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Delrand Resources Limited - Consolidated Financial Statements For Years Ended 30 June 2015 And 2014

Release Date: 29/09/2015 11:00:00      Code(s): DRN     
Delrand Resources Limited
(Incorporated in Canada)
(Corporation number 627115-4)
Share code: DRN ISIN Number: CA2472672062
(?Delrand? or the "Company")

CONSOLIDATED FINANCIAL STATEMENTS
For the years ended June 30, 2015 and 2014
(Expressed in Canadian dollars)

Management?s Report

The consolidated financial statements, the notes thereto and other financial information contained in the
Management?s Discussion and Analysis have been prepared in accordance with International Financial Reporting
Standards and are the responsibility of the management of Delrand Resources Limited (the ?Company?). The
financial information presented elsewhere in the Management?s Discussion and Analysis is consistent with the data
that is contained in the consolidated financial statements. The consolidated financial statements, where necessary,
include amounts which are based on the best estimates and judgments of management.

In order to discharge management?s responsibility for the integrity of the financial statements, the Company
maintains a system of internal controls. These controls are designed to provide reasonable assurance that the
Company?s assets are safeguarded, transactions are executed and recorded in accordance with management?s
authorization, proper records are maintained and relevant and reliable information is produced. These controls
include maintaining quality standards in hiring and training of employees, policies and procedures manuals, a
corporate code of conduct and ensuring that there is proper accountability for performance within appropriate and
well-defined areas of responsibility. The system of internal controls is further supported by a compliance function,
which is designed to ensure that management and the Company?s employees comply with securities legislation and
conflict of interest rules.

The Board of Directors is responsible for overseeing management?s performance of its responsibilities for financial
reporting and internal control. The Audit Committee meets with management as well as the external auditors, as
and when appropriate, to ensure that management is properly fulfilling its financial reporting responsibilities to the
Board of Directors who approve the consolidated financial statements.

The consolidated financial statements for the year ended June 30, 2015 have been audited by McGovern, Hurley,
Cunningham LLP, Chartered Accountants, and the consolidated financial statements for the year ended June 30,
2014 have been audited by Deloitte LLP, Chartered Professional Accountants, Chartered Accountants and Licensed
Public Accountants, in accordance with Canadian generally accepted auditing standards.



(Signed) ?Arnold Kondrat?                                 (Signed) ?Brian Scallan?

Arnold Kondrat, Chief Executive Officer                   Brian Scallan, Vice President, Finance

September 28, 2015

Independent Auditor?s Report

To the Shareholders of Delrand Resources Limited,

We have audited the accompanying consolidated financial statements of Delrand Resources Limited and its subsidiary, which
comprise the consolidated statement of financial position as at June 30, 2015, and the consolidated statement of comprehensive
loss, consolidated statement of changes in equity and consolidated statement of cash flow for the year then ended, and a
summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance
with International Financial Reporting Standards and for such internal control as management determines is necessary to
enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or
error.

Auditor?s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our
audit in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial
statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated
financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of
material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments,
the auditor considers internal control relevant to the entity's preparation and fair presentation of the consolidated financial
statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the
overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.

Opinion
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Delrand
Resources Limited and its subsidiary as at June 30, 2015, and their financial performance and cash flows for the year then
ended in accordance with International Financial Reporting Standards.

Other Matter
The consolidated financial statements of Delrand Resources Limited for the year ended June 30, 2014, were audited by other
auditors, who expressed an unmodified opinion on those statements on September 29, 2014.

Emphasis of Matter
Without qualifying our opinion, we draw attention to Note 1 in the consolidated financial statements, which indicates that the
Company had continuing losses during the year ended June 30, 2015 and a working capital deficiency and cumulative deficit as
at June 30, 2015. These conditions along with other matters set forth in Note 1 indicate the existence of a material uncertainty
that may cast significant doubt about the Company?s ability to continue as a going concern.

/s/ McGovern, Hurley, Cunningham, LLP
Chartered Accountants
Toronto, Canada
September 28, 2015

CONTENTS
Consolidated Statements of Financial Position.............................................................................5
Consolidated Statements of Loss and Comprehensive Loss....................................................................6
Consolidated Statements of Changes in Equity..............................................................................7
Consolidated Statements of Cash Flow......................................................................................8
Notes to the Consolidated Financial Statements............................................................................9



1. Corporate Information and Continuation of the Business ................................................................9
2. Basis of Preparation ..................................................................................................9
3. Summary of Significant Accounting Policies ........................................................................... 10
4. Subsidiary and Investment in Associate................................................................................ 19
5. Exploration and Evaluation Assets .................................................................................... 19
6. Accounts Payable and Accrued Liabilities ............................................................................. 20
7. Related Party Transactions ........................................................................................... 20
8. Share Capital ........................................................................................................ 21
9. Share-Based Payments ................................................................................................. 22
10. Segmented Reporting.................................................................................................. 23
11. Financial Risk Management Objectives and Policies ................................................................... 23
12. Commitments and Contingencies........................................................................................ 26
13. Income Taxes ........................................................................................................ 28

                                                                  Notes           June 30, 2015                    June 30, 2014

                                                                                          $                              $

Assets
Current Assets
    Cash                                                                                   9,163                          31,559
    Due from related parties                                        7                          -                           1,588
    Prepaid expenses and other assets                                                     24,968                           5,523
Total Current Assets                                                                      34,131                          38,670


Non-Current Assets
     Exploration and evaluation                                     5                          -                       2,333,457
Total Non-Current Assets                                                                       -                       2,333,457

 
Total Assets                                                                               34,131                      2,372,127


Liabilities and Shareholders' Equity
Current Liabilities
      Accounts payable and accrued liabilities                      6                   1,750,913                        560,679
      Income taxes payable                                          13                      5,420                          5,420
      Due to related parties                                        7                     665,726                         60,212
Total Current Liabilities                                                               2,422,059                        626,311


Shareholders' Equity
    Share capital                                                   8                 117,345,802                    117,128,346
    Contributed surplus                                                                 8,183,615                      8,159,644
    Deficit                                                                          (127,917,345)                  (123,542,174)
Total Shareholders' Equity/(Deficiency)                                                (2,387,928)                     1,745,816
Total Liabilities and Shareholders' Equity                                                 34,131                      2,372,127

                                                                    1
Continuation of Business
                                                                    12
Commitments and Contigencies


Common shares
    Authorized (Note 8a)                                                                         Unlimited                     Unlimited
    Issued and outstanding                                                                      21,781,581                    21,281,581
 

The accompanying notes are an integral part of these consolidated financial statements.

