natan resources ltd. interim financial statements - Canadian Stocks

NATAN RESOURCES LTD. 

INTERIM FINANCIAL STATEMENTS 

(UNAUDITED) 

FOR THE THREE MONTHS ENDED JULY 31, 2011 

EXPRESSED IN CANADIAN DOLLARS


July 31, 2011 

(Expressed in Canadian Dollars - Unaudited) 

NOTICE OF NO AUDITOR REVIEW OF INTERIM FINANCIAL STATEMENTS 

The accompanying unaudited interim financial statements of the Company have been prepared by and are 

the responsibility of the Company’s management. 

The Company’s independent auditor has not performed a review of these financial statements in accordance 

with standards established by the Canadian Institute of Chartered Accountants for a review of interim 

financial statements by an entity’s auditor. 

Under National Instrument 51-102, Part 4, Subsection 4.3(3)(a), if an auditor has not performed a review of the interim financial 

statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor. 

1


July 31, 2011 


Page 

Notice to Reader 1 

Content 2 

Interim Statements of Financial Position 3 

Interim Statements of Comprehensive Loss 4 

Interim Statements of Cash Flows 5 

Interim Statements of Changes in Shareholders’ Equity 6 

Notes to Interim Financial Statements 7-17 

2


Interim Statements of Financial Position 


Assets 

July 31, April 30, August 18, 

2011 2011 

2010 

(Note 8) 

$ $ $ 

Current 

Cash 951,224 421,572 - 

Prepaid expenses 4,000 4,000 - 

955,224 425,572 - 

Due from shareholders - - 1 

Liabilities 

955,224 425,572 1 

Current 

Accounts payable and accrued liabilities 15,126 12,248 - 

Advance due to director (Note 4) 10,000 10,000 - 

25,126 22,248 - 

Shareholders' equity 

Capital stock (Note 3) 951,155 409,671 1 

Reserves (Note 3) 81,688 81,688 - 

Deficit (102,745) (88,035) - 

930,098 403,324 1 

Nature and Continuance of Operations (Note 1) and Subsequent Events (Note 7) 

955,224 425,572 1 

Approved and authorized by the Board on October 31, 2011. 

On Behalf of the Board: 

“Brett Matich” 

Brett Matich, Director 

“Joel Schuster” 

Joel Schuster, Director 

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

3


Interim Statements of Comprehensive Loss 


For the 

three months 

ended July 31, 

2011 

$ 

Expenses 

Bank charge and interest 52 

Office 281 

Regulatory and shareholders service 4,857 

Rent 9,520 

Loss and comprehensive loss for the period (14,710) 

Basic and diluted loss per share (0.00) 

Weighted average number of common 

shares outstanding 4,228,262 

There are no comparative figures for the period ended July 31, 2010 because the Company was incorporated on August 18, 

2010. 


4


Interim Statements of Cash Flows 


For the 

three months 

ended July 31, 

2011 

$ 

Cash flows used in operating activities 

Loss for the period (14,710) 

Changes in non-cash working capital item 

Increase in accounts payable 2,878 

(11,832) 

Cash flows from financing activities 

Proceeds from share issuances 550,000 

Share issuance costs (8,516) 

541,484 

Net change in cash 529,652 

Cash, beginning of period 421,572 

Cash, end of period 951,224 

There are no comparative figures for the period ended July 31, 2010 because the Company was incorporated on August 18, 

2010. 


