FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REPORT OF FOREIGN ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
The Securities Exchange Act of 1934
For the month of December, 2004
SEC File #0-24570
- --------------------------------------------------------------------------------
CENTRAL MINERA CORP.
PO Box 93038, Caulfeild Village R.P.O.
West Vancouver, BC
V7W 3G4
CANADA
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F
Form 20-F [X] Form 40-F
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes [ ] No [X]
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b) : 82-
THIS FORM 6-K CONSISTS OF:
Annual Financial Statements for the year ended June 30, 2004
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CENTRAL MINERA CORPORATION
By: "Michael Cytrynbaum"
Name: Michael Cytrynbaum
Title: President
Date: December 6, 2004
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
AUDITORS' REPORT
TO THE SHAREHOLDERS OF
CENTRAL MINERA CORP.
We have audited the balance sheet of Central Minera Corp. (a development stage
company) as at June 30, 2004 and the statements of operations and deficit and
cash flow for the year ended June 30, 2004. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with Canadian generally accepted auditing
standards and the standards of the Public Company Accounting Oversight Board
(United States). Those standards require that we plan and perform an audit to
obtain reasonable assurance whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation.
In our opinion, these financial statements present fairly, in all material
respects, the financial position of the Company as at June 30, 2004 and the
results of its operations and its cash flows for the year then ended in
accordance with Canadian generally accepted accounting principles.
The financial statements as at June 30, 2003 and for the years ended June 30,
2003 and 2002 were audited by other auditors who expressed an opinion without
reservation on those statements in their report dated September 9, 2003.
Vancouver, Canada "Pannell Kerr Forster"
October 5, 2004 CHARTERED ACCOUNTANTS
COMMENTS BY AUDITORS FOR U.S. READERS ON CANADA-U.S. REPORTING CONFLICT
In the United States, reporting standards for auditors require the addition of
an explanatory paragraph (following the opinion paragraph) when the financial
statements are affected by conditions and events that cast substantial doubt on
the Company's ability to continue as a going concern, such as that described in
Note 1 of these financial statements. Our report to the shareholders dated
October 5, 2004 is expressed in accordance with Canadian reporting standards
which do not permit a reference to such uncertainties in the auditors' report
when the uncertainties are adequately disclosed in the financial statements.
Vancouver, Canada "Pannell Kerr Forster"
October 5, 2004 CHARTERED ACCOUNTANTS
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
JUNE 30,
(EXPRESSED IN U.S. DOLLARS)
2004 2003
------------ ------------
ASSETS
CURRENT
CASH AND TERM DEPOSITS (NOTE 5) $ 161,322 $ 65,569
ACCOUNTS RECEIVABLE 7,049 19,143
MARKETABLE SECURITIES (NOTE 6) 2,000 8,513
PREPAID EXPENSES 4,141 -
------------ ------------
174,512 93,225
EQUIPMENT (NOTE 7) 1,476 2,109
MINERAL PROPERTIES AND INTERESTS (NOTE 8) 2 2
------------ ------------
$ 175,990 $ 95,336
============ ============
LIABILITIES
CURRENT
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES $ 21,552 $ 24,209
------------ ------------
SHARE CAPITAL AND DEFICIT
CONVERTIBLE DEBENTURES (NOTE 9) - 300,000
SHARE CAPITAL (NOTE 10)
VARIABLE MULTIPLE VOTING SHARES 300,000 -
SUBORDINATE VOTING SHARES 41,759,052 41,538,468
CONTRIBUTED SURPLUS ARISING FROM
STOCK-BASED COMPENSATION (NOTE 10) 9,073 9,073
DEFICIT (41,913,687) (41,776,414)