These consolidated financial statements were approved and authorized for issue by the Board of Directors on September 28, 2015.
Signed on behalf of the Board of Directors by:

/s/ Arnold Kondrat                                                                             /s/ Brian Scallan
Arnold Kondrat                                                                                 Brian Scallan
Director                                                                                       Director

                                                                                          Year ended June 30,      Year ended June 30,
                                                                                                 2015                     2014
                                                                           Notes
                                                                                                  $                        $

Expenses
     Consulting and professional fees                                                         1,584,591                  163,656
     General and administrative                                                                 414,063                  204,055
     Impairment of exploration and evaluation assets                       5                  2,353,315                3,115,554
     Foreign exchange loss                                                                       23,202                    4,287
Total expenses                                                                               (4,375,171)              (3,487,552)


Net loss and comprehensive loss                                                              (4,375,171)              (3,487,552)



Basic and diluted loss per share                                           8c                     (0.20)                   (0.16)
Adjustments for headline loss per share                                    8c                      0.11                     0.15
Headline loss per share                                                    8c                     (0.09)                   (0.01)

Weighted average number of common shares outstanding                                         21,750,074               20,590,336


The accompanying notes are an integral part of these consolidated financial statements.
                                                                                                                                 Total
                                                                 Common shares
                                                                                                                             Shareholders'
                                                           Number of                          Contributed                       equity
                                               Notes                                                           Deficit
                                                          shares (Note         Amount           Surplus
                                                               8)
                                                                                   $              $              $                $

Balance at June 30, 2013                                    19,578,214       116,601,688        8,159,644   (120,054,622)       4,706,710


Net loss                                                             -                 -                -     (3,487,552)      (3,487,552)
Share issuance (net of costs)                  8a            1,703,284            526,658               -              -          526,658
Fractional shares due to consolidation                              83                  -               -              -                -
                                                                                   $              $              $                $
Balance at June 30, 2014                                    21,281,581        117,128,346       8,159,644   (123,542,174)       1,745,816


Net loss                                                             -                  -               -     (4,375,171)      (4,375,171)
Issuance of units (net of costs)               8a              500,000            217,456          23,971              -          241,427
                                                                                   $              $                $              $
Balance at June 30, 2015                                    21,781,581        117,345,802       8,183,615   (127,917,345)      (2,387,928)


The accompanying notes are an integral part of these consolidated financial statements.

                                                                                          Year ended June 30,       Year ended June 30,
                                                                                                 2015                      2014
                                                                             Notes
                                                                                                  $                         $


Cash flows from operating activities
Net loss                                                                                          (4,375,171)               (3,487,552)

Adjustments to reconcile net loss to net cash used in
operating activities
     Impairment of exploration and evaluation assets                            5                  2,353,315                 3,115,554
Changes in non-cash working capital
    Prepaid expenses and other assets                                                                (19,445)                   19,335
    Accounts payable and accrued liabilities                                                       1,190,234                    54,762
    Taxes payable                                                                                          -                   (10,840)
Net cash used in operating activities                                                               (851,067)                 (308,741)


Cash flows from investing activities
Expenditures on exploration and evaluation                                      5                    (19,858)                 (278,903)
Funds received from Rio Tinto                                                                              -                    57,269
Net cash used in investing activities                                                                (19,858)                 (221,634)


Cash flows from financing activities
Net proceeds from issuance of shares                                            8a                   217,456                   116,158
Warrants issued                                                                 8a                    23,971                         -
Warrants exercised                                                                                         -                   410,500
Due from related parties                                                        7                          -                      (667)
Due to/(from) related parties                                                   7                    607,102                   (65,770)
Net cash provided by financing activities                                                            848,529                   460,221


Net decrease in cash during the year                                                                 (22,396)                  (70,154)
Cash, beginning of the year                                                                           31,559                   101,713
Cash, end of the year                                                                                  9,163                    31,559
The accompanying notes are an integral part of these consolidated financial statements.

1. CORPORATE INFORMATION AND CONTINUATION OF THE BUSINESS
Corporate Information

The principal business of Delrand Resources Limited (?Delrand? or the ?Company?) is the acquisition and exploration of
mineral properties in the Democratic Republic of the Congo (?the DRC?).

These consolidated financial statements as at and for the year ended June 30, 2015 and June 30, 2014 include the accounts
of the Company and of its wholly-owned subsidiary incorporated in the DRC, Delrand Resources Congo SPRL.

The Company is a publicly traded company whose outstanding common shares were listed for trading on the Toronto Stock
Exchange (?TSX?) and are listed for trading on the JSE Limited in Johannesburg, South Africa. On September 11, 2015, the
Company voluntarily delisted from the TSX. On September 14, 2015, the Company listed its shares on NEX, a separate board
of the TSX Venture Exchange. The head office of the Company is located at 1 First Canadian Place, 100 King Street West,
Suite 7070, Toronto, Ontario, M5X 1E3, Canada.


Continuation of the business

The Company incurred a net loss of $4,375,171 for the year ended June 30, 2015 (year ended June 30, 2014: $3,487,552)
and as at June 30, 2015 had a working capital deficit of $2,387,928 and deficit of $127,917,345, (June 30, 2014: $587,641
and $123,542,174, respectively). The Company does not currently have revenue-generating properties.

The Company?s ability to continue operations in the normal course of business is dependent on several factors, including its
ability to secure additional funding. These material uncertainties may cast significant doubt upon the validity of the going
concern assumption. Management is exploring all available options to secure additional funding, including equity financing
and strategic partnerships. In the event the Company is unable to identify recoverable resources, receive the necessary
permitting, or arrange appropriate financing, the carrying value of the Company?s assets could be subject to material
adjustment.During the year ended June 30, 2015, the Company wrote off the carrying value of its exploration and
evaluation assets.

These consolidated financial statements do not include any additional adjustments to the recoverability and classification of
certain recorded asset amounts, classification of certain liabilities and changes to the statements of loss and comprehensive
loss that might be necessary if the Company was unable to continue as a going concern.

2. BASIS OF PREPARATION
a) Statement of compliance
    These consolidated financial statements as at and for the years ended June 30, 2015 and 2014 have been prepared in
    accordance with International Financial Reporting Standards (?IFRS?).

    The accompanying financial information as at and for the years ended June 30, 2015 and 2014 have been prepared in
    accordance with the IFRS and IFRS Interpretation Committee (?IFRIC?) interpretations issued and effective at June 30,
    2015.

b) Basis of measurement
    These consolidated financial statements have been prepared under the historical cost convention, except for certain
    financial assets which are presented at fair value, as explained in the summary of significant accounting policies set out
    in Note 3.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial
statements, unless otherwise indicated. The accounting policies have been applied consistently by all group entities and for
all periods presented.

a) Basis of Consolidation
   i.      Subsidiaries

           Subsidiaries consist of entities over which the Company is    exposed to, or has rights to, variable returns as well as
           the ability to affect those returns through the power to direct the relevant activities of the entity. Subsidiaries are
           fully consolidated from the date control is transferred to the Company and are-deconsolidated from the date
           control ceases. The consolidated financial statements include all the assets, liabilities, revenues, expenses and cash
           flows of the Company and its subsidiaries after eliminating inter-entity balances and transactions.

           Transactions eliminated on consolidation

           All intercompany group transactions, balances, income and expenses are eliminated in full on consolidation.

  ii.      Associates

           Where the Company has the power to significantly influence but not control the financial and operating policy
           decisions of another entity, the investment is accounted for as an associate. Associates are initially recognized in
           the consolidated statements of financial position at cost and adjusted thereafter for the post-acquisition changes in
           the Company?s share of the net assets of the associate, under the equity method of accounting. The Company's
           share of post-acquisition profits and losses is recognized in the consolidated statement of loss and comprehensive
           loss, except that losses in excess of the Company's investment in the associate are not recognized unless there is a
           legal or constructive obligation to recognize such losses. If the associate subsequently reports profits, the
           Company?s share of profits is recognized only after the Company?s share of the profits equals the share of losses not
           recognized.

           Profits and losses arising on transactions between the Company and its associates are recognized only to the extent
           of unrelated investor?s interests in the associate. The investor's share in the associate's profits and losses resulting
           from these transactions is eliminated against the carrying value of the associate.

