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EXCEL - IDEA: XBRL DOCUMENT - Mining Global, Inc.Financial_Report.xls
EX-31.1 - CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL ACCOUNTING OFFICER - Mining Global, Inc.exhibit31-1.htm
EX-32.1 - CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL ACCOUNTING OFFICER - Mining Global, Inc.exhibit32-1.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended February 29, 2012

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________

COMMISSION FILE NUMBER: 000-53556

YATERRA VENTURES CORP.
(Exact name of registrant as specified in its charter)

NEVADA 75-3249571
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
   
240 Martin Street, #3  
Blaine, WA 98230
(Address of principal executive offices) (Zip Code)

(360) 510-8998
(Registrant's telephone number, including area code)

Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
[X] Yes     [   ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
[X] Yes      [   ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [   ] Accelerated filer [   ]
Non-accelerated filer [   ] (Do not check if a smaller reporting company) Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [   ]      No [X]

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:
As of April 20, 2012, the Registrant had 1,630,000 shares of common stock outstanding.


PART I - FINANCIAL INFORMATION

ITEM 1.               FINANCIAL STATEMENTS.

The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X, and, therefore, do not include all information and footnotes necessary for a complete presentation of financial position, results of operations, cash flows, and stockholders' equity in conformity with generally accepted accounting principles. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. Operating results for the three and six months ended February 29, 2012 are not necessarily indicative of the results that can be expected for the year ending August 31, 2012.

As used in this Quarterly Report, the terms "we,” "us,” "our,” “Yaterra” and the “Company” mean Yaterra Ventures Corp. unless otherwise indicated. All dollar amounts in this Quarterly Report are in U.S. dollars unless otherwise stated.

2



YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
 
SECOND QUARTER INTERIM CONDENSED FINANCIAL STATEMENTS
 
 
SIX MONTHS ENDED FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)



YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
INTERIM CONDENSED BALANCE SHEETS
(Unaudited)
(Stated in U.S. Dollars)

    FEBRUARY 29,     AUGUST 31,  
    2012     2011  
             
ASSETS            
             
Current            
         Cash $  1,224   $  -  
         Prepaid expense   -     360  
Total Current Assets   1,224     360  
             
Mineral Property Acquisition Costs (Note 4)   22,000     22,000  
             
Total Assets $  23,224   $  22,360  
             
LIABILITIES            
             
Current            
         Excess of checks issued over funds on deposit $  -   $  693  
         Accounts payable and accrued liabilities   166,703     160,548  
         Amounts payable to related parties (Note 8)   52,250     47,033  
         Promissory notes payable (Note 5)   279,037     267,500  
         Promissory notes payable to related parties (Note 6)   23,244     9,593  
         Convertible notes (Note 9)   47,938     -  
Total Current Liabilities   569,172     485,367  
             
STOCKHOLDERS’ DEFICIENCY            
             
Capital Stock (Note 7)            
         Authorized: 
                  100,000,000 common voting stock with a par value of $0.001 per share 
                  100,000,000 preferred stock with a par value of $0.001 per share – none issued
 
   
 
             
         Issued: 
                  1,630,000 common shares as at August 31, 2011 
                  and February 29, 2012
 

1,630
   

1,630
 
             
Additional Paid-In Capital   211,544     189,370  
Deficit Accumulated During The Exploration Stage   (759,122 )   (654,007 )
Total Stockholders’ Deficiency   (545,948 )   (463,007 )
             
Total Liabilities and Stockholders’ Deficiency $  23,224   $  22,360  

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



YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
INTERIM CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
(Stated in U.S. Dollars)

                            CUMULATIVE  
                            PERIOD FROM  
    THREE     SIX     INCEPTION  
    MONTH PERIODS     MONTH PERIODS     NOVEMBER 20  
    TO THE END OF     TO THE END     2006 TO  
    FEBRUARY     FEBRUARY     FEBRUARY 29  
    2012     2011     2012     2011     2012  
                               
Expenses                              
         Accounting and audit $  22,279   $  5,348   $  31,895   $  14,631   $  178,537  
         Bank charges and interest   7,981     5,585     14,931     10,002     57,737  
         Consulting fees   150     150     300     300     3,050  
         Depreciation   -     -     -     98     1,184  
         Finance charges   1,012     -     1,012     -     1,012  
         Management fees   13,750     12,000     25,000     24,000     220,500  
         Mineral property exploration costs   -     1,756     2,984     1,756     52,555  
         Office and administrative   8,510     9,178     4,886     11,947     66,633  
         Professional fees   11,318     8,954     13,362     18,363     124,118  
         Transfer agent and filing fees   9,528     3,956     10,360     3,956     34,219  
         Travel and promotion   188     162     385     334     16,208  
         Write-off mineral property costs   -     -     -     -     3,369  
                               
Net Loss For The Period $  (74,716 ) $  (47,089 ) $  (105,115 ) $  (85,387 ) $  (759,122 )
                               
                               
Basic And Diluted Loss Per Share $  (0.05 ) $  (0.03 ) $  (0.06 ) $  (0.05 )      
                               
                               
Weighted Average Number Of Common Shares Outstanding   1,630,000     1,630,000     1,630,000     1,630,000      

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



YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
INTERIM CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
(Stated in U.S. Dollars)

                CUMULATIVE  
                PERIOD FROM  
    SIX     INCEPTION  
    MONTH PERIODS     NOVEMBER 20,  
    ENDED     2006 TO  
    FEBRUARY     FEBRUARY 29,  
    2012     2011     2012  
                   
Cash (Used In) Operating Activities                  
         Net loss for the period: $  (105,115 ) $  (85,387 ) $  (759,122 )
                   Depreciation   -     98     1,184  
                   Finance charges on convertible notes   1,012     -     1,012  
                   Interest accrued on convertible notes   1,048     -     1,048  
                   Interest accrued on promissory notes   12,799     8,969     49,113  
                   Write-off of mineral property acquisition costs   -     -     3,369  
         Changes in non-cash operating working capital                  
             items:                  
                   Accounts payable and accrued liabilities   6,155     9,038     166,703  
                   Amounts payable to related parties   5,217     7,750     52,250  
                   Prepaid expense   360     -     -  
    (78,524 )   (59,532 )   (484,443 )
Cash (Used In) Investing Activities                  
         Mineral property acquisition costs   -     (493 )   (25,369 )
         Computer equipment   -     -     (1,184 )
    -     (493 )   (26,553 )
Cash Provided By Financing Activities                  
         Issue of capital stock   -     -     191,000  
         Promissory notes payable   4,822     57,472     238,712  
         Repayment of promissory notes   (5,149 )   -     (5,149 )
         Proceeds from promissory notes payable to related parties   17,999     -     27,485  
         Repayment of promissory notes payable to related parties   (5,283 )   -     (7,880 )
       Convertible notes subscriptions received   68,052     -     68,052  
    80,441     57,472     512,220  
                   
Increase (Decrease) In Cash   1,917     (2,553 )   1,224  
                   
(Excess of Checks Issued Over Funds on Deposit) Cash, Beginning Of Period   (693 )   51     -  
                   
(Excess of Checks Issued Over Funds on Deposit) Cash, End Of Period $  1,224   $  (2,502 ) $  1,224  
                   
Supplemental Disclosure Of Cash Flow Information                  
         Cash paid during the period for:                  
                   Interest $  -   $  -   $  -  
                   Income taxes $  -   $  -   $  -  

There were no material non-cash financing or investing activities during the periods presented.