------------ ------------
154,438 71,127
------------ ------------
$ 175,990 $ 95,336
============ ============
GOING CONCERN CONSIDERATIONS (NOTE 1)
RELATED PARTY TRANSACTIONS (NOTE 11)
COMMITMENTS (NOTE 12)
APPROVED BY THE DIRECTORS
"Michael Cytrynbaum"
"Murray Kosick"
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS AND DEFICIT
YEAR ENDED JUNE 30,
(EXPRESSED IN U.S. DOLLARS)
CUMULATIVE
TO JUNE 30,
2004 2004 2003 2002
------------ ------------ ------------ ------------
ADMINISTRATION EXPENSES
ACCOUNTING AND AUDIT $ 705,975 $ 12,620 $ 8,141 $ 23,845
AMORTIZATION 282,944 633 372 912
CONSULTING FEES 1,883,858 82,736 107,304 40,490
LEGAL 1,851,954 8,202 129,860 75,944
OFFICE 933,055 5,680 5,912 12,268
RENT 726,425 - 153 72,065
SALARIES AND BENEFITS 292,748 1,496 11,854 -
TRANSFER AGENT AND FILING FEES 177,141 15,379 16,345 8,042
TRAVEL AND PROMOTION 1,219,314 3,413 21,372 999
------------ ------------ ------------ ------------
8,073,414 130,159 301,313 234,565
------------ ------------ ------------ ------------
INTEREST AND OTHER INCOME (1,517,908) (70) (7,249) (30,242)
LOSS (GAIN) ON FOREIGN EXCHANGE 44,549 625 (11,572) (3,213)
WRITE-DOWN OF INVESTMENT IN
PRIVATE COMPANY (NOTE 8) 1,000,799 - - -
LOSS (GAIN) ON SALE AND WRITE-
DOWN OF MARKETABLE SECURITIES (7,402) 6,559 2,079 -
WRITE-DOWN OF MINERAL
PROPERTIES (NOTE 8) 24,724,778 - 741 -
LOSS ON SALE OF PROPERTY
AND EQUIPMENT 11,307 - - 1,512
SETTLEMENT OF LAWSUITS,
NET OF (RECOVERIES) 729,038 - (99,424) -
LOSS ON SALE OF SUBSIDIARY 8,855,112 - - -
------------ ------------ ------------ ------------
33,840,273 7,114 (115,425) (31,943)
------------ ------------ ------------ ------------
NET LOSS FOR THE PERIOD 41,913,687 137,273 185,888 202,622
DEFICIT BEGINNING OF THE PERIOD - 41,776,414 41,590,526 41,387,904
------------ ------------ ------------ ------------
DEFICIT END OF THE PERIOD $ 41,913,687 $ 41,913,687 $ 41,776,414 $ 41,590,526
============ ============ ============ ============
BASIC AND DILUTED LOSS PER SHARE $ .01 $ .01 $ .01
============ ============ ============
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 25,490,936 21,826,240 21,760,068
============ ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOW
YEAR ENDED JUNE 30,
(EXPRESSED IN U.S. DOLLARS)
CUMULATIVE
TO JUNE 30,
2004 2004 2003 2002
------------ ------------ ------------ ------------
CASH PROVIDED (USED) BY
OPERATING ACTIVITIES
NET LOSS FOR THE PERIOD $(41,913,687) $ (137,273) $ (185,888) $ (202,622)
ITEMS NOT INVOLVING CASH
AMORTIZATION 282,944 633 372 912
LOSS ON SALE OF SUBSIDIARY 8,855,112 - - -
LOSS ON SALE OF PROPERTY
AND EQUIPMENT 11,307 - - 1,512
WRITE-DOWN OF INVESTMENT IN
PRIVATE COMPANY 1,000,799 - - -
WRITE-DOWN OF MINERAL
PROPERTIES 24,724,777 - 741 -
STOCK COMPENSATION EXPENSE 9,073 - 9,073 -
SHARE CONSIDERATION PAYABLE
INCLUDED IN SETTLEMENT
OF LAWSUITS 375,000 - - -
------------ ------------ ------------ ------------
(6,654,675) (136,640) (175,702) (200,198)
NET CHANGE IN NON-CASH
WORKING CAPITAL ITEMS
ACCOUNTS RECEIVABLE (7,049) 12,094 (10,214) 6,934
PREPAID EXPENSES (4,141) (4,141) - 17,559
MARKETABLE SECURITIES (2,000) 6,513 (2,095) -
ACCOUNTS PAYABLE AND
ACCRUED LIABILITIES 21,552 (2,657) (51,081) 56,172
------------ ------------ ------------ ------------
(6,646,313) (124,831) (239,092) (119,533)
------------ ------------ ------------ ------------
FINANCING ACTIVITIES
LOAN AND CONVERTIBLE
DEBENTURES PAYABLE - (300,000) 30,251 269,749
FUNDS HELD IN TRUST - - 175,000 (175,000)
SHARES ISSUED FOR CASH, LOAN
AND CONVERTIBLE DEBENTURES 25,934,051 520,584 96,611 -
------------ ------------ ------------ ------------
25,934,051 220,584 301,862 94,749
------------ ------------ ------------ ------------
INVESTING ACTIVITIES
MINERAL PROPERTIES (17,311,378) - (741) -
