(An Exploration Stage Company) INTERIM CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2008
(Unaudited – Prepared by Management) (Expressed in Canadian Dollars)
UNAUDITED FINANCIAL STATEMENTS: In accordance with National Instrument 51-102 of the Canadian Securities Administrators, the Company discloses that its auditors have not reviewed the unaudited financial statements for the three months ended March 31, 2008.
| RADIUS GOLD INC. | |
|---|---|
| (An Exploration Stage Company) | |
| INTERIM CONSOLIDATED BALANCE SHEETS | |
| AS AT MARCH 31, 2008 | |
| (Unaudited - Prepared by Management) | |
| (Expressed in Canadian Dollars) | |
| March 31, | December 31, |
| 2008 | 2007 |
| ASSETS | |
| CURRENT | |
| Cash and cash equivalents 974,559$ | 2,378,514 $ |
| Marketable securities (Note 3 & Note 4) 4,702,151 | 4,624,095 |
| Advances and other receivables (Note 7) 185,939 | 79,309 |
| GST receivable 15,909 | 27,919 |
| Due from related parties (Note 7) 39,415 | 50,498 |
| Prepaid expenses and deposits 102,729 | 107,275 |
| 6,020,702 | 7,267,610 |
| PROPERTY & EQUIPMENT (Note 5) 365,545 | 289,888 |
| MINERAL PROPERTIES (Note 6) 16,898,982 | 15,923,030 |
| 23,285,229$ | 23,480,528 $ |
| LIABILITIES | |
| CURRENT | |
| Accounts payable and accrued liabilities (Note 7) 384,928$ | 371,962 $ |
| SHAREHOLDERS' EQUITY | |
| SHARE CAPITAL (Note 8) 42,587,194 | 42,587,194 |
| CONTRIBUTED SURPLUS 4,164,587 | 4,164,587 |
| DEFICIT (23,869,816) | (23,608,176) |
| ACCUMULATED OTHER COMPREHENSIVE INCOME (Note 12) 18,336 | (35,039) |
| 22,900,301 | 23,108,566 |
| 23,285,229$ | 23,480,528 $ |
| Nature of operations (Note 1) | |
| APPROVED BY THE DIRECTORS: | |
| “signed” , Director “signed” | , Director |
| Simon Ridgway Mario Szotlender | |
| See Accompanying Notes | |
RADIUS GOLD INC. (An Exploration Stage Company) INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2008 (Unaudited - Prepared by Management) (Expressed in Canadian Dollars)
Three Month Period Ended
| March 31, | ||
|---|---|---|
| 2008 | 2007 | |
| EXPENSES | ||
| Amortization | 14,714 $ | 10,864$ |
| Consulting fees | 19,937 | 31,362 |
| Donations | 472 | 475 |
| Legal and accounting fees | 10,790 | - |
| Management fees & salaries (Note 7) | 15,000 | 15,000 |
| Office and miscellaneous | 17,740 | 15,036 |
| Public relations | 23,457 | 32,805 |
| Rent and utilities | 13,593 | 6,367 |
| Repair and maintenance | 5,809 | 1,196 |
| Salaries and wages (Note 7) | 74,548 | 31,235 |
| Telephone and fax | 4,927 | 2,844 |
| Transfer agent and regulatory fees | 8,059 | 7,516 |
| Travel and accommodation | 59,001 | 26,955 |
| 268,049 | 181,655 | |
| OTHER INCOME (EXPENSES) | ||
| Foreign currency exchange | (34,139) | 12,710 |
| Loss on uncollectible receivable | - | (22,172) |
| Gain on disposal of asset | 2,750 | - |
| Interest income | 37,753 | 62,956 |
| Other income | 45 | 12,466 |
| 6,409 | 65,960 | |
| Net loss for the period | (261,640) | (115,695) |
| Deficit, beginning of the period | (23,608,176) | (21,330,517) |
| Deficit, end of the period | $(23,869,816) | $(21,446,212) |
| LOSS PER SHARE | (0.00)$ | (0.00)$ |
| NUMBER OF WEIGHTED AVERAGE SHARES 53,548,488 | 53,385,988 | |
See Accompanying Notes
RADIUS GOLD INC. (An Exploration Stage Company) INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2008 (Unaudited -Prepared by Management) (Expressed in Canadian Dollars)
Three month period ended
