Management’s Discussion and Analysis
GENERAL
Management’s discussion and analysis (“MD&A”) has been prepared based on information available to RTN
Stealth Software Inc. (“RTN” or the “Company”), formerly Arris Resources Inc., as of April 30, 2010. The
MD&A provides a detailed analysis of the company’s business and compares its 2009 results with those of the
previous years and should be read in conjunction with the Company’s audited consolidated financial statements for
the year ended December 31, 2009. The consolidated financial statements have been prepared in accordance with
Canadian generally accepted accounting principles (“Canadian GAAP”). This MD&A may contain forward-
looking statements about the Company’s future prospects, and the Company provides no assurance that actual
results will meet management’s expectations.
The Company is a Canadian resource exploration and development company with assets in oil and gas sectors in
Alberta and interest in mineral claims located in the Atlin Mining District in Atlin of British
Columbia.
Resource exploration business is risky and most mineral exploration projects will not become producing mines and
most resource exploration projects will not become oil and gas producers. The Company may offer an opportunity
to another company to acquire an interest in a property in return for funding all or part of the exploration and
development of the property. For the funding property acquisitions and exploration that the Company conducts, the
Company depends on the issuance of shares from the treasury to investors. These stock issues depend on numerous
factors including a positive mineral and resource exploration environment, positive stock market conditions, a
company’s trackrecord,and the experienceof management.
FORWARDLOOKING STATEMENTS
Certain statements contained in the following MD&A constitute forward looking statements.
Such forward
looking statements involve a number of known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to be materially different from actual future
results and achievements expressed or implied by such forward looking statements. Readers are cautioned not to
place undue reliance on these forward looking statements, which speak only as of the date the statements were made.
OVERALLPERFORMANCE
MineralProperties:Moly Project – Atlin, British Columbia
The Company has acquired 22 mineral claims cover approximately 15,000 acres which are located near Gladys
Lake molybdenum occurrence (discovered in late 1960s) in 2008 with the consideration of $295,612. The
molybdenum occurrence is similar to the occurrence at Adanac’s Ruby Creek project. Adanac’s project is located
approximately 15 miles northeast of Atlin in northern BC.
On September 9, 2009, the Company announced that it utilized its consulting geologists and mining engineers to
complete its evaluation of the twenty two mineral claims and determined the feasibility for further development of the
claims. As a result, 17 claims previously acquired have been allowed to elapse and the Company keeps the remained 5
claims.As a result, the mineral property has been written down to $67,185 for the year ended December 31, 2009.
The Company has not deferred and capitalized any exploration cost in connection with these mineral properties.
Oil and Gas Properties:Alexander Prospect – Alberta
In February, 2007 the Company entered into a purchase and sale agreement (the “Agreement”) with Arctos
Petroleum Corp. (“Arctos”) whereby Arctos agreed to sell to the Company an interest in the Alexander Area,
Alberta propertyin the consideration of $150,000.
The Company holds a 30% working interest in 64 gross Ha (19.2 Net Ha) of onshore P&NG rights in Alexander,
Alberta. The property includes a producing Ellerslie/Wabamun oil well at 6-7-57-1W5 and a 40% interest in an oil
battery at 3-7-57-1W5. As the Company did not contribute towards the exploration work, the Company is in a non-
participation penalty position on both the well and battery and does not currently receive production or fee revenues
2
from these assets. As a result, management decided to write down this investment to $1for the year end December 31,
2009.
The Company has not deferred and capitalized any exploration or development cost in connection with these oil and
gas properties
Option Agreement in Guinea
On October 15, 2009, the Company entered into an option agreement, whereby the Company can earn up to an
undivided 70% interest in the Forecariah Copper Concession (225 sq. Km). The Company decided not to proceed
further and let the option agreement expires after the technical information in connection with the Concession was
further reviewed by management.
ConvertibleDebentureSubscription
On October 31, 2008 the Company subscribed an unsecured convertible debenture (“Debenture”) of Desert Gold
Ventures Inc. (“Desert Gold”) in the principal amount of $500,000. The Debenture carries an interest at a rate of
10% per annum and the Debenture matures on April 30, 2009. Pursuant to the terms of the Debenture, at any
time prior to the maturity date, the Company may, at its sole option, convert all or any part of the principal amount
of the Debenture and any unpaid interest thereon into units of Desert Gold at price per unit of $0.50. Each Unit
consists of one common share and one common share purchase warrant of Desert Gold. Each Warrant entitles the
Company to purchase one common share of Desert Gold at a price of $0.60 for a term of six months from the date of
issuance of such Warrant. The Company decided not to make conversion when the debenture was matured and the
full amount of principal and accrued interest was fully repaid to the Company in July 2009.
