The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been applied.

The accounting policies set out below have been consistently applied to all years presented, unless otherwise stated.

INCOME TAXThe charge for current income tax expense is based on the profit for the year adjusted for any non-assessable or disallowed items. It is calculated using the tax rates that have been enacted or are substantially enacted by the balance date.

Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.

Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or liability is settled. Deferred tax is credited in the income statement except where it relates to items that may be credited directly to equity, in which case the deferred tax is adjusted directly against equity.

Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be available against which deductible temporary differences can be utilised.

The amount of benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that the economic entity will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law.

NOTES TO THE FINANCIAL STATEMENTS

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FINANCIAL INSTRUMENTS

RECOGNITION AND INITIAL MEASUREMENT

Financial instruments, incorporating financial assets and liabilities, are recognised when the entity becomes a party to the contractual provisions of the instrument. Trade date accounting is adopted for financial assets that are delivered within timeframes established by market place convention.

Financial instruments are initially measured at fair value plus transaction costs where the instrument is not classified as at fair value through profit or loss. Transaction costs related to instruments classified as at fair value through profit or loss are expensed to profit or loss immediately. Financial instruments are classified and measured as set out below.

DERECOGNITION

Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is transferred to another party whereby the entity no longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised where the related obligations are either discharged, cancelled or expire. The difference between the carrying value of the financial liability extinguished or transferred to another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss.

FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT AND LOSS

Financial assets are classified at fair value through profit or loss when they are held for trading for the purpose of short term profit taking, where they are derivatives not held for hedging purposes, or designated as such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented risk management or investment strategy. Realised and unrealised gains and losses arising from changes in fair value are included in profit or loss in the period in which they arise.

LOANS AND RECEIVABLES

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost using the effective interest rate method.

HELD-TO-MATURITY INVESTMENTS

Held-to-maturity investments are non-derivative financial assets that have fixed maturities, and fixed or determinable payments, and it is the entity’s intention to hold these investments to maturity. They are subsequently measured at amortised cost using the effective interest rate method.

AVAILABLE-FOR-SALE FINANCIAL ASSETS

Available-for-sale financial assets are non-derivative financial assets that are either designated as such or that are not classified in any of the other categories. They comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed determinable payments. Available-for-sale financial assets are valued at fair value. Unrealised gains and losses arising from changes in fair value are taken directly to equity.

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FINANCIAL LIABILITIES

Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost using the effective interest rate method.

DERIVATIVE INSTRUMENTS

Derivative instruments are measured at fair value. Gains and losses arising from changes in fair value are taken to the income statement unless they are designated as hedges.

FAIR VALUE

Fair value is determined based on market value for all quoted investments. Valuation techniques are applied to determine the fair value for all unlisted securities. The Company uses net asset value of funds to determine the valuation of all unlisted securities.

IMPAIRMENT

The Company assesses at each balance date whether there is objective evidence that a financial asset or group of financial assets is impaired. In the case of equity securities classified as available-for-sale, a significant or prolonged decline in the fair value of a security below its cost is considered in determining whether the security is impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit and loss – is removed from equity and recognised in the income statement. Impairment losses recognised in the income statement on equity instruments are not reversed through the income statement.

FOREIGN CURRENCY TRANSACTIONS AND BALANCES

FUNCTIONAL AND PRESENTATION CURRENCY

The functional currency of the entity is measured using the currency of the primary economic environment in which that entity operates. The financial statements are presented in Australian dollars which is the Company’s functional and presentation currency.

TRANSACTION AND BALANCES

Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.

Transaction differences arising on non-monetary financial assets such as equities classified as “available-for-sale” are included in the available-for-sale investments revaluation reserve.

Exchange differences arising on the translation of monetary items are recognised in the income statement, except where deferred in equity as a qualifying cash flow or net investment hedge.

Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in the income statement.

NOTES TO THE FINANCIAL STATEMENTS CONT

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CASH AND CASH EQUIVALENTSCash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities on the balance sheet.

REVENUEInterest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

Dividend revenue is recognised when the right to receive a dividend has been established.

All revenue is stated net of the amount of goods and services tax (GST).