           Any premium paid for an associate above the fair value of the Company's share of the identifiable assets, liabilities
           and contingent liabilities acquired is capitalized and included in the carrying amount of the Company?s investment
           in an associate. Where there is objective evidence that the investment in an associate has been impaired, the
           carrying amount of the investment is tested for impairment in the same way as other non-financial assets.

b) Use of Estimates and Judgments
   The preparation of these consolidated financial statements in conformity with IFRS requires management to make
   judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of
   assets, liabilities, income and expenses. Actual results may differ from these estimates.

   Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
   recognized in the period in which the estimates are revised and in any future periods affected. Critical judgments and
   estimates in applying accounting policies that have the most significant effect on the amounts recognized in the
   consolidated financial statements are as follows:

Estimates:

i) Provisions and contingencies

 The amount recognized as a provision, including legal, contractual, constructive and other exposures or obligations, is
 the best estimate of the consideration required to settle the related liability, including any related interest charges,
 taking into account the risks and uncertainties surrounding the obligation. In addition, contingencies will only be
 resolved when one or more future events occur or fail to occur. Therefore, assessment of contingencies inherently
 involves the exercise of significant judgment and estimates of the outcome of future events. The Company assesses its
 liabilities and contingencies based upon the best information available, relevant tax laws and other appropriate
 requirements.

ii) Impairment

 Assets, including exploration and evaluation, are reviewed for impairment whenever events or changes in circumstances
 indicate that their carrying amounts may exceed their recoverable amounts.

iii)Share-based payment transactions

 The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the
 equity instruments at the date at which they are granted. Estimating fair value for share-based payment transactions
 requires determining the most appropriate valuation model, which is dependent on the terms and conditions of the
 grant. This estimate also requires determining the most appropriate inputs to the valuation model including the
 expected life of the stock option, volatility, dividend yield, forfeiture rate and making assumptions about them. The
 assumptions and models used for estimating fair value for share-based payment transactions are disclosed in Note 9.

iv)Decommissioning and environmental provisions

 The Company?s operations are subject to environmental regulations in the DRC. Upon any establishment of commercial
 viability of a site, the Company will estimate the cost to restore the site following the completion of commercial
 activities and depletion of reserves. These future obligations are estimated by taking into consideration closure plans,
 known environmental impacts, and internal and external studies, which estimate the activities and costs that will be
 carried out to meet the decommissioning and environmental obligations. Amounts recorded for decommissioning and
 environmental provisions are based on estimates of decommissioning and environmental costs, which may not be
 incurred for several years or decades. The decommissioning and environmental cost estimates could change due to
 amendments in laws and regulations in the DRC. Additionally, actual estimated decommissioning and reclamation costs
 may differ from those projected as a result of an increase over time of actual remediation costs, a change in the timing
 for utilization of reserves and the potential for increasingly stringent environmental regulatory requirements.
 Management has estimated that there are no material decommissioning and environmental reclamation costs as at June
 30, 2015 and 2014.

 Judgments:

i) Exploration and evaluation expenditures

 The application of the Company?s accounting policy for exploration and evaluation expenditures requires judgment in
 determining whether it is likely that future economic benefits will flow to the Company, which may be based on
 assumptions about future events or circumstances. Estimates and assumptions made may change if new information
 becomes available. If, after the expenditure is capitalized, information becomes available suggesting that the recovery
 of the expenditure is unlikely, the amount capitalized is written off in the statement of loss and comprehensive loss
 during the period the new information becomes available.

ii Income and other taxes

 The Company is subject to income and other taxes in various jurisdictions and subject to various rates and rules of
 taxation. Significant judgment is required in determining the provision for income and other taxes. There are many
 transactions and calculations undertaken during the ordinary course of business for which the ultimate tax
 determination is uncertain. The Company recognizes liabilities for anticipated tax audit issues based on the Company?s
 current understanding of the tax law. Where the final tax outcome of these matters is different from the amounts that
 were initially recorded, such differences will impact the current and deferred tax provisions in the period in which such
 determination is made.

 In addition, the Company has not recognized deferred tax assets relating to tax losses carried forward. Future
 realization of the tax losses depends on the ability of the entity to satisfy certain tests at the time the losses are
 recouped, including current and future economic conditions, tax law, production rates and production costs.

iii)Functional and presentation currency

 Judgment is required to determine the functional currency of each entity. These judgments are continuously evaluated
 and are based on management?s experience and knowledge of the relevant facts and circumstances.

iv)Impairment

 Judgment is involved in assessing whether there is any indication that an asset or cash generating unit may be impaired.
 This assessment is made based on the analysis of, amongst other factors, changes in the market or business environment,
 events that have transpired that have impacted the asset or cash generating unit, and information from internal
 reporting. During the year ended June 30, 2015, there were indications that a particular project met the requirements
 for impairment and as a result, an amount of $2,353,315 (2014: $3,115,554) was recorded in the statement of loss and
 comprehensive loss.

v) Going concern

 As described in the continuation of business note, management uses its judgment in determining whether the Company is
 able to continue as a going concern. Refer to Note 1.



c) Foreign Currency Translation
   Functional and presentation currency

   These consolidated financial statements are presented in Canadian dollars (?$?), which is the Company?s functional and
   presentation currency.

   Foreign currency transactions

   The functional currency for the Company?s subsidiary is the currency of the primary economic environment in which the
   entity operates. Transactions entered into by the Company?s subsidiary in a currency other than the currency of the
   primary economic environment in which it operates (their "functional currency") are recorded at the rates prevailing
   when the transactions occur except depreciation and amortization which are translated at the rates of exchange
   applicable to the related assets, with any gains or losses recognized in the consolidated statements of loss and
   comprehensive loss. Foreign currency monetary assets and liabilities are translated at current rates of exchange with
   the resulting gain or losses recognized in the consolidated statements of loss and comprehensive loss. Exchange
   differences arising on the retranslation of unsettled monetary assets and liabilities are recognized immediately in net
   loss. Non-monetary assets and liabilities are translated using the historical exchange rates. Non-monetary assets and
   liabilities measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair
   value is determined.

d) Cash
   Cash includes cash on hand and deposits held with financial institutions.

e) Financial Assets

   Financial assets are classified as either financial assets at fair value through profit or loss (?FVTPL?), loans and
   receivables, held to maturity investments (?HTM?), or available for sale financial assets (?AFS?), as appropriate and,
   except in very limited circumstances, the classification is not changed subsequent to initial recognition. The
   classification is determined at initial recognition and depends on the nature and purpose of the financial asset. A
   financial asset is derecognized when contractual rights to the asset?s cash flows expire or if substantially all the risks
   and rewards of the asset are transferred.

   i.  Financial assets at FVTPL
       Financial assets are classified as FVTPL when the financial asset is held for trading or it is designated upon initial
       recognition as at FVTPL. A financial asset is classified as held for trading if (1) it has been acquired principally for
       the purpose of selling or repurchasing in the near term; (2) it is part of an identified portfolio of financial
       instruments that the Company manages and has an actual pattern of short term profit taking; or (3) it is a
       derivative that is not designated and effective as a hedging instrument. Financial assets at FVTPL are carried in the
       consolidated statement of financial position at fair value with changes in fair value recognized in net loss.
       Transaction costs are expensed as incurred.


  ii.  Loans and receivables
       Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an
       active market are classified as loans and receivables. The Company has classified cash as loans and receivables.

