Lode-Star Mining (LSMG) 10-K 30 Mar 17 2016 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2016	Mar. 30, 2017
Document And Entity Information
Entity Registrant Name	Lode-Star Mining Inc.
Entity Central Index Key	1,319,643
Document Type	10-K
Document Period End Date	Dec. 31, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Public Float	$ 452,523
Entity Common Stock, Shares Outstanding		49,127,825
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2,016

BALANCE SHEETS

BALANCE SHEETS - USD ($)	Dec. 31, 2016	Dec. 31, 2015
Current
Cash	$ 5,134	$ 12,456
Prepaid fees	0	3,217
Total current assets	5,134	15,673
Mineral Property Interest, unproved	230,180	230,180
Total assets	235,314	245,853
Current liabilities:
Accounts payable and accrued liabilities	19,016	14,302
Due to related parties and accrued interest	762,117	495,384
Loans payable and accrued interest	62,310	76,180
Total current liabilities	843,443	585,866
Commitments and contingencies (Notes 3, 7 and 8)
STOCKHOLDERS’ DEFICIENCY
Capital Stock Authorized: 480,000,000 voting common shares with a par value of $0.001 per share 20,000,0000 preferred shares with a par value of $0.001 per share Issued: 49,127,825 common shares at December 31, 2016 and 2015	1,947	1,947
Additional Paid-In Capital	1,070,064	1,070,064
Accumulated Deficit	(1,680,140)	(1,412,024)
Total stockholders’ deficiency	(608,129)	(340,013)
Total liabilities and stockholders’ deficiency	$ 235,314	$ 245,853

BALANCE SHEETS (Parenthetical)

BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2016	Dec. 31, 2015
STOCKHOLDERS' DEFICIENCY
Common stock, par value	$ 0.001	$ 0.001
Common stock, Authorized	480,000,000	480,000,000
Common stock, Issued	49,127,825	49,127,825

STATEMENTS OF OPERATIONS

STATEMENTS OF OPERATIONS - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Income Statement [Abstract]
Revenue	$ 0	$ 0
Operating Expenses
Consulting services	25,776	121,409
Corporate support services	2,099	12,759
Mineral option fees	100,000	123,913
Office, foreign exchange and sundry	11,783	10,136
Professional fees	67,182	94,783
Transfer and filing fees	27,535	27,796
Total operating expenses	234,375	390,796
Operating Loss	(234,375)	(390,796)
Other Expense
Penalties	(5,113)	0
Interest, bank and finance charges	(28,628)	(20,525)
Total other expense	(33,741)	(20,525)
Net Loss For The Year	$ (268,116)	$ (411,321)
Basic And Diluted Net Loss Per Common Share	$ (0.01)	$ (0.01)
Weighted Average Number Of Common Shares Outstanding – basic and diluted	49,127,825	47,436,336

STATEMENTS OF CASH FLOWS

STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Operating Activities
Net loss for year	$ (268,116)	$ (411,321)
Adjustments to reconcile net loss to net cash used in operating activities:
Foreign exchange (gain)	830	(4,791)
Stock issued for services	0	29,397
Warrants issued for services	0	66,721
Changes in operating assets and liabilities:
Prepaid expenses	3,217	(3,217)
Accounts payable and accrued liabilities	73,704	33,194
Due to related party	100,000	123,913
Accrued interest payable	28,043	19,788
Net cash used in operating activities	(62,322)	(146,316)
Financing Activities
Repayment of loans payable	(20,000)	(14,000)
Repayment of loans payable - related party	0	(5,000)
Proceeds from loans payable - related party	75,000	172,400
Net cash provided by financing activities	55,000	153,400
Net (Decrease) Increase In Cash	(7,322)	7,084
Cash, Beginning Of Year	12,456	5,372
Cash, End Of Year	5,134	12,456
Supplemental Disclosure Of Cash Flow Information
Cash paid during the period for Interest	0	0
Cash paid during the period for Income taxes	0	0
Non-cash Financing Activity
Expenses paid by related party on behalf of the Company	68,990	57,289
Common shares issued for debt settlements	$ 0	$ 53,213

