Announcement PDF Fulcrum Lithium Ltd and its controlled entities ABN: 23 665 528 307 Financial Statements For the Financial Year Ended 30 June 2024 Fulcrum Lithium Ltd and its controlled entities ABN: 23 665 528 307 Contents For the Financial Year Ended 30 June 2024 Page Directors' Report 1 Auditor's Independence Declaration under Section 307C of the Corporations Act 2001 5 Consolidated Statement of Profit or Loss and Other Comprehensive Income 6 Consolidated Statement of Financial Position 7 Consolidated Statement of Changes in Equity 8 Consolidated Statement of Cash Flows 9 Notes to the Consolidated Financial Statements 10 Consolidated Entity Disclosure Statement 24 Directors' Declaration 25 Independent Auditor’s Report 26 FULCRUM LITHIUM LTD and its controlled entities Directors' Report The Directors present their report together with the consolidated financial statements of the Group, comprising Fulcrum Lithium Ltd (‘Fulcrum’ or ‘the Company’) and its controlled entities, for the year ended 30 June 2024. Directors The names and details of the Directors in office during or since the end of the previous financial year are as follows. Directors were in office for the entire year unless otherwise stated.     Norman Alfred Seckold Peter James Nightingale Anthony Sgro Foster Vance Wilson Since 6 February 2023 Since 6 February 2023 Since 6 February 2023 Since 6 February 2023 Principal activities The principal activities of Fulcrum since its incorporation have been the acquisition of a number of lode claims focused on exploration for lithium in the state of Nevada, USA. Operating results The consolidated loss after income tax attributable to members of the Company for the year was $1,025,351 (for the period 6 February 2023 to 30 June 2023 - $17,309 loss). Review of operations During the financial year ended 30 June 2024, the Company identified and acquired additional lithium exploration claims in Nevada, USA, in the heart of Nevada’s “lithium belt” which hosts Albemarle Corporation’s (NYSE: ALB) Silver Peak lithium mine, the only lithium producing mine in the USA. In July 2023, the Company incorporated a wholly owned subsidiary, Flasher LLC (‘Flasher’), and on 31 July 2023 Flasher entered into a Novation Agreement with Foster Wilson (Director and related party) in relation to the Fairway lithium exploration project for consideration totalling US$75,000 and, upon evidence that the Fairway project lode claims are registered under the name of Flasher, the issue of 7,100,000 ordinary Fulcrum shares. In accordance with the agreement, on 31 July 2023, the Company paid $112,629 (US$75,000) in cash and on 6 November 2023 issued 7,100,000 ordinary shares at an issue price of $0.10 per share for $710,000. The total consideration in cash and shares was $822,629. In August 2023, the Company’s wholly owned subsidiary, Last Basin LLC (‘Last basin’) claim staked 160 lode claims, the Summit project. The Company now holds the following lithium projects in Nevada, USA:    the Alkali Flats lithium project comprising 2,276 lode claims (approximately 190 km2); the Fairway lithium project comprising 327 lode claims (approximately 27 km2); and the Summit lithium project comprising 160 lode claims (approximately 13 km2). The Company’s Projects represent the largest known portfolio of lode claims in Nevada focused on the exploration for claystone hosted lithium deposits. Exploration results to date, particularly at the Company’s flagship project, Alkali Flats, have shown that claystone hosted lithium is present on the Company’s claims. The claystone present on the Company’s claims exhibits geologic and topographic characteristics considered to be instrumental in the significant accumulations of lithium in claystone reported at several nearby projects. The Company plans to systematically explore all three Projects through geophysical tests, drilling and metallurgical test work with the aim of defining an economic mineral resource. On 12 December 2023, the Company issued 1,500,000 ordinary shares at an issue price of $0.10 to raise $150,000 before costs. The Company is in the process of undertaking an Initial Public Offer (‘IPO’) and ASX Listing of 40,000,000 shares at an issue price of $0.25 per share to raise $10.0 million (before costs) to facilitate the exploration of its Projects with the objective of defining, developing and exploiting lithium opportunities that are critical to the transition to clean energy. A prospectus was lodged with ASIC on 21 August 2024 and the IPO ‘went live’ on 28 August 2024. 1 FULCRUM LITHIUM LTD and its controlled entities Directors' Report Alkali Flats Project The USA Bureau of Land Management (‘BLM’) has permitted the Company’s proposed 14 hole, Phase 1 drilling program, at the Alkali Flats lithium exploration project. The Company collected 52 rock chips samples from the Alkali Flats project:  Assays averaged 307 ppm lithium (‘Li’)  23 samples returned assays greater than 300 ppm Li  Sample 26520 - 797 ppm Li  Sample 26521 - 721 ppm Li Summit Project The Company undertook rock chip sampling at its Summit lithium exploration project returning anomalous LI up to 175 ppm Li. Fairway Project Historical results reported by American Lithium Corp. are:     RECON -312 - 500 ppm Li RECON -313 - 930 ppm Li RECON -314 - 580 ppm Li RECON -315 - 304 ppm Li These results are historical estimates and not reported in