| March 31, | |||
|---|---|---|---|
| 2008 | 2007 | ||
| NET LOSS | $ | (261,640) $ | (115,695) |
| Other comprehensive income, net of tax Unrealized gain/( loss) on available for sale marketable securities | 53,375 | 28,711 | |
| COMPREHENSIVE LOSS | $ | (208,265) $ | (86,984) |
See Accompanying Notes
RADIUS GOLD INC. (An Exploration Stage Company) INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2008 (Unaudited - Prepared by Management) (Expressed in Canadian Dollars)
Three Month Period Ended March 31,
| OPERATING ACTIVITIES Net loss for the period Items not involving cash Loss from settlement of old debt Amortization Gain from disposal of asset Changes in non-cash working capital items Advances and other receivables GST receivable Prepaid expense Accounts payable and accrued liabilities | $ | 2008 (261,640) -14,714 (2,750) (249,676) (106,630) 12,010 4,546 12,966 (326,784) | $ | 2007 (115,695) (7,406)10,864-(112,237)(512,230)(347)14,11925,482 (585,213) | |
|---|---|---|---|---|---|
| FINANCING ACTIVITIES Due to related parties (Note 7) | - | (614) | |||
| INVESTING ACTIVITIES Marketable securities Due from related parties (Note 7) Expenditures on deferred exploration costs Proceeds from sale of asset Purchase of property & equipment | (24,681) 11,083 (975,952) 10,204 (97,825) | 1,349,16812,226(511,942)-(3,931) | |||
| (1,077,171) | 845,521 | ||||
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (1,403,955) | 259,694 | |||
| Cash and cash equivalents - beginning of period | 2,378,514 | 933,697 | |||
| CASH AND CASH EQUIVALENTS PERIOD | -END OF | $ | 974,559 | $ | 1,193,391 |
| Supplementary disclosure of cash flow information: Cash paid for interest Cash paid for income taxes | $ $ | -- | $ $ | -- | |
| Cash ande cash equivalents is comprised of: | |||||
| Cash Term deposits | $ $ | 2,402,872 -2,402,872 | $ $ | 1,193,391 -1,193,391 | |
| Non-cash Transactions - Note 9 | |||||
See Accompanying Notes
RADIUS GOLD INC. (An Exploration Stage Company) INTERIM CONSOLIDATEDSCHEDULE OF MINERAL PROPERTIES COSTS FOR THE THREEMONTHPERIOD ENDED MARCH 31, 2008 (Unaudited - Prepared by Management) (Expressed in Canadian Dollars)
| MineralConcess ions Guatemala | Nicaragua General Mineral Exploration Concessions | General Mineral Exploration Concessions Mexico | Other General Exploration | Ecuador Cerro Colorado | Peru General Exploration | Peru Mineral Concess ions | Period Ended March 31, 2008 | Year Ended December 31, 2007 | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| ACQUISITION COSTS BALANCE -BEGINNING OF PERIOD $ | 4,142,864 | -$ 82,482 $ | $ | - | $ | - | -$ | 113,130 $ | -$ 210,566 $ 4,549,042 $ 4,255,994 $ | ||||||||||||
| Shares - Cash -- | --- | --- | --- | --- | --- | --- | --- | -36,817 36,817 | -36,817 36,817 | 93,000200,048 293,048 | |||||||||||
| BALANCE -END OF YEAR | 4,142,864 | - | 82,482 | - | - | - | 113,130 | - | 247,383 | 4,585,859 | 4,549,042 | ||||||||||
| DEFERRED EXPLORATION COSTS | |||||||||||||||||||||
| BALANCE -BEGINNING OF PERIOD $ | 6,496,840 | -$ 4,144,644 $ | -$ 299,640 $ | 4,683 | 24,116 $ | 161,090 $ 242,975 $ 11,373,988 $ 9,182,255 $ | |||||||||||||||