STATEMENTS OF STOCKHOLDERS' EQU

STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total
Beginning Balance, Shares at Dec. 31, 2014	46,509,000
Beginning Balance, Amount at Dec. 31, 2014	$ 465	$ 922,215	$ (1,000,703)	$ (78,023)
Shares issued for debt, Shares	1,149,000
Shares issued for debt, Amount	$ 12	53,201		53,213
Shares issued for consulting services, Shares	1,469,825
Shares issued for consulting services, Amount	$ 1,470	27,927		29,397
Warrants issued for consulting services		66,721		66,721
Net loss for the year			(411,321)	(411,321)
Ending Balance, Shares at Dec. 31, 2015	49,127,825
Ending Balance, Amount at Dec. 31, 2015	$ 1,947	1,070,064	(1,412,024)	(340,013)
Net loss for the year			(268,116)	(268,116)
Ending Balance, Shares at Dec. 31, 2016	49,127,825
Ending Balance, Amount at Dec. 31, 2016	$ 1,947	$ 1,070,064	$ (1,680,140)	$ (608,129)

1. BASIS OF PRESENTATION AND NA

1. BASIS OF PRESENTATION AND NATURE OF OPERATIONS	12 Months Ended
	Dec. 31, 2016
Notes to Financial Statements
NOTE 1 - BASIS OF PRESENTATION AND NATURE OF OPERATIONS	Organization Lode-Star Mining INC. (formerly International Gold Corp.) (“the Company”) was incorporated in the State of Nevada, U.S.A., on December 9, 2004. The Company’s principal executive offices are located in Cypress, Texas. The Company was originally formed for the purpose of acquiring exploration stage natural resource properties. The Company acquired a mineral property interest from Lode Star Gold INC., a private Nevada corporation (“LSG”) on December 11, 2014 (See Note 3) in consideration for the issuance of 35,000,000 common shares of the Company. As a result of this transaction, control of the Company was acquired by LSG. On May 12, 2015, International Gold Corp. completed a merger with its wholly owned subsidiary, Lode-Star Mining Inc., and formally assumed the subsidiary’s name by filing Articles of Merger with the Nevada Secretary of State (the “Name Change”). The subsidiary was incorporated entirely for the purpose of effecting the Name Change and the merger did not affect the Company’s corporate structure in any other way. Going Concern The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The future of the Company is dependent upon its ability to establish a business and to obtain new financing to execute its business plan. As shown in the accompanying financial statements, the Company has had no revenue and has incurred accumulated losses of $1,680,140 as of December 31 2016. In order to continue as a going concern, the Company will need, among other things, additional capital resources. The Company is significantly dependent upon its ability, and will continue to attempt, to secure additional equity and/or debt financing. There are no assurances that the Company will be successful and without sufficient financing it would be unlikely for the Company to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