INVESTMENT IN PRIVATE COMPANY (1,000,799) - - -
PURCHASE OF PROPERTY
AND EQUIPMENT (814,239) - (2,481) -
------------ ------------ ------------ ------------
(19,126,416) - (3,222) -
------------ ------------ ------------ ------------
CHANGE IN CASH FOR THE PERIOD 161,322 95,753 59,548 (24,784)
CASH AND TERM DEPOSITS BEGINNING
OF THE PERIOD - 65,569 6,021 30,805
------------ ------------ ------------ ------------
CASH AND TERM DEPOSITS END OF THE
PERIOD $ 161,322 $ 161,322 $ 65,569 $ 6,021
============ ============ ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
1. GOING CONCERN CONSIDERATIONS
These financial statements have been prepared on the assumption that the
Company will continue as a going concern, meaning it will continue in
operation for the foreseeable future and will be able to realize assets
and discharge liabilities in the normal course of operations. Different
bases of measurement may be appropriate when a company is not expected to
continue operations for the foreseeable future. As at October 5, 2004, the
Company had not reached a level of operations which would finance
day-to-day activities. The Company's continuation as a going concern is
dependent upon its ability to attain profitable operations and generate
funds therefrom and/or raise equity capital or borrowings sufficient to
meet current and future obligations.
For the years ended June 30, 2004, 2003 and 2002, the Company sustained
operating losses of $137,273, $185,888 and $202,622 respectively.
2. CONTINUING OPERATIONS
The Company is incorporated under the laws of Yukon Territory of Canada.
The principal business activity is the acquisition, exploration and
development of mineral properties. At the Company's annual general meeting
in December, 2002, the shareholders approved the consolidation of the
Company's shares to a maximum ratio of 1:20 and to change its domicile.
The directors are authorized to implement these changes at their
discretion. No changes have been implemented.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Mineral Properties
The Company accounts for its mineral properties whereby all direct
costs relative to the acquisition are capitalized and all
exploration and development expenditures are expensed until an
economic feasibility study is completed. All pre-production revenue
and option proceeds received are first credited against the costs of
the related property, with any excess credited to earnings. Once
commercial production has commenced, the net costs of the applicable
property are charged to operations using the unit-of-production
method based on reserves. On an ongoing basis, the Company evaluates
each property based on results to date to determine the nature of
exploration work that is warranted in the future. If there is little
prospect of future work being carried out on a property, the costs
related to that property are written down to the estimated amount
recoverable.
The Company's mineral properties are in the exploration stage and it
has not yet been determined whether or not the properties contain
ore reserves that are economically recoverable. The amounts shown
for mineral properties are not intended to reflect present or future
values. The recoverability of the investment in these properties is
dependent upon the existence of economically recoverable reserves,
confirmation of the Company's interest in the mineral properties,
the ability of the Company to finance their development and upon
future profitable production.
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
b. Foreign Currency Translation
The Company's operations have been translated into U.S. dollars
using the temporal method. Under this method, monetary assets and
liabilities have been translated at the period end exchange rates.