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



YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

1.

BASIS OF PRESENTATION AND NATURE OF OPERATIONS

   

The unaudited financial information furnished herein reflects all adjustments which, in the opinion of management, are necessary to fairly state the Company’s financial position and the results of its operations for the periods presented. These financial statements should be read in conjunction with the Company’s financial statements and notes thereto included for the fiscal year ended August 31, 2011. The Company assumes that the readers of these interim financial statements herein have read, or have access to, the audited financial statements for the preceding fiscal year, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. Accordingly, footnote disclosure, which would substantially duplicate the disclosure contained in the Company’s financial statements for the fiscal year ended August 31, 2011, has been omitted. The results of operations for the six month period ended February 29, 2012 are not necessarily indicative of results for the entire year ending August 31, 2012.

   

Organization

   

Yaterra Ventures Corp. (“the Company”) was incorporated in the State of Nevada, U.S.A., on November 20, 2006. The Company’s principal executive offices are in Bellingham, Washington, U.S.A.

   

Exploration Stage Activities

   

The Company has been in the exploration stage since its formation and has not yet realized any revenues from its planned operations. The Company was formed for the purpose of acquiring exploration and development stage natural resource properties. The Company has not commenced business operations. The Company is an exploration stage company as defined in the Securities and Exchange Commission (“S.E.C.”) Industry Guide No. 7.

   

Going Concern

   

The accompanying financial statements have been prepared assuming the Company will continue as a going concern.




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

1.

BASIS OF PRESENTATION AND NATURE OF OPERATIONS (Continued)

     

Going Concern (Continued)

     

As shown in the accompanying financial statements, the Company has incurred a net loss of $759,122 for the period from November 20, 2006 (inception) to February 29, 2012, and has no sales. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The future of the Company is dependent upon its ability to obtain financing and upon future profitable operations from the development of its natural resource properties. Management has plans to seek additional capital through a private placement and public offering of its common stock. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

     

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States. Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates.

     
2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     

The financial statements have been properly prepared within the framework of the significant accounting policies summarized below:

     
a)

Organization and Start-up Costs

     

Costs of start up activities, including organizational and incorporation costs, are expensed as incurred.

     
b)

Exploration Stage Enterprise

     

The Company’s financial statements are prepared using the accrual method of accounting. Until such properties are acquired and developed, the Company will continue to prepare its financial statements and related disclosures in accordance with entities in the exploration stage.




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

     
c)

Mineral Property Interests

     

The Company is an exploration stage mining company and has not yet realized any revenue from its operations. It is primarily engaged in the acquisition, exploration and development of mining properties. Exploration costs are expensed as incurred regardless of the stage of development or existence of reserves. Costs of acquisition are capitalized subject to impairment testing when facts and circumstances indicate impairment may exist.

     

The Company regularly performs evaluations of any investment in mineral properties to assess the recoverability and/or the residual value of its investments in these assets. All long-lived assets are reviewed for impairment whenever events or circumstances change which indicate the carrying amount of an asset may not be recoverable.

     

Management periodically reviews the carrying value of its investments in mineral leases and claims with internal and external mining related professionals. A decision to abandon, reduce or expand a specific project is based upon many factors including general and specific assessments of mineral deposits, anticipated future mineral prices, anticipated future costs of exploring, developing and operating a producing mine, the expiration term and ongoing expenses of maintaining mineral properties and the general likelihood that the Company will continue exploration on such project. The Company does not set a pre-determined holding period for properties with unproven deposits, however, properties which have not demonstrated suitable metal concentrations at the conclusion of each phase of an exploration program are re-evaluated to determine if future exploration is warranted, whether there has been any impairment in value and that their carrying values are appropriate.

     

If an area of interest is abandoned or it is determined that its carrying value cannot be supported by future production or sale, the related costs are charged against operations in the year of abandonment or determination of value. The amounts recorded as mineral leases and claims represent costs to date and do not necessarily reflect present or future values.

     

The Company’s exploration activities are subject to various laws and regulations governing the protection of the environment. These laws are continually changing, generally becoming more restrictive. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations.




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

     
d)

Cash

     

Cash consists of cash on deposit with high quality major financial institutions, and to date has not experienced losses on any of its balances. The carrying amounts approximate fair market value due to the liquidity of these deposits.

     
e)

Financial Instruments

     

All financial instruments are classified into one of five categories; held-for-trading, held- to-maturity investments, loans and receivables, available-for-sale assets or liabilities. All instruments and derivatives are measured in the balance sheet at fair value, except for loans and receivables, held-to-maturity investments and other financial liabilities, which are measured at amortized costs. Subsequent measurement and changes in fair value will depend on their initial classification. Held-for-trading financial assets are measured at fair value and changes in fair value are recognized in the statement of operations. Available-for-sale financial instruments are measured at fair value with changes in fair value recorded in other comprehensive income until the instrument is derecognized or impaired.

     

The Company classified its cash as held-for-trading, excess of checks issued over funds on deposit, accounts payable and accrued liabilities, accounts payable to related parties, promissory notes payable and promissory notes payable to related parties as other financial liabilities, all of which are measured at amortized cost.

     
f)

Basic and Diluted Loss Per Share

     

Basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. At February 29, 2012, the Company has no common stock equivalents that were anti-dilutive and excluded in the earnings per share computation.




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

       
g)

Income Taxes

       

The Company follows the asset and liability method of accounting for income taxes whereby deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted or substantially enacted tax rates and laws expected to apply in the years in which temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred income tax assets and liabilities is recognized in operations in the period that includes the substantive enactment date.

       
A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. To the extent that the Company does not consider it probable that a deferred tax asset will be recovered, it provides a valuation allowance against that excess.
       
h)

Foreign Currency Translation

       

The Company’s functional currency is the US dollar. Transactions in foreign currencies are translated into U.S. dollars as follows:

       

i)      monetary items are translated at the exchange rate prevailing at the balance sheet date;

ii)     non-monetary items are translated at the historical exchange rate;
iii)    revenue and expenses are translated at the average rate in effect during the applicable accounting period.

