JULY 31, 2022NOTE 1– NATURE OF OPERATIONS

NOTE 1 – NATURE OF OPERATIONS

Star Gold Corp. (the “Company”) was initially incorporated as Elan Development, Inc., in the State of Nevada on December 8, 2006. The Company was originally organized to explore mineral properties in British Columbia, Canada but the Company is currently focusing on gold, silver and other base metal-bearing properties in Nevada.

The Company’s core business consists of assembling and/or acquiring land packages and mining claims the Company believes have potential mining reserves, and expending capital to explore these claims by drilling, and performing geophysical work or other exploration work deemed necessary. The business is a high-risk business as there is no guarantee that the Company’s exploration work will ultimately discover or produce any economically viable minerals.

NOTE 2–SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the results for the interim periods reported. The condensed balance sheet at April 30, 20222023 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. Operating results for the three-monththree-month period ended July 31, 20222023 are not necessarily indicative of the results that may be expected for the fiscal year ending April 30, 2023.2024.

These unaudited condensed interim financial statements have been prepared by management in accordance with generally accepted accounting principles used in the United States of America (“U.S. GAAP”). These unaudited condensed interim financial statements should be read in conjunction with the annual audited financial statements included in the Company’s Annual Report on Form 10-K10-K for the year ended April 30, 20222023 filed with the Securities and Exchange Commission on July 29, 2022.September 14, 2023.

This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to U.S. GAAP and have been consistently applied in the preparation of the financial statements.

Going Concern

As shown in the accompanying financial statements, the Company has incurred operating losses since inception. As of July 31, 2022,2023, the Company has limited financial resources with which to achieve the objectives and obtain profitability and positive cash flows. As shown in the accompanying condensed balance sheet as of July 31, 2023, the Company has an accumulated deficit of $12,708,782.  On July 31, 2023, the Company's working capital deficit was $125,679. The lack of sufficient working capital andto meet current obligations, continuing losses and ongoing cash used by operating activities raises substantial doubt about the Company’s ability to continue as a going concern. As shown in the accompanying balance sheets of July 31, 2022, the Company has an accumulated deficit of $12,335,034. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue in existence. Achievement of the Company’s objectives will depend on the ability to obtain additional financing, to locate profitable mining properties and generate revenue from current and planned business operations, and control costs. The Company plans to fund its future operations by joint venturing or obtaining additional financing from investors and/or lenders.

Reclassifications

Certain reclassifications have been made to the 2021 financial statements in order to conform to the 2022 presentation. These reclassifications have no effect on net loss, total assets or accumulated deficit as previously reported.

STAR GOLD CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

JULY 31, 2022Financial Instruments 

The Company's financial instruments include cash and cash equivalents, reclamation bonds and promissory notes related party and convertible promissory notes-related parties.

Cash and cash equivalents, reclamation bonds and promissory notes-related party are accounted for on a cost basis, which, due to the short maturity of these financial instruments, approximates fair value at July 31, 2023.

New Accounting Pronouncements

Accounting Standards Updates Adopted

In December 2019, August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12 Income Taxes (Topic 740): “Simplifying the Accounting for Income Taxes. The update contains a number of provisions intended to simplify the accounting for income taxes. The update is effective for fiscal years beginning after December 15, 2020 with early adoption permitted. The update was adopted as of May 1, 2021, and its adoption did not have a material impact on the Company’s financial statements.

In August 2020, the FASB issued ASU 2020-06, ASC Subtopic 470-20 “Debt-Debt-06 Debt with Conversion and Other Options”Options (Subtopic 470-20) and ASC subtopic 815-40 “Hedging-ContractsDerivatives and Hedging—Contracts in Entity’s Own Equity”. The standard reduced the number of accounting modelsEquity (Subtopic 815-40): Accounting for convertible debt instrumentsConvertible Instruments and convertible preferred stock. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting; and, (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. The amendmentsContracts in this update are effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.an Entity’s Own Equity. The update was adoptedis to address issues identified as a result of May 1, 2021,the complexity associated with applying generally accepted accounting principles for certain financial instruments with characteristics of liabilities and itsequity. The Company took early adoption did not have a material impact on the Company’s financial statements.of ASU 2020-06.

Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

NOTE 3– 3–EARNINGS PER SHARE

Basic Earnings Per Share (“EPS”) is computed as net income (loss) available to common stockholders divided by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options and warrants.

The outstanding securities on July 31, 2022 2023 and 20212022 that could have a dilutive effect are as follows:

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

For the three months-months ended July 31, 2022, 2023 and 2021,2022, respectively, the effect of the Company’s outstanding stock options, convertible promissory notes, related parties and warrants would have been anti-dilutive and so are excluded in the calculation of diluted EPS.

NOTE 4– EQUIPMENT AND 4–MINING INTEREST

The following is a summary of the Company’s equipment and mining interest on July 31, 20222023 and April 30, 2022.

Schedule of Company Equipment and Mining Interest

JULY 31, 20222023.