| Property Payment/Investigation Automobile Camp, food and supplies Construction road access Drafting, maps and printing Drilling Exploration administration Environment Geochemistry Geological consulting (Note 6) Other consulting Legal and accounting Licenses , rights and taxes Linecutting & trenching Underground development M aterials Maintenance Mis cellaneous Medical expenses Road building Rent and utilities Rental equipment Salaries and wages Shipping Telephone and communications Travel and accommodation | -502 1,371 44 -535 -5,628 9,506 3,502 860 18,672 499 -120 359 556 1,201 -6,924 -8,791 56 973 79 | -813 2,291 -74 -279 -152 35,725 1,289 877 4,330 1,117 -44 68 16 629 -68 -3,801 1,715 2 4,043 | 661 22,803 24,143 6,418 374 75,000 4,946 8,492 83,688 69,516 23,363 2,735 36,727 8,332 -15,634 6,610 719 2,651 -10,894 97 44,982 6,847 6,368 13,980 | -4,969 5,433 -253 672 -11,110 42,757 18,854 13,578 -2,280 -787 348 142 774 -1,957 -5,511 1,841 1,384 13,595 | --------3,706 17,848 11,147 -61,840 ----284 299 ------- | -------------------------- | ------------------------- | -2,121 544 301 -8,694 -1,431 41,473 4,821 3,611 8,416 21 -107 3,370 285 2,674 -809 -2,438 354 531 446 | -1,906 724 --410 -3,659 2,548 3,321 6,347 20,583 88 -199 238 77 1 -734 --5 108 882 | 661 33,114 34,507 6,418 1,046 75,000 15,537 8,492 109,374 219,371 66,298 28,009 150,569 12,337 -16,891 10,993 2,079 8,229 -21,385 97 65,523 10,818 9,365 33,025 | 47,754143,950104,508-9,157-39,29816,719102,138826,327280,22698,793 218,41156,069423,76944,39722,4077,62225,92711,265 75,8407,691204,52023,22539,222147,377 | ||||||||||
| 60,177 | 57,334 | 475,978 | 126,244 | 95,123 | - | - | 82,448 | 41,830 | 939,135 | 2,976,612 | |||||||||||
| W rite-off Exploration Costs | - | - | - | - | - | - | - | - | - | - | (784,879) | ||||||||||
| BA LANCE -END OF PERIOD | 6,557,017 | 57,334 | 4,620,622 | 126,244 | 394,763 | 4,683 | 24,116 | 243,538 | 284,805 | 12,313,123 | 11,373,988 | ||||||||||
| TOTAL MINERAL PROPERTIES -END | |||||||||||||||||||||
OF PERIOD
$ 10,699,881 $ 57,334 $ 4,703,103 $ 126,244 $ 394,763 $ 4,683 $ 137,246 $ 243,538 $ 532,189 $ 16,898,982 $ 15,923,030
See Accompanying Notes
Radius Gold Inc.
(An Exploration Stage Company) Notes to the Interim Consolidated Financial Statements For the three month period ended March 31, 2008 Expressed in Canadian Dollars
1. Nature of Operations and Ability to Continue as a Going Concern
Radius Gold Inc. (The Company) was formed by the amalgamation of Radius Explorations Ltd. and PilaGold Inc. which became effective on July 1, 2004.
The Company is engaged in acquisition and exploration of mineral properties located primarily in Central and South America. The amounts shown for the mineral properties represent costs incurred to date and do not reflect present or future values. The Company is in the process of exploring its mineral properties and has not yet determined whether the properties contain reserves that are economically recoverable. Accordingly, the recoverability of these capitalized costs is dependant upon the existence of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete their development and upon future profitable production or disposition thereof.
These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for its next fiscal year. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. At March 31, 2008, the Company had not yet achieved profitable operations, has accumulated losses of $23,869,816 since inception, and is expected to incur further losses in the development of its business, all of which raises doubt about its ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due.
