(i) Significant accounting judgments (ii) Significant accounting estimates and assumptions 72  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2011 The determination of reserves impacts the accounting for asset carrying values, depreciation and  amortisation rates and provisions for mine rehabilitation. Metals X Limited estimates its mineral resource and  reserves in accordance with the Australian code for Reporting of Exploration Results, Mineral Resources and  Ore Reserves 2004 (the “JORC code”). The information on mineral resources and ore reserves were prepared  by or under the supervision of Competent Persons as defined in the JORC code. The amounts presented are  based on the mineral resources and ore reserves determined under the JORC code. There are numerous uncertainties inherent in estimating mineral resources and ore reserves and  assumptions that are valid at the time of estimation may change significantly when new information  becomes available. Changes in the forecast prices of commodities, exchange rates, production costs or recovery rates may  change the economic status of reserves and may, ultimately, result in the reserves being restated. In determining the amount of impairment of financial assets, the Consolidated Entity has made judgements in  identifying financial assets whose decline in fair value below cost is considered “significant” or “prolonged”. A  significant decline is assessed based on the historical volatility of the share price. The higher the historical volatility, the greater the decline in fair value required before it is likely to be  regarded as significant. A prolonged decline is based on the length of time over which the share price has  been depressed below cost. A sudden decline followed by immediate recovery is less likely to be considered  prolonged compared to a sustained fall of the same magnitude over a longer period. The Consolidated Entity considers a less than a 10% decline in fair value is unlikely to be considered significant  for investments actively traded in a liquid market, whereas a decline in fair value of greater than 20% will often  be considered significant. For less liquid investments that have historically been volatile (standard deviation  greater than 25%), a decline of greater than 30% is usually considered significant. Generally, the Consolidated Entity does not consider a decline over a period of less than three months to be  prolonged. However, where the decline in fair value is greater than six months for liquid investments and 12  months for illiquid investments, it is usually considered prolonged. The Consolidated Entity classifies assets and liabilities as held for sale when the carrying amount will be  recovered through a sale transaction. The assets and liabilities must be available for immediate sale and the  Consolidated Entity must be committed to selling the assets either through the entering into a contractual  sale agreement or the activation and commitment to a program to locate a buyer and dispose of the assets  and liabilities. The Consolidated Entity assesses its mine rehabilitation provision on an annual basis in accordance with the  accounting policy stated in note 2(t). Significant judgement is required in determining the provision for mine  rehabilitation as there are many transactions and other factors that will affect the ultimate liability payable  to rehabilitate the mine site. Factors that will affect this liability include future development, changes in  technology and changes in interest rates. When these factors change or become known in the future, such  difference will impact the mine rehabilitation provision in the period in which they change or become known. •  Determination of mineral resources and ore reserves •  Impairment of available-for-sale-investments •  Classification of assets and liabilities as held for sale •  Mine rehabilitation provision