Pursuant to the Longstreet Property Option Agreement with Great Basin Resources, Inc. (“Great Basin”), as amended, which was originally entered into by the Company on or about January 15, 2010 (the(the “Longstreet Agreement”), the Company leased, with an option to acquire, unpatented mining claims located in the State of Nevada known as the Longstreet Property. Through August 12, 2019, the Company was required to make minimal lease payments in the form of cash and options to purchase shares of the Company’s common stock.

On August 24, 2020, the Company executed an amendment to the Consulting Agreement which accelerated the payments to Great Basin to include a $22,500 lump sum payment and three subsequent monthly payments of $7,500 in consideration of the execution and recording of a quit claim deed on the Longstreet claims for benefit of the Company. For the year ended April 30, 2021, the Company paid Great Basin a total of $67,500 which is included in pre-development expense. As of July 31, 2022, no amount is due to Great Basin under the Consulting Agreement.

The August 24, 2020 Amendment grants the Company the option, to be exercised no later than six (6) (6) months following the first receipt of proceeds from the sale of ore from the Longstreet Property, to purchase one-halfone-half of Great Basin’s 3.0% Net Smelter Royalty on the Longstreet Project for a payment of $1,750,000.

In addition, the Company is obligated, pursuant to the Longstreet Agreement, as amended, to pay an annual advance royalty payment of $12,000 related to the Clifford claims. For the three months ended July 31, 2022 2023 and 2021,2022, respectively, the Company paid the annual $12,000 advance royalty for additional mining interest on the Longstreet Property.

At July 31, 20222023 and April 30, 2022,2023, the Company has a reclamation bond of $89,400 with the United States Department of Agriculture-Forest Service to increase the Reclamation Bond as collateral on the Longstreet Property. The bond is collateral on reclamation of planned drilling activities on the Longstreet Property and is refundable subject to the Company completing defined reclamation actions upon completion of drilling.

NOTE 5–OTHER CURRENT ASSETS

On August 21, 2017, the Company entered into an Option and Lease of Water Rights, with High Test Hay, LLC (the “High Test Water Rights Agreement”). In exchange for a one-time payment of $25,000, the High Test Water Rights Agreement grants the Company a three-year option to commence a ten-year lease on certain water rights in Nevada. The water rights are for use in conjunction with the Company’s Longstreet Project. Lease payments for the water rights do not commence unless and until the Company exercises the option to lease.  The High Test Water Rights Agreement also grants the Company the ability to extend, upon additional option payments, the option to lease for up to an additional three years and the ability to extend the water rights lease (if exercised) for up to an additional twenty years.  The initial $25,000 payment has been deferred and was amortized on a straight-line basis over the three-year option period.

On August 21, 2020, 2022, the Company exercised its firstthird and final option to extend the High Test Hay Water Rights agreement for an additional twelve months and made a $25,000 payment to be amortized over twelve months. On August 21, 2021, the Company exercised its second option to extend the High Test Hay Water Rights agreement for an additional twelve months and made a $25,000 payment to be amortized over twelve months.

As of July 31, 20222023 and April 30, 2022,2023, the unamortized portion of the High Test Hay Water Rights Agreement and subsequent exercise of its second option is $1,438$ 1,438 and $7,740,$ 7,740, respectively.

On October 31, 2021, the Company issued 2,000,000 warrants to purchase stock in accordance with an agreement whereby the Company will receive promotional services to be performed in the future. The fair value of the warrants issued was $87,871 was recorded as other current assets and is being amortized over subsequent periods when services are received. For the quarter ended July 31, 2022 and the year ended April 30, 2022, no share-based compensation has been recognized. (Note 8).

On August 21, 2021, the Company exercised its second option to extend the High Test Hay Water Rights agreement for an additional twelve months and made a $25,000 payment to be amortized over twelve months.

STAR GOLD CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

JULY 31, 2022

The following is a summary of the Company’s Other Current Assets at July 31, 20222023 and April 30, 2022:2023:

Schedule of Company Other Current Assets

On August 21, 2022, the Company exercised its third option to extend the High Test Hay Water Rights agreement for an additional twelve months and made a $25,000 payment to be amortized over twelve months (Note 10).

NOTE 6– 6–RELATED PARTY TRANSACTIONS

Consulting agreements

For the three months ended July 31, 2023 and 2022, the Company recognized $7,500  and $7,500, respectively, for contract Chief Financial Officer services, which is included in "management and administrative expense".  

Promissory notes, related party

On May 1, 2021,April 12, 2022, the Company entered in a promissory note with the Company’s Chairman of the Board of Directors in the amount of $50,000. The note has a maturity date of April 12, 2024 and accrued interest at 5% per annum.

On June 28, 2022, the Company entered in a promissory note with the Company’s Chairman of the Board of Directors in the amount of $30,000. The note has a maturity date of June 28, 2024 and accrues interest at 5% per annum.

