Japan Gold : Financial Statements - September 30, 2021

CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHS ENDED

SEPTEMBER 30, 2021 AND 2020

(Unaudited - expressed in Canadian dollars)

JAPAN GOLD CORP.

CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

September 30, 2021

Notice of No Auditor Review

The accompanying unaudited condensed consolidated interim financial statements of Japan Gold Corp. for the three and nine month period ended September 30, 2021 have been prepared by the Company's management and approved by the Audit Committee and Board of Directors of the Company.

In accordance with National Instrument 51-102, the Company discloses that its independent auditor has not performed a review of these unaudited condensed consolidated interim financial statements.

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JAPAN GOLD CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION (Unaudited - Expressed in Canadian dollars)

As at	September 30, 2021		December 31, 2020
Assets
Current
Cash and cash equivalents (Note 3)	$	13,996,086	$	2,368,000
Restricted cash (Note 4)		4,033		1,004,412
Accounts receivable		454,199		90,548
Prepaid expenses and deposits		150,229		253,766
		14,604,547		3,716,726
Non-Current Assets
Deposit		103,483		106,583
Exploration and evaluation assets (Note 4)		18,005,742		16,304,050
Property, plant and equipment (Note 5)		289,630		385,368
Software		-		13,882
Right of use asset (Note 6)		87,875		129,879
Total assets	$	33,091,277	$	20,656,488
Liabilities
Current
Accounts payable and accrued liabilities (Note 9)	$	751,451	$	1,020,625
Current portion of lease liability (Note 7)		17,585		72,995
		769,036		1,093,620
Non-Current Liabilities
Lease liability (Note 7)		26,997		34,725
Total liabilities		796,033		1,128,345
Shareholders' equity
Share capital (Note 8)		53,598,471		37,750,321
Contributed surplus		5,466,343		4,967,021
Accumulated other comprehensive income (loss)		(974,899)		316,723
Deficit		(25,794,671)		(23,505,922)
Total shareholders' equity		32,295,244		19,528,143
Total liabilities and shareholders' equity	$	33,091,277	$	20,656,488

Nature and continuance of operations (Note 1)

Subsequent events (Note 4)

Approved by the Board of Directors and authorized for issuance on November 26, 2021:

On behalf of the Board of Directors

"Murray Flanigan" Director

"John Proust"

Director

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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JAPAN GOLD CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF LOSS AND COMPREHENSIVE LOSS (Unaudited - expressed in Canadian dollars)

		Three months		Three months Nine months ended		Nine months
	ended September	ended September		September 30,	ended September
For the periods ended		30, 2021		30, 2020		2021		30, 2020
Expenses
Audit	$	13,750	$	14,105	$	65,314	$	59,827
Consulting		75,460		45,973		234,805		165,818
Depreciation		1,148		835		5,385		1,884
Director fees		38,222		45,685		114,666		99,556
Filing and regulatory		12,899		935		76,448		63,443
Foreign exchange loss		11,533		74,890		39,377		171,793
Occupancy and office		93,227		86,345		224,477		261,226
Insurance		10,127		10,585		30,314		33,241
Investor relations		207,066		174,550		445,931		419,548
Management fees		141,000		141,000		423,000		423,000
Marketing		-		-		-		13,127
Professional fees		18,025		30,433		78,652		243,662
Project evaluation		66,820		(239,178)		273,491		17,921
Share-based compensation (Note 8)		41,729		115,101		249,821		666,156
Transfer agent		8,234		5,183		12,467		10,343
Travel		4,676		5,368		14,006		44,012
Loss before other items	$	743,916	$	511,810	$	2,288,154	$	2,694,557
Other items
Financing expense (Note 9)		4,860		3,165		13,102		103,282
Interest income		-		(2,759)		(12,507)		(14,432)
		4,860		406		595		88,850
Net loss for the period		748,776		512,216		2,288,749		2,783,407
Foreign exchange loss (gain) on translation of
foreign operations		(290,475)		18,512		1,291,622		(570,716)
Net comprehensive loss for the period	$	458,301	$	530,728	$	3,580,371	$	2,212,691
Loss per share
Basic and diluted loss per share	$	(0.00)	$	(0.00)	$	(0.01)	$	(0.02)
Weighted average number of shares
outstanding		220,666,876		175,082,816		191,133,451		156,911,218

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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JAPAN GOLD CORP.

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS (Unaudited - Expressed in Canadian dollars)

For the periods ended	September 30, 2021	September 30, 2020
Cash flows from operating activities
Net loss for the period	$	(2,288,749)	$	(2,783,407)
Adjustments for:
Share-based compensation (Note 8)		249,821		666,156
Depreciation (Note 5)		5,385		1,884
Financing expense		13,102		103,282
Interest income		(12,507)		(14,432)
Interest received		12,507		14,432
Unrealized foreign exchange loss		39,377		-
Changes in non-cash working capital items:
Accounts receivable, prepaid expenses and deposits		732,709		(655,505)
Accounts payable and accrued liabilities		(215,594)		52,730
Net cash used in operating activities		(1,463,949)		(2,614,860)
Cash flows from investing activities
Exploration and evaluation expenditure (Note 4)		(2,887,706)		(3,193,181)
Acquisition of property, plant and equipment and software (Note 5)		(29,308)		(16,823)
Net cash used in investing activities		(2,917,014)		(3,210,004)
Cash flows from financing activities
Proceeds received from private placement, net of issuance cost		15,976,208		7,339,682
Proceeds received from exercise of warrants (Note 8)		121,443		403,630
Lease payments (Note 7)		(87,023)		(60,430)
Loan from related party (Note 9)		-		1,100,000
Cash financing expense paid on related party loan		-		(55,000)
Repayment of related party loan (Note 9)		-		(100,000)
Net cash from financing activities		16,010,628		8,627,882
Change in cash and cash equivalents during the period	$	11,629,665	$	2,803,018
Effect of foreign exchange on cash and cash equivalents		(1,579)		(1,638)
Cash and cash equivalents, beginning of the period		2,368,000		1,452,270
Cash and cash equivalents, end of the period	$	13,996,086	$	4,253,650

The accompanying notes are an integral part of these condensed consolidated interim financial statements.

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