       Loans and receivables are initially recognized at fair value plus transaction costs that are directly attributable to
       their acquisition or issue, and are subsequently carried at amortized cost less losses for impairment. The
       impairment loss of receivables is based on a review of all outstanding amounts at period end. Bad debts are written
       off during the period in which they are identified. Amortized cost is calculated taking into account any discount or
       premium on acquisition and includes fees that are an integral part of the effective interest rate and transaction
       costs. Gains and losses are recognized in the statements of loss and comprehensive loss when the loans and
       receivables are derecognized or impaired, as well as through the amortization process.


  iii. HTM investments
       HTM financial instruments are initially measured at fair value. Subsequently, HTM financial assets are measured at
       amortized cost using the effective interest rate method, less any impairment losses. The Company did not classify
       any assets as HTM.

  iv.  AFS financial assets
       Non-derivative financial assets not included in the above categories are classified as AFS financial assets. They are
       carried at fair value with changes in fair value generally recognized in other comprehensive loss and accumulated in
       the AFS reserve. Impairment losses are recognized in net loss. Purchases and sales of AFS financial assets are
       recognized on settlement date with any change in fair value between trade date and settlement date being
       recognized in the AFS reserve. On sale, the cumulative gain or loss recognized in other comprehensive loss is
       reclassified from the AFS reserve to net loss. The Company has not designated any of its financial assets as AFS.

  v.   Impairment of financial assets
       The Company assesses at each reporting date whether a financial asset or a group of financial assets is impaired. A
       financial asset or group of financial assets is deemed to be impaired, if, and only if, there is objective evidence of
       impairment as a result of one or more events that has occurred after the initial recognition of the asset and that
       event has an impact on the estimated future cash flows of the financial asset or the group of financial assets that
       can be reliably estimated.

       For financial assets carried at amortized cost, the amount of the impairment is the difference between the asset?s
       carrying amount and the present value of estimated future cash flows, discounted at the asset?s original effective
       rate.

       The carrying amount of all financial assets, excluding other receivables, is directly reduced by any impairment loss.
       The carrying amount of other receivables is reduced through the use of an allowance account. Associated
       allowances are written off when there is no realistic prospect of future recovery and all collateral has been realized
       or has been transferred to the Company. Subsequent recoveries of amounts previously written off are credited
       against the allowance account. Changes in the carrying amount of the allowance account are recognized in net loss.
       A provision for impairment is made in relation to other receivable, and an impairment loss is recognized in net loss
       when there is objective evidence that the Company will not be able to collect all of the amounts due under the
       original terms. The carrying amount of the receivable is reduced through use of an allowance account.

       With the exception of AFS equity instruments, if in a subsequent period the amount of impairment loss decreases
       and the decrease relates to an event occurring after the impairment was recognized, the previously recognized
       impairment loss is reversed through net loss. On the date of impairment reversal, the carrying amount of the
       financial asset cannot exceed its amortized cost had the impairment not been recognized. Reversals for AFS equity
       instruments are recognized in other comprehensive loss.

  vi.  Effective interest method
       The effective interest method calculates the amortized cost of a financial instrument asset or liability and allocates
       interest income over the corresponding period. The effective interest rate is the rate that discounts estimated
       future cash receipts over the expected life of the financial asset or liability, or where appropriate, a shorter
       period. Income is recognized on an effective interest basis for debt instruments other than those financial assets
       classified as FVTPL.

f) Financial Liabilities
   Financial liabilities are classified as FVTPL, or other financial liabilities, as appropriate upon initial recognition. A
   financial liability is derecognized when the obligation under the liability is discharged, cancelled or expired.

   i.  Financial liabilities classified as other financial liabilities are initially recognized at fair value less directly
       attributable transaction costs. Subsequent to the initial recognition, other financial liabilities are measured at
       amortized cost using the effective interest method. The Company?s other financial liabilities include accounts
       payable and accrued liabilities and related party liability balances.

   ii. Financial liabilities classified as FVTPL include financial liabilities held-for-trading and financial liabilities
       designated upon initial recognition as FVTPL. Financial liabilities are classified as held-for-trading if they are
       acquired for the purpose of selling in the near term. This category includes derivative financial instruments
       (including separated embedded derivatives) held for trading unless they are designated as effective hedging
       instruments. Gains or losses on liabilities held for trading are recognized in the consolidated statement of
       comprehensive loss. The Company does not have any financial liabilities classified as FVTPL.

g) Loss Per Share
   Basic loss per share is computed by dividing the net loss applicable by the weighted average number of common shares
   outstanding during the reporting period. Diluted loss per share is computed by dividing the net loss by the sum of the
   weighted average number of common shares issued and outstanding during the reporting period and all additional
   common shares for the assumed exercise of stock options and warrants outstanding for the reporting period, if dilutive.
   The treasury stock method is used for the assumed proceeds upon the exercise of stock options and warrants that are
   used to purchase common shares at the average market price during the reporting period. As the Company is incurring
   losses, basic and diluted loss per share are the same because the exercise of outstanding stock options and share
   purchase warrants in the diluted loss per share calculation is anti-dilutive.

   Headline loss per share is an additional earnings number that is permitted by IAS 33, Earnings per share (?IAS 33?). The
   starting point is earnings as determined in IAS 33, excluding ?separately identifiable re-measurements? (as defined), net
   of related tax (both current and deferred) and related non-controlling interest, other than re-measurements specifically
   included in headline. A re-measurement is an amount recognized in profit or loss relating to any change (whether
   realized or unrealized) in the carrying amount of an asset or liability that arose after the initial recognition of such asset
   or liability.

h) Property, Plant and Equipment (?PPE?)
   i.   Recognition and measurement
        Items of PPE are measured at cost less accumulated depreciation and accumulated impairment losses. Cost includes
        expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets
        includes the cost of materials, directed labor and any other cost directly attributable to bring the asset to the
        location and condition necessary to be capable of operating in the manner intended by the Company. Assets in the
        course of construction are capitalized in the capital construction in progress category and transferred to the
        appropriate category of PPE upon completion. When components of an asset have different useful lives,
        depreciation is calculated on each separate component.

   ii.  Subsequent costs
        The cost of replacing part of an item of PPE is recognized in the carrying amount of the item if it is probable that
        the future economic benefits embodied within the part will flow to the Company and its cost can be measured
        reliably. The carrying amount of the replaced part is derecognized and included in net loss. If the carrying amount
        of the replaced component is not known, it is estimated based on the cost of the new component less estimated
        depreciation. The costs of the day?to?day servicing of property, plant and equipment are recognized in net loss as
        incurred.


   iii. Depreciation
        Depreciation is based on the cost of an asset less its residual value. Significant components of individual assets are
        assessed to determine whether a component has an estimated useful life that is different from that of the
        remainder of that asset, in which case that component is depreciated separately. Depreciation is recognized in net
        loss on a straight-line basis over the estimated useful lives of each item or component of an item of PPE as follows:

             -     Furniture and office equipment              two to seven years
             -     Vehicles                                    four years
             -     Computer equipment                          three years
             -     Exploration and mining assets               two to four years

        Depreciation methods, useful lives and residual values are reviewed annually and adjusted, if appropriate.
        Depreciation commences when an asset is available for use. Changes in estimates are accounted for prospectively.

   iv.  Gains and losses
        Gains and losses on disposal of an item of PPE are determined by comparing the proceeds from disposal with the
        carrying amount of the PPE, and are recognized net within other income in the consolidated statement of loss and
        comprehensive loss.

   v.   Repairs and maintenance
        Repairs and maintenance costs are charged to expense as incurred, except major inspections or overhauls that are
        performed at regular intervals over the useful life of an asset are capitalized as part of PPE.

   vi.  De-recognition
        An item of PPE is derecognized upon disposal or when no future economic benefits are expected to arise from the
        continued use of the asset. Any gain or loss arising on de-recognition of the assets (calculated as the difference
        between the net disposal proceeds and the carrying amount of the item) is included in net loss in the period the
        item is derecognized.

i) Exploration and Evaluation Assets
   All direct costs related to exploration and evaluation of mineral properties, net of incidental revenues, are capitalized
   under exploration and evaluation assets. Exploration and evaluation expenditures include such costs as acquisition of
   rights to explore; sampling, trenching and surveying costs; costs related to topography, geology, geochemistry and
   geophysical studies; drilling costs and costs in relation to technical feasibility and commercial viability of extracting a
   mineral resource.

