The Sheldon Grading System
Poor-1 A coin in this condition can just be identified; its date and legend may be entirely worn, the coin presenting an almost completely smooth flat surface.
Fair-2 A coin in fair condition may have the date and half the legend faintly discernible, on an otherwise smooth-flat coin.
Good (G-4) This coin will be heavily worn, its design/features weak. The main designs will be silhouettes and minor inscriptions worn away.
Very Good (VG-8) On such a coin we should see most of the minor inscriptions, such as Australia on the obverse. The overall design is clear, despite the coin being flat and lacking any further detail.
Fine (F-12) This coin should show almost half the details of the major figure, although hardly any distorted images of the Queen's face.
Very Fine (VF-20) A coin in this condition should have a moderate even wear and all major features should be visible. On the obverse figure most of the hair and drapery, if any, should be bold despite obvious wear. The figure's lips and eyes should be well defined. The word Australian and Elizabeth and the hair ribbon should be fairly visible.
Extremely Fine (XF-40) This coin should still preserve faint traces of mint lustre, mostly around the design/coast of arms on the obverse and around the legend on the portrait. There should be slight wear on the Queen's hair, above the eye and ear, the high points of many Australian coin designs. From this grade upwards, signs of wear decrease and mint lustre increases.
About Uncirculated (AU-50) On such a grade of coin a good deal of mint lustre will be found, mostly around the rim edge radiating inwards covering a large part of the field. There will be faint traces of wear in the highest points, ie above the eye and ear on the obverse and around the Queen's portrait. All other high points should be clearly visible, while preserving a mint crispness in the design on the lower areas.
Mint State (MS-60) A coin in this condition should by definition be uncirculated and display all the characteristics of a coin kept out of general use the moment it left the mint or very shortly thereafter. Such a coin will display no evidence of wear on all the high points, it may have a few marks, a natural result from minting and transportation; it will lack full mint lustre across the whole of its surface.
Mint State (MS-65) This state of preservation expresses a mint state coin which should have full mint lustre on all its surfaces, even on the tops of letters and fine detail. It should be void of any blemishes, such as 'bag marks', scrapes or dings.
Please note: this information has been obtained from external sources. Please inquire if you require any references or additional information.