2. SUMMARY OF SIGNIFICANT ACCOU

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	12 Months Ended
	Dec. 31, 2016
Accounting Policies [Abstract]
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment. All dollar amounts are in U.S. dollars unless otherwise noted. The financial statements have, in management’s opinion, been properly prepared within reasonable limits of materiality and within the framework of the significant accounting policies summarized below: a) Basis of Accounting The Company’s financial statements have been prepared using the accrual method of accounting. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein. b) Cash and Cash Equivalents Cash consists of cash on deposit with high quality major financial institutions. For purposes of the balance sheets and statements of cash flows, the Company considers all highly liquid debt instruments purchased with maturity of 90 days or less to be cash equivalents. At December 31, 2016 and 2015, the Company had no cash equivalents. c) Foreign Currency Accounting The Company’s functional currency is the U.S. dollar. Branch office activities are generally in Canadian dollars. Transactions in Canadian currency are translated into U.S. dollars as follows: i) monetary items at the exchange rate prevailing at the balance sheet date; ii) non-monetary items at the historical exchange rate; and iii) revenue and expense items at the rate in effect of the date of transactions. Gains and losses arising on the settlement of foreign currency denominated transactions or balances are recorded in the statements of operations. d) Fair Value of Financial Instruments ASC Topic 820-10 establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. These tiers include: ■ Level 1 – defined as observable inputs such as quoted prices in active markets; ■ Level 2 – defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and ■ Level 3 – defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. The Company’s financial instruments consist of cash, accounts payable and accrued liabilities, and loans payable. The Company is not exposed to significant interest, currency or credit risks arising from these financial instruments. Pursuant to ASC 820 and 825, the fair value of cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. Accounts payable and accrued liabilities and loans payable are measured using “Level 2” inputs as there are no quoted prices in active markets for identical instruments. The carrying values of cash, accounts payable and accrued liabilities, and loans payable approximate their fair values due to the immediate or short term maturity of these financial instruments. e) Asset Retirement Obligations The Company has no asset retirement obligations, including environmental rehabilitation expenditures, which relate to an existing condition caused by past operations. f) Use of Estimates and Assumptions The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying disclosures. By their nature, these estimates are subject to measurement uncertainty and the effect on the financial statements of changes in such estimates in future periods could be significant. Significant areas requiring management’s estimates and assumptions are determining the fair value of transactions involving related parties and common stock. Actual results may differ from the estimates. g) Basic and Diluted Earnings Per Share The Company reports basic earnings or loss per share in accordance with ASC Topic 260, “Earnings Per Share”. Basic earnings per share is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed similarly, except that the common stock number is increased to include the any potential additional common shares, for example from the exercise of options or warrants. As the Company generated net losses in the periods presented, the additional impact of including potential shares from outstanding warrants would be anti-dilutive and is therefore not part of the earnings per share calculation. h) Income Taxes The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, Income Taxes. This standard requires the use of an asset and liability approach for financial accounting and reporting on income taxes. If it is more likely than not that some portion or all of a deferred tax asset will not be realized, a valuation allowance is recognized. i) Stock-Based Compensation Stock-based compensation of employees is accounted for in accordance with ASC 718 whereby a compensation charge based on the fair value of the equity instruments issued, measured at the grant date, is recorded against earnings over the period during which the employee is required to perform the services in exchange for the award (generally the vesting period). For transactions with non-employees in which services are performed in exchange for the Company’s common stock or other equity instruments, the transactions are accounted for in accordance with ASC 505-50, whereby the compensation charge is recorded on the basis of the fair value of the goods or services received or the fair value of the equity instruments granted, whichever is more reliably measurable at the earlier of the date at which a commitment for performance is reached or the date at which the performance is complete. The expense is recognized in the same manner as if the Company had paid cash for the goods or services. j) Mineral Property Interest and Impairment Mineral property interests are capitalized and recorded at fair value. The property interests are periodically assessed for impairment of value when facts and circumstances suggest that the carrying amount of the property interest may exceed its recoverable amount. Costs of exploration, evaluation and retaining mineral property interests are expensed as incurred. Once the Company has identified proven and probable reserves in its investigation of its property interests and upon development of a plan for operating a mine, it would enter the development stage and capitalize future costs until production is established. When a property reaches the production stage, the related capital costs will be amortized, using the units-of-production method over proven and probable reserves. k) Related Party Transactions In accordance with ASC 850, the Company discloses: the nature of the related party relationship(s) involved; a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. l) Recent Accounting Pronouncements The Company has implemented all applicable new accounting pronouncements that are in effect. Those pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

3. MINERAL PROPERTY INTEREST

3. MINERAL PROPERTY INTEREST	12 Months Ended
	Dec. 31, 2016
Mineral Property Interest
NOTE 3 - MINERAL PROPERTY INTEREST	On December 5, 2014, the Company entered into a subscription agreement (the “Subscription Agreements”) with Lode Star Gold INC. (“LSG”), a private Nevada corporation controlled by the spouse of the Company’s current President, pursuant to which the Company agreed to issue 35,000,000 shares of its common stock, valued at $230,180, to LSG in exchange for a 20% undivided interest in and to the mineral claims owned by LSG. The mineral claims, known as the “Goldfield Bonanza Project” (the “Property”), are located in the State of Nevada. The execution of the Subscription Agreement was one of the closing conditions of an Option Agreement dated October 4, 2014, pursuant to which the Company acquired the sole and exclusive option to earn up to an 80% undivided interest in and to the Property. In order to earn the additional 60% interest in the Property, the Company is required to fund all expenditures on the Property and pay LSG an aggregate of $5 million in cash in the form of a net smelter royalty, each beginning on the Closing Date, which was December 11, 2014. Until such time as the Company has earned the additional 60% interest, the net smelter royalty will be split 79.2% to LSG, 19.8% to the Company and 1% to the former Property owner. If the Company fails to make any cash payments to LSG within one year of the Effective Date of the Mineral Option Agreement with LSG dated October 4, 2014, it is required to pay LSG an additional $100,000, and in any subsequent years in which the Company fails to complete the payment of the entire $5 million described above, it must make quarterly cash payments to LSG of $25,000 until such time as the Company has earned the additional 60% interest in the Property. At December 31, 2016 $223,913 in fees payable to LSG has been accrued. Given that permitting for operations on the Property is still to be completed, LSG granted a series of deferrals of the payment, with the most recent being granted on January 11, 2017. LSG agreed on that date to defer payment of all amounts due in accordance with the Mineral Option Agreement until further notice. On January 17, 2017, the Company and LSG agreed that as of January 1, 2017, all outstanding balances shall carry a compound interest rate of 5% per annum. It was further agreed that the ongoing payment deferral shall apply to interest and principal. The Option Agreement provides that the Company will act as the operator on the Property and that a management committee will be formed, comprised of representatives from the Company and LSG, with voting based on each party’s proportionate interest, to supervise exploration of the Property and approve work programs and budgets. To December 31, 2016 and to the date of these financial statements, no work programs had been approved. The Company assessed its mineral property interest at December 31, 2016 and to the date of these financial statements and concluded that facts and circumstances do not suggest that the mineral property interest’s carrying value exceeds its recoverable amount and therefore no impairment is required. On February 17, 2017 the Company executed an agreement with Scorpio Gold Corporation (Scorpio) for a pilot toll milling test of its mineralized material. Upon the Company’s completion of required permitting activities with the Nevada Division of Environmental Protection, Bureau of Mining Regulation and Reclamation (NDEP), the bulk sample pilot test will provide the baselines for metallurgical recoveries and mill throughput. Dependent on the pilot test results and completion of a cost analysis and other operational details, negotiation of a full scale, custom milling agreement is planned.