5


Interim Statements of Changes in Shareholders’ Equity 


Total 

Number of 

Shares Issued Capital Stock Reserves Deficit 

Shareholders' 

Equity 

$ $ $ $ 

Balance at August 18, 2010 - - - - - 

Share issued on incorporation 1 1 - - 1 

Shares issued for cash 8,400,000 520,000 - - 520,000 

Share issuance costs - (110,330) 12,220 - (98,110) 

Share based compensation - - 69,468 - 69,468 

Loss for the period - - - (88,035) (88,035) 

Balance at April 30, 2011 8,400,001 409,671 81,688 (88,035) 403,324 

Shares issued for cash 5,000,000 550,000 - - 550,000 

Share issuance costs - (8,516) - - (8,516) 

Loss for the period - - - (14,710) (14,710) 

Balance at July 31, 2011 13,400,001 951,155 81,688 (102,745) 930,098 

There are no comparative figures for the period ended July 31, 2010 because the Company was incorporated on August 18, 2010. 


6


Notes to Interim Financial Statements 

For the three months ended July 31, 2011 


NOTE 1 - Nature and Continuance of Operations 

Natan Resources Ltd. (the “Company”) was incorporated on August 18, 2010 under the Business Corporations Act of British 

Columbia. On April 13, 2011, the Company successfully completed its Initial Public Offering (“IPO”) to be classified as a 

Capital Pool Company as defined in the TSX Venture Exchange (“TSX-V”) Policy 2.4. On April 15, 2011, the Company began 

trading its stock on the TSX-V under the symbol NRL.P. The principal business of the Company is the identification and 

evaluation of assets or a business and, once identified or evaluated, to negotiate an acquisition or participation in a business 

subject to receipt of shareholder approval, if required, and acceptance by regulatory authorities (the “Qualifying Transaction”). 

On August 31, 2011, the Company signed a non-binding letter of intent ("LOI") with the principal security holders of Wantsa, 

namely Caring Capital Corporation, David Strebinger, and Donald Kirkwood, which sets out the proposed terms and conditions 

of a transaction whereby the Company and United Media Partners Inc., doing business as Wantsa ("Wantsa") will undertake a 

business combination. Wantsa, a private company incorporated in British Columbia, holds intellectual property which provides 

solutions and a technology platform for creating and distributing offers, coupons, incentives, and deals to online and mobile 

consumers (Note 7). 

The Company’s head office, principal address and registered and records office is Suite 2000 – 1177 West Hastings Street, 

Vancouver, British Columbia, Canada, V6E 2K3. 

These unaudited interim financial statements have been prepared on the assumption that the Company will continue as a going 

concern, meaning it will continue in operation for the foreseeable future and will be able to realize assets and discharge 

liabilities in the ordinary course of operations. Different bases of measurement may be appropriate if the Company is not 

expected to continue operations for the foreseeable future. As at July 31, 2011 the Company had no commercial activity and is 

not able to finance day to day activities through operations. 

The Company’s continuation as a going concern is dependent upon ability to close the Qualifying Transaction or to identify, 

evaluate and negotiate an acquisition of, a participation in or an interest in properties, assets or businesses within 24 months of 

listing on the TSX-V. Such an acquisition will be subject to regulatory approval and may be subject to shareholder approval. 

In order to continue as a going concern and meet its corporate objectives, the Company will require additional financing 

through debt or equity issuances or other available means. During the three months ended July 31, 2011, the Company raised 

$550,000 in gross proceeds from a private placement. However, there is no assurance that the Company will be able to obtain 

adequate financing in the future or that such financing will be on terms advantageous to the Company. Furthermore, there is no 

assurance that the Company will complete the above-mentioned transaction by April 13, 2013, at which time the TSX-V may 

suspend or de-list the Company’s shares from trading. 

The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset 

amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence. 

7





NOTE 2 - Significant Accounting Policies and Basis of Preparation 

The following is a summary of significant accounting policies used in the preparation of these financial statements. 

Statement of compliance and conversion to International Financial Reporting Standards 

These interim financial statements, including comparatives, have been prepared in accordance with International Accounting 

Standards (“IAS”) 34, “Interim Financial Reporting” using accounting policies consistent with International Financial Reporting 

Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and Interpretations issued by the 

International Financial Reporting Interpretations Committee (“IFRIC”). 