Non-monetary assets have been translated using historical rates of
exchange. Revenues and expenses have been translated into U.S.
dollars at the average rate of exchange prevailing during the
period, except for amortization, which is translated at exchange
rates applicable to the related asset. Translation gains or losses
are included in the determination of earnings (loss).
c. Loss Per Share
Loss per share has been calculated using the weighted average number
of shares outstanding.
d. Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Significant areas
requiring the use of management estimates relate to the
determination of impairment of assets, environmental issues and the
outcome of lawsuits. Actual results could differ from those
estimates.
e. Equipment
Equipment is recorded at cost. The cost, less the salvage or
residual value, is charged to income over its estimated useful life,
using the declining balance method:
Office furniture and equipment declining balance at 30% per annum
f. Incentive Stock Options
On July 1, 2002, the Company prospectively adopted the
recommendations of the Canadian Institute of Chartered Accountants
("CICA") related to the recognition, measurement and disclosure of
stock-based compensation. Those recommendations encouraged, but did
not require, enterprises to recognize compensation costs for
incentive stock options using the fair value based method. Under the
fair value based method, the value of a stock option is determined
using an option pricing model that takes into account, as of the
grant date, the exercise price, expected life of the option, the
current price of the underlying stock, its expected volatility,
expected dividends on the stock and the risk-free interest rate over
the expected life of the option.
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
f. Incentive Stock Options (Continued)
Effective for the year ended June 30, 2004, the Company
prospectively adopted the new recommendations of the CICA with
respect to stock-based compensation. Under the new recommendations,
the Company recognizes compensation costs for the granting of all
stock options and direct awards of stock.
Previously, the Company accounted for incentive stock options using
the settlement method. Under this method, no compensation expense
was recognized on the grant of incentive stock options and
consideration received on exercise was credited to share capital.
g. Income Taxes
The Company accounts for income taxes whereby the cost (benefit) of
current and future income taxes is recognized as income tax expense
in the determination of results of operations for the period. Future
income tax liabilities (assets) are the amount of income taxes
arising from taxable temporary differences between the tax bases of
an asset or liability and its carrying amount in the balance sheet.
Income tax liabilities and assets are recognized when they are more
likely than not to be realized and are measured using the income tax
rates and laws that are expected to apply at the time of settlement
or realization.
h. Cumulative and Comparative Figures
The cumulative amounts in the statements of operations and cash flow
include the results of operations which were discontinued by the
disposal or abandonment of subsidiary companies. Certain of the
comparative figures have been re-classified to conform to the
current year's financial statement presentation.
4. FINANCIAL INSTRUMENTS
The carrying value of cash and term deposits, accounts receivable,
marketable securities and accounts payable and accrued liabilities
approximate their fair value due to the short-term maturity of these
financial instruments.
The Company is not exposed to any significant interest rate price
risk or cash flow risk due to the short-term maturity of its
monetary assets and liabilities.
The Company is not exposed to any significant credit risk with
respect to its accounts receivable, nor does it expect any credit
losses.
The Company translates the results of its operations into U.S.
currency using rates approximating the rate of exchange prevailing
on the transaction date. The exchange rate may vary from time to
time. Translation gains or losses are included in the determination
of earnings (loss).
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
5. CASH AND TERM DEPOSITS
The Company maintains its cash balances in various currencies. At the year
end, the currencies held and the United States equivalents were as
follows:
2004 2003
-------- --------
Canadian dollars $ 4,179 $ 8,839
U.S. dollars 157,143 56,730
-------- --------
$161,322 $ 65,569
======== ========
6. MARKETABLE SECURITIES
Marketable securities in public companies are carried in the accounts at
the lesser of estimated net realizable value and cost.