2. Significant Accounting Policies
Management has prepared the consolidated financial statements of the Company in accordance with Canadian generally accepted accounting principles. Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgement. Actual results may differ from those estimates. The financial statements have, in management’s opinion, been properly prepared using careful judgement and within the framework of the significant accounting policies summarized below.
a) Principles of Consolidation
These consolidated financial statements include the accounts of the Company and its wholly-owned
subsidiaries:
i) Minerales Sierra Pacifico S.A. and Exploraciones Mineras de Guatemala S.A., companies incorporated under the laws of Guatemala; ii) Minerales de Nicaragua S.A. and Desarrollo Geologico Minerao, S.A., companies incorporated under
the laws of Nicaragua; iii) Recursos Del Cibao, S.A., a company incorporated under the laws of the Dominican Republic; iv) Radius Panamá Corporation, Weltern Resources Corp. and Corporación Geológica de Panamá,
companies incorporated under the laws of Panamá; v) Radius (Cayman) Inc. and Pavon (Cayman) Inc., companies incorporated under the laws of Cayman Island;
Radius Gold Inc.
(An Exploration Stage Company) Notes to the Interim Consolidated Financial Statements For the three month period ended March 31, 2008 Expressed in Canadian Dollars
2. Significant Accounting Policies – (cont’d)
a) Principles of Consolidation
vi) Geometalos Del Norte-Geonorte, a company incorporated under the laws of Mexico and vii) Radius Peru, S.A.C., a company incorporated under the laws of Peru on. May 4, 2007.
All significant inter-company transactions have been eliminated upon consolidation.
b) Cash and Cash Equivalents
Cash and cash equivalents included highly liquid investments with original maturities of three months or less.
c) Marketable Securities
Marketable securities are recorded at market value as they are considered available for sale.
d) Mineral Properties
The Company defers the cost of acquiring, maintaining its interest, exploring and developing mineral properties until such time as the properties are placed into production, abandoned, sold or considered to be impaired in value. Costs of producing properties will be amortized on a unit of production basis and costs of abandoned properties are written-off. Proceeds received on the sale of interests in mineral properties are credited to the carrying value of the mineral properties, with any excess included in operations. Write-downs due to impairment in value are charged to operations.
The Company is in the process of exploring and developing its mineral properties and has not yet determined the amount of reserves available. Management reviews the carrying value of mineral properties on a periodic basis and will recognize impairment in value based upon current exploration results, the prospect of further work being carried out by the Company, the assessment of future probability of profitable revenues from the property or from the sale of the property. Amounts shown for properties represent costs incurred net of write-downs and recoveries, and are not intended to represent present or future values.
Environmental expenditures that relate to current operations are expensed or capitalized as appropriate. Expenditures that relate to an existing condition caused by past operations and which do not contribute to current or future revenue generation are expensed. Liabilities are recorded when environmental assessments and/or remedial efforts are probable, and the costs can be reasonably estimated. Generally, the timing of these accruals coincides with the earlier of completion of a feasibility study or the Company’s commitment to a plan of action based on the then known facts.
.
Radius Gold Inc.
(An Exploration Stage Company) Notes to the Interim Consolidated Financial Statements For the three month period ended March 31, 2008 Expressed in Canadian Dollars
2. Significant Accounting Policies – (cont’d)
e) Basic and Diluted Loss Per Share
Basic loss per share is calculated by dividing the net loss available to common shareholders by the weighted average number of shares outstanding during the year. Diluted earning per share reflect the potential dilution of securities that could share in earnings of an entity. In a loss year, potentially dilutive common shares are excluded from the loss per share calculation as the effect would be anti-dilutive. Basic and diluted loss per share are the same for the years presented.
For the period ended March 31, 2008, potentially dilutive common shares (relating to options outstanding at period end) totalling 4,480,000 (2007: 3,175,000) were not included in the computation of loss per share because their effect was anti-dilutive.
f) Income Taxes
The Company accounts for income taxes using the asset and liability method. Under this method, current income taxes are recognized for the estimated income taxes payable for the current period. Future income taxes assets and liabilities are recognized for temporary differences between the tax and accounting basis of assets and liabilities as well as for the benefit of losses available to be carried forward to future years for tax purposes only if it is more likely than not that they can be realized.
g) Foreign Currency Translation
Monetary items denominated in a foreign currency are translated into Canadian dollars at exchange rates prevailing at the balance sheet date and non-monetary items are translated at exchange rates prevailing when the assets were acquired or obligations incurred. Foreign currency denominated revenue and expense items are translated at exchange rates prevailing at the transaction date. Gains or losses arising from the translations are included in operations.
h) Stock-based Compensation
The Company has a stock-based compensation plan as disclosed in Note 8, whereby stock options are granted in accordance with the policies of regulatory authorities. The fair value of all share purchase options are expensed over their vesting period with a corresponding increase to contributed surplus. Upon exercise of share purchase options, the consideration paid by the option holder, together with the amount previously recognized in contributed surplus, is recorded as an increase to share capital.