4. CAPITAL STOCK

4. CAPITAL STOCK	12 Months Ended
	Dec. 31, 2016
Notes to Financial Statements
NOTE 4 - CAPITAL STOCK	During the years ended December 31, 2016 and 2015, the Company had no cash subscriptions for shares of its common stock. On November 11, 2015, the Company entered into a one year agreement to obtain assistance in conducting business strategy and communications planning, public financial disclosure reporting, and various matters in connection with directors and other professionals as needed by the Company. In consideration for the services to be provided, the Company granted the consultant 1,469,825 shares of common stock. Those shares were issued on December 11, 2015 and were valued at $29,397, based on market price at the date of the agreement. In addition, the consultant was granted warrants with a five year term, commencing the date of the agreement, to purchase 3,336,060 shares of common stock at a price of $0.02 per share, including a cashless exercise option. The warrants were valued at $66,721 using the Black-Scholes option pricing model with an average risk-free rate of 1.68%, estimated life of 5 years, volatility of 208.7% and dividend yield of 0%. On January 9, 2015, agreements were reached in connection with the loans of $24,696 (CAD $28,650) and $1,767 (CAD $2,050) whereby the loan amounts were to be converted to Company shares at a price of CAD $0.05, to result in the issuance of 573,000 and 41,000 common shares respectively. Those shares were issued on April 6, 2015. On January 9, 2015, an agreement was reached to modify the terms of a loan such that $26,750 of accrued interest together with a premium was to be converted to Company shares at a price of $0.05 per share, to result in the issuance of 535,000 common shares. Those shares were issued on April 6, 2015. Capitalization The authorized capital of the Company is 500,000,000 shares of capital stock, divided into 480,000,000 shares of common stock with a par value of $0.001 per share, and 20,000,000 shares of preferred stock with a par value of $0.001 per share. The Company reserved 10,000,000 shares of common stock for issuance under its new 2016 Omnibus Equity Incentive Plan. No preferred shares have been issued to December 31, 2016 or to the date of issue of these financial statements. To December 31, 2016 and to the date of issue of these financial statements, warrants to purchase 3,336,060 shares of common stock have been issued and none of those warrants have been exercised. At December 31, 2016 the warrants had an intrinsic value of $66,721 based on the exercise price of $0.02 per warrant and a market price of $0.04 per share. No stock options had been issued at December 31, 2016. Warrants Summary of warrant activity and warrants outstanding at December 31, 2016: Number of Warrants Exercise Price Weighted Average Exercise Price Weighted Average Life Remaining (Years) Expiry Date Intrinsic Value Balance December 31, 2014 — — — — — Issued 3,336,060 $ 0.02 $ 0.02 5.00 November 10, 2020 — Expired — — — — — — Exercised — — — — — — Balance December 31, 2015 3,336,060 $ 0.02 $ 0.02 4.86 November 10, 2020 — Issued — — — — — — Expired — — — — — — Exercised — — — — — — Balance December 31, 2016 3,336,060 $ 0.02 $ 0.02 3.86 November 10, 2020 $ 66,721