GOODS AND SERVICES TAX (GST)Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the balance sheet are shown inclusive of GST.

The Company qualifies for Reduced Input Tax Credits (RITC’s) at a rate of 75% hence listing fees, registry fees and other expenses have been recognised in the income statement net of the amount of GST recoverable from the Australian Taxation Office.

The net amount of GST recoverable from the Australian Taxation Office is included in receivables in the balance sheet.

Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

ACCOUNTS PAYABLETrade payables and other accounts payable are recognised when the Company becomes obliged to make future payments resulting from the purchase of goods and services.

RECEIVABLESTrade receivables and other receivables are recorded at amounts due less any allowance for impairment.

EARNINGS PER SHAREBasic earnings per share is determined by dividing the operating profit/(loss) after income tax excluding any cost of servicing equity other than ordinary shares by the weighted average number of ordinary shares outstanding during the financial year. Diluted earnings per share is the same because there are no dilutive potential ordinary shares.


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CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTSThe directors evaluate estimates and judgments incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data obtained both externally and within the Company.

KEY ESTIMATES – IMPAIRMENT

The Investment Committee regularly reviews the investments held in the company’s portfolio and where it believes that impairment has occurred or is likely to occur, will normally seek to exit the position.

The Company follows the guidance of AASB 139 Financial Instruments: Recognition and Measurement on determining when an available-for-sale financial asset is impaired. This determination requires significant judgment. In making this judgment, the Company evaluates, among other factors, the duration and extent to which the fair value of an investment is less than its cost and the financial health of and near term business outlook for the investee including factors such as industry and sector performance, and operational and financing cash flows.

The Company is a long-term investor and does not regard short-term or cyclical movements in the share price of its investments as evidence of impairment.

No impairment has been recognised in respect of financial assets.

KEY JUDGMENTS - PROVISION FOR IMPAIRMENT OF RECEIVABLES

No provision for impairment of receivables has been recognised in the accounts.

COMPARATIVE FIGURESThere are no comparatives as the Company was incorporated on 20 November 2008.

The company listed on the Australian Securities Exchange under the code GRF (ordinary shares) on 3 February 2009.

NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTEDNo new accounting standards and interpretations, that are available for early adoption at 30 June 2009, will result in any material change in relation to the financial statements. Changes to the accounting standard, AASB 101 Presentation of Financial Statements (issued September 2007) will apply for annual reporting periods beginning on or after 1 January 2009, but the changes are to presentation and will not affect any of the amounts recognised in the financial statements.


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2. REVENUE

2009 $ 2008 $

Operating Activities

Dividends Received 1,714 -

Interest Received 447,681 -

Total Revenue 449,395 -

Dividend revenue from:

Rebateable dividends

- other corporations 1,714 -

Total Dividend Revenue 1,714 -

Interest revenue from:

Interest Received

- investment account deposits 4,847 -

- bank deposits 442,834 -

Total Interest Received 447,681 -

3. AUDITOR’S REMUNERATION

Auditor’s remuneration

Audit and review of financial report 23,000 -

Tax compliance services fee 12,500 -

Tax and other advice 8,345 -

43,845 -


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4. INCOME TAX EXPENSE

2009 $ 2008 $

(a) The components of tax expense comprise:

Current Tax - -

Deferred Tax 10,265 -

10,265 -

(b) Prima facie tax/(tax benefit) on profit/(loss) from ordinary activities before income tax at 30%

10,265 -

The applicable weighted average effective tax rates are as follows: 30% -

5. CASH AND CASH EQUIVALENTS

Current

Cash at Bank 14,692,747 -

6. TRADE AND OTHER RECEIVABLES

Current

GST Refundable 186,051 -

Interest Receivable 172,709 -

358,760

There are no balances above that contain assets that are impaired and past due. All receivables are non-interest bearing.


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7. FINANCIAL ASSETS

2009 $ 2008 $

Non-Current Assets

(a) Available-for-sale Financial Assets

- at fair value 33,401,576 -

(i) Available-for-sale Financial Assets comprise:

Available-for-sale financial assets comprise investments in global fund products specialising in the natural resources sector. There are no fixed returns or fixed maturity dates attached to these investments.