The Company uses the Black-Scholes option valuation model to calculate the fair value of share purchase options at the date of grant. Option valuation models require the input of highly subjective assumptions, including the expected price volatility. Changes in these assumptions can materially affect the fair value estimate.
i) Asset Retirement Obligation
The fair value of obligations associated with the retirement of tangible long-lived assets are recorded in the period it is incurred with a corresponding increase to the carrying amount of the related asset. The obligations recognized are statutory, contractual or legal obligations. The liability is accreted over time for changes in the fair value of the liability through charges to accretion, which is included in depletion, amortization and accretion expense. The costs capitalized to the related assets are amortized in a manner consistent with the depletion and amortization of the related asset.
Radius Gold Inc.
(An Exploration Stage Company) Notes to the Interim Consolidated Financial Statements For the three month period ended March 31, 2008 Expressed in Canadian Dollars
2. Significant Accounting Policies – (cont’d)
i) Asset Retirement Obligation – (cont’d)
At March 31, 2008, the fair value of the mineral properties site restoration costs is not significant.
j) Impairment of Long-lived Assets
Canadian generally accepted accounting principles require that long-lived assets and intangibles to be held and used by the Company be reviewed for possible impairment whenever events or changes in circumstances indicate that the asset may not be recoverable. If changes in circumstances indicate that the carrying amount of an asset that an entity expects to hold and use may not be recoverable, future cash flows expected to result from the use of the asset and its disposition must be estimated. If the undiscounted value of the future cash flows is less that the carrying amount of the asset, impairment is recognized.
3. Change in Accounting Policies
Financial Instruments and Comprehensive Income
On January 1, 2007, The Company adopted CICA Section 1530 “Comprehensive Income”, Section 3251 “Equity”, Section 3855 “Financial Instruments – Recognition and Measurement”, Section 3861 “Financial Instruments – Disclosure and Presentation”, and Section 3865 “Hedges”. Section 1530 establishes standards for reporting and presenting comprehensive income, which is defined as the change in equity from transactions and other events from non-owner sources. Other comprehensive income refers to items recognized in comprehensive income that are excluded from net income calculated in accordance with Canadian generally accepted accounting princples.
Section 3861 establishes standards for presentation of financial instruments and non-financial derivatives and identifies the information that should be disclosed about them. Under the new standards, policies followed for the periods prior to the effective date generally are not reversed and, therefore, the comparative figures have not been restated. Section 3865 describes when and how hedge accounting can be applied as well as the disclosure requirements. Hedge accounting enables the recording of gains, losses, revenues and expenses from derivative financial instruments in the same period as for those related to the hedged item.
Section 3855 prescribes when a financial asset, financial liability or non-financial derivative is to be recognized on the balance sheet and at what amount, requiring fair value or cost-based measures under different circumstances. Under Section 3855, financial instruments must be classified into one of these five categories: held-for-trading, held-to-maturity, loans and receivables, available-for-sale financial assets or other financial liabilities. All financial instruments, including derivatives, are measured in the balance sheet at fair value except for loans and receivables, held-to-maturity investments and other financial liabilities which are measured at amortized cost. Subsequent measurement and changes in fair value will depend on their initial classification, as follows: held-for-trading financial assets are measured at fair value and changes in fair value are recognized in net earnings; available-for-sale financial instruments are measured at fair value with changes in fair value recorded in other comprehensive income until the investment is derecognized or impaired at which time the amounts would be recorded in net earnings.
The Company has made the following classifications:
The marketable securities have been classified as “available-for-sale”. They are initially recorded at cost which is equal to their fair value. Subsequent changes to the market value of the investments are recorded as changes to other comprehensive income.
Radius Gold Inc.
(An Exploration Stage Company) Notes to the Interim Consolidated Financial Statements For the three month period ended March 31, 2008 Expressed in Canadian Dollars
3. Change in Accounting Policies – (cont’d)
Under adoption of these new standards, the Company classified advances and other receivables and due from related parties as loans and receivables which are measured at amortized cost. Accounts payable and accrued liabilities and due to related parties are classified as other financial liabilities, which are measured at amortized cost.
