Financial Statements
December 31, 2023 and 2022
(Expressed in Canadian Dollars)
Independent Auditor's Report
To the Shareholders of Purepoint Uranium Group Inc.:
Opinion
We have audited the financial statements of Purepoint Uranium Group Inc. (the "Company"), which comprise the
statements of financial position as at December 31, 2023 and December 31, 2022, and the statements of loss and
comprehensive loss, changes in equity and cash flows for the years then ended, and notes to the financial
statements, including a summary of significant accounting policies.
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of
the Company as at December 31, 2023 and December 31, 2022, and its financial performance and its cash flows for
the years then ended in accordance with International Financial Reporting Standards.
Basis for Opinion
We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities
under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated
Financial Statements section of our report. We are independent of the Company in accordance with the ethical
requirements that are relevant to our audits of the financial statements in Canada, and we have fulfilled our other
ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our opinion.
Material Uncertainty Related to Going Concern
We draw attention to Note 2 in the financial statements, which indicates that the Company incurred a net loss during
the year ended December 31, 2023 and, as of that date, the Company had an accumulated deficit. As stated in Note
2, these events or conditions, along with other matters as set forth in Note 2, indicate that a material uncertainty
exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not
modified in respect of this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
financial statements of the current period. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these
matters.
Except for the matter described in the Material Uncertainty Related to Going Concern section, we have determined
that there are no other key audit matters to communicate in our report.
MNP LLP
50 Burnhamthorpe Road West, Suite 900, Mississauga ON, L5B 3C2 | T: 416.626.6000 F: 416.626.8650 |
Other Information
Management is responsible for the other information. The other information comprises Management's Discussion
and Analysis.
Our opinion on the financial statements does not cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audits of the financial statements, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial statements or our
knowledge obtained in the audits or otherwise appears to be materially misstated. We obtained Management's
Discussion and Analysis prior to the date of this auditor's report. If, based on the work we have performed on this
other information, we conclude that there is a material misstatement of this other information, we are required to
report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Consolidated Financial
Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with
International Financial Reporting Standards, and for such internal control as management determines is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to fraud or
error.
In preparing the financial statements, management is responsible for assessing the Company's ability to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic
alternative but to do so.
Those charged with governance are responsible for overseeing the Company's financial reporting process.
Auditor's Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
Canadian generally accepted auditing standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements.
As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional
judgment and maintain professional skepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the Company's internal control.
50 Burnhamthorpe Road West, Suite 900, Mississauga, Ontario, L5B 3C2
T: 416.626.6000 F: 416.626.8650 MNP.ca
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by management.
- Conclude on the appropriateness of management's use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that
may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our auditor's report to the related
disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future
events or conditions may cause the Company to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content of the financial statements, including the disclosures,
and whether the financial statements represent the underlying transactions and events in a manner that
achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audits and significant audit findings, including any significant deficiencies in internal control that we
identify during our audits.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter
or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
The engagement partner on the audit resulting in this independent auditor's report is Andrew Kevin Spidle.
Mississauga, Ontario | Chartered Professional Accountants |
April 2, 2024 | Licensed Public Accountants |
50 Burnhamthorpe Road West, Suite 900, Mississauga, Ontario, L5B 3C2
T: 416.626.6000 F: 416.626.8650 MNP.ca
Statements of Financial Position
As at December 31, 2023 and 2022
(Expressed in Canadian Dollars)
2023 | 2022 | |
$ | $ | |
Assets | ||
Current assets | ||
Cash | 4,054,315 | 3,925,659 |
Accounts receivable | 87,408 | 162,119 |
Receivable from projects (note 6) | 57,619 | 36,559 |
Prepaid expenses | 75,881 | 83,062 |
Deposits (note 8) | 114,292 | 275,647 |
4,389,515 | 4,483,046 | |
Property, equipment and | ||
Right of use asset (note 4) | 71,224 | 994 |
4,460,739 | 4,484,040 | |
Liabilities | ||
Current liabilities | ||
Accounts payable and accrued liabilities | 234,406 | 90,284 |
Current portion of lease liability (note 7) | 35,000 | - |
269,406 | 90,284 | |
Long term portion of lease liability (note 7) | 40,227 | - |
309,633 | 90,284 | |
Shareholders' equity | ||
Share capital (note 9(a)) | 48,441,470 | 46,018,773 |
Contributed surplus (note 10) | 17,654,148 | 15,148,193 |
Deficit | (61,944,512) | (56,773,210) |
4,151,106 | 4,393,756 | |
4,460,739 | 4,484,040 | |
Note 2 : Basis of presentation and going concern |
The accompanying notes are an integral part of these financial statements.