   A regular review of each property is undertaken to determine the appropriateness of continuing to carry forward costs
   in relation to exploration and evaluation of mineral properties. Should the carrying value of the expenditure not yet
   amortized exceed its estimated recoverable amount in any year, the excess is written off in the consolidated statement
   of loss and comprehensive loss. Costs incurred before the Company had obtained the legal rights to explore an area are
   recognized as expenses in the consolidated statement of loss and comprehensive loss.

   The Company recognized impairment of exploration and evaluation assets during the year ended June 30, 2015 in
   relation to the Northern DRC Project in the amount of $2,353,315 (year ended June 30, 2014 - $3,115,554 in relation to
   the Tshikapa Project)

j) Impairment of Non-financial Assets
   Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying
   amount of an exploration and evaluation asset may exceed its recoverable amount. Internal factors, such as budgets
   and forecasts, as well as external factors, such as expected future prices, costs and other market factors are also
   monitored to determine if indications of impairment exist. If any indication of impairment exists, an estimate of the
   asset?s recoverable amount is calculated. The recoverable amount is determined as the higher of the fair value less
   costs to sell for the asset and the asset?s value in use. This is determined for an individual asset, unless the asset does
   not generate cash inflows that are largely independent of those from other assets or the Company?s assets. If this is the
   case, the individual assets are grouped together into cash generating units (?CGU?) for impairment purposes. Such CGUs
   represent the lowest level for which there are separately identifiable cash inflows that are largely independent of the
   cash flows from other assets.

   If the carrying amount of the asset exceeds its recoverable amount, the asset is impaired and an impairment loss is
   charged to the consolidated statement of loss and comprehensive loss so as to reduce the carrying amount to its
   recoverable amount (i.e., the higher of fair value less cost to sell and value in use). Fair value less cost to sell is the
   amount obtainable from the sale of an asset or CGU in an arm?s length transaction between knowledgeable, willing
   parties, less the costs of disposal.

k) Income Taxes
   Income tax expense consists of current and deferred tax expense. Income tax expense is recognized in profit and loss,
   except to the extent that it relates to items recognized in other comprehensive loss or directly in equity. In this case,
   the tax is also recognized in other comprehensive loss or directly in equity.

   Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be
   recovered from, or paid, to the taxation authorities. The tax rates and tax laws used to compute current income tax
   assets and liabilities are measured at future anticipated tax rates, which have been enacted or substantively enacted at
   the reporting date. Current tax assets and current tax liabilities are only offset if a legally enforceable right exists to
   set off the amounts, and the Company intends to settle on a net basis, or to realize the asset and settle the liability
   simultaneously.

   Deferred taxes are recognized on all qualifying temporary differences at the reporting date between the tax basis of
   assets and liabilities and their carrying amounts for financial reporting purposes. Deferred tax assets are only recognized
   to the extent that it is probable that the deductible temporary differences will reverse in the foreseeable future and
   future taxable profit will be available against which the temporary difference can be utilized.

   Deferred tax liabilities and assets are not recognized for temporary differences between the carrying amount and tax
   bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of the
   temporary differences and it is probable that the differences will not reverse in the foreseeable future. Deferred tax
   assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and
   when the deferred tax balances relate to the same taxation authority.

l) Share-Based Payments
   Equity-settled share-based payments for directors, officers and employees are measured at estimated fair value at the
   date of grant and recorded as compensation expense in the consolidated statement of loss and comprehensive loss. The
   fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis
   over the vesting period based on the Company?s estimate of shares that will eventually vest. The number of forfeitures
   likely to occur is estimated on grant date. Any consideration paid by the optionee on exercise of equity-settled share-
   based payments is credited to share capital. Shares are issued from treasury upon the exercise of equity-settled share-
   based instruments.

   Compensation expense on stock options granted to non-employees is measured at the earlier of the completion of
   performance and the date the options are vested using the fair value method and is recorded as an expense in the same
   period as if the Company had paid cash for the goods or services received.

   When the value of goods or services received in exchange for the share-based payment cannot be reliably estimated,
   the fair value is measured by use of a Black-Scholes valuation model. The expected life used in the model is adjusted,
   based on management?s best estimate, for the effects of non-transferability, exercise restrictions, and behavioural
   considerations.

m) Provisions and Contingencies
   Provisions are recognized when a legal or constructive obligation exists, as a result of past events, and it is probable
   that an outflow of resources that can be reliably estimated will be required to settle the obligation. Where the effect is
   material, the provision is discounted using an appropriate current market-based pre-tax discount rate. The increase in
   the provision due to passage of time is recognized as interest expense.

   When a contingency substantiated by confirming events, can be reliably measured and is likely to result in an economic
   outflow, a liability is recognized as the best estimate required to settle the obligation. A contingent liability is disclosed
   where the existence of an obligation will only be confirmed by future events, or where the amount of a present
   obligation cannot be measured reliably. Contingent assets are only disclosed when the inflow of economic benefits is
   probable. When the economic benefit becomes virtually certain, the asset is no longer contingent and is recognized in
   the consolidated financial statements.

   The Company had no material provisions at June 30, 2015 and June 30, 2014.

n) Related Party Transactions
   Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or
   exercise significant influence over the other party in making financial and operating decisions. Parties are also
   considered to be related if they are subject to common control or common significant influence. Related parties may be
   individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer
   of resources or obligations between related parties.

o) Newly Adopted Accounting Standards
   The Company has applied the following new and revised IFRS in these consolidated financial statements:

       -    IAS 24, ?Related Parties Disclosures? (amendment); and
       -    IFRS 8, ?Operating Segments? (amendment)

   The adoption of these revised standards and interpretations did not have a significant impact on the Company?s
   consolidated financial statements.

p) Accounting Standards Issued But Not Yet Effective
   Certain pronouncements were issued by the IASB or the IFRIC that are mandatory for accounting periods on or after
   January 1, 2015 or later periods. Many are not applicable or do not have a significant impact to the Company and have
   been excluded. The following have not yet been adopted and are being evaluated to determine their impact on the
   Company.

   IFRS 9 ? Financial Instruments (?IFRS 9?) was issued by the IASB in November 2009 with additions in October 2010 and
   May 2013 and will replace IAS 39 Financial Instruments: Recognition and Measurement (?IAS 39?). IFRS 9 uses a single
   approach to determine whether a financial asset is measured at amortized cost or fair value, replacing the multiple
   rules in IAS 39. The approach in IFRS 9 is based on how an entity manages its financial instruments in the context of its
   business model and the contractual cash flow characteristics of the financial assets. Most of the requirements in IAS 39
   for classification and measurement of financial liabilities were carried forward unchanged to IFRS 9, except that an
   entity choosing to measure a financial liability at fair value will present the portion of any change in its fair value due
   to changes in the entity?s own credit risk in other comprehensive income, rather than within profit or loss. The new
   standard also requires a single impairment method to be used, replacing the multiple impairment methods in IAS 39.
   IFRS 9 is effective for annual periods beginning on or after January 1, 2018. Earlier adoption is permitted.