5. LOANS PAYABLE

5. LOANS PAYABLE	12 Months Ended
	Dec. 31, 2016
Notes to Financial Statements
NOTE 5 - LOANS PAYABLE	At December 31, 2016, the Company had the following loans payable: i. $1,000 (December 31, 2015 - $1,000): unsecured; interest at 15% per annum; originally due on April 20, 2012. Accrued interest payable on the loan at December 31, 2016 was $3,218 (December 31, 2015:$3,068). During the year 2016, the Company repaid $0 (2015: $4,000) on this loan. ii. $45,000 (December 31, 2015 - $65,000): unsecured; interest at 10% per annum from January 10, 2015. During the year 2016, the Company repaid $20,000 (2015: $10,000) on this loan. ● The balance of the outstanding principal $27,500, and any accrued interest was due and payable on written demand in full (not received to date) on the earlier of June 9, 2015 or the date on which the Company completes one or more debt or equity financings that generate aggregate gross proceeds of at least $250,000; ● The balance of the outstanding principal $17,500, and any accrued interest was due and payable on written demand in full (not received to date) on January 9, 2016; and ● The Company shall have the right to repay all or any part of the Principal and any accrued interest to the Lender at any time and from time to time, without any premium. ● The above said notes are currently in default; there are no changes to the terms due to these being in default. ● Accrued interest payable on the loan at December 31, 2016 was $13,091 (December 31, 2015:$7,112). At December31, 2016, total interest accrued on the above loans was $16,309 (December 31, 2015: 10,180).

6. RELATED PARTY TRANSACTIONS A

6. RELATED PARTY TRANSACTIONS AND AMOUNTS DUE	12 Months Ended
	Dec. 31, 2016
Notes to Financial Statements
NOTE 6 - RELATED PARTY TRANSACTIONS AND AMOUNTS DUE	At December 31, 2016, the Company had the following amounts due to related parties: i. $39,777 (December 31, 2015 - $40,789): unsecured; interest at 5% per annum; with no specific terms of repayment, due to the President of the Company. Accrued interest payable on the loan at December 31, 2016 was $4,655 (December 31, 2015:$2,609). During the year 2016 the Company’s President paid $0 (2015: $11,592) for expenses directly on behalf of the Company. The Company repaid $0 (2015:$5,000) and borrowed $0 (2015:$2,348) from the President. ii. $345,000 (December 31, 2015 - $290,000): unsecured; interest at 5% per annum from January 1, 2015; with no specific terms of repayment, due to LSG, the Company’s majority shareholder. Accrued interest payable on the loan at December 31, 2016 was $25,551 (December 31, 2015:$10,157). During the year 2016, the Company borrowed $75,000 (2015: $170,000) from LSG and a $20,000 expense paid directly on behalf of the Company by LSG was reallocated to Loan iii) below. iii. $114,688 (December 31, 2015 - $23,966): unsecured; interest at 5% per annum; with no specific terms of repayment, due to LSG, the Company’s majority shareholder. Accrued interest payable on the loan at December 31, 2016 was $4,810 (December 31, 2015:$336). During the year 2016, LSG paid expenses directly on behalf of the Company totaling $68,981 (2015:$45,707). iv. $3,724 (December 31, 2015 - $3,613): unsecured; non-interest bearing; with no specific terms of repayment, due to the controlling shareholder of LSG. The change in value during the year is entirely due to a change in foreign exchange. At December 31, 2016, total interest accrued on the above related party loans was $35,016 (December 31, 2015: 13,102). During the year ended December 31, 2016, there was an $830 foreign exchange loss (2015:$4,791 gain) due to related party loan amounts in non-US currency. During the year ended December 31, 2016, the Company incurred $100,000 (2015 - $123,913) in mineral option fees payable to LSG, which have been accrued as of that date. The total amount of such fees due at December 31, 2016 was $223,913 (December 31, 2015: $123,913).

7. CONTRACTUAL OBLIGATIONS AND

7. CONTRACTUAL OBLIGATIONS AND COMMITMENTS	12 Months Ended
	Dec. 31, 2016
Notes to Financial Statements
NOTE 7 - CONTRACTUAL OBLIGATIONS AND COMMITMENTS	See Note 3 for details about the Company’s obligations and commitments regarding its Mineral Property Interest.