Reconciliation of Financial Assets

Carrying amount at the beginning of the year - -

Additions

(i) Unlisted investments 34,412,585 -

Revaluation to fair value

(i) Unlisted investments (1,011,009) -

33,401,576 -

8. DEFERRED TAX ASSET

Non-Current

Deferred tax asset comprises:

Provisions 15,090 -

Transaction costs on equity issue 512,535 -

Losses on revenue account 34,560 -

Fair value adjustments 423,335 -

985,520 -


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9. TRADE AND OTHER PAYABLES

2009 $ 2008 $

Current

Trade Creditors 126,782 -

Trade Creditors are unsecured and non-interest-bearing.

10. DEFERRED TAX LIABILITIES

Non-Current

Deferred Tax Liabilities 51,813 -

11. ISSUED CAPITAL

(a) Issued Shares

27,887,731 Fully Paid Ordinary Shares of $1.60 44,620,368

4,183,000 Fully Paid Ordinary Shares of $1.63 6,818,290 -

Issue Costs (net of tax) (1,494,895) -

49,943,763 -

Holders of ordinary shares participate in dividends and the proceeds on a winding up of the Company in proportion to the number of shares held.

At shareholders meetings, each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands.

The Company has authorised share capital amounting to 32,070,731 ordinary shares of no par value.

(b) Movement in Ordinary Shares

Balance at beginning of year - -

Issuance of shares 32,070,731 -

Balance at reporting date 32,070,731 -


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(c) Capital Management

The Company will focus on active capital management.

The Company may consider capital management alternatives such as the issue of other securities through bonus issues, rights issues and option issues with a view to enhancing the value of securities held by investors.

The Company’s capital consists of shareholders’ equity plus net debt. The movement in equity is shown in the Statement of Changes in Equity. At 30 June 2009, net debt was $nil.

12. EARNINGS PER SHAREThe following reflects the income and share data used in the calculations of basic and diluted earnings per share.

2009 $ 2008 $

Basic earnings per share 0.001 cents -

Diluted earnings per share 0.001 cents -

Weighted average number of ordinary shares outstanding during the year used to calculate basic earnings per share

28,453,001 -

Profit from continuing operations used to calculate basic earnings per share

23,951 -

13. CASH FLOW INFORMATION(a) Reconciliation of Cash

For the purpose of the statement of cash flows, cash includes:

(i) cash on hand and at bank, cash on deposit, net of outstanding bank overdrafts; and

(ii) cash held in investment trading accounts.

Cash at the end of the financial year as shown in the cash flow statement is reconciled to the related items in the balance sheet as follows:

Cash at 30 June 2009 is shown in the balance sheet as:

Cash at bank 14,692,747 -

14,692,747 -


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(b) Reconciliation Statement

A reconciliation of ‘net cash provided by operating activities’ to ‘profit after income tax’ is as follows:

2009 $ 2008 $

Profit after income tax 23,951 -

Add/(less)

Unrealised loss on foreign currency transactions 1 -

Changes in assets and liabilities

Increase in receivables (358,760) -

Increase in tax assets (41,549) -

Increase in trade creditors and accruals 126,782 -

Increase in tax liabilities 51,813 -

Increase in income tax payable - -

Net cash provided by operating activities (197,762) -

The Company does not have any formal loan facilities in place at the date of these financial statements.

14. SEGMENT REPORTINGPRIMARY REPORTING – BUSINESS OPERATIONS

The Company operates in Australia and in one business operation being investing in global fund products specialising in the natural resources sector.

SECONDARY REPORTING – GEOGRAPHICAL SEGMENTS

In presenting information on the basis of geographical segments, segment revenue is based on the geographical location of the investment. Segment assets are based on the geographical location of the assets. Liabilities are allocated to segments based on the underlying geographical location of the investment asset that gives rise to a segment. Segment revenues, assets and liabilities are those directly attributable to a segment. Results have not been allocated on the basis that expenses cannot be attributable to individual segments on a reasonable basis.