Accounting Policy Choice for Transaction Costs
On June 1, 2007, the Emerging Issues Committee of the CICA issued Abstract No. 166, Accounting Policy Choice for Transaction Costs (“EIC-166). This EIC addresses the accounting policy choice of expensing or adding transaction costs related to the acquisition of financial assets and financial liabilities that are classified as other than held-for-trading. Specifically, it requires that the same accounting policy choice be applied to all similar financial instruments classified as other than held-for-trading, but permits a different policy choice for financial instruments that are not similar. The Company has adopted EIC-166 effective December 31, 2007 and requires retroactive application to all transaction costs accounted for in accordance with CICA Handbook Section 3855, Financial Instruments – Recognition and Measurement. The Company has evaluated the impact of EIC-166 and determined that no adjustments are currently required.
Future Accounting Changes
Capital Disclosures and financial Instruments – Disclosures and Presentation
On December 1, 2006, the CICA issued three new accounting standards: Handbook Section 1535, Capital Disclosures, Handbook Section 3862, Financial Instruments – Disclosures, and Handbook Section 3863, Financial instruments – Presentation. These standards are effective for interim and annual financial statements for the Company’s reporting period beginning on December 1, 2007.
Section 1535 specifies the disclosure of (i) an entity’s objectives, policies and processes for managing capital;
(ii) quantitative data about what the entity regards as capital; (iii) whether the entity has complied with any capital requirements; and (iv) if it has not complied, the consequences of such non-compliance.
The new Sections 3862 and 3863 replace Handbook Section 3861, Financial Instruments – Disclosure and Presentation, revising and enhancing its disclosure requirements, and carrying forward unchanged its presentation requirements. These new sections place increased emphasis on disclosures about the nature and extent of risks arising from financial instruments and how the entity manages those risks.
The Company is currently assessing the impact of these new accounting standards on its financial statements.
Accounting Changes
In July 2006, the Accounting Standards Board (“AcSB”) issued a replacement of The Canadian Institute of Chartered Accountants’ Handbook (“CICA Handbook”) Section 1506, Accounting Changes. The new standard allows for voluntary changes in accounting policy only when they result in the financial statements providing reliable and more relevant information, requires changes in accounting policy to be applied retrospectively unless doing so is impracticable, requires prior period errors to be corrected retrospectively and calls for enhanced disclosures about the effects of changes in accounting policies, estimates and errors on the financial statements. The impact that the adoption of Section 1506 will have on the Company’s results of operations and financial condition will depend on the nature of future accounting changes.
Radius Gold Inc.
(An Exploration Stage Company) Notes to the Interim Consolidated Financial Statements For the three month period ended March 31, 2008 Expressed in Canadian Dollars
3. Change in Accounting Policies – (cont’d)
International Financial Reporting Standards (“IFRS”) In 2006, the Canadian Accounting Standards Board (“AcSB”) published a new strategic plan that will significantly affect financial reporting requirements for Canadian companies. The AcSB strategic plan outlines the convergence of Canadian GAAP and IFRS over an expected five year transitional period. In February 2008 the AcSB announced that 2011 is the changeover date for publicly-listed companies to use IFRS, replacing Canada’s own GAAP. The date is for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. The transition date of January 1, 2011 will require the restatement for comparative purposes of amounts reported by the Company for the year ended December 31, 2010. While the Company has begun assessing the adoption of IFRS for 2011, the financial reporting impact of the transition to IFRS cannot be reasonably estimated at this time.
Marketable securities are recorded at market value as they are considered available for sale. Included in marketable securities is 7,406 common shares of a company with directors in common.