       

The Company has an operating bank account held in Canadian dollars that may expose them to certain translation risks due to foreign exchange fluctuations between the Canadian and US currencies. Foreign exchange gains and losses are reflected in the statement of operations for the period.

       
i)

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 amounts reported in the financial statements and accompanying disclosures. Actual results may differ from the estimates.




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

     
i)

Use of Estimates (Continued)

     

Significant accounts that require estimates as a basis for determining the stated amounts include mineral property acquisition costs and impairment, accrued liabilities and the valuation allowance of deferred tax assets.

     
j)

Impairment of Long-Lived Assets

     

The Company records impairment losses on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amount. In such cases, the amount of the impairment is determined based on the relative fair values of the impaired assets. The Company tests the recoverability of the assets whenever events or changes in circumstances indicate that its carrying amount may not be recoverable.

     
k)

Asset Retirement Obligations

     

An asset retirement obligation (“ARO”) is a legal obligation associated with the retirement of a tangible long-lived asset that the Company is required to settle. The Company recognizes the fair value of a liability for the ARO in the year in which it is incurred when a reasonable estimate of fair value can be made. The carrying amount of the related long-lived asset is increased by the same amount as the liability.

     

The cost of the tangible asset, including the initially recognized ARO, is depleted, such that the cost of the ARO is recognized over the useful life of the asset. The ARO is recorded at fair value, and accretion expense is recognized over time as the discounted liability is accreted to its expected settlement value. The fair value of the ARO is measured using expected future cash flows, discounted at the Company’s credit-adjusted risk-free interest rate. To date, no significant asset retirement obligation exists due to the early stage of exploration. Accordingly, no liability has been recorded.

     
l)

Environmental Protection and Reclamation Costs

     

The operations of the Company have been, and may in the future be affected from time to time in varying degrees by changes in environmental regulations, including those for future removal and site restorations costs. Both the likelihood of new regulations and their overall effect upon the Company may vary from region to region and are not predictable.




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

     
l)

Environmental Protection and Reclamation Costs (Continued)

     

Environmental expenditures that relate to ongoing environmental and reclamation programs are charged against the statement of operations as incurred or capitalized and amortized depending upon their future economic benefits. The Company does not currently anticipate any material capital expenditures for environmental control facilities because its property holding is at an early stage of exploration.


  m)

Fair Value of Financial Instruments

     
 

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or most advantageous market. The Company uses a three-tier fair value hierarchy which prioritizes the inputs in measuring fair value as follows:


  Level 1: Observable inputs such as quoted prices in active markets;
     
Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
     
Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
     
  The Company classified its cash as Level 1.

3.

RECENT ACCOUNTING PRONOUNCEMENTS

   

In May 2011, the FASB issued new authoritative guidance to provide a consistent definition of fair value and ensure that fair value measurements and disclosure requirements are similar between GAAP and International Financial Reporting Standards. This guidance changes certain fair value measurement principles and enhances the disclosure requirements for fair value measurements. This guidance is effective for interim and annual periods beginning after December 15, 2011 and is applied prospectively. The Company does not expect that the adoption of this guidance will have a material impact on its financial statements.




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

4.

MINERAL PROPERTIES


      AUGUST 31,           ABANDONED,     FEBRUARY 29,  
      2011     ADDITIONS     IMPAIRED     2012  
  Mineral Property                        
                           
  Blue Jack claims $  16,000   $  -   $  -   $  16,000  
  Minnie Lode claims   6,000     -     -     6,000  
                           
    $  22,000   $  -   $  -   $  22,000  
                           
      AUGUST 31,           ABANDONED,     AUGUST 31,  
      2010     ADDITIONS     IMPAIRED     2011  
  Mineral Property                        
                           
  Blue Jack claims $  16,000   $  -   $  -   $  16,000  
  Frances claims   2,362     1,007     (3,369 )   -  
  Minnie Lode claims   6,000     -     -     6,000  
                           
    $  24,362   $  1,007   $  (3,369 ) $  22,000  

During the period ended August 31, 2007, the Company entered into a purchase agreement to acquire an undivided 100% interest in a mineral claim (known as the “Minnie Lode Claims”) located in the Leecher Creek Mining District, Okanogan County, Washington. The consideration was $6,000 cash (paid) on execution of the agreement.

During the year ended August 31, 2009, the Company entered into a purchase agreement to acquire an undivided interest in a series of ten mineral claims (collectively referred to as the “Blue Jack Claims”) located in Humboldt County, Nevada. The consideration was $16,000 (paid) on execution of the agreement.

On July 14, 2009, the Company entered into an assignment agreement to acquire an undivided 60% interest in a mineral claim (known as the “Frances” claim) situated in the Vancouver Mining District, British Columbia, Canada. The Company paid $500 CDN on execution of the agreement.



YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

4.

MINERAL PROPERTIES (Continued)

   

The assignment agreement was amended on October 27, 2009 (the “First Amendment Agreement”), December 10, 2009 (the “Second Amendment Agreement”), February 11, 2010 (the “Third Amendment Agreement”), June 1, 2010 (the “Fourth Amendment Agreement”), September 1, 2010 (the “Fifth Amendment Agreement”), and March 15, 2011 (the “Sixth Amendment Agreement”), and consideration for the claim is as follows:


  1.

$500 CDN on execution of the First Amendment Agreement (paid); $500 CDN on execution of the Second Amendment Agreement (paid); $500 CDN on execution of the Third Amendment Agreement (paid); $500 CDN on execution of the Fourth Amendment Agreement (paid); $500 CDN on execution of the Fifth Amendment Agreement (paid); $500 CDN on execution of the Sixth Amendment Agreement (paid);

  2.

incurring $10,000 CDN in exploration expenditures September 15, 2011;

  3.

2,000 common shares due on or before September 15, 2011;

  4.

additional $2,000 CDN on October 15, 2011;

  5.

an additional 3,000 common shares due on or before October 15, 2011;

  6.

additional $10,000 CDN on December 15, 2011;

  7.

an additional 10,000 common shares due on or before December 15, 2011;

  8.

incurring an additional $150,000 CDN in exploration expenditures by July 14, 2012.

All other terms of the agreement remain unchanged.

During the year ended August 31, 2011, the Company abandoned and wrote off all costs incurred with respect to the Frances property.

5.

PROMISSORY NOTES PAYABLE

   

During the year ended August 31, 2011, the Company entered into additional promissory note agreements, whereby it borrowed an additional $83,946 (2010 - $85,217) from arms’ length parties. These notes bear interest at 10% to 12%, are unsecured and are repayable on demand. As at August 31, 2011, the promissory notes consist of $231,293 in principal and a total of $36,207 has been accrued as interest.