Approved by the Board | |||
signed: "Borys Chabursky" | signed: "Allan Beach" | ||
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Statements of Loss and Comprehensive Loss
For the years ended December 31, 2023 and 2022
(Expressed in Canadian Dollars)
2023 | 2022 | |
$ | $ | |
Expenses | ||
Mining exploration and evaluation expenditures (notes 4 and 5) | 3,146,690 | 4,676,147 |
Mining exploration and evaluation salaries and benefits (note 15) | 545,141 | 575,137 |
Share-based payments (notes 10 and 15) | 871,305 | 376,912 |
Salaries, compensations and benefits (note 15) | 261,200 | 243,200 |
Investor relations | 300,292 | 466,308 |
Professional fees | 215,515 | 267,254 |
General and administration | 28,307 | 30,511 |
Insurance | 50,979 | 42,867 |
Transfer agent and filing fees | 72,935 | 105,309 |
Travel | 30,637 | 24,314 |
Depreciation (note 4) | - | 458 |
5,523,001 | 6,808,417 | |
Other | ||
Operator fees and other recoveries (note 6) | (286,444) | (202,676) |
Interest income | (65,255) | (46,884) |
Premium on a flow-through shares | - | (205,714) |
(351,699) | (455,274) | |
Net loss and comprehensive loss | (5,171,302) | (6,353,143) |
Basic and diluted loss per common share (note 12) | (0.01) | (0.02) |
Weighted average number of shares (note 12) | 421,807,435 | 364,723,523 |
The accompanying notes are an integral part of these financial statements.
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Statements of Changes in Equity
For the years ended December 31, 2023 and 2022
(Expressed in Canadian Dollars)
Share capital | |||||
Number of | Contributed | Equity | |||
shares | Amount | surplus | Deficit | total | |
$ | $ | $ | $ | ||
Balance at January 1, 2023 | 417,532,288 | 46,018,773 | 15,148,193 | (56,773,210) | 4,393,756 |
Issuance of common shares | |||||
from private placements (note 9(a)) | 83,190,477 | 4,350,000 | - | - | 4,350,000 |
Fair value of issued warrants | |||||
from private placements | - | (1,470,711) | 1,470,711 | - | - |
Fair value of finders fee | |||||
compensation warrants | - | (163,939) | 163,939 | - | - |
Expenses of the private placements | - | (292,653) | - | - | (292,653) |
Share-based payment (notes 10 and 15) | - | - | 871,305 | - | 871,305 |
Net loss | - | - | - | (5,171,302) | (5,171,302) |
Balance at December 31, 2023 (note 9(a)) | 500,722,765 | 48,441,470 | 17,654,148 | (61,944,512) | 4,151,106 |
Balance at January 1, 2022 | 343,351,111 | 41,980,262 | 12,404,406 | (50,420,067) | 3,964,601 |
Issuance of common shares | |||||
from private placements (note 9(a)) | 73,643,857 | 6,905,140 | - | - | 6,905,140 |
Fair value of issued warrants | |||||
from private placements | - | (2,149,244) | 2,149,244 | - | - |
Fair value of finders fee | |||||
compensation warrants | - | (258,112) | 258,112 | - | - |
Expenses of the private placements | - | (542,710) | - | - | (542,710) |
Exercise of warrants and options (note 9(a)) | 537,320 | 42,956 | - | - | 42,956 |
Fair value of exercised warrants and options | - | 40,481 | (40,481) | - | - |
Share-based payments (notes 10 and 15) | - | - | 376,912 | - | 376,912 |
Net loss | - | - | - | (6,353,143) | (6,353,143) |
Balance at December 31, 2022 (note 9(a)) | 417,532,288 | 46,018,773 | 15,148,193 | (56,773,210) | 4,393,756 |
The accompanying notes are an integral part of these financial statements.