7. EQUIPMENT
2004 2003
-------- --------
Office furniture and equipment $ 2,481 $ 2,481
Accumulated amortization (1,005) (372)
-------- --------
Net book value $ 1,476 $ 2,109
======== ========
8. MINERAL PROPERTIES AND INTERESTS
a. Investment in Private Company
The Company acquired a 15.72% interest in a private company
incorporated in Nevada, U.S.A. The Nevada company is in the
development stage and is exploring properties in southern Nevada
(the "Eldorado Project"). It is unlikely that any benefit will
accrue to the Company during the development stages and the
Company's investment of $1,000,800 has been written down to a
nominal value.
b. Mineral Property Interests
The Company has abandoned its mineral interests in Canada, Mexico,
Nicaragua and Nevada and all property-related costs have been
expensed.
9. CONVERTIBLE DEBENTURES
The debentures were unsecured, had a maturity date of July 31, 2004, and
were deemed to have been converted into units of the Company on July 31,
2003 in the ratio of one unit for each $.10 (3,000,000 units). Each unit
was comprised of one variable multiple voting share and one
non-transferrable share purchase warrant to acquire one subordinate voting
share at $.10 (originally $.30) per share before July 31, 2004. Related
parties subscribed for the debentures.
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
10. SHARE CAPITAL
a. Authorized
3,000,000 variable multiple voting shares without par value
Unlimited number of subordinate voting shares without par
value
The variable multiple voting shares are identical to the
subordinate shares except they may only be transferred with
the approval of the directors and entitle the holder to more
than one vote, calculated on a predetermined ratio between the
share classes. The variable multiple voting shares may be
converted into subordinate shares at a ratio of 1:1 with a
mandatory conversion if the then outstanding balance is less
than 1,500,000 shares.
b. Issued
SHARE
PRICE SHARES CONSIDERATION
--------- ---------- -------------
Variable Multiple Voting Shares
Shares Issued
Conversion of convertible debentures $ .10 3,000,000 $ 300,000
========== ============
Subordinate Voting Shares
Balance June 30, 2002 21,760,068 $ 41,441,857
Shares issued
For cash - Private placement $ .10 750,000 75,000
For debt settlement (related party
loan payable) $ .10 216,114 21,611
Escrow shares cancelled (562,500) -
---------- ------------
Balance June 30, 2003 22,163,682 41,538,468
Shares issued
For cash - Private placement $ .05 1,200,000 60,000
For cash - Warrants exercised $ .10 1,605,835 160,584
---------- ------------
Balance June 30, 2004 24,969,517 $ 41,759,052
========== ============
c. Incentive Stock Option
The Company has a stock option plan for which options granted under
the plan generally have a maximum term of ten years. The exercise
price of each option equals the market price of the Company's shares
on the date of the grant.
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
10. SHARE CAPITAL (CONTINUED)
c. Incentive Stock Option (Continued)
Details of director, employee and consultant share purchase options
are as follows:
2004 2003
------------------------------- --------------------------------
WEIGHTED WEIGHTED
NUMBER OF AVERAGE NUMBER OF AVERAGE
OPTIONS EXERCISE PRICE OPTIONS EXERCISE PRICE
--------- -------------- --------- --------------
Balance Beginning of the Year 1,925,000 $ .20 2,165,000 $ .20
Granted - $ - 1,925,000 $ .20
Cancelled (300,000) $ .20 (2,165,000) $ .20
--------- ------------ -------- ------------
Balance End of the Year 1,625,000 $ .20 1,925,000 $ .20
========= ============ ========= ============
BALANCE BALANCE
JUNE 30, JUNE 30, EXERCISE
2003 CHANGE 2004 PRICE EXPIRY DATE
- --------- -------- --------- -------------- -----------------
300,000 (300,000) - $ .20 December 31, 2003
300,000 - 300,000 $ .20 December 31, 2004
1,325,000 - 1,325,000 $ .20 December 31, 2005
- --------- -------- ---------
1,925,000 (300,000) 1,625,000
========= ======== =========
As at June 30, 2004, the weighted average remaining contractual life of the
stock options is 16 months.