Three months ended March 31, 2008
| Cost | Accumulated Amortization | Net | ||||
|---|---|---|---|---|---|---|
| LandLeasehold improvementsTrucksComputer equipmentFurniture and equipmentGeophysical equipmentWebsite | $ | 44,838 15,322 399,830 136,854 84,392 36,445 4,800 | $ | - 15,322 209,807 79,748 31,432 16,686 3,941 | $ | 44,838 190,022 57,107 52,960 19,758 859 |
| $ | 722,481 | 356,936$ | $ | 365,545 | ||
Year ended December 31, 2007
| Cost | Accumulated Amortization | Net | ||||
|---|---|---|---|---|---|---|
| Land Leasehold improvements Trucks Computer equipment Furniture and equipment Geophysical equipment Website | $ | 44,838 15,322 361,524 131,412 39,756 36,445 4,800 | $ | - 15,322 201,849 76,137 31,376 15,652 3,872 | $ | 44,838 - 159,675 55,276 8,380 20,793 928 |
| $ | 634,096 | 344,208 $ | $ | 289,888 | ||
Radius Gold Inc.
(An Exploration Stage Company) Notes to the Interim Consolidated Financial Statements For the three month period ended March 31, 2008 Expressed in Canadian Dollars
6. Mineral Properties
Title to mineral properties involves certain inherent risks due to the difficulties of determining the validity of certain claims as well as the potential for problems arising from the frequently ambiguous conveyancing history characteristic of many mineral properties. The Company has investigated title to all of its mineral properties and, to the best of its knowledge, title to all of its properties are in good standing.
During the three month period ending March 31, 2008 The Company had field crews on the ground in three countries: Nicaragua, Peru and Mexico.
In Nicaragua, the Company resumed work again at Trebol, after the delay from the Hurricane, completing seventeen trenches and starting the drill program spending $200,000.The Company carried out preliminary drill testing of several of its other Nicaraguan projects and exploration work along with camp installations spending $333,390.
In Peru, the Company undertook regional target generation and evaluation of projects and opportunities and spent $124,278 as a result. The Company also acquired the Charpal concession for $36,817.
In Mexico, the Company continues with further regional targeting via structural interpretation and remote-sensing methods and has spent $160,934 doing so. The Company has also acquired a 100% interest in the Tlacolula property and carried out a stream sediment sampling program on the Tlacolula property spending $60,433 during the three months ending March 31, 2008.
In Guatemala, the Company spent $60,100 on the owned concession to keep in good standing.
7. Related Party Transactions
The Company incurred the following expenditures charged by officers and companies which have common
| directors with the Company: | ||||
|---|---|---|---|---|
| 2008 For the three months en | 2007 ded March 31, | |||
| Expenses: Management fees Consulting Salaries and benefits Mineral property costs: Geological consulting fees Salaries and benefits | $ | 15,000 $ 3,250 27,897 59,600 19,582 | 15,000 -19,720 18,000 10,181 | |
$ 125,329 $ 62,901
These expenditures were measured by the exchange amount which is the amount agreed upon by the transacting parties.
Advances and other receivables include $94,174 (2007:$26,665) due from directors and officers of the Company. These were funds advanced for Company expenses and any balance owed will be repaid in the normal course of business.
Due from related parties of $39,415 (2007: $50,498) are amounts due from companies which have a common director with the Company and arose from shared administrative costs. The balance owing is repayable in the normal course of business.
Accounts payable and accrued liabilities include $9,919 (2007: $15,778) payable to an officer of the Company.
Radius Gold Inc.
(An Exploration Stage Company) Notes to the Interim Consolidated Financial Statements For the three month period ended March 31, 2008 Expressed in Canadian Dollars
8. Share Capital
| a) | Authorized: | ||||
|---|---|---|---|---|---|
| Unlimited common shares without par value | |||||
| b) | Issued: | Number of Shares | Price Per Share $ | Amount $ | |
| Balance December 31, 2005 | 53,310,988 | 42,402,819 | |||
| Exercise of stock options | 75,000 | 0.68 | 51,000 | ||
| Transfer of contributed surplus on exercise of options | - | 75,000 | 0.43 | 32,250 | |
| Balance December 31, 2006 | 53,385,988 | 42,486,069 | |||
| Exercise of stock options | 12,500 | 0.56 | 7,000 | ||
| Acquisition of property | 50,000 | 0.58 | 29,000 | ||
| Acquisition of property | 100,000 | 0.64 | 64,000 | ||
| Transfer of contributed surplus on exercise of options | 12,500 | 0.09 | 1,125 | ||
| Balance December | |||||