By ATO rules state capitalized expenditure must be deducted over the life of the benefit gained from the expenditure.
That life span of benefit would have been longer than the current stated LOM of 2 years.
By recently revising the resource and reserve statement to reflect 2 years LOM, MGX are now permitted to revise the life span of benefit also to 2 years.
The result of which is hefty tax deductions over the next 2 years, which will assist cash build. Our accountant leader, Peter Kerr, has repeatedly stated he is focussed on rapid cash build.
MGX Price at posting:
29.5¢ Sentiment: Buy Disclosure: Held
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