   

During the six month period ended February 29, 2012, the Company entered into an additional promissory note agreement, whereby it borrowed an additional $4,822 from an arms’ length party. This note bears interest of 10%, is unsecured and is repayable on demand. Also during this period, the Company paid back $5,149 of a previous year’s note balance. As at February 29, 2012, the promissory notes consist of $230,966 in principal and a total of $48,071 has been accrued as interest.




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

6.

PROMISSORY NOTES PAYABLE TO RELATED PARTIES

   

During the year ended August 31, 2011, the Company entered into promissory note agreements, whereby it borrowed $12,083 from related parties. The Company paid back $2,597 of this balance during the year. These notes bear interest at 10%, are unsecured and are repayable on demand. As at August 31, 2011, the promissory notes consist of $9,486 in principal and a total of $107 has been accrued as interest.

   

During the six month period ended February 29, 2012, the Company entered into additional promissory note agreements, whereby it borrowed $17,999 from related parties. The Company paid back $4,950 of this balance during the period. These notes bear interest at 10%, are unsecured and are repayable on demand. Also during this period, the Company paid back $333 of previous year’s notes balances. As at February 29, 2012, the promissory notes consist of $22,202 in principal and a total of $1,042 has been accrued as interest.

   
7.

CAPITAL STOCK

   

During the year ended August 31, 2007, the Company issued 900,000 founder shares at par value for gross proceeds of $9,000 and the Company issued 610,000 common shares at $0.20 per share for gross proceeds of $122,000.

   

During the year ended August 31, 2009, the Company completed an offering of 120,000 shares of common stock at a price of $0.50 per share for gross proceeds of $60,000.

   

Included in issued share capital are 900,000 restricted common shares of the Company (2011 – 900,000).

   

As outlined in Note 9, the embedded beneficial conversion feature relating to the convertible notes of $22,174 was allocated to additional paid in capital from convertible notes.

   
8.

RELATED PARTY TRANSACTIONS

   

During the six month period ended February 29, 2012, the Company paid or accrued management fees for services performed in the amount of $23,500 (2011 - $21,000) to directors and also paid or accrued during the period, $1,500 to a member of management (2011 - $3,000).




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

8.

RELATED PARTY TRANSACTIONS (Continued)

   

As at February 29, 2012, a total of $52,250 (August 31, 2011 - $47,033) is owing to a director and two members of management. These amounts are unsecured, do not bear interest and are due on demand.

   

These transactions were in the normal course of operations and were recorded at their exchange amount, which is the amount of consideration established and agreed to by the related parties.


9.

CONVERTIBLE NOTES

   

During the six month period ended February 29, 2012, the Company’s Board of Directors approved the offering of up to $100,000 of 10% convertible notes. Each note will be due on December 31, 2014 and bears interest at 10% per annum payable annually. The notes may be converted into common stock of the Company equal to the principal amount of the note divided by 75% of the average trading price of the Company’s common stock for 10 business days prior to the date of conversion (“conversion value”). The Company may elect at its option to pay the interest required annually by an issuance of common stock using the same terms for the conversion of the notes. As at February 29, 2012, the Company has issued $68,052 convertible notes.

   

In accordance with the provisions of ASC 470-20, Debt, the Company recognized the value of the embedded beneficial conversion feature of $22,174 with the notes. The fair value of the embedded beneficial conversion feature was estimated to be the difference between the conversion value and the carrying value of the debt, based on the underlying estimated fair values of the common stock. The embedded beneficial conversion feature was recorded as a credit to additional paid-in capital. The resulting debt discount is being accreted over the term of the note using the effective interest amortization method. In the event of conversion of the note, the proceeds will be allocated proportionately to the carrying value of the convertible note, additional paid-in capital, and to common stock, consistent with the original allocations between their debt and equity components. To February 29, 2012, the Company has recorded accretion of $1,012 and accrued interest of $1,048.


10.

COMMITMENTS AND CONTRACTUAL OBLIGATIONS

   

The Company has no significant commitments or contractual obligations with any parties respecting executive compensation or consulting arrangements. Rental of premises is on a month-to-month basis.




YATERRA VENTURES CORP.
(An Exploration Stage Company)
 
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
 
FEBRUARY 29, 2012
(Unaudited)
(Stated in U.S. Dollars)

11.

SEGMENT INFORMATION

   

The Company has one reportable operating segment, being the acquisition and exploration of mineral properties. Details of identifiable assets by geographic segments are as follows:


      MINERAL  
      PROPERTY  
      INTERESTS  
  February 29, 2012      
         USA $  22,000  
         
  August 31, 2011      
           USA $  22,000  

12.

SUBSEQUENT EVENTS

     

Subsequent to February 29, 2012:

     
a)

The Company entered into two promissory note agreements, whereby, it borrowed $6,208 from a related party. The notes bear interest at 10% per annum, are unsecured and are repayable on demand.




ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report constitute "forward-looking statements.” These statements, identified by words such as “plan,” "anticipate,” "believe,” "estimate,” "should,” "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. These statements reflect the current views of management with respect to future events and are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those described in the forward-looking statements. Such risks and uncertainties include those set forth under the caption, "Part II - Item 1A. Risk Factors,” and elsewhere in this Quarterly Report.

Forward looking statements are based on the reasonable assumptions, estimates, analysis and opinions of management made in light of its experience and perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable at the date such statement are made.

We intend to discuss in our Quarterly Reports and Annual Reports any events or circumstances that occurred during the period to which such documents relate that are reasonably likely to cause actual events or circumstances to differ materially from those disclosed in this Quarterly Report. New factors emerge from time to time, and it is not possible for management to predict all of such factors and to assess in advance the impact of each such factor on the Company’s business or the extent to which any factor, or combination of such factors, may cause actual results to differ materially from those contained in any forwarding looking statement.

We advise you to carefully review the reports and documents we file from time to time with the United States Securities and Exchange Commission (the “SEC”), particularly our periodic reports filed with the SEC pursuant to the Securities Exchange Act of 1934 (the "Exchange Act").

OVERVIEW

We were incorporated on November 20, 2006 pursuant to the laws of the State of Nevada.

We are an exploration stage company engaged in the acquisition and exploration of mineral properties. Currently, we hold a 100% interest in two mineral properties that we call the “Blue Jack Property” and the “Minnie Claim”. The Blue Jack Property is comprised of 10 mineral claims covering approximately 206 acres located in Humboldt County, Nevada. The Minnie Claim covers an area of 20 acres, located in the Leecher Creek Mining Division, Washington State. We plan to focus our resources on the Blue Jack Property in order to assess whether it possesses mineral deposits of gold, silver, copper and rare earth minerals capable of commercial extraction.