8. INCOME TAXES

8. INCOME TAXES	12 Months Ended
	Dec. 31, 2016
Income Tax Disclosure [Abstract]
NOTE 8 - INCOME TAXES	In December, 2014, the Company underwent a change in control which subjected it to limitations under Internal Revenue Code Section 382. That section restricts post-change annual net operating loss utilization, based on applying an IRS- prescribed rate to the purchase price of the stock acquired in the change in control. The Company accordingly revised its estimates of net operating loss carry forwards, resulting in a reduction in the estimate of losses available for utilization in the amount of approximately $872,000. Years 2004 to 2011 remain subject to review by the IRS. A reconciliation of income tax benefit to the amount computed at the statutory rate of 34% (2015 – 34%) is as follows: 2016 2015 Expected income tax recovery $ (91,200 ) $ (139,800 ) Adjustment for non-deductible stock compensation — 32,700 Estimated decrease in expected tax recovery resulting from Section 382 net operating loss limitations after change in control — 296,400 Increase (decrease) in valuation allowance (91,200 ) (189,300 ) $ — $ — Significant components of deferred income tax assets are as follows: 2016 2015 Deferred income tax assets Net operating losses carried forward $ 242,200 $ 151,000 Valuation allowance (242,200 ) (151,000 ) $ — $ — The Company has approximately $712,000 (2015 - $444,000) in net operating losses carried forward which will expire by 2036 if not utilized. Future tax benefits, which may arise as a result of these losses, have not been recognized in these financial statements, and have been offset by a valuation allowance. The Company’s net operating losses carried forward for United States income tax purposes will expire, if not utilized, as follows: 2024 $ 10,000 2025 7,600 2026 6,000 2027 10,900 2028 53,200 2029 8,975 2030 6,445 2031 6,445 2032 6,445 2033 6,445 2034 6,445 2035 315,200 2036 268,100 $ 712,200 Realization of the above losses carried forward is dependent on the Company filing the applicable tax returns with the tax authorities, generating sufficient taxable income prior to expiration of the losses carried forward and continuing use of the acquired historic business or a significant portion of the acquired assets for two years after the change of control transaction. If this continuity of business enterprise

9. SUBSEQUENT EVENTS

9. SUBSEQUENT EVENTS	12 Months Ended
	Dec. 31, 2016
Subsequent Events [Abstract]
NOTE 9 - SUBSEQUENT EVENTS	On February 14, 2017, the Company granted 9,500,000 non-qualified stock options pursuant to the Equity Incentive Plan, to key corporate officers and outside consultants, with 25% vesting immediately and a further 25% vesting every six months thereafter for eighteen months. Each option is exercisable into one share of the Company’s common stock at a price of US$0.06 per share, equal to the closing price of the common stock on the grant date, for a term of five years. On February 17, 2017 the Company executed an agreement with Scorpio Gold Corporation (Scorpio) for a pilot toll milling test of its mineralized material. Upon the Company’s completion of required permitting activities with the Nevada Division of Environmental Protection, Bureau of Mining Regulation and Reclamation (NDEP), the bulk sample pilot test will provide the baselines for metallurgical recoveries and mill throughput. Dependent on the pilot test results and completion of a cost analysis and other operational details, negotiation of a full scale, custom milling agreement is planned. On March 9, 2017 the IRS issued a letter to the Company advising that, on appeal, a previously assessed penalty in connection with the filing of its tax return for the year ended December 31, 2013 had been reduced from $20,000 to $5,000 plus related interest.