Corporate Restructuring
(1) On May 19, 2009, the Company entered into an Arrangement Agreement with Incana Investments Inc.
(“Incana”), its former wholly-own subsidiary to proceed with a corporate restructuring by way of
statutory plan to transfer cash of $100,000 and assign a property contract to Incana. The corporate
restructuring was completed on October 2, 2009, and Incana ceased to be a subsidiary of the Company on
the same day. Detail of the restructuring is disclosed in the note 9 to the Company’s 2009 audited
consolidated financial statements.
(2) On November 2, 2009, the Company and its three wholly-owned subsidiaries Arris Holdings Inc. (“AHI”),
CLI Resources Inc. (“CLI”) and QMI Seismic Inc. (“QMI”) collectively known as the “parties” entered
into an agreement (“Arrangement”) whereby the three subsidiaries would spin-out from the parent
company, each becoming a reporting issuer and each acquiring an asset from the Company in exchange
for common shares (the “Common Shares”) of the respective subsidiary.
The change in corporate structure was effective on January 5, 2010.
The Company has the following assets which it has transferred, on the effective date of the
Arrangement, to its three subsidiaries:
i. an interest in five mineral claims in British Columbia, Canada; and,
ii. an agreement with a British Columbia manufacturing company to distribute its
earthquake sensor products in India; and,
iii. equity investments.
The Company has transferred one of the aforementioned assets currently held by the Company
to each one of its subsidiaries. In the case of CLI, the Company has transferred its interest in
five mineral claims in British Columbia, Canada (the “Mineral Properties”); and in the case of
QMI the Company has transferred its agreement with a British Columbia manufacturing
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company to distribute its earth quake sensor products in India (the “Distribution Agreement”);
and in the case of AHI the Company has transferred its equity investments (the “Equity
Portfolio”).
In exchange for the asset the subsidiaries received, each of the three subsidiaries has issued
common shares which are distributed to the Company’s shareholders of record as of the close of
business on November 5, 2009 being the share distribution record date (the “Share
Distribution Record Date”). Upon closing of the Arrangement, each shareholder of the
Company, as of the Share Distribution Record Date, receive one new common share ("New
Share") in the capital of the Company and its pro-rata share of the each one of the three
subsidiaries’ Common Shares to be distributed under the Arrangement for each of the
Company’s share currently held. On the effective date (January 5, 2010), the Company has
transferred the Mineral Properties to CLI in consideration for 17,583,372 CLI Shares; the
Distribution Agreement to QMI in consideration for 17,583,372 QMI Shares; and the Equity
Portfolio toAHI in consideration for 17,583,372AHI Shares.
Change of Company’s name and Acquisition of New Business Asset
The Company entered into software business and signed a definitive agreement to acquire an exclusive and perpetual
license of a security trading software, the Market Navigation, Trade Execution and Market Timing Software in
December 2009. As a result, the Company changed its name from Arris Resources Inc. to RTN Stealth Software Inc.
and changed its trading symbol to RTN on December 21, 2009. The acquisition was completed on January 19, 2010
and the details is discussed in the section “Subsequent Events” of this MD&A.
Selected Annual Information
The summaryof selected annual information has been prepared in accordance with Canadian GAAP.