This condensed interim financial report does not include all of the information required of a full annual financial report and is 

intended to provide users with an update in relation to events and transactions that are significant to an understanding of the 

changes in financial position and performance of the Company since the end of the last annual reporting period. It is therefore 

recommended that this financial report be read in conjunction with the annual financial statements of the Company for the 

period ended April 30, 2011. However, this interim financial report, being the first IFRS financial report, provides selected 

significant disclosures that are required in the annual financial statements under IFRS. The disclosures concerning the 

transition from Canadian Generally Accepted Accounting Principles (“Canadian GAAP”) to IFRS are provided in Note 8. 

Basis of presentation 

The financial statements of the Company have been prepared on an accrual basis and are based on historical costs, modified 

where applicable. The financial statements are presented in Canadian dollars unless otherwise noted. 

Use of estimates 

The preparation of the Company’s financial statements in conformity with IFRS requires management to make judgments, 

estimates and assumptions that affect the reported amounts of assets, liabilities and contingent liabilities at the date of the 

financial statements and reported amounts of revenues and expenses during the reporting period. Estimates and assumptions are 

continuously evaluated and are based on management’s experience and other factors, including expectations of future events 

that are believed to be reasonable under the circumstances. However, actual outcomes can differ from these estimates. 

Areas requiring a significant degree of estimation and judgment relate to the determination of fair value measurements for 

financial instruments and share-based compensation and other equity-based payments, and the recoverability and measurement 

of deferred tax assets and liabilities. Actual results may differ from those estimates and judgments. 

Share-based payments 

The Company operates an employee stock option plan. Share-based payments to employees are measured at the fair value of the 

instruments issued and amortized over the vesting periods. Share-based payments to non-employees are measured at the fair 

value of goods or services received or the fair value of the equity instruments issued, if it is determined the fair value of the 

goods or services cannot be reliably measured, and are recorded at the date the goods or services are received. The 

corresponding amount is recorded to the stock option reserve. The fair value of options is determined using the Black–Scholes 

pricing model which incorporates all market vesting conditions. The number of shares and options expected to vest is reviewed 

and adjusted at the end of each reporting period such that the amount recognized for services received as consideration for the 

equity instruments granted shall be based on the number of equity instruments that eventually vest. 

Reserves 

The stock option reserve records items recognized as share-based compensation expense until such time that the stock options are 

exercised, at which time the corresponding amount will be transferred to share capital. If vested options expire unexercised or are 

forfeited, the amount recorded is transferred to deficit. 

8





NOTE 2 - Significant Accounting Policies and Basis of Preparation – (continued) 

Financial instruments 

Financial assets 

The Company classifies its financial assets into one of the following categories as follows: 

Fair value through profit or loss - This category comprises derivatives and financial assets acquired principally for the purpose 

of selling or repurchasing in the near term. They are carried at fair value with changes in fair value recognized in profit or loss. 

The Company classifies cash as fair value through profit or loss. 

Loans and receivables - These assets are non-derivative financial assets with fixed or determinable payments that are not quoted 

in an active market. They are carried at amortized cost using the effective interest method less any provision for impairment. 

Held-to-maturity investments - These assets are non-derivative financial assets with fixed or determinable payments and fixed 

maturities that the Company's management has the positive intention and ability to hold to maturity. These assets are measured 

at amortized cost using the effective interest method less any provision for impairment. 

Available-for-sale - Non-derivative financial assets not included in the above categories are classified as available-for-sale. 

They are carried at fair value with changes in fair value recognized in other comprehensive income (loss). Where a decline in 

the fair value of an available-for-sale financial asset constitutes objective evidence of impairment, the amount of the loss is 

removed from accumulated other comprehensive income (loss) and recognized in profit or loss. 

All financial assets except those measured at fair value through profit or loss are subject to review for impairment at least at 

each reporting date. Financial assets are impaired when there is objective evidence of impairment as a result of one or more 

events that have occurred after initial recognition of the asset and that event has an impact on the estimated future cash flows of 

the financial asset or the group of financial assets. 

Financial liabilities 

The Company classifies its financial liabilities into one of two categories as follows: 

Fair value through profit or loss - This category comprises derivatives and financial liabilities incurred principally for the 

purpose of selling or repurchasing in the near term. They are carried at fair value with changes in fair value recognized in profit 

or loss. 

Other financial liabilities: This category consists of liabilities carried at amortized cost using the effective interest method, and 

includes accounts payable, and advance due to director. 

As at July 31, 2011, the Company does not have any derivative financial assets and liabilities. 

Income taxes 

Current income tax: 

Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered from or 

paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or 

substantively enacted, at the reporting date, in the country where the Company operates and generates taxable income. 

Current income tax relating to items recognized directly in other comprehensive income or equity is recognized in other 

comprehensive income or equity and not in profit or loss. Management periodically evaluates positions taken in the tax returns 

with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where 

appropriate. 

9





NTE 2 - Significant Accounting Policies and Basis of Preparation – (continued) 

Income taxes (continued) 

Deferred income tax: 

Deferred income tax is provided using the balance sheet method on temporary differences at the reporting date between the tax 

bases of assets and liabilities and their carrying amounts for financial reporting purposes. The carrying amount of deferred 

income tax assets is reviewed at the end of each reporting period and recognized only to the extent that it is probable that 

sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilized. 

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is 

realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of 

the reporting period. 

Deferred income tax assets and deferred income tax liabilities are offset, if a legally enforceable right exists to set off current 

tax assets against current income tax liabilities and the deferred income taxes relate to the same taxable entity and the same 

taxation authority. 

Loss per share 

Basic earnings (loss) per share is computed by dividing net earnings (loss) available to common shareholders by the weighted 

average number of shares outstanding during the reporting period. Diluted earnings (loss) per share is computed similar to basic 

earnings (loss) per share except that the weighted average shares outstanding are increased to include additional shares for the 

assumed exercise of stock options and warrants, if dilutive. The number of additional shares is calculated by assuming that 

outstanding stock options and warrants were exercised and that the proceeds from such exercises were used to acquire common 

stock at the average market price during the reporting periods. 

Accounting pronouncements not yet adopted 

A number of new standards, amendments to standards and interpretations applicable to the Company are not yet effective for 

the three months ended July 31, 2011 and have not been applied in preparing these financial statements. The Company is 

currently considering the possible effects of the new and revised standards which will be effective to the Company’s financial 

statements for the year ending April 30, 2012 or later: 

Title of the new IFRS standard 

Required 

application date 

of the IFRS 

Amendments to IAS 12 – Income Taxes - Deferred Tax: 

For periods beginning on or 

Recovery of Underlying Assets after January 1, 2012. 

IFRS 9, Financial Instruments 

IFRS 10, Consolidated Financial Statements 

IFRS 11, Joint Arrangements 

IFRS 12, Disclosure of Interests in Other Entities 


after January 1, 2013. 







10





NOTE 3 - Capital Stock and Reserves 

Authorized share capital 

Unlimited number of common shares without par value 

Unlimited Class “A” preference shares with a par value of $1.00 

Unlimited Class “B” preference shares with a par value of $5.00 

Issued share capital 

In August 2010, the Company issued 1 common share at a price of $1.00 per share on incorporation. 

In September 2010, the Company issued 2,000,000 common shares at a price of $0.05 per share for total proceeds of $100,000 

through a private placement. 

In October 2010, the Company issued 4,400,000 common shares at a price of $0.05 per share for total proceeds of $220,000 through a 

private placement. 

In April 2011, the Company completed its IPO by issuing 2,000,000 common shares at $0.10 per share for a gross proceeds of 

$200,000. Pursuant to an Agency Agreement between the Company and Canaccord Genuity Corp. (the “Agent”), the Agent 

received a cash commission of $20,000, equal to 10% of the gross proceeds, an administration fee of $10,000 and expenses of 

$10,500. Legal fees and other transaction costs of $57,610 were incurred. 

In June 2011, the Company issued 5,000,000 common shares at a price of $0.11 per share for total proceeds of $550,000 through a 

private placement. Legal fees and other transaction costs of $8,516 were incurred. 

The Company entered into an Escrow Agreement with Computershare Trust Company of Canada, whereby 6,400,000 common 

shares were placed into escrow, and upon completion of its Qualifying Transaction, 10% of the escrowed shares will be 

released. The remainder of the escrowed shares will be released in six equal tranches of 15% every six months thereafter for a 

period of 36 months. These escrow shares may not be transferred, assigned or otherwise dealt with without the consent of the 

regulatory authorities. As at July 31, 2011, the Company has 6,400,000 common shares subject to escrow pursuant to the 

requirements of the TSX-V. 

Share Purchase Warrants 

In conjunction with the IPO, the Company issued 200,000 agent’s warrants exercisable at $0.10 per share for a period of two years. 

The agent’s warrants were valued at $12,220 calculated using the Black-Scholes option pricing model assuming a life expectancy of 

two years, a risk free rate of 1.82%, expected dividend yield of 0%, a forfeiture rate of 0%, and volatility of 120%. 

A summary of share purchase warrant activities are as follows: 

Number of 

warrants 

Weighted 

average 

exercise price 

$ 

Outstanding and exercisable at August 18, 2010 - - 

Issued 200,000 0.10 

Outstanding and exercisable at April 30, 2011 and July 31, 2011 200,000 0.10 

11





NOTE 3 - Capital Stock and Reserves – (continued) 

Share Purchase Warrants (continued) 

A summary of the share purchase warrants outstanding at July 31, 2011 is as follows: 

Exercise 

Price 

Number 

Outstanding Expiry Date 

$ 

0.10 200,000 April 15, 2013 

Stock Options 

The Company has adopted a stock option plan (the “Option Plan”), which provides that the Board of Directors of the Company 

may, from time to time, grant to directors, officers, employees and technical consultants of the Company, non-transferable 

options to purchase common shares. The expiry date for each option shall be set by the Board of Directors at the time of issue 

and shall not exceed ten years. A vesting schedule may be imposed at the discretion of the Board of Directors at the time of 

issue. During any twelve-month period, the number of shares issuable to any one optionee shall not exceed 5% of the total 

number of issued and outstanding shares of the Company, and the maximum number of shares reserved for issuance shall not 

exceed 840,000, until completion of a Qualifying Transaction by the Company. Once a Qualifying Transaction has been 

completed, the number of shares that may be reserved for issuance shall not exceed 20% of the total number of issued and 

outstanding shares of the Company. The plan is subject to regulatory approval. 

In April 2011, concurrent with its IPO, the Company granted 840,000 stock options exercisable at $0.10 per share for a period of ten 

years, valued at $0.083 per option for a total of $69,468 calculated using the Black-Scholes option pricing model assuming a life 

expectancy of ten years, a risk free rate of 3.37%, expected dividend yield of 0%, a forfeiture rate of 0%, and volatility of 80%. 

A summary of stock options activities are as follows: 

Number of 

options 

Weighted 

average 

exercise price 

$ 

Outstanding at August 18, 2010 - - 

Granted 840,000 0.083 

Outstanding at April 30, 2011 and July 31, 2011 840,000 0.083 

A summary of the stock options outstanding and exercisable at July 31, 2011 is as follows: 

Exercise 

Price 

Number 

Outstanding 

Number 

Exercisable Expiry Date 

$ 

0.10 840,000 840,000 April 15, 2021 

12





NOTE 6 - Financial Instruments and Risk Management – (continued) 

a) Currency risk 

The Company’s operations and financing activities are conducted in Canadian dollars and as a result, the Company is not 

subject to significant exposure to market risks from changes in foreign currency rates. 

b) Credit risk 

Credit risk is risk of financial loss to the Company if a counterparty to a financial statement fails to meet its contractual 

obligations. The Company’s cash is held in large Canadian financial institutions and is not exposed to significant credit 

risk. 

c) Interest rate risk 

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of 

changes in market interest rates. The Company is exposed to limited interest rate risk as it only holds cash and does not 

have any interest bearing debt. 

d) Liquidity risk 

Liquidity risk is the risk that the Company will not be able to meet its obligations as they come due. The Company’s 

ability to continue as a going concern is dependent on management’s ability to raise the required capital through future 

equity or debt issuances. The Company manages its liquidity risk by forecasting cash flows from operations and 

anticipating any investing and financing activities. Management and the Board of Directors are actively involved in the 

review, planning, and approval of significant expenditures and commitments. 

NOTE 7 - Subsequent Events 

a) In August 2011, the Company signed a non-binding letter of intent ("LOI") with the principal security holders of Wantsa, 

namely Caring Capital Corporation, David Strebinger, and Donald Kirkwood, which sets out the proposed terms and 

conditions of a transaction whereby the Company and United Media Partners Inc., doing business as Wantsa ("Wantsa") 

will undertake a business combination. Wantsa, a private company incorporated in British Columbia, holds intellectual 

property which provides solutions and a technology platform for creating and distributing offers, coupons, incentives, and 

deals to online and mobile consumers. 

The transaction ("Transaction") between Natan and Wantsa will take the form of a plan of arrangement under the Business 

Corporations Act (British Columbia) pursuant to which Natan will acquire, from the principal shareholders and the other 

shareholders of Wantsa, all of the issued and outstanding shares of Wantsa in exchange for common shares of Natan. The 

plan of arrangement must be approved by the shareholders of Wantsa at a special shareholder meeting to be called in 

connection with the Transaction and by the Supreme Court of British Columbia. 

Upon completion of the Transaction, Wantsa will become a wholly-owned subsidiary of Natan. The Transaction is 

expected to be treated as a reverse take-over within the meaning of applicable Canadian securities laws. The material terms 

of the LOI include: 

(i) 

Prior to completion of the Transaction, Natan will consolidate (the "Consolidation") its outstanding share 

capital on a five (5) old shares for one (1) new share basis. Based on Natan's current outstanding shares 

totalling 13,592,001, Natan would have 2,718,400 shares outstanding immediately after giving effect to the 

Consolidation. 

14





NOTE 7 - Subsequent Events – (continued) 

(ii) 

(iii) 

(iv) 

(v) 

(vi) 

Natan will issue to the Wantsa shareholders up to an aggregate of 13,323,486 post-Consolidation common 

shares in exchange for all of the issued and outstanding common shares of Wantsa, subject to certain existing 

convertible securities in Wantsa being exercised or cancelled prior to the closing of the Transaction. Natan 

shares will be exchanged for Wantsa shares under the Transaction on a 1 for 1 basis. 

As a condition to the closing of the Transaction, Natan must complete, concurrently with the closing of the 

Transaction, a private placement (the "Offering") of a minimum of 3,000,000 common shares of Natan at a 

price of $1.75 per share (on a post-Consolidation basis) to raise proceeds of at least $5,250,000. The proceeds 

from the Offering will be used to launch and support a number of Wantsa's major publishing partners, expand 

the Wantsa technology platform with global transaction capabilities and for general working capital purposes. 

Upon execution of the LOI, Natan has provided to Wantsa the sum of $25,000 as a non-interest bearing 

advance, to be used by Wantsa to preserve assets, including retaining key employees and consultants that are 

critical to the development and success of the Wantsa brand. The advance is refundable to Natan in the event 

Natan determines to cancel the Transaction as a result of its due diligence investigations being unsatisfactory, 

or if the Transaction does not complete in the time and in the manner contemplated in the LOI or the Definitive 

Agreement (as defined below), unless such failure to complete is the result of a breach by Natan of any of its 

obligations under the LOI or such Definitive Agreement. 