   IAS 1 ? Presentation of Financial Statements (?IAS 1?) was amended in December 2014 in order to clarify, among other
   things, that information should not be obscured by aggregating or by providing immaterial information, that materiality
   consideration apply to all parts of the financial statements and that even when a standard requires a specific disclosure,
   materiality considerations do apply. The amendments are effective for annual periods beginning on or after January 1,
   2016. Earlier adoption permitted.

   IAS 27 ? Separate Financial Statements (?IAS 27?) was amended in August 2014 to reinstate the equity method as an
   accounting option for investments in subsidiaries, joint ventures and associates in an entity?s separate financial
   statements. The amendments are effective for annual periods beginning on or after January 1, 2016. Earlier adoption
   permitted.

4. SUBSIDIARY AND INVESTMENT IN ASSOCIATE
   The table below sets out certain information in respect of the Company?s DRC subsidiary:

                                                                            Proportion of Ownership
Name of Subsidiary                 Place of Incorporation                                             Principal Activity
                                                                                   Interest
Delrand Resources Congo SPRL       Democratic Republic of the Congo                  100%             Mineral Exploration


The Company?s former investment in Rio Tinto Exploration DRC Oriental Limited (?DRC Orientale?), which met the definition
of an associate of the Company, is summarized as follows:


                                                      As at June 30,           As at June 30,
                                                               2014                     2013


 Portion of ownership interest                                0.00%                    25.00%
 Common shares held                                              -                       250
 Total investment                                                $-                       $-

On January 26, 2010, the Company entered into an agreement (the ?Iron Ore Agreement?) with Rio Tinto Minerals
Development Limited ("Rio Tinto Minerals") for the exploration for iron ore in areas within the Orientale Province of the
DRC. Under the Iron Ore Agreement, which was in the form of a shareholders' agreement, the Company owned 25% and Rio
Tinto Minerals owned 75% of the capital stock of DRC Orientale, which owned a DRC registered company called Rio Tinto
Exploration RDC Orientale SPRL. The Company?s investment in DRC Orientale was accounted for in the consolidated financial
statements using the equity method.

During the year ended June 30, 2014, Rio Tinto Minerals withdrew from the iron ore project and, in connection with this
withdrawal, the Company surrendered all of its shares in DRC Orientale. As part of the arrangement with respect to Rio
Tinto's said withdrawal, the Company has maintained the iron ore rights in the exploration permits relating to the iron ore
project.

5. EXPLORATION AND EVALUATION ASSETS
The following table summarizes the Company?s tangible exploration and evaluation expenditures with respect to the
properties in the DRC:

                                                                                               Northern DRC
                                                           Notes       Tshikapa Project                                    Total
                                                                                                    Project
Cost                                                                               (a)$                 (b)$                 $
Balance as at June 30, 2013                                                   3,115,554            2,024,324           5,139,878
  Additions                                                                           -              306,914             306,914
  Impairment                                                                (3,115,554)                    -          (3,115,554)
Balance as at June 30, 2014                                                          -             2,331,238           2,331,238
  Additions                                                                          -                22,077              22,077
  Impairment                                                                         -            (2,353,315)         (2,353,315)
Balance as at June 30, 2015                                                          -                     -                   -
  
   a.    Tshikapa Project

         The Tshikapa project is located in the south-western part of the Kasai Occidental province of the DRC near the
         town of Tshikapa. The Company had focused its attention on the Tshikapa triangle through six exploration permits,
         covering an area of 1,043km?, held through an option agreement with the permit holder Acacia SPRL. Acacia SPRL
         had advised the Company of its wish to modify the option agreement. As a result of not being able to resolve this
         situation with Acacia (i.e. Acacia?s wish to modify the option agreement) over an extended period of time, during
         the year ended June 30, 2014, the Company recorded an impairment loss of $3,115,554 with respect to this
         project.

    b.   Northern DRC Project

         The Northern DRC Project is located in Orientale Province of the DRC and had consisted of four exploration permits,
         two of which were held by the Company directly through its DRC subsidiary and the balance of which were held
         through an option agreement with the holder of the permits. During the year ended June 30, 2015, based on
         exploration results these four exploration permits were relinquished by the Company and the Company recorded an
         impairment loss of $2,353,315 with respect to the Northern DRC Project.

6. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
Accounts payable and accrued liabilities are mainly comprised of amounts outstanding for purchases relating to exploration
activities and amounts payable for professional services and other general and administrative services. The credit period for
purchases typically ranges from 30 to 90 days.

7. RELATED PARTY TRANSACTIONS
    a)   Key Management Remuneration

The Company?s related parties include key management. Key management includes executive directors and non-executive
directors. The remuneration of the key management of the Company as defined above, during the years ended June 30,
2015 and 2014 was as follows:
                                      Year ended June 30,              Year ended June 30,
                                                    2015                             2014

 Salaries                                       $110,000                         $229,534
                                                $110,000                         $229,534

    b)   Other Related Parties

As at June 30, 2015, an amount of $568,764 (June 30, 2014 - $56,462) was owing to current directors and a former director
of the Company representing advances and consulting fees.

As at June 30, 2015, an amount of $93,928 was owed to Banro Corporation (?Banro?) related to shared expenses (June 30,
2014 - $1,588 was owed by Banro). Banro owns 1,538,998 common shares of the Company, representing a 7.07% interest in
the Company, and has a director in common with the Company.

During the year ended June 30, 2015, the Company incurred common expenses of $1,179 (year ended June 30, 2014- $nil) in
the DRC together with Loncor Resources Inc. (?Loncor?), a corporation with common directors. As at June 30, 2015, an
amount of $3,033 (June 30, 2014 - $3,750) owing to Loncor was included in due to related parties in the consolidated
statement of financial position.


                                June 30, 2015           June 30, 2014
                                      $                        $
 Due from related parties                   -                   1,588
     Due to related parties           665,726                  60,212

All amounts due to/from related parties are unsecured, non-interest bearing and due on demand.

8. SHARE CAPITAL
a)     Authorized

       The Company's authorized share capital consists of an unlimited number of common shares with no par value.

       The holders of the common shares are entitled to receive notice of and to attend all meetings of the shareholders of the
       Company and shall have one vote for each common share held at all meetings of the shareholders of the Company. The
       holders of the common shares are entitled to (a) receive any dividends as and when declared by the Board of Directors,
       out of the assets of the Company properly applicable to the payment of dividends, in such amount and in such form as
       the board of directors may from time to time determine, and (b) receive the remaining property of the Company in the
       event of any liquidation, dissolution or winding-up of the Company.

       In July 2014, the Company closed a non-brokered arm?s length private placement of 500,000 units of the Company at a
       price of $0.50 per unit for gross proceeds to the Company of $250,000. Each such unit was comprised of one common
       share of the Company and one-half of one warrant of the Company, with each full warrant entitling the holder to
       purchase one common share of the Company at a price of $0.75 for a period of two years.