2009
2008
2007
$
$
$
Revenues
-
-
-
Net Income (Loss)
(599,471)
(305,762)
(23,333)
Net Income (Loss) per Share
(0.01)
(0.01)
(0.001)
Total Assets
2,151,954
892,243
922,340
Total Long-termliabilities
-
-
-
Cash dividend
-
-
-
RESULTS OF OPERATIONS
For the Year Ended December 31, 2009
The Company reported a net loss of $599,471 ($0.01 per share) for the year ended December 31, 2009 as compared
to a net loss of $305,762 ($0.01 per share) for the year ended December 31, 2008. Significant changes between the
2009 and 2008 year leading to the increase of the net loss are, write down of mineral & oil and gas properties,
the recovery of loss recorded on investment, increase in management & consulting fees, stock based compensation,
trust and filing fees, and professional fees. Details are as follows:
Write down charge increased by $378,426 which is a result of writing down of the Company’s mineral & oil and gas
properties by $378,426 in current year (2008 - $nil). This is a one-time event which did not happen in last & nbsp;year. In
accordance with the Company’s accounting policies, investment is recorded at its fair market value at the year-end
date. As a result the Company took a mark-to-market fair value adjustment (a loss) of $188,333 for its sole short
term investment (a convertible debenture) for the year ended December 31, 2008. This convertible debenture was
expired in 2009 and the principal plus accrued interest was repaid to the Company in 2009. As a result, the Company
recorded a recovery of $188,333 (a gain) in current year accordingly. Management & consulting fees in 2009 was
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increased by $28,300 from last year. The increase is mainly a result of hiring more business consultant to explore
addition business opportunities. The Company granted 6,250,000 stock options to various employees, directors, and
consultants during 2009 (2008 – nil). As a result, the Company recorded a stock-based compensation of $47,360 in
2009 comparing $nil in the last year. Trust and filing fees increased by $23,000 and professional fees increased by
$70,800 are the results of incurring more expenses for the filing of the plan of arrangement discussed in “Overall
Performance” section.
Q4 Operations
The Company reported net loss for the three months ended December 31, 2009 of $507,977 compared to
$194,531 for the same period in 2008, an increase of 313,446. As the Company is still in the exploration and
development stage, variances in its quarterly losses are not affected by sales or production-related factors. This
increase is mainly a combined result of incurring $378,426 write down charge for the mineral & oil and gas
properties, more professional fees and filing fees in connection with the plan of arrangement.
Summary of Quarterly Results
The summary of quarterly results has been prepared in accordance with Canadian GAAP.
For the 3-month ended
Revenue
Net Income
Net Income
(Loss)
(Loss)
$
per share
December 31, 2009
-
(507,977)
(0.00)
September 30, 2009
-
160,220
0.00
June 30, 2009
-
(211,395)
(0.00)
March 31, 2009
-
(40,319)
(0.00)
December 31, 2008
-
(194,531)
(0.00)
September 30, 2008
-
(51,256)
(0.00)
June 30, 2008
-
(61,428)
(0.00)
March31, 2008
-
1,453
(0.00)
LIQUIDITY & CAPITAL RESOURCES
The Company does not generate revenues from operations. The Company relies on equity financing for its working
capital requirements to fund its exploration, business development, investment, and administrative activities. At
December 31, 2009, the Company had $379,284 in cash and cash equivalent (2008 – $99,366), a marketable
securities of $1,448,800 (2008-$nil) and a positive working capital of $2,005,756 (2008 –$362,339). For the year
ended December 31, 2009 operating expenditures were $438,906 compared to $142,135 in 2008.
The Company is not subject to external working capital requirement and does not have significant capital
commitment that is obligated to make. Under the Plan of Arrangement dated November 5, 2009, (discussed in the
section corporate restructuring) and subsequent to the year ended December 31, 2009, the Company transferred
its interest in five mineral claims in British Columbia, Canada, its agreement with a British Columbia
manufacturing company to distribute its earth quake sensor products in India and its marketable securities to its
three subsidiaries to complete the spin-off corporate restructuring. Excluding the marketable securities of
$1,448,800 that would have been transferred out, the Company would have a working capital of $556,956 and
accumulated deficit of $3,018,127 as at December 31, 2009. To date, the Company has not generated any
revenues from operations and will most likely require additional funds to meet its obligations and the costs of its
operations. While the Company believes it will be able to raise the additional financing when required, the impacts
of the current global economic downturn and uncertainty in the global capital market provide no guarantees that the
Company can complete an equity or a debt financing when needed.