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2009 Revenue $ Assets $ Liabilities $

Geographical Location

USA & Canada - 23,481,308

Europe - 4,676,221

Asia - 1,068,850

Australia 449,395 17,673,704 178,595

Other - 2,538,520

Total 449,395 49,438,603 178,595

15. EVENTS AFTER THE BALANCE SHEET DATECAPITAL RAISING

The Company has completed a placement of 15,189,890 ordinary shares at an issue price of $1.63 raising $24,759,520. This capital raising was to sophisticated and professional investors and did not require a disclosure document under the Corporations Act 2001 (s708(8) and s708(11)).

In accordance with ASX Listing Rule 7.1, a total of 4,183,000 ordinary shares have been issued without the need for shareholder approval (representing 15% of the issued capital of the Company). This represents approximately $6.8million. The Company had an extraordinary general meeting of shareholders and approval was obtained for the issue of the additional 11,006,890 ordinary shares on 29 July 2009.

The funds raised will be used to opportunistically secure additional fund investments at fundamentally cheap valuation levels. The capital raising will allow the Company to further diversify the portfolio in addition to acquiring further units in existing funds that are presently held.

16. RESERVES

2009 $ 2008 $

Available-for-Sale Investments Revaluation Reserve

Balance at the beginning of the financial year - -

Unrealised loss on investments (707,706) -

Balance at the end of the financial year (707,706) -

Changes in the fair value of investments classified as available-for-sale financial assets are taken to the available-for-sale investments revaluation reserve. Amounts are transferred and recognised in profit and loss when the associated assets are sold or impaired.


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17. KEY MANAGEMENT(a) Names and positions held by key management personnel in office at any time during the financial year are:

KEY MANAGEMENT PERSON POSITION

Maximilian Walsh Non-executive chairman

Daryl Dixon Non-executive director

Alan Dixon Non-executive director

Alexander MacLachlan Managing director

Nirav Desai Independent director

Jeffrey Whalan Independent director

(b) Key management personnel remuneration

DirectorSalary, fees and Commission $

Superannuation Contributions $

Cash bonus $

Non-cash benefits $

Other $ Total $

Maximilian Walsh - - - - - -

Daryl Dixon - - - - - -

Alan Dixon - - - - - -

Alexander MacLachlan - - - - - -

Nirav Desai 31,000 - - - - 31,000

Jeffrey Whalan 31,000 - - - - 31,000

Total 62,000 - - - - 62,000


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(c) Shareholdings

Number of shares held by key management personnel

DirectorBalance at 01/07/08

Received as remuneration

Options exercised

Net change other

Balance at 30/06/09

Maximilian Walsh (directly/indirectly) - - - 125,001 125,001

Daryl Dixon (indirectly) - - - 312,500 312,500

Alan Dixon (indirectly) - - - 511,000 511,000

Alexander MacLachlan (indirectly) - - - 62,500 62,500

Nirav Desai - - - - -

Jeffrey Whalan (indirectly) - - - 50,000 50,000

- - - 1,061,001 1,061,001

18. RELATED PARTY TRANSACTIONS The names of persons who were directors of the Company at any time during the year and to the date of these financial statements are:

Maximilian Walsh

Daryl Dixon

Alan Dixon

Alexander MacLachlan

Nirav Desai

Jeffrey Whalan

Transactions between related parties are on normal commercial terms and conditions unless otherwise stated and are as follows:-

DIXON ADVISORY AND SUPERANNUATION SERVICES PTY LTD

Mr Maximilian Walsh, Mr Daryl Dixon, Mr Alan Dixon and Mr Alexander MacLachlan are Directors of the Company and Directors of the Issue Manager, Dixon Advisory and Superannuation Services Pty Ltd. In connection with the provision of services as Issue Manager, the Issue Manager is entitled to receive commission and handling fees of 4.4% of the total funds raised in the prospectus. The handling fee and commission on $51,438,658 in funds raised for the year ending 30 June 2009 was $2,263,301 including GST.

Management fees paid or payable for the year ending 30 June 2009 were $194,295 including GST.


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(a) Key Management Personnel Related Entity Transactions

Key management personnel and their related entities hold directly, indirectly or beneficially as at the reporting date the following interests in the Company:

Directors Ordinary shares

Direct Indirect

Maximilian Walsh 1 125,000

Daryl Dixon - 312,500

Alan Dixon - 511,000

Alexander MacLachlan - 62,500

Nirav Desai - -

Jeffrey Whalan - 50,000

Movements in these holdings during the year were as follows:

(i) Acquisitions

Directors Ordinary shares

Direct Indirect

Maximilian Walsh 1 125,000

Daryl Dixon - 312,500

Alan Dixon - 511,000

Alexander MacLachlan - 62,500

Nirav Desai - -

Jeffrey Whalan - 50,000

(b) Key management personnel remuneration has been included in the Remuneration Report section of the Directors’ Report.


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19. RETAINED PROFIT

2009 $ 2008 $

Retained profit at the beginning of the year - -

Net profit attributable to members of the Company 23,951 -

Retained profit at the end of the financial year 23,951 -

20. CONTINGENT LIABILITIES The directors are not aware of any potential liabilities or claims against the Company as at the date to which these financial statements are made up.

21. FINANCIAL INSTRUMENTS FINANCIAL RISK MANAGEMENT

The Company’s financial instruments consist primarily of deposits with banks, long-term investments, accounts receivable and payable and bills.

(a) Interest rate risk exposure

The Company is exposed to interest rate risk through primary financial assets and financial liabilities. Any variation in short and long term interest rates, particularly in Australia could materially affect the operating results of the Company.

The following table summarises the interest rate risk for the Company, together with the effective weighted average interest rate for each class of financial assets and liabilities.


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2009 NoteFloating

interest rate $

1 year or less

$

Over 1-5 years

$

Non interest bearing

$Total

Financial Assets

Cash 13 14,692,747 - - - 14,692,747

Receivables 6 - - - 358,760 358,760

Investment – Unlisted Securities

7(a) - - - 33,401,576 33,401,576

Deferred tax asset 8 - - - 985,520 985,520

Total Financial Assets 14,692,747 - - 34,745,856 49,438,603

Weighted average interest rate

3% - - - -

Financial Liabilities

Trade and sundry creditors 9 - - - 126,782 126,782

Deferred tax liabilities 10 - - - 51,813 51,813

Total Financial Liabilities - - - 178,595 178,595

Net Financial Assets 14,692,747 - - 34,567,261 49,260,008

2009 $ 2008 $

Reconciliation of Net Financial Assets to Net Assets

Net financial assets detailed above 49,260,008 -

Net assets per balance sheet 49,260,008 -


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(b) Net fair values

The net fair values of:

• Unlistedinvestmentshavebeenvaluedattherealisablemarketpriceatbalancedate,adjustedfortransactioncostsexpected to be incurred. For unlisted investments where there is no organised financial market, the net fair value has been based on a reasonable estimation of the underlying net assets or discounted cash flows of the investment.

• Otherloansandamountsduearedeterminedbydiscountingthecashflows,atmarketinterestratesofsimilarborrowings, to their present value.

(c) Foreign exchange risk exposure

The Company invests internationally and is exposed to foreign exchange risk arising from various currency exposures. Foreign exchange risk arises from recognised assets and liabilities denominated in a currency that is not the entity’s functional currency. The risk is measured using cash flow forecasting.

Management has set up a policy to manage their foreign exchange risk against their functional currency. The Company does not undertake hedging of their foreign currency exchange risk exposure arising from commercial transactions.

If the currency in which the Company’s investments are denominated changes in value relative to the Australian dollar, the Australian dollar value of the investment will change. For example, a rise in the Australian dollar relative to other currencies may negatively impact investment value or returns. Conversely, a decline in the Australian dollar relative to other currencies may positively impact investment value or returns.

The Company’s exposure to foreign currency risk at the reporting date was as follows:

USD 20,523,760

The following sensitivity is based on the foreign currency risk exposures in existence at the balance sheet date. At 30 June 2009, had the Australian dollar moved, as illustrated in the table below, with all other variables held constant, equity would have been affected as follows:

2009 $ 2008 $

Appreciation of AUD to USD by 10% (2,283,336) -

Decline of AUD to USD by 5% 1,374,294 -

(d) Credit risk exposure

The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial assets is the carrying amount, net of any provision for doubtful debts, as disclosed in the balance sheet and notes to the financial statements.

The Company does not have any material credit risk exposure to any single debtor or group of debtors under financial instruments entered into by the Company.


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(e) Liquidity risk exposure

Liquidity risk refers to the risk that the Company’s investments or the underlying funds’ investments cannot at short notice be easily converted into cash to realise underlying investment positions.

The Company will not invest more than 20% of the gross value of the portfolio in underlying funds where the notice period for withdrawal of invested capital is greater than 30 days notice period. However, to the extent that the underlying funds are invested in illiquid securities that may be difficult to sell at short notice or at desired prices, this can result in diminished redemption prices for the Company, or in declining markets, loss of capital through a decline in the value of the investment in the underlying fund.

(f) Market price risk exposure

Market risk is the risk that changes in market prices will affect the fair value of the financial instrument.

The Company is exposed to market risk through the movement of unit prices of the commodities in which it invested.

The market value of individual investments fluctuates and the fair value of the portfolio changes continuously, with this change in the fair value recognised through the asset revaluation reserve.

Investments represent 68% of total assets. A 5% movement in the market value of each of the securities within the portfolio would result in a 3.46% movement in the net assets before provision for tax on unrealised capital gains at 30 June 2009. The net asset backing before provision for tax on unrealised capital gains would move by 5.21 cents per share at 30 June 2009.

The Company regularly monitors the performance of the holdings within its portfolio and make portfolio recommendations which are considered by the Investment Committee. The Board reviews the portfolio on a regular basis.

The fair value of other financial instruments is unlikely to be materially affected by a movement in interest rates as they generally have short dated maturities and variable interest rates.

22. COMPANY DETAILS The registered office of the Company is:

Global Resource Masters Fund Limited Level 15, 100 Pacific Highway North Sydney NSW 2060

The principal place of business is:

Global Resource Masters Fund Limited Level 15, 100 Pacific Highway North Sydney NSW 2060


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1. In the opinion of the directors of Global Resource Masters Fund Limited (“the Company”):

a) the financial statements and notes, and the Remuneration report in the Directors’ report, set out on pages 22 to 44, are in accordance with the Corporations Act 2001, including;

i) giving a true and fair view of the Company’s financial position as at 30 June 2009 and of its performance, for the financial year ended on that date; and

ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001; and

b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

2. The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the managing director for the financial year ended 30 June 2009.

Mr Maximilian Sean Walsh CHAIRMAN28 August 2009

Mr Graham Chee COMPANY SECRETARY 28 August 2009

NOTES TO THE FINANCIAL STATEMENTS CONT DIRECTORS’ DECLARATION

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INDEPENDENT AUDITOR’S REPORT

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INDEPENDENT AUDITOR’S REPORT

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Unless disclosed below, all the best practice recommendations of the ASX Corporate Governance Council have been applied for the entire financial year ended 30 June 2009.

BOARD COMPOSITIONThe skills, experience and expertise relevant to the position of each director who is in office at the date of the annual report and their term of office are detailed in the director’s report.

The Company has two independent Directors, Nirav Desai and Jeffrey Whalan. The remaining four Directors, Maximilian Walsh, Daryl Dixon, Alan Dixon and Alexander MacLachlan, are associated with the Manager and are involved in the management of the business of the Manager. The Board is of the view that the board is structured in such a way that the number of independent directors is appropriate for the size, nature and complexity of the business of the Company.

Maximilian Walsh is the non-executive Chairman and is associated with the Manager. The Board has determined that Maximilian Walsh’s experience as a director and chair is of benefit to the Company and given the Company’s size there are no immediate plans to appoint an independent non-executive Chairperson.

The Board will have direct involvement with the management of the Portfolio.

When determining whether a non-executive director is independent the director must not fail any of the following materiality thresholds:

• Lessthan10%ofcompanysharesareheldbythedirectorandanyentityorindividualdirectlyorindirectlyassociated with the director;

• Nosalesaremadetoorpurchasesmadefromanyentityorindividualdirectlyorindirectlyassociatedwiththedirector; and

• Noneofthedirectors’incomeortheincomeofanindividualorentitydirectlyorindirectlyassociatedwiththe director is derived from a contract with any member of the economic entity other than income derived as a director of the entity.

Because of the relatively small size of the Company and its operations, the board does not consider it appropriate, at this time, to form a separate committee to deal with the nomination of directors.

It is the Board’s policy to determine the terms and conditions relating to the appointment and retirement of non-executive Directors on a case-by-case basis and in conformity with the requirements of the Listing Rules and the Corporations Act.

Independent directors have the right to seek independent professional advice in the furtherance of their duties as directors at the company’s expense. Written approval must be obtained from the Chair prior to incurring any expense on behalf of the Company.

It is the Board’s policy that any committees established by the Board should:

• BeentitledtoobtainindependentprofessionalorotheradviceatthecostoftheCompany,unlesstheBoarddetermines otherwise.

• BeentitledtoobtainsuchresourcesandinformationfromtheCompanyincludingdirectaccesstoemployeesofandthe advisers to the Company as they might require.

• OperateinaccordancewithtermsofreferenceestablishedbytheBoard.

CORPORATE GOVERNANCE STATEMENT

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CODE OF CONDUCTBoard members and company officers are made aware of the requirements to follow corporate policies and procedures, to obey the law and to maintain appropriate standards of honesty and integrity at all times. In this regard the directors have adopted a code of conduct for directors and employees. The code of conduct covers ethical operations, compliance with laws, dealings with customers and public officials, conflicts of interest, confidential and proprietary information and insider trading. A copy of the code is available on the Company web site under Corporate Governance section.

SHARE TRADING POLICYThe Company’s code of conduct provides that no director or employee shall purchase or sell Company securities while in possession of material information concerning the Company or such a company that has not previously been generally disclosed to the investing public for at least two business days. Nor shall an employee inform any individual or entity of any such material information, except in the necessary course of business.

Directors are required to give prior notice to the Chairman of any dealings in Company securities by themselves or their associates and to provide particulars of any transactions immediately following execution. The Secretary is to make the requisite notifications to ASX within 2 days of each such transaction.

INVESTMENT COMMITTEEThe Investment Committee of the Company will comprise Maximilian Walsh, Alexander MacLachlan and Nirav Desai. Daryl Dixon, Alan Dixon and Jeffrey Whalan may also attend all meetings of the Investment Committee. Maximilian Walsh, in his capacity as Chairman of the Investment Committee, will have a casting vote.

The primary role of the Investment Committee is to:

• Reviewinformation,researchandanalysiscompiledbytheManagerwithrespectstotheglobalnatural resources sector.

• DeterminetheallocationoftheCompany’scapitalintermsoftheinvestmentinvariousfunds.

Particulars of committee meetings held during the year ended 30 June 2009 and the attendance of each committee member is set out in the accompanying directors’ report.

CONTINUOUS DISCLOSUREAll directors have been made aware of the continuous disclosure requirements of the ASX Listing Rules and have been provided with a copy of the relevant rules and guidance notes.

The directors have allocated responsibility to the Company Secretary to alert the Board to any operational or regulatory matters respectively which they consider may require disclosure to the market under the continuous disclosure requirements of the ASX Listing Rules. The directors then consider and approve the form of any such announcement.

All Company announcements require the approval of the Board with provision for available directors, including the Chairman, to approve urgent announcements. The Company Secretary is responsible for communication with ASX. The Chairman is responsible for all media contact and comment.

The annual report contains a review of operations.

CORPORATE GOVERNANCE STATEMENT

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SHAREHOLDER COMMUNICATIONThe Company communicates with its shareholders through ASX announcements, the half-year report, the annual report and the annual general meeting. Copies of all such ASX announcements are linked to the Company’s website.

The independent auditor attends the annual general meeting to respond to questions from shareholders on the conduct of the audit and the preparation and content of the audit report.

RISK MANAGEMENTThe board has accepted the role of identification, assessment, monitoring and managing the significant areas of risk applicable to the Company and its operations. It has not established a separate committee to deal with th

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