From metal to money: the importance of reliable metallurgical accounting
D Seke
Metal inventories are usually reported in financial statements of
mining companies. However, the value of these inventories can be
reliable only if the metals in stock are measured within acceptable
tolerances. Reliable metal balancing requires accurate mass
measurement, sampling, and chemical analysis.
Many mining companies are usually unable to validate the
accuracy of metals in inventories at the end of their financial year.
This is mainly due to poor mass measurement, sampling, and
chemical analysis practices. This has an adverse impact on
metallurgical accounting and metal valuation. In addition, it puts a
lot of stress on external auditors, who have the duty to recommend
the approval of the financial statements to the board of directors.
Although a full value chain of metal reconciliation includes the
accuracy of Mineral Reserve definition and grade control at the mine,
this paper discusses the implementation of best practices for mass
measurement, sampling, and chemical analysis at processing plants.
This is an important aspect of sampling and reconciliation that is
required in order to improve the reporting of inventories in the
financial statements of public mining companies.
Keywords: metallurgical accounting, corporate governance, sampling, analysis.