5
OFF BALANCE SHEET ARRANGEMENT
None
RELATED PARTY TRANSACTIONS
All transactions with related parties have occurred in the normal course of operations and management represents that
they have occurred on a basis consistent with those involving unrelated parties, and accordingly that they are measured
at fair value.
a)
During the year ended December 31, 2009, a company controlled by the President charged the
Company $61,750 in consulting and administrative fees and $60,000 in rental expenses (2008 -
45,000; 2007 - nil). Another Company controlled by the President also charged the Company
$50,000 in property research charges. At December 31, 2008 the Company owes $nil for these
expenses (2008 - $52,500; 2007 - nil).
b)
During the year ended December 31, 2009, two companies related by a common director charged the
Company $45,000 management fees and $48,229 finders’fees as share issuance costs respectively.
c)
During the year ended December 31, 2009, the Company also paid $3,000 directors fee to each of
three directors for a total of $9,000.
d)
During the year ended December 31, 2009, the Company owed $nil (2008 - $22,441; 2007- $22,441)
to the company controlled by the spouse of the Company’s president.
PROPOSED TRANSACTION
There are no proposed transactions that will materially affect the performance of the Company.
SUBSEQUENT EVENTS
The Company has the following significant events happened after the year ended December 31, 2009 which have not
discussed in other sections of this MD&A:
1) On January 19, 2010, the Company executed a definitive agreement with privately owned Market Guidance
Systems Inc. (“MGS”) whereby the Company had acquired a fully supported exclusive and perpetual license
to the Market Navigation, Trade Execution and Market Timing Software.
As consideration for the above, the Company has issued 5 million Class B convertible preferred shares (Class
B Preferred Share) to the shareholders of MGS. The holders of the Class B Preferred Shares has the rights to
convert the 5 million Class B Preferred Shares into 50 million common shares of the Company only when the
cumulative net revenues derived from the license of the Market Navigation, Trade Execution and Market
Timing Software reach a total of C$ 20 million. In connection with the acquisition, the Company pays a
consultant a transaction advisory fee of 250,000 Class B Preferred Shares.
2) On February 24, 2010, the Company awarded its directors, officers, employees and consultants a total of
5,650,000 stock options at an exercise price of $0.32 with an expiry date of February 24, 2015
CRITICALACCOUNTING POLICIES
The Company’s completed accounting policies are described in the note 2 to the audited consolidated financial
statements for the year ended December 31, 2009. Management considers the following policies to be the
most critical in understanding the judgments and estimates that are involved in the preparation of its consolidated
financial statements.
Going Concern
Canadian GAAP requires management to make an assessment of the Company’s ability to continue as a going
concern, and to disclose any material uncertainties related to events or conditions that may cast significant doubt
6
upon the entity’s ability to continue as a going concern.
In assessing the appropriateness of the going concern assumption, management is required to consider all
available information about the future which is at least, but not limited to, twelve months from the balance sheet
date and to disclose any material uncertainties related to events or conditions that may cast significant doubt
upon the entity’s ability to continue as a going concern.
Under the Plan of Arrangement dated November 5, 2009, (discussed in the section corporate restructuring) and
subsequent to the year ended December 31, 2009, the Company transferred its interest in five mineral claims in
British Columbia, Canada, its agreement with a British Columbia manufacturing company to distribute its earth
quake sensor products in India and its marketable securities to its three subsidiaries to complete the spin-off
corporate restructuring. Excluding the marketable securities of $1,448,800 that would have been transferred out,
the Company would have a working capital of $556,956 and accumulated a deficit of $3,018,127 as at December
31, 2009. As the Company had changed its business from resource exploration into the software business, it is
unsure whether the Company may successfully change its business model and strategic direction. The ability of
the Company to continue to operate as a going concern is dependent on its ability to ultimately operate its
business at a profit. To date, the Company has not generated any revenues from operations and will most likely
require additional funds to meet its obligations and the costs of its operations. As a result, further losses are
anticipated prior to the generation of any profits.
The Company’s future capital requirements will depend on many factors, including the costs of operating the
software business. The Company’s anticipated operating losses and increasing working capital requirements may
require that it obtain additional capital to continue operations.
The Company will depend almost exclusively on outside capital. Such outside capital will include the sale of
additional shares. There can be no assurance that capital will be available as necessary to meet these continuing
operating costs or, if the capital is available, that it will be on terms acceptable to the Company. The issuances of
additional equity securities by the Company may result in significant dilution to the equity interests of its current
shareholders. Obtaining commercial loans, assuming those loans would be available, will increase the
Company’s liabilities and future cash commitments. If the Company is unable to obtain financing in the amounts
and on terms deemed acceptable, the business and future success may be adversely affected, thus giving rise to
doubt about the Company’s ability to continue as a going concern. The financial statements do not reflect
adjustments to the carrying values of assets, liabilities or reported results should the Company be unable to
continue as a going concern.