       During the year ended June 30, 2014, 1,036,617 warrants were exercised at a price of $0.396 per share. This resulted in
       the issuance of 1,036,617 common shares of the Company and gross proceeds to the Company of $410,500. 703,283 of
       the shares were issued to a director of the Company (Arnold T. Kondrat). In April 2014, the Company closed a non-
       brokered private placement of 666,667 common shares of the Company at a price of $0.225 per share for gross proceeds
       of $150,000. A director of the Company (Arnold T. Kondrat) was the purchaser of all of the shares.

       In May 2014, the Company consolidated its outstanding common shares on a three to one basis. Immediately prior to the
       consolidation, the Company had 63,844,492 common shares outstanding. Upon effecting the consolidation, and as of
       June 30, 2014, the Company had 21,281,581 common shares outstanding. All share, stock option and warrant numbers
       have been adjusted to reflect the share consolidation to provide more comparable information.

                                                                       Amount
                                           Number of shares               $
 Balance at June 30, 2013                        19,578,214       116,601,688
 Shares issued for:
     Cash                                           666,667           116,158
     Exercise of Warrants                         1,036,617           410,500
 Fractional shares due to consolidation                  83                 -

 Balance at June 30, 2014                        21,281,581       117,128,346


 Shares issued for:
     Cash                                           500,000           217,456

 Balance at June 30, 2015                        21,781,581       117,345,802


b)   Share purchase warrants

     In July 2014, the Company issued 250,000 warrants, with each such warrant entitling the holder to purchase one
     common share of the Company at a price of $0.75 until July 2016. As at June 30, 2015, all 250,000 warrants were
     outstanding.

     During the year ended June 30, 2014, 1,286,615 warrants exercisable at a price of $0.396 per share expired in
     November 2013 and 1,666,667 warrants exercisable at a price of $0.66 per share expired in May 2014.

c)   Loss per share

     Loss per share was calculated on the basis of the weighted average number of common shares outstanding for the year
     ended June 30, 2015, amounting to 21,739,610 (year ended June 30, 2014: 21,120,325) common shares. Diluted loss per
     share was calculated using the treasury stock method. For the year ended June 30, 2015, total stock options of nil
     (2014: nil) and warrants of 250,000 (year ended June 30, 2014: nil) were excluded from the calculation of diluted loss
     per share as their effect would have been anti-dilutive. Items that are adjusted in the reconciliation to be excluded
     from the Company?s headline loss per share are impairment of exploration and evaluation assets.

                                            Year ended          Year ended
                                         June 30, 2015       June 30, 2014

Loss for the year                           (4,375,171)         (3,487,552)
  Adjustments for headline loss              2,353,315           3,115,554
Headline loss for the year                  (2,021,856)           (371,998)


Basic and diluted loss per share                 (0.20)              (0.16)
Headline loss per share                          (0.09)              (0.01)


 9. SHARE-BASED PAYMENTS
    The Company has a stock option plan (the ?Plan?), pursuant to which non-transferable options to purchase common
    shares of the Company may be granted by the Company?s Board of Directors to any director, officer, employee or
    consultant of the Company or any subsidiary of the Company. The Plan contains provisions providing that the term of an
    option may not be longer than ten years and the exercise price of an option shall not be lower than the last closing
    price of the Company?s shares on the Toronto Stock Exchange prior to the date the stock option is granted. The total
    number of common shares of the Company issuable upon the exercise of all outstanding stock options granted under the
    Plan shall not at any time exceed 12% of the total number of outstanding common shares of the Company, from time to
    time.

    As at June 30, 2015, the Company had no stock options outstanding.

    The following table summarizes information regarding outstanding stock options for the year ended June 30, 2014:

                                              During the Year
                                                                                                  Weighted
  Exercise                                                                                         average
  Price                                                                                          remaining
  Range             Opening                                                          Closing   contractual      Vested &
  ($)               Balance   Granted      Exercised       Expired     Forfeited    Balance    life (years)   Exercisable   Unvested

  2.10              675,000         -               -     (675,000)             -          -              -             -          -

                    675,000         -               -     (675,000)             -          -              -             -          -

  Weighted
  Average
  Exercise
  Price               $2.10        $-             $-             $-            $-         $-            $-             $-         $-


  The estimated fair value at grant date is determined using a Black-Scholes option pricing model that takes into account the
  exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of
  the underlying share, the expected dividend yield and the risk-free interest rate for the term of the option. The contractual
  life of all options on the date of grant is 5 years.

  The expected price volatility is based on the historic volatility (based on the remaining life of the options), adjusted for any
  expected changes to future volatility due to publicly available information.

10. SEGMENTED REPORTING
The Company has one operating segment: the acquisition, exploration and development of mineral properties located in the
DRC. The operations of the Company are located in two geographic locations, Canada and the DRC. Geographic
segmentation of non-current assets is as follows:


 As at June 30, 2015
                              Exploration and evaluation     Total Non-current Assets
 DRC                                                   -                            -
 Canada                                                -                            -
                                                      $0                           $0

 As at June 30, 2014
                              Exploration and evaluation     Total Non-current Assets
 DRC                                          $2,333,457                   $2,333,457
 Canada                                                -                            -
                                              $2,333,457                   $2,333,457


11. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
a)   Fair value of financial assets and liabilities

     The consolidated statements of financial position carrying amounts for cash, prepaid expenses and other assets and
     accounts payable and accrued liabilities approximate fair value due to their short-term nature. Due to the use of
     subjective judgments and uncertainties in the determination of fair values, these values should not be interpreted as
     being realizable in an immediate settlement of the financial instruments.

     Fair value hierarchy

     The following provides a description of financial instruments that are measured subsequent to initial recognition at fair
     value, grouped into Levels 1 to 3 based on the degree to which the fair value is observable:

     -    Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical
          assets or liabilities;

     -    Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1
          that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices);
          and

     -    Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or
          liability that are not based on observable market data (unobservable inputs).

     There were no transfers between Level 1 and Level 2 during the reporting periods. The fair values of financial assets
     and liabilities carried at amortized cost are approximated by their carrying values. Cash is ranked Level 2 as it is based
     on similar loans in the market.

b) Risk Management Policies

   The Company is sensitive to changes in commodity prices and foreign-exchange. The Company?s Board of Directors has
   overall responsibility for the establishment and oversight of the Company?s risk management framework. Although the
   Company has the ability to address its price-related exposures through the use of options, futures and forward contacts,
   it does not generally enter into such arrangements.

c) Foreign Currency Risk

   Foreign currency risk is the risk that a variation in exchange rates between the Canadian dollar and United States dollar
   or other foreign currencies will affect the Company?s operations and financial results. A portion of the Company?s
   transactions are denominated in United States dollars, Congolese francs and South African rand. The Company is also
   exposed to the impact of currency fluctuations on its monetary assets and liabilities.           The Company?s functional
   currency is the Canadian dollar. The majority of major expenditures are transacted in US dollars.           The Company
   maintains the majority of its cash in Canadian dollars but it does hold balances in US dollars and South African Rand.
   Significant foreign exchange gains or losses are reflected as a separate component of the consolidated statement of
   comprehensive loss. The Company does not use derivative instruments to reduce its exposure to foreign currency risk.

   The following table indicates the impact of foreign currency exchange risk on net working capital as at June 30, 2015.
   The table below also provides a sensitivity analysis of a 10 percent strengthening of the Canadian dollar against foreign
   currencies as identified which would have increased (decreased) the Company?s net loss by the amounts shown in the
   table below. A 10 percent weakening of the Canadian dollar against the same foreign currencies would have had the
   equal but opposite effect as at June 30, 2015.