In November 2011, we completed a preliminary rock sampling program on the Blue Jack Property. The results of this initial program indicated that the Blue Jack Property contained anomalous values of rare earth minerals. Based on these results, we plan to commence Phase I of the Blue Jack exploration program in Spring 2012. See “Plan of Operation”.

We have not earned any revenues to date. We do not anticipate earning revenues until such time as we enter into commercial production of our mineral properties. We are presently in the exploration stage of our business and we can provide no assurance that we will discover commercially exploitable levels of mineral resources on our properties, or if such deposits are discovered, that we will enter into further substantial exploration programs.

3


PLAN OF OPERATION

During the next twelve months and subject to our ability to obtain additional financing, we intend to conduct mineral exploration activities on the Blue Jack Property in order to assess whether it possesses mineral reserves capable of commercial extraction. We have decided to suspend our operations on the Minnie Claim in order to focus our resources on the Blue Jack Property.

Blue Jack Property

Our plan is to conduct Phase I(a) of our exploration program on the Blue Jack Property in Summer 2012. However, we will require additional financing in order to implement Phase I(a) of our exploration program on the Blue Jack Property. If we are able to raise additional financing, of which there is no assurance, our plan for the Blue Jack Property is as follows:


Phase

Recommended Exploration Program
Estimated
Cost

Status
Phase I(a) Detailed geological mapping and radiometric surveys and soil and rock sampling along grid. $25,700

To be implemented in Summer 2012, subject to obtaining additional financing.

Phase I(b) Geophysical survey (IP and magnetometer). $43,050

Planned for Summer 2012.

Phase II(a) Trenching and geochemical analysis $40,500

Dependent on the Results of Phases I(a) and I(b)

We anticipate that we will incur the following expenses over the next twelve months:


Category
Planned Expenditures Over
The Next 12 Months (US$)
Legal and Accounting Fees $30,000
Office Expenses 6,000
Consulting Fees 48,000
Phase I Exploration Expenses 68,750
TOTAL $152,750

To date, we have not earned any revenues and we do not anticipate earning revenues in the near future. As at February 29, 2102, we had $1,224 cash on hand. As such, we do not have sufficient financial resources to meet the anticipated costs of completing our exploration program for the Blue Jack Property. Accordingly, we will need to obtain additional financing in order to complete our plan of operation and meet our current obligations as they come due. Our Board of Directors approved an offering of up to $100,000 of 10% convertible notes (the “Offering”) pursuant to Regulation S of the Securities Act. As at February 29, 2012, we have issued $68,052 of convertible notes. Completion of the Offering is subject to a number of factors outside of our control, including the results from our exploration program, and any unanticipated problems relating to our mineral exploration activities, such as environmental assessments and additional costs and expenses that may exceed our current estimates. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us in which case our business will fail.

4


RESULTS OF OPERATIONS

Three and Six Months Summary

    Three Months Ended     Percentage     Six Months Ended     Percentage  
    February 29,     February 28,     Increase /     February 29,     February 28,     Increase /  
    2012     2011     (Decrease)     2012     2011     (Decrease)  
Revenue $  -   $  -     n/a   $  -   $  -     n/a  
Expenses   (74,716 )   (47,089 )   58.7%     (105,115 )   (85,387 )   23.1%  
Net Loss $  (74,716 ) $  (47,089 )   58.7%   $  (105,115 ) $  (85,387 )   23.1%  

Revenue

We have not earned any revenues to date. We do not anticipate earning revenues until such time as we enter into commercial production of our mineral properties. We are presently in the exploration stage of our business and we can provide no assurance that we will discover commercially exploitable levels of mineral resources on our properties, or if such deposits are discovered, that we will enter into further substantial exploration programs.

Expenses

Our expenses for the three and six months ended February 29, 2012 and the three and six months ended February 28, 2011 consisted of the following:

    Three     Three                          
    Months     Months           Six Months     Six Months        
    Ended     Ended     Percentage     Ended     Ended     Percentage  
    February 29,     February 28,     Increase /     February 29,     February 28,     Increase /  
    2012     2011     (Decrease)     2012     2011     (Decrease)  
Accounting and Audit $  22,279   $  5,348     316.6%   $  31,895   $  14,631     118.0%  
Bank Charges and Interest   7,981     5,585     42.9%     14,931     10,002     49.3%  
Consulting Fees   150     150     0.0%     300     300     0.0%  
Depreciation   -     -     n/a     -     98     (100.0 )%
Finance Charges   1,012     -     100.0%     1,012     -     100.0%  
Management Fees   13,750     12,000     14.6%     25,000     24,000     4.2%  
Mineral Property Exploration Costs   -     1,756     (100.0 )%   2,984     1,756     69.9%  
Office and Administrative   8,510     9,178     (7.3 )%   4,886     11,947     (59.1 )%
Professional Fees   11,318     8,954     26.4%     13,362     18,363     (27.2 )%
Transfer Agent and Filing Fees   9,528     3,956     140.8%     10,360     3,956     161.9%  
Travel and Promotion   188     162     16.0%     385     334     15.3%  
Total Expenses $  74,716   $  47,089     58.7%   $  105,115   $  85,387     23.1%  

Our operating expenses increased from $47,089, during the three months ended February 28, 2011, to $74,716, during the three months ended February 29, 2012. The increase was primarily due to increases in accounting and audit expenses, bank charges and interest, finance charges, management fees, professional fees, transfer agent filing fees and travel and promotion. This was partially offset by a decrease in office and administrative expenses.

5


Our operating expenses increased from $85,387, during the six months ended February 28, 2011, to $105,115, during the six months ended February 29, 2012. The increase was primarily due to increases in accounting and audit expenses, bank charges and interest, finance charges, management fees, mineral property exploration costs, transfer agent and filing fees and travel and promotion. This was partially offset by decreases in depreciation, office and administrative expenses and professional fees.

Audit and accounting expenses and professional expenses primarily relate to expenses incurred in connection with meeting our ongoing reporting requirements under the Exchange Act.

Management fees consists of fees incurred to our executive directors and officers.

Mineral exploration costs relate to costs incurred with our preliminary rock sampling program on the Blue Jack Property in November 2011.

If we are able to obtain sufficient financing to proceed with our plan of operation, of which there is no assurance, we expect that our expenses will increase significantly as we engage in mining and exploration activities.