Use of Estimates
The preparation of financial statements in conformity with Canadian GAAP requires management to make estimates
and assumptions which affect the reported amounts of assets and liabilities and the disclosure of contingent assets
and liabilities at the dates of the financial statements, as well as the reported amounts of revenues and expenses
incurred during the period. Significant areas requiring the use of management estimates relate to the impairment of
mineral properties, oil and gas properties, equipment, income taxes, valuation allowances for future income tax assets,
depreciation and amortization, and the assumptions used in computing stock-based compensation. Actual results could
differ from those estimated.
Stock-based Compensation
The Company records all stock-based payments using the fair value method. Under the fair value method, stock-
based payments are measured at the fair value of the consideration received or the fair value of the equity
instruments issued or liabilities incurred, whichever is more reliably measurable, and are charged to operations
over the vesting period. The offset is credited to contributed surplus.
Consideration received on the exercise of stock options is recorded as share capital and the related contributed
surplus is transferred to share capital.
Mineral Property
The cost of unproven mineral rights and their related direct exploration costs are deferred until the properties are
placed into production, sold or abandoned. These deferred costs will be amortized on the unit-of-production
basis over the estimated useful life of the properties following the commencement of production, or written-off
7
if the properties are sold, allowed to lapse or abandoned.
Cost includes any cash consideration and the fair market value of any shares issued on the acquisition of mineral
right interests. Properties acquired under option agreements, whereby payments are made at the sole discretion
of the Company, are recorded in the accounts when the payments are made. The recorded amounts of property
acquisition costs and their related deferred exploration costs represent actual expenditures incurred and are not
intended to reflect present or future values.
The Company reviews capitalized costs on its mineral rights on a periodic basis and will recognize impairment
in value based upon current exploration results and upon management’s assessment of the future probability of
profitable revenues from the property or from the sale of the property. Management’s assessment of the
property’s estimated current fair market value is also based upon a review of other property transactions that
have occurred in the same geographic area as that of the property under review. Administrative costs are
expensed as incurred.
CHANGESIN ACCOUNTINGPOLICIES INCLUDING INITIAL ADOPTION
The changes in accounting policies including initial adoption are disclosed in the note 3(a) to (e) to the 2009
audited consolidated financial statements
NEW ACCOUNTING PRONOUNCEMENTS
The new accounting pronouncements the Company yet to adopt are disclosed in the note 3(f) to the 2009 audited
consolidated financial statements
SHAREDATA
As at the date of this MD&A, the Company has 99,416,860 common shares, 5,650,000 stock options, and
5,250,000 Class B Preferred shares that can be converted into 52,500,000 common shares outstanding, for a total
of 157,566,860 fully diluted common shares outstanding.
FINANCIAL INSTURMENTS
Financial Instrument Recognition, Measurement, and Classification
All financial instruments, including derivatives, are included on the Company’s balance sheet and measured either at
fair value or amortized cost. Changes in fair value are recognized in the statements of operations or accumulated other
comprehensive income, depending on the classification of the related instruments.
All financial assets and liabilities are recognized when the entity becomes a party to the contract creating the asset or
liability. All financial instruments are classified into one of the following categories: held for trading, held-to-maturity,
loans and receivables, available-for-sale financial assets, or other financial liabilities. Initial and subsequent
measurement and recognition of changes in the value of financial instruments depends on their initial classification:
• Held-to-maturity investments, loans and receivables, and other financial liabilities are initially
measured at fair value and subsequently measured at amortized cost. Amortization of premiums or
discounts and losses due to impairment are included in current period net earnings (loss).
• Available-for-sale financial assets are measured at fair value. Changes in fair value are included in
other comprehensive income (loss) until the gain or loss is recognized in net earnings (loss) or if an
impairment is determined to be other than temporary.
• Held for trading financial instruments are measured at fair value. All changes in fair value are
included in net earnings (loss) in the period in which they arise.