On July 5, 2022, the Company entered into consulting agreementsa promissory note with four members of the Company’s management team (the “consulting agreements”). The Company entered into an agreement with each ofentity controlled by the Chairman of the Board of Directors and another Company director in the President,amount of $80,000. The proceeds repaid the Chief Financial Officer April 12, 2022 and the Vice PresidentJune 28, 2022 promissory notes outstanding. The July 5, 2022 promissory note has a maturity date of Finance.

Each agreement is for a two-year period, automatically renewable annually thereafter, and originally paid each executive $6,000 per month. Each executive was originally eligible to receive a bonus equal to eighteen (18) months’ compensation, payable upon a change in control event. The consulting agreements superseded all previous agreements or resolutions.

Effective December 1, 2021, the consulting agreements were amended. Under the terms of the amended agreements, three executives are to be paid $1 annual compensation and one executive will be paid $2,500 per month. Each executive is eligible to receive a bonus of $108,000 payable upon a change of control.

For the three months ended July 31, 2022, the Company recognized $7,500 in management 2025 and administrative expense under the consulting agreements. For the three months ended July 31, 2021, the Company recognized $72,000 in management and administrative expense under the consulting agreements.accrues interest at 8% per annum.

On November 30, 2021,August 4, 2022, the Company entered into a promissory note with an entity controlled by the Chairman of the Board of Directors and another Company director in the amount of $150,000. The promissory note has a maturity date of July 31, 2025 and accrues interest at 8% per annum.

On January 17, 2023, the Company entered into a promissory note with an entity controlled by the Chairman of the Board of Directors and another Company director in the amount of $30,000. The promissory note has a maturity date of January 31, 2026 and accrues interest at 8% per annum.

On March 31, 2023, the Company entered into a promissory note with the Chairman of the Board of Directors in the amount of $15,000.  The promissory note has a maturity date of March 31, 2024 and accrues interest at 8% per annum. 

On June 28, 2023, the Company entered into a promissory note with the Chairman of the Board of Directors in the amount of $20,000.  The promissory note has a maturity date of June 28, 2024 and accrues interest at 8% per annum.

As of  July 31, 2023, the principal balance of the promissory notes, related party is $35,000 and accrued interest on the promissory notes, related party is $546.

Convertible promissory notes, related parties

On November 30, 2021, the Company entered into four Convertible Promissory Notes (the “Convertible Promissory Notes”) with certain officers and directors of the Company in consideration of deferred compensation totaling $150,000. The notes accrue interest at 5% per annum with monthly interest-only payments through April 30, 2025.2025. The notes mature April 30, 2025.

The Convertible Promissory Notes are convertible at any time after the original issue date into a number of shares of the Company’s common stock,Common Stock, determined by dividing the amount to be converted by a conversion price equal to $0.05 per share. The Convertible Promissory Notes are convertible into an aggregate of 3,000,000 shares. At July 31, 2022 and

On  April 30, 2022, 14, 2023, the balanceCompany issued four convertible promissory notes (the " April 14, 2023 Notes")  with an aggregate principal amount $312,500.  One note was issued to a related party, controlled by two members of the Convertible Promissory Notes was $150,000.

On April 12, 2022,Board, in conversion and satisfaction of three existing promissory notes, totaling $260,000 issued by the Company entered inon July 5, 2022, August 4, 2022 and January 17, 2023 respectively.  Three of the April 14, 2023 Notes were issued to an officer, a promissory note withmember of the Company’s ChairmanBoard of Directors and an entity controlled by two members of the Board of Directors in the amount of $50,000. totaling $52,500.

The note hasApril 14, 2023 Notes bear eight percent (8%) interest and have a maturity date of April 12, 202414, 2026 (the “Maturity Date”). There are no required periodic payments due under the Notes and the entire amount of accrued interest and unpaid principal is due and payable on the Maturity Date. The Notes and accrued interest at 5% per annum.

On June 28, 2022,are convertible into shares of common stock of the Company entered in a promissory note withat the Company’s Chairmanconversion price of  $0.0206 per share.

For the Board of Directors in the amount of $30,000. The note has a maturity date of April 12, 2024 and accrued interest at 5% per annum.

On July 5, 2022, the Company entered into a promissory note with an entity controlled by a director and the Chairman of the Board of Directors in the amount of $80,000. The proceeds repaid the April 12, 2022 and June 28, 2022 promissory notes outstanding. The July 5, 2022 promissory note has a maturity date of three months ended July 31, 2025 2023 and accrues interest at 8% per annum. At July 31, 2022 the balance of the promissory note is $80,000.

For the three months ended July 31, 2022 and 2021,, the Company recognized interest expense, related parties of $2,505$7,873 and $Nil, $2,505,respectively.   At July 31, 20222023 and April 30, 2022,2023, the balance of accrued interest due to related parties is $5,117$33,081 and $3,226,$25,208, respectively, which is included in “Accounts payable“Accrued interest, related parties”.

The following is a summary of the Company's Promissory notes, related parties and other accrued liabilities”.