The Company is required to disclose the pro-forma effects on net loss and net
loss per share data as if the Company had elected to use the fair value approach
to account for its incentive stock options plans as described in Note 3(f). For
2003, if this approach had been applied, the Company's net loss and net loss per
share would have been as below:
Loss for the year, as reported $ 185,888
Add fair value of stock based compensation 32,540
Less intrinsic value of stock based compensation -
------------
Pro-forma loss for the year $ 218,428
============
Basic and fully diluted loss per share
As reported $ .01
Pro-forma $ .01
The fair value for the options was estimated using the Black-Scholes option
pricing model assuming: no expected dividends; interest rate - 3.25%, term - 2
years; and share price volatility - 36%.
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
10. SHARE CAPITAL (CONTINUED)
c. Incentive Stock Option (Continued)
Option pricing models require the input of highly subjective
assumptions, including the expected price volatility. Changes in
these assumptions can materially affect the fair value estimate and,
therefore, the existing models do not necessarily provide a reliable
single measure of the fair value of the Company's stock options.
d. Share Purchase Warrants
2004 2003
--------------------------- ------------------------------
WEIGHTED WEIGHTED
NUMBER OF AVERAGE NUMBER OF AVERAGE
WARRANTS EXERCISE PRICE WARRANTS EXERCISE PRICE
---------- -------------- --------- --------------
Balance Beginning of the Year 6,969,454 $ .18 6,003,340 $ .20
Issued 4,200,000 $ .10 - $ -
Exercised (3,211,670) .18 966,114 $ .10
Lapsed (2,791,670) $ .18 - $ -
---------- ---------- --------- ---------
Balance End of the Year 5,166,114 $ .10 6,969,454 $ .18
========== ========== ========= =========
BALANCE BALANCE
JUNE 30, JUNE 30, EXERCISE
2003 CHANGE 2004 PRICE EXPIRY DATE
- --------- ---------- --------- ----------- -----------------
6,003,340 (6,003,340) - $.10 / 2wts May 30, 2004
- 3,000,000 3,000,000 $.10 / 1wt July 31, 2004
966,114 - 966,114 $.10 / 1wt June 5, 2005
- 1,200,000 1,200,000 $.10 / 1wt February 13, 2006
- --------- --------- ---------
6,969,454 (1,803,340) 5,166,114
======== ========== =========
During the year, the Company extended the expiry date of 6,003,340 outstanding
warrants to May 30, 2004. As at June 30, 2004, the weighted average remaining
contractual life of the warrants is 7 months.
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
11. RELATED PARTY TRANSACTIONS
Related party transactions not separately disclosed elsewhere in these
financial statements were as follows:
2004 2003 2002
---------- ---------- ----------
Consulting or other fees paid to directors/officers
or to companies controlled by directors/officers $ 67,200 $ 94,390 $ 35,754
========== ========== ==========
Occupancy costs charged to companies controlled
by a director/officer and a public company under
common management $ - $ - $ 29,135
========== ========== ==========
12. COMMITMENTS
The Company has entered into a management agreement, with a company
controlled by a director, which requires minimum annual payments of
approximately $134,000 ($180,000 Cdn). The agreement contains a clause
requiring a termination payment of approximately $64,000. The corporate
related party has voluntarily reduced the monthly fee to $5,600 (Cdn.
$7,500) commencing March, 2003.