• All derivative financial instruments are measured at fair value, even when they are part of a hedging
relationship. Changes in fair value are included in net earnings (loss) in the period in which they arise,
8
Contractual
Over 3
As at December 31, 2008
Obligations
2009
2010
2011
years
Accounts payable and accrued
liabilities
$ 2,094 $ 2,094 $
– $
– $
–
Amounts due to a related party
74,941
74,941
–
–
–
Total liabilities
$ 77,035 $ 77,035 $
– $
– $
–
RISKSAND UNCERTAINTIES
The Company’s principal activity is oil and gas exploration and development. Companies in this industry are
subject to many and varied kinds of risks, including but not limited to, environmental, oil and gas prices, political
and economical.
The Company has no significant source of operating cash flow and no revenues from operations. None of the
Company’s oil and gas properties currently have reserves. The Company has limited financial resources. Substantial
expenditures are required to be made by the Company to establishreserves.
The property interests the Company has are in the exploration stages only, are without proven reserves of
commercial levels of production. Oil and gas exploration involves a high degree of risk and few properties, which
are explored, are ultimately developed into commercially producing wells. If the Company’s efforts do not result in
commercial production at the Alexander Prospect, the Company will be forced to look for other explorationprojects.
The Company is subject to the laws and regulations relating to environmental matters in all jurisdictions in which it
operates, including provisions relatingto propertyreclamation, discharge of hazardous material and other matters.
The Company’s functional currency is the Canadiandollar.
CONTROLSAND PROCEDURES
Disclosure Controls and Procedures
The Chief Financial Officer, are responsible for establishing and maintaining effective disclosure controls and
procedures for the Company as defined in National Instrument 52-109 Certification of Disclosure in Annual and
Interim Filings. Management has concluded that as of December 31, 2009, discussion of disclosure controls and
procedures is preemptive; however, once operations begin, such controls will be effective enough to provide
reasonable assurance that material information relating to the Company would be known to them, particularly during
the period in which reports are being prepared.
Internal Control over Financial Reporting
Management has concluded that internal control over financial reporting will be effective. The design and operation of
internal control over financial reporting will provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with applicable generally
accepted accounting principles.
Internal control over financial reporting will include those policies and procedures that establish the following:
maintenance of records in reasonable detail, that accurately and fairly reflect the transactions and dispositions of
assets; reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements
in accordance with applicable generally accepted accounting principles; receipts and expenditures are only being
made in accordance with authorizations of management and the Board of Directors; and reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets.
Management will design internal control over financial reporting to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with
Canadian GAAP.
10
Segregation of Duties
Currently duties have not been segregated due to the small number of individuals involved in this start-up. This lack
of segregation of duties has not resulted in any material misstatement to the financial statements.
As the Company incurs future growth, management plans to expand the number of individuals involved in the
accounting and finance functions. At the present time, the Chief Executive Officer and Chief Financial Officer oversee
all material transactions and related accounting records. In addition, the Audit Committee of the Company will review
on a quarterly basis the interim financial statements and key risks and will query management about significant
transactions.
Complex and Non-Routine Transactions
The Company may be required to record complex and non-routine transactions. These sometimes will be extremely
technical in nature and require an in-depth understanding of Canadian GAAP. Finance staff will consult with their
third party expert advisors as needed in connection with the recording and reporting of complex and non-routine
transactions. In addition, an annual audit will be completed and presented to the Audit Committee for its review and
approval.
INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS)
In February 2008, the Canadian Accounting Standards Board announced that 2011 is the changeover date for publicly
accountable profit-oriented enterprises to use IFRS, replacing Canadian GAAP for interim and annual financial
statements relating to fiscal years beginning on or after January 1, 2011. The Company will commence reporting in
IFRS in the first quarter of the 2011 fiscal year, with comparative figures.
The company will use a four phase approach to ensure successful conversion to IFRS,
including:
•
diagnostic impact assessment;
•
design and planning;
•
solution development and;
•
implementation.
The Company has begun developing its detailed IFRS conversion plan, including commencement of an education
process for management and the board of directors, and evaluating the effect of the new standards on its financial
statements.
The Company has identified six major areas to date that will impact the financial statements under IFRS, including:
•
Petroleum properties;
•
Impairment of petroleum properties;
•
Foreign currency translation;
•
Stock based compensation;
•
Revenue recognition;
•
Income taxes; and
•
First-time adoption of International Financial Reporting Standards (IFRS 1).
It is not practically possible at this time to quantify the impact of these differences.
OTHER
To view the public documents of the Company, pleasevisit the Company's profile on the SEDAR website at
www.sedar.com.
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