                                  `                                            U.S. dollar               South African rand
                                                                                    $                           ZAR
Cash                                                                                 4,068                              (27)
Prepaids and other assets                                                                -                                -
Accounts payable and accrued liabilities                                           (21,352)                        (376,189)
Total foreign currency financial assets and liabilities                            (17,284)                        (376,216)
Foreign exchange rate at June 30, 2015                                              1.2474                           0.1027
Total foreign currency financial assets and liabilities in CDN $                   (21,560)                         (38,637)
Impact of a 10% strengthening or weakening of the CDN $ on net
loss                                                                                (2,156)                          (3,864)

d) Credit Risk

   Financial instruments which are potentially subject to credit risk for the Company consist primarily of cash. Cash is
   maintained with several financial institutions of reputable credit in Canada, the DRC and South Africa and may be
   redeemed upon demand. It is therefore the Company?s opinion that such credit risk is subject to normal industry risks
   and is considered minimal.

e) Liquidity Risk

   Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The
   Company attempts to ensure that there is sufficient cash to meet its liabilities when they are due and manages this risk
   by regularly evaluating its liquid financial resources to fund current and long-term obligations and to meet its capital
   commitments in a cost-effective manner. The key to success in managing liquidity is the degree of certainty in the cash
   flow projections. If future cash flows are fairly uncertain, the liquidity risk increases. The Company?s liquidity
   requirements are met through a variety of sources, including cash, and equity capital markets. In light of market
   conditions, the Company initiated a series of measures to bring its spending in line with the projected cash flows from
   its operations and available project specific facilities in order to preserve its financial position and maintain its liquidity
   position. As as June 30, 2015, accounts payable and accrued liabilities of $1,750,913 and amounts due to related parties
   of $665,726 are due within one year and represent all significant contractual commitments, obligations, and interest
   and principal repayments on financial liabilities. Please refer to Note 1, Continuation of the Business.

f) Mineral Property Risk

   The Company?s activities in the DRC are exposed to various levels of political risk and uncertainties, including political
   and economic instability, government regulations relating to exploration and mining, military repression and civil
   disorder, all or any of which may have a material adverse impact on the Company?s activities or may result in
   impairment in or loss of part or all of the Company's assets.

g) Market Risk

   Market risk is the potential for financial loss from adverse changes in underlying market factors, including foreign-
   exchange rates, commodity prices, interest rates and stock based compensation costs.

h) Interest rate risk

   Interest rate risk is the potential impact on any Company earnings due to changes in bank lending rates and short-term
   deposit rates. The Company is not exposed to significant interest rate risk other than cash flow interest rate risk on its
   cash. The Company does not use derivative instruments to reduce its exposure to interest rate risk. A fluctuation of
   interest rates of 1% would not affect significantly the fair value of cash.

i) Country risk

   The DRC is a developing country and as such, the Company?s activities in the DRC could be adversely affected by
   uncertain political or economic environments, war, civil or other disturbances, and a changing fiscal regime and by DRC?s
   underdeveloped industrial and economic infrastructure.

   The Company?s activities in the DRC may be effected by economic pressures on the DRC. Any changes to regulations or
   shifts in political attitudes are beyond the control of the Company and may adversely affect its business. Operations may
   be affected in varying degrees by factors such as DRC government regulations with respect to foreign currency
   conversion, production, price controls, export controls, income taxes or reinvestment credits, expropriation of property,
   environmental legislation, land use, water use and mine safety.

   There can be no assurance that policies towards foreign investment and profit repatriation will continue or that a change
   in economic conditions will not result in a change in the policies of the DRC government or the imposition of more
   stringent foreign investment restrictions. Such changes cannot be accurately predicted.

j) Capital Management

   The Company manages its cash, common shares, warrants and any stock options as capital. The Company?s main
   objectives when managing its capital are:

           -  to maintain a flexible capital structure which optimizes the cost of capital at acceptable risk while providing an
              appropriate return to its shareholders;

           -  to maintain a sufficient capital base so as to maintain investor, creditor and market confidence and to sustain
              future development of the business;

           -  to safeguard the Company?s ability to obtain financing; and

           -  to maintain financial flexibility in order to have access to capital in the event of future acquisitions.

   The Company manages its capital structure and makes adjustments to it in accordance with the objectives stated above,
   as well as responds to changes in economic conditions and the risk characteristics of the underlying assets.

   There were no significant changes to the Company?s approach to capital management during the year ended June 30,
   2015.

   Neither the Company nor its subsidiary is subject to externally imposed capital requirements.
                                As at              As at
                            June 30, 2015      June 30, 2014
                                  $                  $
 Cash                               9,163             31,559
 Share capital                117,345,802        117,128,346
 Deficit                     (127,917,345)      (123,542,174)
 Contributed surplus            8,183,615          8,159,644

12. COMMITMENTS AND CONTINGENCIES
The Company and its subsidiary are subject to routine legal proceedings and tax audits. The Company does not believe that
the outcome of any of these matters, individually or in aggregate, would have a material adverse effect on its consolidated
losses, cash flow or financial position.

13. INCOME TAXES
The provision for income taxes is at an effective tax rate, which differs from the basic corporate tax rate for the following
reasons:


                                                                Year ended          Year ended
                                                             June 30, 2015       June 30, 2014


 Canadian basic Federal and Provincial income tax rates              26.5%                26.5%


 Net loss before tax                                           (4,375,171)          (3,487,552)


 Recovery of income tax based on statutory rates               (1,159,420)           (924,201)
        Foreign rate differential                                (153,131)           (109,045)
        Unrecognized benefit of losses                          1,312,551           1,033,246
 Income tax expense                                                     -                   -


Income Tax Payable
The Company has income tax payable as a result of the Ontario harmonization as at June 30, 2015 and 2014.
                                                                            As at                                   As at
                                                                    June 30, 2015                           June 30, 2014
                                                                          $                                       $

             Current income tax payable                                      5,420                                  5,420
             Non-current income tax payable                                      -                                      -
                                                                             5,420                                  5,420


Unrecognized Income Tax Assets
As at June 30, 2015, the Company has unrecognized temporary differences of approximately $116,294,737 (June 30, 2014:
$119,298,858)

The following information summarizes the main temporary differences for which no deferred tax asset has been recognized:


                                                                    June 30, 2015                  June 30, 2014
                                                                          $                              $


              Deductible temporary differences                          18,579,162                    21,735,226
              Tax losses                                                97,715,575                    97,563,632
Total                                                                  116,294,737                   119,298,858


Deferred tax assets have not been recognized in respect of these items because the Company does not have a history of
taxable earnings.

The following table summarizes the Company?s net operating tax losses and deductible temporary differences not
recognized that can be applied against future taxable profit. The Company?s capital losses not recognized can be applied
against future capital gains.
                                                              Amount 
Country               Type                                       $                       Expiry Date
 
Canada                Net operating losses                  5,155,130                    2027 - 2034
Canada                Capital losses                       92,560,445                      No expiry
Canada                Deductible temporary differences        757,169                      No expiry
DRC                   Deductible temporary differences     17,821,993                      No expiry


Toronto
September 28, 2015

Sponsor
Arbor Capital Sponsors Proprietary Limited

Date: 29/09/2015 11:00:00 Supplied by www.sharenet.co.za                     
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