2. SUMMARY OF SIGNIFICANT ACC16

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Dec. 31, 2016
Notes to Financial Statements
Basis of Accounting	The Company’s financial statements have been prepared using the accrual method of accounting. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein.
Cash and Cash Equivalents	Cash consists of cash on deposit with high quality major financial institutions. For purposes of the balance sheets and statements of cash flows, the Company considers all highly liquid debt instruments purchased with maturity of 90 days or less to be cash equivalents. At December 31, 2016 and 2015, the Company had no cash equivalents.
Foreign Currency Accounting	he Company’s functional currency is the U.S. dollar. Branch office activities are generally in Canadian dollars. Transactions in Canadian currency are translated into U.S. dollars as follows: i) monetary items at the exchange rate prevailing at the balance sheet date; ii) non-monetary items at the historical exchange rate; and iii) revenue and expense items at the rate in effect of the date of transactions. Gains and losses arising on the settlement of foreign currency denominated transactions or balances are recorded in the statements of operations.
Fair Value of Financial Instruments	ASC Topic 820-10 establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. These tiers include: ■ Level 1 – defined as observable inputs such as quoted prices in active markets; ■ Level 2 – defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and ■ Level 3 – defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. The Company’s financial instruments consist of cash, accounts payable and accrued liabilities, and loans payable. The Company is not exposed to significant interest, currency or credit risks arising from these financial instruments. Pursuant to ASC 820 and 825, the fair value of cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. Accounts payable and accrued liabilities and loans payable are measured using “Level 2” inputs as there are no quoted prices in active markets for identical instruments. The carrying values of cash, accounts payable and accrued liabilities, and loans payable approximate their fair values due to the immediate or short term maturity of these financial instruments.
Asset Retirement Obligations	The Company has no asset retirement obligations, including environmental rehabilitation expenditures, which relate to an existing condition caused by past operations.
Use of Estimates and Assumptions	The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying disclosures. By their nature, these estimates are subject to measurement uncertainty and the effect on the financial statements of changes in such estimates in future periods could be significant. Significant areas requiring management’s estimates and assumptions are determining the fair value of transactions involving related parties and common stock. Actual results may differ from the estimates.
Basic and Diluted Earnings Per Share	The Company reports basic earnings or loss per share in accordance with ASC Topic 260, “Earnings Per Share”. Basic earnings per share is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed similarly, except that the common stock number is increased to include the any potential additional common shares, for example from the exercise of options or warrants. As the Company generated net losses in the periods presented, the additional impact of including potential shares from outstanding warrants would be anti-dilutive and is therefore not part of the earnings per share calculation.
Income Taxes	The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, Income Taxes. This standard requires the use of an asset and liability approach for financial accounting and reporting on income taxes. If it is more likely than not that some portion or all of a deferred tax asset will not be realized, a valuation allowance is recognized.
Stock-Based Compensation	Stock-based compensation of employees is accounted for in accordance with ASC 718 whereby a compensation charge based on the fair value of the equity instruments issued, measured at the grant date, is recorded against earnings over the period during which the employee is required to perform the services in exchange for the award (generally the vesting period). For transactions with non-employees in which services are performed in exchange for the Company’s common stock or other equity instruments, the transactions are accounted for in accordance with ASC 505-50, whereby the compensation charge is recorded on the basis of the fair value of the goods or services received or the fair value of the equity instruments granted, whichever is more reliably measurable at the earlier of the date at which a commitment for performance is reached or the date at which the performance is complete. The expense is recognized in the same manner as if the Company had paid cash for the goods or services.
Mineral Property Interest and Impairment	Mineral property interests are capitalized and recorded at fair value. The property interests are periodically assessed for impairment of value when facts and circumstances suggest that the carrying amount of the property interest may exceed its recoverable amount. Costs of exploration, evaluation and retaining mineral property interests are expensed as incurred. Once the Company has identified proven and probable reserves in its investigation of its property interests and upon development of a plan for operating a mine, it would enter the development stage and capitalize future costs until production is established. When a property reaches the production stage, the related capital costs will be amortized, using the units-of-production method over proven and probable reserves.
Related Party Transactions	In accordance with ASC 850, the Company discloses: the nature of the related party relationship(s) involved; a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.
Recent Accounting Pronouncements	The Company has implemented all applicable new accounting pronouncements that are in effect. Those pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

4. CAPITAL STOCK (Tables)

4. CAPITAL STOCK (Tables)	12 Months Ended
	Dec. 31, 2016
Capital Stock Tables
Summary of warrant activity	Number of Warrants Exercise Price Weighted Average Exercise Price Weighted Average Life Remaining (Years) Expiry Date Intrinsic Value Balance December 31, 2014 — — — — — Issued 3,336,060 $ 0.02 $ 0.02 5.00 November 10, 2020 — Expired — — — — — — Exercised — — — — — — Balance December 31, 2015 3,336,060 $ 0.02 $ 0.02 4.86 November 10, 2020 — Issued — — — — — — Expired — — — — — — Exercised — — — — — — Balance December 31, 2016 3,336,060 $ 0.02 $ 0.02 3.86 November 10, 2020 $ 66,721

7. INCOME TAXES (Tables)

7. INCOME TAXES (Tables)	12 Months Ended
	Dec. 31, 2016
Income Taxes Tables
Schedule reconciliation of income tax benefit	2016 2015 Expected income tax recovery $ (91,200 ) $ (139,800 ) Adjustment for non-deductible stock compensation — 32,700 Estimated decrease in expected tax recovery resulting from Section 382 net operating loss limitations after change in control — 296,400 Increase (decrease) in valuation allowance (91,200 ) (189,300 ) $ — $ —
Schedule of deferred income tax assets	2016 2015 Deferred income tax assets Net operating losses carried forward $ 242,200 $ 151,000 Valuation allowance (242,200 ) (151,000 ) $ — $ —
Schedule of net operating losses carried forward	2024 $ 10,000 2025 7,600 2026 6,000 2027 10,900 2028 53,200 2029 8,975 2030 6,445 2031 6,445 2032 6,445 2033 6,445 2034 6,445 2035 315,200 2036 268,100 $ 712,200