LIQUIDITY AND CAPITAL RESOURCES

Working Capital                  
                Percentage  
    As at     As at     Increase /  
    February 29, 2012     August 31, 2011     (Decrease)  
Current Assets $  1,224   $  360     240.0%  
Current Liabilities   (569,172 )   (485,367 )   17.3%  
Working Capital Deficit $  (567,948 ) $  (485,007 )   17.1%  

Cash Flows            
    Six Months Ended     Six Months Ended  
    February 29, 2012     February 28, 2011  
Cash Flows (Used In) Operating Activities $  (78,524 ) $  (59,532 )
Cash Flows (Used In) Investing Activities   -     (493 )
Cash Flows Provided By Financing Activities   80,441     57,472  
Increase (Decrease) In Cash During Period $  1,917   $  (2,553 )

As of February 29, 2012, we had $1,224 cash on hand and a working capital deficit of $567,948. The increase in our working capital deficit is primarily a result of: (i) an increase in accounts payable due to a lack of capital to meet our ongoing expenditures; (ii) the fact that we received $17,999 in short term loans from related parties, which bears interest at 10%, are unsecured and due on demand; and (iii) the fact that we issued $68,052 of convertible notes. We have incurred a cumulative net loss of $759,122 for the period from the date of our inception on November 20, 2006 to February 29, 2012 and have not attained profitable operations to date.

Since our inception, we have used our common stock to raise money for our operations and to fund our property acquisitions. We have not obtained profitable operations and are dependent upon obtaining additional financing to pursue our plan of operation.

Future Financings

We currently do not have sufficient financial resources to implement Phase I(a) of our exploration program on the Blue Jack Property. Therefore, we will need to obtain additional financing in order to implement our exploration program on the Blue Jack Property.

On December 9, 2011, our Board of Directors approved an offering of up to $100,000 of 10% convertible notes (the “Offering”). The Offering will be completed pursuant to Regulation S of the Securities Act to

6


persons who are not U.S. Persons as contemplated under Regulation S. The proceeds of the Offering will be used to fund our business and for working capital purposes. As at February 29, 2012, we have issued $68,052 of convertible notes. There is no assurance that the Offering will be completed on the above terms or at all.

Our plan of operation calls for us to spend significantly more than our current capital resources or the amount of financing that we have been able to obtain to date. As such, there is a substantial doubt that we will be able to raise significant financing to complete our stated plan of operation. Any substantial financing that we are able to obtain is expected to be in the form of equity financing.

OFF-BALANCE SHEET ARRANGEMENTS

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

CRITICAL ACCOUNTING POLICIES

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 amounts reported in the financial statements and accompanying disclosures. Actual results may differ from the estimates.

Significant accounts that require estimates as a basis for determining the stated amounts include mineral property acquisition costs and impairment, accrued liabilities and the valuation allowance of deferred tax assets.

Exploration Stage Enterprise

Our financial statements are prepared using the accrual method of accounting. Until such properties are acquired and developed, we will continue to prepare our financial statements and related disclosures in accordance with entities in the exploration stage.

Mineral Property Interests

We are an exploration stage mining company and have not yet realized any revenue from our operations. We are primarily engaged in the acquisition, exploration and development of mining properties. Exploration costs are expensed as incurred regardless of the stage of development or existence of reserves. Costs of acquisition are capitalized subject to impairment testing when facts and circumstances indicate impairment may exist.

We regularly perform evaluations of any investment in mineral properties to assess the recoverability and/or the residual value of our investments in these assets. All long-lived assets are reviewed for impairment whenever events or circumstances change which indicate the carrying amount of an asset may not be recoverable.

Our management periodically reviews the carrying value of our investments in mineral leases and claims with internal and external mining related professionals. A decision to abandon, reduce or expand a specific project is based upon many factors including general and specific assessments of mineral deposits, anticipated future mineral prices, anticipated future costs of exploring, developing and operating a producing mine, the expiration term and ongoing expenses of maintaining mineral properties and the general likelihood that we will continue exploration on such project. We do not set a predetermined holding period for properties with unproven deposits; however, properties which have not demonstrated suitable metal concentrations at the conclusion of each phase of an exploration program are re-evaluated to determine if future exploration is warranted, whether there has been any impairment in value and that their carrying values are appropriate.

If an area of interest is abandoned or it is determined that its carrying value cannot be supported by future production or sale, the related costs are charged against operations in the year of abandonment or

7


determination of value. The amounts recorded as mineral leases and claims represent costs to date and do not necessarily reflect present or future values.

Our exploration activities and proposed mine development are subject to various laws and regulations governing the protection of the environment. These laws are continually changing, generally becoming more restrictive. We have made, and expect to make in the future, expenditures to comply with such laws and regulations.

ITEM 3.               QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable.

ITEM 4.               CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Accounting Officer, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rules 13a-15(e) and 15(d)-15(e) as of February 29, 2012, (“Evaluation Date”). Based upon that evaluation, our Principal Executive Officer and Principal Accounting Officer concluded that our disclosure controls and procedures were not effective as of the Evaluation Date as a result of the material weaknesses in internal control over financial reporting discussed in our Annual Report on Form 10-K for the year ended August 31, 2011 (the "2011 Annual Report").

Notwithstanding the assessment that our internal control over financial reporting was not effective and that there were material weaknesses as identified in our 2011 Annual Report, we believe that our financial statements contained in our Quarterly Report on Form 10-Q for the quarter ended February 29, 2012 fairly present our financial condition, results of operations and cash flows in all material respects.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the fiscal quarter ended February 29, 2012 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

8


PART II - OTHER INFORMATION

ITEM 1.               LEGAL PROCEEDINGS.

None.

ITEM 1A.             RISK FACTORS.

The following are some of the important factors that could affect our financial performance or could cause actual results to differ materially from estimates contained in our forward-looking statements. We may encounter risks in addition to those described below. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, may also impair or adversely affect our business, financial condition or results of operation.

If we do not obtain additional financing, our business will fail.

As at February 29, 2012, we had $1,224 cash on hand. Our ability to implement our exploration program on the Blue Jack Property will be subject to our obtaining additional financing. Our ability to obtain additional financing could be subject to a number of factors outside of our control, including the results from our exploration program, and any unanticipated problems relating to our mineral exploration activities, including environmental assessments and additional costs and expenses that may exceed our current estimates. Our Board of Directors approved an offering of up to $100,000 of 10% convertible notes (the “Offering”) pursuant to Regulation S of the Securities Act of 1933 (the “Securities Act”). As at February 29, 2012, we have issued $68,052 of convertible notes. If we are unable to obtain additional financing in the amounts and when needed, our business could fail.

Because of the unique difficulties and uncertainties inherent in mineral exploration ventures, we face a high risk of business failure.