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Statements of Cash Flows
For the years ended December 31, 2023 and 2022
(Expressed in Canadian Dollars)
2023 | 2022 | |
$ | $ | |
Cash flow from operating activities | ||
Net loss for the year | (5,171,302) | (6,353,143) |
Items not affecting cash: | ||
Depreciation | 35,451 | 35,152 |
Interest on lease liability | 12,890 | 3,185 |
Premium on flow-through shares | - | (205,714) |
Share-based payments | 871,305 | 376,912 |
(4,251,656) | (6,143,608) | |
Changes in non-cash items relating to operating activities: | ||
Accounts receivable | 74,711 | (35,901) |
Prepaid expenses | 7,181 | 24,281 |
Deposits | 161,355 | (224,285) |
Accounts payable and accrued liabilities | 144,120 | (238,512) |
Receivables from joint venturers, net | (21,060) | (92,699) |
(3,885,349) | (6,710,724) | |
Cash flow from financing activities | ||
Proceeds from exercise of options and warrants, net of costs | - | 42,956 |
Proceeds from issuance of shares, net of costs | 4,057,347 | 6,362,430 |
Amount paid on lease liability | (43,342) | (44,573) |
4,014,005 | 6,360,813 | |
Net increase (decrease) in cash | 128,656 | (349,911) |
Cash - Beginning of the year | 3,925,659 | 4,275,570 |
Cash - End of the year | 4,054,315 | 3,925,659 |
The accompanying notes are an integral part of these financial statements.
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Notes to the Financial Statements
For the years ended December 31, 2023 and 2022
(Expressed in Canadian Dollars)
-
GENERAL INFORMATION
Purepoint Uranium Group Inc. ("the Company") is a Canadian resource company engaged in the acquisition, exploration and development of properties for the purpose of producing uranium. The
Company's principal assets are mineral properties located in Saskatchewan. The ability of the Company to realize the costs it has incurred to date on these and other properties is dependent upon the discovery of economically recoverable reserves, the preservation of the Company's interest in the underlying mining claims, the ability to continue to raise adequate financing and to commence profitable operations in the future, or alternatively, upon the disposal of properties, or the Company's interests therein, on an advantageous basis.
The Company's head office is located at 120 Adelaide Street West, Suite 2500, Toronto, Ontario, M5H 1T1, Canada. - BASIS OF PRESENTATION AND GOING CONCERN
These financial statements have been prepared on a going concern basis. The going concern basis of presentation assumes that the Company will continue in operation for the foreseeable future and be able to realize its assets and discharge its liabilities and commitments in the normal course of business.
During the year ended December 31, 2023, the Company incurred a net loss of $5,171,302 (2022 - $6,353,143), and as of that date, the Company's accumulated deficit was $61,944,512 (December 31, 2022 - $56,773,210). As at December 31, 2023, the Company had available working capital of $4,120,109 (December 31, 2022 - $4,392,762), including a cash balance of $4,054,315 (December 31, 2022 - $3,925,659), which it can deploy to fulfill financial requirements for the 12-month period ending December 31, 2024.
The ability of the Company to continue as a going concern is dependent on the successful completion of the actions taken or planned. In order to meet future expenditures and cover administrative costs, the Company will need to raise additional financing. Although the Company has been successful in raising funds to date, there can be no assurance that adequate funding will be available in the future, or available under terms favourable to the Company. These circumstances and the volatile and speculative nature of the mining business, represent material uncertainties which may cast doubt on the Company's ability to continue as a going concern.
These financial statements do not reflect adjustments that would be necessary if the going concern assumption were not appropriate. If the going concern basis was not appropriate for these financial statements, then adjustments would be necessary in the carrying value of assets and liabilities, the reported expenses, and the statement of financial position classifications used.
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Notes to the Financial Statements
For the years ended December 31, 2023 and 2022
(Expressed in Canadian Dollars)
3. MATERIAL ACCOUNTING POLICIES
(a) Statement of compliance
These financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and Intrepretations of the IFRS Interpretations Committee ("IFRIC"). The accounting policies set out below were consistently applied to all periods presented in these financial statements.
These financial statements were reviewed, approved and authorized for issuance by the Board of Directors (the "Board") of the Company on April 2, 2024.
(b) Basis of preparation
The financial statements are presented in Canadian dollars. The financial statements are prepared on the historical cost basis.
(c) Share-based payments
The share option plan allows Company employees and consultants to acquire shares of the Company. The fair value of options granted is recognized as an employee or consultant expense with a corresponding increase in equity. An individual is classified as an employee when the individual is an employee for legal or tax purposes (direct employee) or provides services similar to those performed by a direct employee, including directors of the Company. The fair value of the stock options granted is measured at grant date and each tranche is recognized on a graded basis over the period during which the options vest. The fair value of the options granted is measured using the Black-Scholes option pricing model taking into account the terms and conditions upon which the options were granted. At the end of each reporting period, the amount recognized as an expense for unvested options is adjusted to reflect the actual number of share options that are expected to vest.
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Purepoint Uranium Group Inc. published this content on 03 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 April 2024 19:32:06 UTC.