accordance with the JORC Code. Material changes in state of affairs Other than as described in the Review of operations above, there have been no material changes in the state of affairs of the Group during the period. Dividends paid or recommended No dividends were paid or declared during the period. Future developments and results Likely developments in the operations of the Group 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 Group. Environmental issues The operations and proposed activities of the Group are subject to State and Federal laws and regulations in the USA concerning the environment. As with most exploration projects and mining operations, the Group's activities are expected to have an impact on the environment, particularly if advanced exploration or field development proceeds. It is the Group's intention to conduct its activities to the highest standard of environmental obligation, including compliance with all applicable environmental laws. Subsequent events after the reporting date As noted above, a prospectus for the IPO of 40,000,000 shares to raise $10.0 million (before costs) was lodged with ASIC on 21 August 2024 and the IPO ‘went live’ on 28 August 2024. The Company has entered into a loan facility agreement with Norman A. Seckold (Company Director) whereby Norman A. Seckold (or his nominee) has agreed to make a loan facility in the amount of $1.0 million available to the Company. On 23 August 2024, the Company has fully drawn down the amount of $1.0 million. Funds drawn from the Loan Facility are interest free and unsecured and shall be repaid within 5 days of the issue of Shares pursuant to the IPO. If the IPO is not completed by 30 June 2025, the Company will repay outstanding monies owed under the Loan Facility by the issue of Shares in the Company at a deemed issue price of $0.10 per Share within 5 days of the lender providing a written notice of demand of repayment. No other matters or circumstances have arisen since the end of the reporting period which materially affected or may materially affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial years. 2 FULCRUM LITHIUM LTD and its controlled entities Directors' Report Directors Norman A. Seckold (Executive Chairman) Norman Seckold graduated with a Bachelor of Economics degree from the University of Sydney and has spent more than 30 years in the full time management of natural resource companies, both in Australia and overseas. Mr. Seckold has been the Chairman of a number of publicly listed companies including Moruya Gold Mines (1983) N.L., which acquired the Golden Reward heap leach gold deposit in South Dakota, USA, Pangea Resources Limited, which acquired and developed the Pauper's Dream gold mine in Montana, USA, Timberline Minerals, Inc. which acquired and completed a feasibility study for the development of the MacArthur copper deposit in Nevada, USA, Perseverance Corporation Limited, which discovered and developed the Nagambie gold mine in Victoria, Valdora Minerals N.L., which developed the Rustler's Roost gold mine in the Northern Territory and the Ballarat East Gold Mine in Victoria, Viking Gold Corporation, which discovered a high grade gold deposit in northern Sweden, Mogul Mining N.L., which drilled out the Magistral and Ocampo gold deposits in Mexico and Bolnisi Gold N.L, which discovered and developed the Palmarejo and Guadalupe gold and silver mines in Mexico. Mr. Seckold is currently Chairman of ASX-listed companies Alpha HPA Limited, Nickel Industries Limited, and Sky Metals Limited. Interest in Shares 29,828,005 ordinary fully paid shares. Peter J. Nightingale (Executive Director, CFO and Company Secretary) Peter Nightingale graduated with a Bachelor of Economics degree from the University of Sydney and is a member of Chartered Accountants Australia & New Zealand. He has worked as a chartered accountant in both Australia and the USA. As a director or company secretary Mr. Nightingale has, for more than 35 years, been responsible for the financial control, administration, secretarial and in-house legal functions of a number of private and public listed companies in Australia and the including Bolnisi Gold N.L. and Nickel Industries Limited. Mr. Nightingale is currently a director of ASX listed Alpha HPA Limited and Prospech Limited. Interest in Shares 3,000,000 ordinary fully paid shares. Anthony Sgro (Independent, Non-Executive Director) Mr. Sgro is a Chemical Engineer, graduating from the University of Sydney. His studies included a thesis on Minerals Chlorination, which focused on the application of chlorination techniques to the extractive metallurgy of various minerals including titanium, nickel, chromium and tungsten ores. He also completed a Graduate Diploma in Marketing from Macquarie University School of Business. In a career spanning 45 years, Mr. Sgro was involved in the technical and commercial aspects of supply of specialised equipment to the major process industries including oil and gas, petrochemical, chemical and mining industries, including equipment specification, material selection, commercial and technical aspects of large tenders, contract negotiation and contract management. Mr Sgro is currently a director of ASX listed Alpha HPA Limited. Interest in Shares 1,000,000 ordinary fully paid shares Foster V. Wilson (Non-Executive Director) Mr Wilson has over 40 years of experience, with