St Barbara Mines Limited Annual Report 2004 Notes to the Financial Statements  for the year ended 30 June 2004 34. RECONCILIATION OF AUSTRALIAN GENERALLY  ACCEPTED ACCOUNTING PRINCIPLES TO INTERNATIONAL  ACCOUNTING STANDARDS The  fi  nancial statements are prepared in accordance with Australian Generally Accepted Accounting Principles (“GAAP”),  which differs in certain respects from International Financial Reporting Standards (“IFRS”). The approximate effect of applying IFRS for the two years ended 30 June 2004 and 30 June 2003, where IFRS are materially different to GAAP,  is set out below. Consolidated 30 June 2004 $’000 30 June 2003 $’000 Net (loss) attributable to members of the Company under GAAP (24,315) (32,733) Accounting for impairment of assets (5,621) (8,571) Net (loss) attributable to outside equity interests 6,369 - Net (loss) attributable to members of the Company under IFRS (23,567) (41,304) Total equity under GAAP 44,852 37,973 Accounting for impairment of assets (14,192) (8,571) Accounting for investments in available for sale securities - (229) Total equity under IFRS 30,660 29,173 Under IAS 36 “Impairment of Assets” the consolidated entity is required to record an impairment loss whenever the carrying  amount of an asset exceeds its recoverable amount. Recoverable amount is measured as the higher of the net selling price  and value in use. Net selling price is the amount obtainable from the sale of an asset in an arm’s length transaction and value  in use is the present value of estimated future cash  fl  ows expected to arise from continued use and disposal at the end of its  useful life. As a result of this treatment the consolidated entity is required to take an after tax write down of $5.6 million  for the year ended 30 June 2004 (2003 $8.6 million). Impairment of assets attributable to the outside equity interest in  the current year is $2.5 million. Under GAAP, recoverable amount write-downs or impairments are determined using  undiscounted cash  fl  ows. Under IFRS deferred tax balances are calculated based on the difference between the tax base of the asset and the carrying  amount of the asset. As a result of this treatment, at 30 June 2004, a deferred tax liability of $5.3 million (2003: $7.7 million)  would be recognised in relation to the carrying amount of exploration, evaluation and development expenditure acquired in  the NuStar acquisition which has no tax base. This would also result in an increase of $5.3 million (2003: $7.7 million)  in exploration, evaluation and development expenditure acquired. This adjustment has no impact on net pro fi  t or net assets  of the consolidated entity. Under GAAP deferred tax balances re fl  ect differences arising from the timing of recognition  of revenue and expenses for accounting and tax. Under IAS 39 “Financial Instruments: Recognition and Measurement” the consolidated entity is required to classify  investments in securities as, “held for trading” or “available-for-sale”. The investments held by the consolidated entity are  classi fi  ed as available-for-sale and carried at fair value with unrealised gains and losses reported in equity and recycled to the  Statement of Financial Performance when sold or impaired. Under GAAP investments are carried at cost with a provision  recognised for any diminution in value considered to be permanent Under IFRS rehabilitation and restoration costs incurred during production and after production stops, should be accrued  when the liability is incurred. As a result of this treatment no additional provision for rehabilitation would be recognised  at 30 June 2004 (2003: $0). During the year NuStar Mining Corporation Limited (“NuStar”) a subsidiary of the Company, raised $19.8 million by the  issue of 420 million shares to outside investors to fund the Paulsens project. Simultaneously, the Company converted its loan  of $17.6 million to NuStar to equity through the receipt of 352 million shares. As a result of this transaction, the Company  diluted its interest in NuStar from 88% to 54%. Under IFRS the transfer of value from the outside equity interest to the  parent entity interest is $3.4 million compared to a transfer under GAAP from the parent entity interest to the outside equity  interest of $0.4 million. This transfer of value has no impact on the net assets of the consolidated entity. Accounting for impairment of assets Accounting for income taxes Accounting for investments in available for sale securities Accounting for rehabilitation and restoration costs Net (loss) attributable to outside equity interests