Investors should be aware of the difficulties normally encountered by new mineral exploration companies and the high rate of failure of such enterprises. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the exploration of the mineral properties that we plan to undertake. These potential problems include, but are not limited to, unanticipated problems relating to exploration, and additional costs and expenses that may exceed current estimates. Our mineral properties do not contain a known body of commercial ore and, therefore, any program conducted on our mineral properties would be an exploratory search of ore. There is no certainty that any expenditures made in the exploration of our mineral properties will result in discoveries of commercial quantities of ore. Most exploration projects do not result in the discovery of commercially mineable deposits of ore. Problems such as unusual or unexpected formations and other conditions are involved in mineral exploration and often result in unsuccessful exploration efforts. If the results of our exploration program do not reveal viable commercial mineralization, we may decide to abandon our claim and acquire new claims for new exploration. The acquisition of additional claims will be dependent upon our possessing sufficient capital resources to purchase such claims. If we do not have sufficient capital resources and are unable to obtain sufficient financing, we may be forced to abandon our operations.

We have no known mineral reserves and if we cannot find any, we may have to cease operations.

We are in the initial phases of our exploration program for the Blue Jack Property. It is unknown whether this property contains viable mineral reserves. If we do not find a viable mineral reserve, or if we cannot exploit the mineral reserve, either because we do not have the money to do it or because it will not be economically feasible to do it, we may have to cease operations and investors may lose their investment. Mineral exploration is a highly speculative endeavor. It involves many risks and is often non-productive. Even if mineral reserves are discovered on our properties our production capabilities will be subject to further risks and uncertainties including:

  (i)

Costs of bringing the property into production including exploration work, preparation of production feasibility studies, and construction of production facilities, all of which we have not budgeted for;

9



  (ii)

Availability and costs of financing;

  (iii)

Ongoing costs of production; and

  (iv)

Environmental compliance regulations and restraints.

The marketability of any minerals acquired or discovered may be affected by numerous factors which are beyond our control and which cannot be accurately predicted, such as market fluctuations, the lack of milling facilities and processing equipment near the Blue Jack Property, and such other factors as government regulations, including regulations relating to allowable production, importing and exporting of minerals, and environmental protection.

We face significant competition in the mineral exploration industry.

We compete with other mining and exploration companies possessing greater financial resources and technical facilities than we do. Due to our weaker competitive position, we may have greater difficulty in hiring and retaining qualified personnel to conduct our planned exploration activities, which could cause delays in our exploration programs. In addition, there is significant competition for a limited number of mineral properties. Due to our weaker financial position, we may be unable to acquire rights to new mineral properties on a continuing basis.

Because of the inherent dangers involved in mineral exploration, there is a risk that we may incur liability or damages as we conduct our business.

The search for valuable minerals involves numerous hazards. As a result, we may become subject to liability for such hazards, including pollution, cave-ins and other hazards against which we cannot insure or against which we may elect not to insure. At the present time we have no coverage to insure against these hazards. The payment of such liabilities may result in our inability to complete our planned exploration program and/or obtain additional financing to fund our exploration program.

As we undertake exploration of our mineral properties, we will be subject to compliance with government regulations that may increase the anticipated cost of our exploration program.

There are several governmental regulations that materially restrict mineral exploration. We may be required to obtain work permits, post bonds and perform remediation work for any physical disturbance to the land in order to comply with these laws. If we enter the production phase, the cost of complying with permit and regulatory environment laws will be greater because the impact on the project area is greater. Permits and regulations will control all aspects of the production program if the project continues to that stage. Examples of regulatory requirements include:

  (i)

Water discharge will have to meet drinking water standards;

  (ii)

Dust generation will have to be minimal or otherwise re-mediated;

  (iii)

Dumping of material on the surface will have to be re-contoured and re-vegetated with natural vegetation;

  (iv)

An assessment of all material to be left on the surface will need to be environmentally benign;

  (v)

Ground water will have to be monitored for any potential contaminants;

  (vi)

The socio-economic impact of the project will have to be evaluated and if deemed negative, will have to be re-mediated; and

  (vii)

There will have to be an impact report of the work on the local fauna and flora including a study of potentially endangered species.

At this stage of our development, the annual cost of complying with regulatory requirements in the State of Nevada is expected to be minimal. There is a risk that new regulations could increase our costs of doing business and prevent us from carrying out our exploration program. We will also have to sustain the cost of reclamation and environmental remediation for all exploration work undertaken. Both reclamation and environmental remediation refer to putting disturbed ground back as close to its original state as possible. Other potential pollution or damage must be cleaned-up and renewed along standard guidelines outlined in the usual permits. Reclamation is the process of bringing the land back to its natural state after completion of exploration activities. Environmental remediation refers to the physical activity of taking steps to remediate, or remedy, any environmental damage caused. The amount of these costs is not known at this time as we do not know the extent of the exploration program that will be undertaken beyond completion of the

10


recommended work program. If remediation costs exceed our cash reserves we may be unable to complete our exploration program and have to abandon our operations.

Because our executive officers and directors do not have formal training specific to the technicalities of mineral exploration, there is a higher risk that our business will fail.

None of our executive officers and directors has any formal training as a geologist. With the exception of Mr. Gorrill, our executive officers and directors have only limited training in the technical aspects of managing a mineral exploration company. With very limited direct training or experience in these areas, our management may not be fully aware of the specific requirements related to working within this industry. Our management's decisions and choices may not take into account standard engineering or managerial approaches mineral exploration companies commonly use. Consequently, our operations, earnings, and ultimate financial success could suffer irreparable harm due to management's lack of experience in this industry.

If we are unable to hire and retain key personnel, we may not be able to implement our business plan and our business will fail

Our success will largely depend on our ability to hire highly qualified personnel with experience in geological exploration. These individuals may be in high demand and we may not be able to attract the staff we need. In addition, we may not be able to afford the high salaries and fees demanded by qualified personnel, or may lose such employees after they are hired. Currently, we have not hired any key personnel. Our failure to hire key personnel when needed could have a significant negative effect on our business.

Because the prices of metals fluctuate, if the price of metals for which we are exploring decreases below a specified level, it may no longer be profitable to explore for those metals and we will cease operations.

Metal prices are determined by such factors as expectations for inflation, the strength of the United States dollar, global and regional supply and demand, and political and economic conditions and production costs in metals producing regions of the world. The aggregate effect of these factors on metal prices is impossible for us to predict. In addition, the prices of metals such as lead, zinc, copper, silver, gold or uranium are sometimes subject to rapid short-term and/or prolonged changes because of speculative activities. The current demand for and supply of these metals affect the metal prices, but not necessarily in the same manner as current supply and demand affect the prices of other commodities. The supply of these metals primarily consists of new production from mining. If the prices of the metals are, for a substantial period, below our foreseeable cost of production, it may not be economical for us to continue operations and investors could lose their entire investment.

Subject to escrow, our President, Secretary, Treasurer and Director, Cedric Atkinson, owns 55.2% of our outstanding common stock. As such, investors may find that future corporate decisions controlled by Mr. Atkinson are inconsistent with the interests of other stockholders.