a focus on lithium claystone and brine exploration projects, in roles ranging from reserve drilling and estimation, feasibility studies, mine permitting and development. He has worked in various capacities for Placer Dome Inc., Echo Bay Mines Ltd., American Bonanza Gold Corp. and various junior exploration companies. Mr. Wilson currently serves as a director of TSX-V listed Alpha Lithium Corporation and Atomic Minerals Corp. and is President of Mesa Exploration Corporation. Interest in Shares 21,212,000 ordinary fully paid shares 3 FULCRUM LITHIUM LTD and its controlled entities Directors' Report Meetings of directors During the financial year, 3 meetings of Directors were held. Attendances by each Director during the period were as follows: Norman Seckold Peter Nightingale Anthony Sgro Foster Wilson Directors’ Meetings Number eligible to attend 3 3 3 3 Number attended 3 3 3 3 Performance Rights The Company will, to the extent that it has accepted a duly completed application, grant the following Performance Rights, which once vested, will entitle the holder to the issue of one fully paid ordinary share in the Company: Number of rights 3,000,000 Basis Vesting Performancebased Subject to the following: (a) the Company receiving conditional approval to be admitted to Official Quotation on the ASX; and (b) the Company completing at least 10 drill holes of which a minimum of 450 metres is drilled in total across the 10 holes and with at least one intersection returning a minimum grade of 750 ppm lithium. Indemnification and insurance of officers and auditors No indemnities have been given or insurance premiums paid, during the reporting period or since the end of the financial year, for any person who is or has been an officer or auditor of Fulcrum Lithium Ltd. Proceedings on behalf of the company No person has applied for leave of court under Section 237 of the Corporations Act 2001 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. Competent Person’s Statement The information in this Report that relates to Exploration Results is based on information compiled by Mr Bill R. Fleshman of Global Geological Services, LLC, a geologist who is a Fellow and Chartered Professional of the Australasian Institute of Mining and Metallurgy and (FAusIMM CP Geology #107342). Mr Fleshman is an independent consultant and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Fleshman consents to the inclusion in this Report of the matters based on the information in the form and context in which it appears. Auditor’s independence declaration The auditor's independence declaration in accordance with section 307C of the Corporations Act 2001 for the period ended 30 June 2024 has been received and can be found on page 5 of the financial report. This Directors’ Report is signed in accordance with a resolution of the Board of Directors. Signed at Sydney this 16th day of September 2024 Norman A. Seckold Peter J. Nightingale 4 Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001 To the Directors of Fulcrum Lithium Ltd I declare that, to the best of my knowledge and belief, in relation to the audit of Fulcrum Lithium Ltd for the financial year ended 30 June 2024 there have been: i. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and ii. no contraventions of any applicable code of professional conduct in relation to the audit. KPM_INI_01 KPMG Adam Twemlow Partner Brisbane 16 September 2024 PAR_SIG_01 PAR_NAM_01 PAR_POS_01 PAR_DAT_01 PAR_CIT_01 5 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional Standards Legislation. FULCRUM LITHIUM LTD and its controlled entities CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2024 Notes 2024 Period from 6 February 2023 to 30 June 2023 $ $ Continuing operations Filing and incorporation costs - (6,062) (27,548) - (822,629) - (192,061) (20,661) (1,042,238) (26,723) Interest income 16,887 9,414 Interest expense - - 16,887 9,414 (1,025,351) (17,309) - - (1,025,351) (17,309) Exchange differences on translation of foreign operations (29,851) 20,730 Total comprehensive (loss)/profit for the year/period (1,055,202) 3,421 (1.29) cents (0.04) cents Administration costs Consultants fees 19 Other expenses from ordinary activities Operating loss before financing income Net financing income Loss Income tax expense 4 Loss for the year/period Other comprehensive income Items that are or may be reclassified subsequently to profit or loss Basic and diluted loss per share (cents) 5 The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes. 6 FULCRUM LITHIUM LTD and its controlled entities CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2024 Notes 2024 2023 $ $ Current assets Cash and cash equivalents 6 55,785 1,539,214 Other assets 7 211,088 277,751 266,873 1,816,965 Total current assets Non-current assets Other financial assets 8 18,851 - Exploration and evaluation expenditure 9 2,642,274 1,227,295 Total non-current assets 2,661,125 1,227,295 Total assets 2,927,998 3,044,260 107,676 28,736 Total current liabilities 107,676 28,736 Total liabilities 107,676 28,736 2,820,322 3,015,524 Current liabilities Trade and other payables 10 Net assets Equity Issued capital 11 3,872,103 3,012,103 Reserves 12 (9,121) 20,730 Accumulated loss (1,042,660) (17,309) Total equity 2,820,322 3,015,524 The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes. 7 FULCRUM LITHIUM LTD and its controlled entities CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2024 Accumulated Losses $ Reserves Total $ $ - - - - Loss for the year - (17,309) - (17,309) Other comprehensive income - 20,730 20,730 Total comprehensive income/(loss) for the period - (17,309) 20,730 3,421 3,012,103 - - 3,012,103 11,12 3,012,103 (17,309) 20,730 3,015,524 Accumulated Losses $ Reserves Total Notes Issued Capital $ $ $ 3,012,103 (17,309) 20,730 3,015,524 Loss for the year - (1,025,351) - (1,025,351) Other comprehensive loss - (29,851) (29,851) Total comprehensive loss for the year - (1,025,351) (29,851) (1,055,202) 860,000 - - 860,000 3,872,103 (1,042,660) (9,121) 2,820,322 Attributable to equity holders of the Company Notes Issued Capital $ Balance at 6 February 2023 Total comprehensive income for the period Transactions with owners, recorded directly in equity Contribution by and distribution to owners Ordinary shares issued Balance at 30 June 2023 Attributable to equity holders of the Company Balance at 1 July 2023 Total comprehensive loss for the period Transactions with owners, recorded directly in equity Contribution by and distribution to owners Ordinary shares issued Balance at 30 June 2024 11,12 The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes. 8 FULCRUM LITHIUM LTD and its controlled entities CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2024 Notes 2024 2023 $ $ Cash flows from operating activities Cash payments in the course of operations (459,901) (258,137) 16,887 9,414 (443,014) (248,723) (1,171,564) (812,063) (18,851) - (1,190,415) (812,063) Proceeds from share issues 150,000 2,600,000 Net cash from financing activities 150,000 2,600,000 Net (decrease)/increase in cash held (1,483,429) 1,539,214 Cash at the beginning of the reporting period 1,539,214 - 55,785 1,539,214 Interest received Net cash used in operating activities 14 Cash flows from investing activities Payments for exploration and development expenditure Advancement for financial assets Net cash used in investing activities Cash flows from financing activities Cash and cash equivalents at 30 June 6 The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes. 9 FULCRUM LITHIUM LTD and its controlled entities NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2024 Fulcrum Lithium Ltd (the ‘Company’) is a for-profit company limited by shares, incorporated and domiciled in Australia. The consolidated financial statements as at and for the year ended 30 June 2024 comprise the Company and its controlled entities (together referred to as the ‘Group’). The financial report was authorised for issue by the Directors on 16 September 2024. 1 Basis of Preparation (a) Statement of compliance The consolidated financial statements are general purpose financial statements that have been prepared in accordance with the Australian Accounting Standards and the Corporations Act 2001. These financial statements comply with International Financial Reporting Standards as issued by the International Accounting Standards Board. (b)Basis of measurement The consolidated financial statements have been prepared on the historical cost basis except for certain financial assets which are measured at fair value. (c) Functional and presentation currency These consolidated financial statements are presented in Australian dollars, which is the Company’s functional currency. (d) Going concern The consolidated financial statements have been prepared on a going concern basis, which contemplates the continuation of normal business operations and the realisation of assets and settlement of liabilities in the normal course of business. For the year ended 30 June 2024 the Group has incurred a loss of $1,025,351 (for the period ended 30 June 2023, a loss $17,309) and has accumulated losses of $1,042,660 as at 30 June 2024. The Group used $443,014 of cash in operations, in addition to $1,171,564 of cash for exploration and evaluation expenditure for the year ended 30 June 2024. The Group had in cash at bank of $55,785 at year end. The ongoing operations of the Group are dependent upon the Group raising additional funding from shareholders or other parties and continuing to materially reduce expenditure until additional funding has been secured. The Directors have prepared cash flow projections for the period from 1 July 2024 to 30 September 2025 that support the ability of the Group to continue as a going concern. These cash flow projections assume that the Group will have a successful IPO event and will continue its substantial exploration activities in the areas of interest and that adequate funding for its activities will be available. In order to fund its activities, subsequent to the end of the year the Group has:  entered into a loan facility agreement with Norman A. Seckhold (a Company Director) for $1.0 million. This loan is interest free, unsecured, and repayable at the earlier of a successful Initial Public Offering (see below) or 30 June 2025; and  commenced a process to raise funds through an Initial Public Offer (‘IPO’) and ASX Listing. The IPO is to issue 40,000,000 shares at an issue price of $0.25 per share to raise $10.0 million (before costs) to fund its activities. A prospectus was lodged with ASIC on 21 August 2024 and the IPO ‘went live’ on 28 August 2024. In the event that the IPO does not raise sufficient funds in the timeframe required by the Group, alternative funding will need to be obtained. In this event, the Group expects to raise funding from Directors and other parties. There is significant uncertainty in relation to the ability of the group to raise adequate funding and to reduce expenditure until funding has been received. These conditions give rise to a material uncertainty that may cast material doubt upon the Group’s ability to continue as a going concern. In the event that the Group does not continue as a going concern, it may not be able to realise its assets and extinguish its liabilities in the ordinary course of operations and at the amounts stated in the consolidated financial report. 