13. INCOME TAXES
The income taxes shown on the statements of operations and deficit differ
from the amounts calculated by applying the combined Canadian Federal and
Provincial statutory rates due to the following:
2004 2003 2002
----------- ---------- ----------
Income tax recovery at statutory rates $ (50,269) $ (71,790) $ (82,305)
Write-down and loss on investments 2,402 803 -
Other - - 614
Benefit of income tax losses which has
not been recognized 47,867 70,987 81,691
----------- ---------- ----------
$ - $ - $ -
=========== ========== ==========
Future income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. The
components of future tax assets are as follows:
2004 2003
-------------- --------------
Non-capital losses carried forward $ 1,207,263 $ 1,673,836
Resource-related expenditures 132,478 138,977
Investment losses 4,396,786 4,612,484
-------------- --------------
5,736,527 6,425,297
Less: Valuation allowance (5,736,527) (6,425,297)
-------------- --------------
Net future income tax assets $ - $ -
============== ==============
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
13. INCOME TAXES (CONTINUED)
As at June 30, 2004, the Company has operating losses of approximately
$3,297,000, resource-related expenditures of approximately $362,000, and
capital losses of approximately $12,006,500 available for carry-forward to
reduce future years' taxable income. No future income tax benefit has been
recognized in the accounts. The availability of the operating losses
expires as follows:
2005 $ 459,000
2006 1,807,000
2007 449,000
2009 317,000
2010 123,000
2011 142,000
------------
$ 3,297,000
============
14. RECONCILIATION TO ACCOUNTING PRINCIPLES GENERALLY ACCEPTED IN THE UNITED
STATES ("U.S. GAAP")
These financial statements have been prepared in accordance with
accounting principles generally accepted in Canada. A description of
accounting principles that differ in certain respects from United States
generally accepted accounting principles follows:
a. Stock-Based Compensation
The Company has elected, commencing with the year ended June 30,
2004, to account for stock-based compensation using SFAS 123.
Accordingly, compensation cost for stock options is measured at the
fair value of options granted. For the years ended June 30, 2003 and
2002, the Company elected to apply the intrinsic value-based method
of accounting prescribed by Accounting Principles Board Opinion No.
25 ("APB No. 25") "Accounting for Stock Issued to Employees" for
measuring the value of stock-based compensation. The intrinsic
value-based method requires that compensation expense be recorded at
the time of granting an option for the excess of the quoted market
price over the option exercise price. If a stock option is not
exercised, the compensation expense recorded in the previous period
is reversed by decreasing the compensation expense in the period of
forfeiture. No compensation expense was required to be recognized
for those years.
b. Other Accounting Standards
i. The Company has adopted the Statement of Financial Accounting
Standards No. 130 (" SFAS 130") "Reporting Comprehensive
Income" with no impact on U.S. GAAP differences.
ii. The Company does not have any derivative or hedging
instruments and, therefore, Statement of Financial Accounting
Standards No. 149 ("SFAS 149") "Accounting for Derivative
Instruments and Hedging Activity" has no impact on U.S. GAAP
differences.
The adoption of these new pronouncements is not expected to
have an effect on the financial position or results of
operations.
CENTRAL MINERA CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2004
(EXPRESSED IN U.S. DOLLARS)
14. RECONCILIATION TO ACCOUNTING PRINCIPLES GENERALLY ACCEPTED IN THE UNITED
STATES ("U.S. GAAP") (CONTINUED)
The effect of the differences between Canadian GAAP and U.S. GAAP on the
balance sheets and statements of operations and deficit is summarized
below:
June 30, 2004 2003 2002
-------------- --------------- ---------------
Share capital, under Canadian GAAP $ 42,059,052 $ 41,538,469 $ 41,441,858
Adjustment for APB No. 25 12,490 12,490 21,563
-------------- --------------- ---------------
Share capital under U.S. GAAP $ 42,071,542 $ 41,550,959 $ 41,463,421
============== =============== ===============
Deficit, under Canadian GAAP $ (41,913,687) $ (41,776,414) $ (41,590,526)
Adjustment for APB No. 25 (12,490) (12,490) (21,563)
-------------- --------------- ---------------
Deficit, under U.S. GAAP $ (41,926,177) $ (41,788,904) $ (41,612,089)
============== =============== ===============
Loss for the period under Canadian GAAP $ (137,273) $ (185,888) $ (202,622)
Adjustment for APB No. 25 - 9,073 -
-------------- --------------- ---------------
Comprehensive loss under U.S. GAAP $ (137,273) $ (176,815) $ (202,622)
============== =============== ===============
Basic and diluted loss per share under
U.S. GAAP $ (.01) $ (.01) $ (.01)
============== =============== ===============
There is no effect on the statement of cash flow for the difference between
Canadian GAAP and U.S. GAAP.