COVER SHEET AUDITED FINANCIAL STATEMENTS £0 open ose 1] 4[1]o[2 COMPANY NAME a[N[e[elol [r[elr[c[rfelrl [se] [efo[e >] [x[e]s] [clolRlr ofe|alr|rfolx] [a[x]o] [s[u]s[s[r[o[r[ale|i [els a]2]s] [rfifofmfele[r] [se{-[ [ufafnfalali[ulylolale] Jeli tly Fomtype Dapeiart aig terest Seay ame Te. AlalclF[s selec nq’ [a “coeanyv eat ase angi Tonto Nut ie (0) 631-5139) NA Naolsodeaties Pru et Merb 369) Fo Van aD) 3,089) Last Friday of July 1231 [ ‘CONTACT PERSON INFORMATION 1 “help pee AT on OB an ascents ena gaines TegrraNumoe te ae Mr. Girt V. Rabago info@anglophilcom onasrsisy | [aes 9176217350 ‘CONTAGT PERSON’s ADDRESS. ] 6th Floor, Quad Alpha Centrum Building, 125 Pioneer Street, Mandaluyong City Te haath wap a ce pa se en ala ped BP ae (0 etna a han source thes adeno an! cos nan cra renee. 2: at Baws mb pop nd cov Ada. Far oo scans a day basin comune Cn ander arseaat Nee of Decen Pa rn acat ote Otc haat ascent ey fa beeenANGLO PHILIPPINE HOLDINGS CORPORATION [AN INFRASTRUCTURE AND PROPERTY DEVELOPHENT COMPANY STATEMENT OF MANAGEMENT'S RESPONSIBILITY FOR CONSOLIDATED FINANCIAL STATEMENTS, ‘The management of Auglo Philippine Holdings Corporation and Subsidiaries is responsible forthe preperation and fair presentstion of the consolidated financial statements including the schedules attached therein, for the years ended December 31, 2017 and 2016, in accordance with the prescribed financial reporting framework indicsted therein, and for such internal control as management ‘determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concer, disclosing as applicable matters related to going concem and using the going concern bass of accounting unless management either intends to igudate the Group orto cease operation, or has no realistic alternative but to do so. ‘The Board of Director is responsible for overseeing the Group's financel reporting process. ‘The Board of Directors reviews and approves the consolidated financial statements including the schedules atached therein, and submits the same to the stockholders. SyCipGorresVelayo& Co., the independent auditor appointed by the stockholders, has audited the financial statements of the Group in accordance with Philippine Standards on Auditing, and in report to the stockholders, has expressed its opinion on the faimess of presentation upon completion of such se whee Kook wh Tasos ‘Chairman of the Board/CEO PresidentDireeloy(CO0. 27 RANG Ls om BAGO 4 TLE THeowder eat SUBSCRIBED AND SWORN to before me this_ APRegyie 2016 TNS le i to me his Community Tax Cortese, fellows: Passport Number/ Names Government Issued ID sue DateEspiry Date Place of Issue Alfedo C. Ramos TEC#370209 —Jul21, 2016441 20,202] DPA Manila EC6344702. Jan 08, 2016/5an7,2021 DFA Manila PRCO10S874 Valid uni 0324/2000 Mani Kea es ODE, coon guia PSHE «ITY OF MANORLUONS api ia a3fot6 [UN DeceNBeh 3, 2019 Quid ALE. ceva, 120 RONGER STREET iaannauvon crt rR wo, 910411) WANDALIVONG CEY/ 05-08-18 se The No, O2ste / -ob-u8 / QC CHMPTER USCA incu coMBuANcE No. 1v-0019703 [O%t4-2019, Aes “Hetping Build the Fiiping Fueurer®OH NO. 51028 (2005) dese, Quenph Ca 5 Pao eet eee 158 Pes “ashe Na: 61159») O18 Fr NO) STD" eat no ngopcon ahex nageS4G0 Gooey Ca, W632) 8610907 BOWPRE Reg Na. 900% ae ER Bee a eaten Bullgngo beter Priopioes we ‘abe 102058 vl un Nove 9, 2076 sorking wor INDEPENDENT AUDITOR'S REPORT ‘The Board of Directors and the Stockholders Anglo Philippine Holdings Corporation ‘6th Floor, Quad Alpha Centrum 125 Pioneer St. Mandaluyong City Opinion ‘We have audited the consolidated financial statements of Anglo Philippine Holdings Corporation and Subsidiaries (the Group), which comprise the consolidated statements of financial position as at December 31, 2017 and 2016, and the consolidated statements of comprehensive income, consolidated statements of changes in equity and consolidated statements of cashflows for each ofthe three years in the period ended December 31, 2017, and notes to the consolidated financial statements, including a summary of significant accounting policies, In our opinion, the accompanying consolidated financial statements present fairy, in all material respects, the consolidated financial position of the Group as at December 31, 2017 and 2016, and its consolidated financial performance and its consolidated cash flows foreach of te three years in the period ended December 31, 2017 in accordance with Philippine Financial Reporting Standards (PFRSS). B for Opinion ‘We conducted our audits in accordance with Philippine Standards on Auditing (PSAs). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Aut of the Consolidated Financial Statements section of out report. We are independent of the Group in sceordance with the Code of Ethie for Professional Accountants inthe Philippines (Code of Ethics) ‘together with the ethical requirements that are relevant to our audit of the consolidated financial statements inthe Philippines, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion, Key Audit Matters Key audit matters are those matters tht, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed context of our audit of the consoideted financial statements as a whol, and in forming our opinion ‘thereon, and we do not prove a separate opinion on these matters. For each matter below, our description of how our audit addressed tue matter is provided in that context,samen We have flfiled the responsibilities described in the Auditor's Responsibilies for the Aut ofthe Consolidated Financial Statements section of our repor, including in relation to these matters. Accordingly, our anit included the performance of procedures designed to respond to our assessment of| the risks of material misstatement ofthe consolidated financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the bass for our audit opinion onthe accompanying consolidated financial statements, Recoverability of Deferred Exploration Coste ‘The carrying value of deferred exploration costs amounted to 2208.6 millon as at December 31, 2017. PFRSS require the Group to assess the recoverability ofits deferred exploration costs when facts and circumstances suggest thatthe carrying amount exceeds the recoverable amount. The assessment on ‘whether there isan indication that deferred exploration costs may be impaired requires significant ‘management judgment regarding the ability ofthe Group to recover its deferred exploration costs. Hence, such assessment is a key audit matter. ‘The disclosures related to recoverability of deferred exploration costs are included in Notes 3 and 14 to the consolidated financial statements Audit Response ‘We obtained management's assessment on whether there is any indication that deferred exploration costs may be impaired and reviewed relevant updates on the current status ofthe projects and future ‘management plans. We inspected the licenses/permits of each exploration project to determine thatthe period for which the Group has the right to explore in the speciffe area has not expired or will nt expire within the period of their plan of operation. We also inquired about the existing concession areas that are expected to be abandoned or any exploration activities that are planned to be discontinued in those areas, ‘We also reviewed the Group's relevant disclosures Recoverabitity of lnvestments in Associates “The Group's investments in associates amounting to P87 billion represents about 84.7% of ts consolidated total assets as at Deoember 31,2017, In 2017, the Groups share in the net loses of associates amounted to 8213.2 million, which is 91.0% ofthe Group's consolidated net loss. Under PERS, the Group assesses at each reporting period whether thee isan indication that such investments ‘may be impaired. We consider this matter as significant to our aut in view of the magnitude ofthe investments’ camying amounts and the share in the net losses ofthese associates and the significant, ‘management judgement and estimates applied in determining the recoverable amount ofthese investments. Information on these investments is disclosed in Notes 3 and 11 tothe consolidated financial statements, Tonal bAudit Response ‘We obiained an understanding of management’s process in accounting for investments in associates. We obtained relevant financial information of the associates and recomputed the Group's share in equity in the associates’ net earnings/losses. We obtained management's impairment analysis and gained an Understanding of their impairment assessment process and the relevant controls. We discussed with ‘management the current and projected financial performance of the associates and assessed whether these were reflected in the Group's own assumptions. We also involved our internal specialist in assessing the Group's methodology and assumptions used in calculating the recoverable amount ofthe investments ‘which key assumptions include the future production levels and costs, gold prices and discount rate, We assessed future production levels and costs based on the Group’s historical performance. We compared the key inputs such as gold prices against externally published data. We also assessed the discount rate sed to available third party information. We also reviewed the Group's disclosures about those assumptions to which the outcome of the impairment test is most sensitive, specifically those that have the most significant effect in the determination of the recoverable amount ofthe investments in associates, Other Information ‘Management is responsible forthe other information, The other information comprises the information included in SEC Form 20-18 (Definitive Information Statement), SEC Form 17-A and Annual Report for the year ended December 31, 2017, but doesnot include the consolidated financial statements and our auditor's report thereon. The SEC Form 20-18 (Definitive Information Statement), SEC Form 17-A and ‘Annusl Repart forthe year ended Decembor 31, 2017 ate expected to be made available tous after the date of this auditor's port. Our opinion on the consolidated financial statements does not cover the other information and we will not express any form of assurance conclusion thereon, Inconneetion with our audits ofthe consolidated financial statements, our responsibility isto read the other information identified above when it becomes available and, in doing so, consider whether the ether information is meterally inconsistent with the consolidated financial statement of our knowledge obtained inthe audits, or otherwise appears to be materially misstated. Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation ofthe consolidted financial statements in accordance with PFRSs, and for such intemal control as management determines is necessary to enable the preparation of consolidated financial statements that ae free from material ‘misstatement, whether dus to frand or error. In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concem, disclosing, as applicable, matters related to going concern and using the going concem basis of accounting unless management either intends to liquidate the Group or fo cease operations, or has no realistic alternative but to dp $0... ig k ‘Those charged with governance are t serbryt a Yorgi tdoe Auditor's Respons ur objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance isa high level of assurance, but is nota guarantee that an audit conducted in accordance with PSAs, will always detect a material misstatement when it exists. Misstatements can arse from fraud or error and are considered material if, individually or inthe ‘ageregate, they could reasonably be expected to influence the economic decisions of users taken on the basis ofthese consolidated financial statements. ‘As par of an andit in accordance with PSAs, we exercise professional judgment and maintain ‘professional skepticism throughout the audit. We also: [Identify and assess the risks of material misstatement of the consolidated financial statements, ‘Whether due to fraud or error, design and perform audit procedures responsive to those risks, and cobain aut evidence that is Sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting ftom fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentaions, or the override of intern control. ‘© Obtain an understanding of internal control relevant tothe audit in order to design audit procedures ‘that are appropriate in the circumstances, but nat for the purpose of expressing an opinion on the effectiveness ofthe Group's internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting ‘estimates and related disclosures made by management. * Conclude on the appropriateness of management's use ofthe going concer basis of accounting and, ‘based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions thet may cast significant doubt on the Group's ability to continue as @ going concern. If we conclude that a materiel uncer ‘0 draw attention in our auditor's reportto the related disclosures inthe consolidated financial stetements or, if such disclosures are ‘inadequate, to modify our opinion, Our eoncusions are based on the ault evidence obtained upto the date of our auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern, ‘+ Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fuir presentation, ‘+ Obtain sufficient appropriate audit evidence regarding the financial information ofthe entities or business activities within the Group to express an opinion onthe consolidated financial statements. We are responsible forthe direction, supervision and performance of the audit. We remain solely responsible for our audit opinion, ‘We communicate with those charged with governance regarding, among other matters, the planned scope and sing ofthe at and sigan a Hing, dingy infant defies in neal con ta we ety ingore.SGV Bulngabater Soking aa! -5- We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with ther al relationships and other tater that may reasonably be thought tober on ou independence, and where aplabl relied safeguards. From the matters communicated with those charged with governance, we determine those matters that ‘were of most significance in the audit of the consolidated financial statements ofthe current period and are therefore the key audit matters. We deseribe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extvemely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. ‘The engagement partner on the audit resulting inthis independent auditor's report is Jose Rao'ul J. Balisalisa, ‘SYCIP GORRES VELAYO & CO. Ge ae, pb I, 27 ek Partner 1 CPA Contficate No. 109542 ic SEC Acereditation No. 1557-A (Group A), ‘April 14, 2016, valid until April 14, 2019 ‘Tax Identification No, 931-743-705 BIR Accreditation No, 08-001998-113-2016, February 15, 2016, valid until February 14, 2019 PUR No. 6621227, January 9, 2018, Makati City April 12, 2018