10 FULCRUM LITHIUM LTD and its controlled entities NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2024 2 Summary of Material Accounting Policies (a) Basis of consolidation Subsidiaries Subsidiaries are entities controlled by the Group. The Group controls an entity when it 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 over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. Loss of control When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and other components of equity. Any resulting gain or loss is recognised in profit or loss. Any interest retained in the former subsidiary is measured at fair value when control is lost. Transactions eliminated on consolidation Intra-group balances and any unrealised gains and losses or income and expenses arising from intragroup transactions are eliminated in preparing the consolidated financial statements. (b) Foreign operations The assets and liabilities of foreign operations are translated to Australian dollars at foreign exchange rates ruling at the reporting date. The income and expenses of foreign operations are translated to Australian dollars at rates approximating the foreign exchange rates ruling at the dates of the transactions. Foreign exchange differences arising on retranslation are recognised directly in the foreign currency translation reserve ('FCTR'), a separate component of equity. Foreign exchange gains and losses arising from a monetary item receivable or payable to a foreign operation, the settlement of which is neither planned nor likely in the foreseeable future, are considered to form part of a net investment in a foreign operation and are recognised directly in the FCTR. Any references to functional currency, unless otherwise stated, are to the functional currency of the Company, Australian dollars. When a foreign operation is disposed of, in part or in full, the relevant amount in the FCTR is transferred to profit or loss as part of the profit or loss on disposal. When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely in the foreseeable future, foreign exchange gains and losses arising from such a monetary item are considered to form part of a net investment in a foreign operation and are recognised in other comprehensive income and are presented within equity in the FCTR. (c) Exploration and development expenditure Exploration, evaluation and development expenditure incurred is accumulated in respect of each identifiable area of interest. These costs are only carried forward to the extent that they are expected to be recouped through successful development of the area or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves and active and material operations in, or in relation to, the area on interest are continuing. As the asset is not available for use it is not depreciated or amortised. Accumulated costs in relation to an abandoned area are written off in full against profit or loss in the period in which the decision to abandon that area is made. When production commences, the accumulated costs for the relevant area of interest are amortised over the life of the area according to the rate of depletion of the economically recoverable reserves. A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry forward costs in relation to that area of interest. 11 FULCRUM LITHIUM LTD and its controlled entities NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2024 (d) Current and non-current classification Assets and liabilities are presented in the statement of financial position based on current and non-current classification. An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the normal operating cycle; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are classified as non-current. A liability is classified as current when: it is either expected to be settled in the normal operating cycle; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current. (e) Cash and cash equivalents Cash and cash equivalents comprise cash balances and call deposits with an original maturity of three months or less. (f) Finance income Finance income comprises interest income on funds invested. Interest income is recognised as it accrues in profit or loss, using the effective interest method. (g) Goods and services tax (GST) Revenue, 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. Receivables and payable are stated inclusive of GST. Cash flows in the statement of cash flows are included on a gross basis and the GST component of cash flows arising from investing and financing activities which is recoverable from, or payable to, the taxation authority is classified as operating cash flows. 12 FULCRUM LITHIUM LTD and its controlled entities NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE