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Kiska Metals Corporation
Notes to the consolidated interim financial statements
March 31, 2012 and 2011
(Expressed in Canadian Dollars)
(Unaudited – Prepared by Management)
4. Summary of significant accounting policies, (continued)
Deferred income tax (continued)
reassessed at the end of each reporting period and are recognized to the extent that it has become
probable that future taxable profit will be available to allow the deferred tax asset to be recovered.
Deferred 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 tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off
current tax assets against current income tax liabilities and the deferred taxes relate to the same taxable
entity and the same taxation authority.
Royalties, resource rent taxes and revenue-based taxes are accounted for under IAS 12 when they have
the characteristics of an income tax. This is considered to be the case when they are imposed under
government authority and the amount payable is based on taxable income – rather than based on
quantity produced or as a percentage of revenue – after adjustment for temporary differences. For such
arrangements, current and deferred tax is provided on the same basis as described above for other forms
of taxation.
Obligations arising from royalty arrangements that do not satisfy these criteria are recognized as current
provisions and included in cost of sales. Currently, the Company does not pay any royalties nor resource
rent taxes that are considered to meet the criteria to be treated as part of income tax. Claim-based
payments are included in mineral property expenditures.
Sales tax
Revenues, expenses and assets are recognized net of the amount of sales tax except where the sales
tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which
case, the sales tax is recognized as part of the cost of acquisition of the asset or as part of the expense
item as applicable.
The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of
receivables or payables in the statement of financial position.
Revenue recognition
Revenue is recognized to the extent it is probable that the economic benefits will flow to the Group and
the revenue can be reliably measured. Revenue is measured at the fair value of the consideration
received, excluding discounts, rebates, and sales taxes or duty.
The Group assesses its revenue arrangements against specific criteria in order to determine if it is acting
as principal or agent. The Group has concluded that it is acting as a principal in all of its revenue
arrangements.
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