Upon execution of the Definitive Agreement, Natan will, subject to receipt of all necessary approvals from the 

TSX Venture Exchange (the "Exchange"), provide to Wantsa the sum of $225,000 as a non-interest bearing 

secured loan, to be used by Wantsa for continued operating expenses required to support and grow the number 

of publishers integrated with Wantsa's technology platform as well as to retain key employees and consultants. 

The advance will be repayable to Natan in the same circumstances as the $25,000 advance described under item 

(iv) above. 

The LOI may be terminated by either party as a result of unsatisfactory due diligence results or if the Definitive 

Agreement is not entered into September 30, 2011. The date has been subsequently extended to November 4, 

2011. 

b) Subsequent to July 31, 2011, 192,000 share purchase warrants were exercised at a price of $0.10 per share for total 

proceeds of $19,200. 

15





NOTE 8 – First Time Adoption of IFRS 

As stated in Note 2, these financial statements are for the period covered by the Company’s first interim financial statements 

prepared in accordance with IFRS. The accounting policies in Note 2 have been applied in preparing the interim financial 

statements for the period ended July 31, 2011, the financial statements for the period ended April 30, 2011 and the opening 

IFRS statements of financial position on August 18, 2010, the "Transition Date". 

In preparing the opening IFRS statements of financial position and the financial statements for the interim period ended July 31, 

2011, the Company has adjusted amounts reported previously in financial statements that were prepared in accordance with 

Canadian GAAP. An explanation of how the transition from Canadian GAAP to IFRS has affected the Company’s financial 

position, financial performance and cash flows is set out in the following tables. The guidance for the first time adoption of 

IFRS is set out in IFRS 1. 

Additionally, in accordance with IFRS 1, an entity’s estimates under IFRS at the date of transition to IFRS must be consistent 

with estimates made for the same date under previous Canadian GAAP, unless there is objective evidence that those estimates 

were in error. The Company’s IFRS estimates as of August 18, 2010 are consistent with its Canadian GAAP estimates for the 

same date. 

. 

16





NOTE 8 – First Time Adoption of IFRS - (continued) 

The reconciliation between Canadian GAAP and IFRS statements of financial position as at April 30, 2011 is provided below: 

April 30, 2011 

Assets 

Note 

GAAP 

Effect of 

transition to 

IFRS IFRS 

$ $ $ 

Current 

Cash 421,572 - 421,572 

Prepaid expenses 4,000 - 4,000 

Liabilities 

425,572 - 425,572 

Current 

Accrued liabilities 12,248 - 12,248 

Advance due to director 10,000 - 10,000 

22,248 - 22,248 

Shareholders’ equity 

Capital stock 409,671 - 409,671 

Contributed surplus (a) 81,688 (81,688) - 

Reserves (a) - 81,688 81,688 

Deficit (88,035) - (88,035) 

403,324 - 403,324 

Total shareholders’ equity and liabilities 425,572 - 425,572 

There are no significant differences between IFRS and Canadian GAAP in connection with the Company’s statements of 

financial position as at August 18, 2010. 

There are no significant differences between IFRS and Canadian GAAP in connection with the Company’s statements of 

comprehensive loss for the period ended April 30, 2011. 

There are no significant differences between IFRS and Canadian GAAP in connection with the Company’s statements of cash 

flows for the period ended April 30, 2011. 

a) Reserves 

Under Canadian GAAP, amounts recorded in relation to the fair value of stock options granted and warrants issued 

were recorded to contributed surplus. Under IFRS, these amounts have been reclassified as reserves. 

17

natan resources ltd. interim financial statements - Canadian Stocks

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