1. BASIS OF PRESENTATION AND 19

1. BASIS OF PRESENTATION AND NATURE OF OPERATIONS (Details Narrative)	133 Months Ended
	Dec. 31, 2016USD ($)
Basis Of Presentation And Nature Of Operations Details Narrative
State of incorporation	State of Nevada, U.S.A.
Date of incorporation	Dec. 9, 2004
Accumulated losses	$ 1,680,140

4. CAPITAL STOCK (Details)

4. CAPITAL STOCK (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Capital Stock Tables
Number of Warrants, Beginning	3,336,060	0
Issued	0	3,336,060
Expired	0	0
Exercised	0	0
Number of Warrants, Ending	3,336,060	3,336,060
Exercise Price, Beginning	$ .02	$ 0
Exercise Price, Issued	0	.02
Exercise Price, Expired	0	0
Exercise Price, Exercised	0	0
Exercise Price, , Ending	$ .02	$ .02
Weighted Average Life Remaining (Years), Beginning	4 years 10 months 10 days
Weighted Average Life Remaining (Years), Ending	3 years 10 months 10 days
Expiry Date	Nov. 10, 2020
Intrinsic Value	$ 66,721

5. LOANS PAYABLE (Details Narra

5. LOANS PAYABLE (Details Narrative) - USD ($)	Dec. 31, 2016	Dec. 31, 2015
Loans Payable Details Narrative
Interest accrued	$ 16,309	$ 10,180

6. RELATED PARTY TRANSACTIONS22

6. RELATED PARTY TRANSACTIONS AND AMOUNTS DUE (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Interest accrued	$ 35,016	$ 13,102
President
Accrued interest, related parties	4,655	2,609
Majority Shareholder
Accrued interest, related parties	25,551	10,157
Controlling Shareholder
Accrued interest, related parties	$ 4,810	$ 336

8. INCOME TAXES (Details)

8. INCOME TAXES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Income Taxes Details
Expected income tax recovery	$ (91,200)	$ (139,800)
Adjustment for non-deductible stock compensation	0	32,700
Estimated decrease in expected tax recovery resulting from Section 382 net operating loss limitations after change in control	0	296,400
Increase (decrease) in valuation allowance	(91,200)	(189,300)
Total	$ 0	$ 0

8. INCOME TAXES (Details 1)

8. INCOME TAXES (Details 1) - USD ($)	Dec. 31, 2016	Dec. 31, 2015
Deferred income tax assets
Net operating losses carried forward	$ 242,200	$ 151,000
Valuation allowance	(242,200)	(151,000)
Deferred income tax assets, net	$ 0	$ 0

8. INCOME TAXES (Details 2)

8. INCOME TAXES (Details 2)	12 Months Ended
	Dec. 31, 2016USD ($)
Operating losses amount	$ 712,200
Expiry Year 1
Operating losses expiration year	2,024
Operating losses amount	$ 10,000
Expiry Year 2
Operating losses expiration year	2,025
Operating losses amount	$ 7,600
Expiry Year 3
Operating losses expiration year	2,026
Operating losses amount	$ 6,000
Expiry Year 4
Operating losses expiration year	2,027
Operating losses amount	$ 10,900
Expiry Year 5
Operating losses expiration year	2,028
Operating losses amount	$ 53,200
Expiry Year 6
Operating losses expiration year	2,029
Operating losses amount	$ 8,975
Expiry Year 7
Operating losses expiration year	2,030
Operating losses amount	$ 6,445
Expiry Year 8
Operating losses expiration year	2,031
Operating losses amount	$ 6,445
Expiry Year 9
Operating losses expiration year	2,032
Operating losses amount	$ 6,445
Expiry Year 10
Operating losses expiration year	2,033
Operating losses amount	$ 6,445
Expiry Year 11
Operating losses expiration year	2,034
Operating losses amount	$ 6,445
Expiry Year 12
Operating losses expiration year	2,035
Operating losses amount	$ 315,200
Expiry Year 13
Operating losses expiration year	2,036
Operating losses amount	$ 268,100