David K. Ryan our former President, Secretary, Treasurer and Vice-President Finance, entered into a stock purchase agreement (the “Stock Purchase Agreement”) with Cedric Atkinson, our President, Secretary, Treasurer and Director, for the sale Mr. Ryan’s 900,000 shares of our common stock (the “Shares”). Mr. Atkinson will pay Mr. Ryan $120,000 for the Shares, of which $50,000 was paid upon signing. The Shares will be held in escrow and Mr. Ryan retains the right to vote the Shares until Mr. Atkinson pays Mr. Ryan the remaining $75,000, which is due by June 1, 2012.

Subject to escrow, Mr. Atkinson, will control 55.2% of our issued and outstanding shares of common stock. Accordingly, in accordance with our Articles of Incorporation and Bylaws, Mr. Atkinson will be able to control who is elected to our board of directors and thus could act, or could have the power to act, as our management. Since Mr. Atkinson is not simply a passive investor, but is also our principal executive officer, his interests as an executive officer may, at times, be adverse to those of passive investors. Where those conflicts exist, our shareholders will be dependent upon Mr. Atkinson exercising, in a manner fair to all of our shareholders, his fiduciary duties as an officer or as a member of our board of directors. Also, due to his stock ownership position, Mr. Atkinson will have: (i) the ability to control the outcome of most corporate actions requiring stockholder approval, including amendments to our Articles of Incorporation; (ii) the ability to control

11


corporate combinations or similar transactions that might benefit minority stockholders which may be rejected by Mr. Atkinson to their detriment, and (iii) control over transactions between him and Yaterra.

We will likely conduct further offerings of our equity securities in the future, in which case our stockholders’ interest may become diluted.

Since our inception, we have relied on such sales of our common stock to fund our operations. We will likely be required to conduct additional equity offerings in the future to finance our current projects or to finance subsequent projects that we decide to undertake. If common stock is issued in return for additional funds, the price per share could be lower than that paid by our current stockholders. We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. If we issue additional stock, stockholders' percentage interest in us could become diluted.

The quotation price of our common stock may be volatile, with the result that an investor may not be able to sell any shares acquired at a price equal to or greater than the price paid by the investor.

Our stock is quoted on the OTC Bulletin Board under the symbol "YTRV.” Companies quoted on the OTC Bulletin Board have traditionally experienced extreme price and volume fluctuations. In addition, our stock price may be adversely affected by factors that are unrelated or disproportionate to our operating performance. Market fluctuations, as well as general economic, political and market conditions such as recessions, interest rates or international currency fluctuations may adversely affect the market price of our common stock. As a result of this potential volatility and potential lack of a trading market, an investor may not be able to sell any of our common stock that they acquire at a price equal or greater than the price paid by the investor.

Because our stock is a penny stock, shareholders will be more limited in their ability to sell their stock.

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the Nasdaq system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or quotation system. Because our securities constitute “penny stocks” within the meaning of the rules, the rules apply to us and to our securities. The rules may further affect the ability of owners of shares to sell our securities in any market that might develop for them. As long as the trading price of our common stock is less than $5.00 per share, the common stock will be subject to Rule 15g-9 under the Exchange Act. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that:

1.

contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading;

   
2.

contains a description of the broker’s or dealer’s duties to the customer and of the rights and remedies available to the customer with respect to a violation to such duties or other requirements of securities laws;

   
3.

contains a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread between the bid and ask price;

   
4.

contains a toll-free telephone number for inquiries on disciplinary actions;

   
5.

defines significant terms in the disclosure document or in the conduct of trading in penny stocks; and

   
6.

contains such other information and is in such form, including language, type, size and format, as the SEC shall require by rule or regulation.

The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with: (a) bid and offer quotations for the penny stock; (b) the compensation of the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and ask prices apply, or other comparable

12


information relating to the depth and liquidity of the market for such stock; and (d) a monthly account statements showing the market value of each penny stock held in the customer’s account. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitably statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our stock.

ITEM 2.               UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3.               DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4.               MINE SAFETY DISCLOSURES

None.

ITEM 5.               OTHER INFORMATION.

None.

ITEM 6.               EXHIBITS.

The following exhibits are either provided with this Quarterly Report or are incorporated herein by reference:

Exhibit  
Number Description of Exhibits
   
3.1 Articles of Incorporation.(1)
   
3.2

Bylaws, as amended.(1)

   
10.1

Purchase Agreement (Minnie Claim) dated March 28, 2007 between Yaterra and Multi Metal Mining Corp.(1)

   
10.2

Purchase Agreement (Blue Jack Property) dated August 29, 2008 between Yaterra and Howard V. Metzler. (1)

   
10.3

Option Agreement (Frances Property) dated July 14, 2009 between Yaterra and Geoffrey Goodall.(2)

   
10.4

Amendment Agreement (Frances Property) dated October 27, 2009 between Yaterra and Geoffrey Goodall.(3)

   
10.5

Second Amendment Agreement (Frances Property) dated December 10, 2009 between Yaterra and Geoffrey Goodall.(3)

   
10.6

Third Amendment Agreement (Frances Property) dated February 11, 2010 between Yaterra and Geoffrey Goodall.(4)

   
10.7

Fourth Amendment Agreement (Frances Property) dated June 1, 2010 between Yaterra and Geoffrey Goodall. (5)

   
10.8

Fifth Amendment Agreement (Frances Property) dated for reference September 1, 2010 between Yaterra and Geoffrey Goodall. (7)

   
10.9

Sixth Amendment Agreement (Frances Property) dated for reference March 15, 2011 between Yaterra and Geoffrey Goodall. (9)

   
14.1

Code of Ethics.(3)

   
31.1

Certification of Principal Executive Officer and Principal Accounting Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

13



Exhibit  
Number Description of Exhibits
 

 

32.1

Certification of Principal Executive Officer and Principal Accounting Officer as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 

 

99.1

Audit Committee Charter.(3)

 

 

99.2

Letter of Intent between the Company and Healthcare of Today, Inc. (6)

 

 

99.3

Letter of Intent between the Company and NanoCrypt AG.(8)

 

 

EX-101.INS

XBRL Instance Document

 

 

EX-101.SCH

XBRL Taxonomy Extension Schema

 

 

EX-101.CAL

XBRL Taxonomy Extension Calculation Linkbase

 

 

EX-101.DEF

XBRL Taxonomy Extension Definition Linkbase

 

 

EX-101.LAB

XBRL Taxonomy Extension Label Linkbase

 

 

EX-101.PRE

XBRL Taxonomy Extension Presentation Linkbase

Notes:

(1)

Previously filed as an exhibit to our Registration Statement on Form S-1 originally filed with the SEC on December 8, 2008, as amended January 8, 2009 and declared effective January 13, 2009.

(2)

Previously filed as an exhibit to our Quarterly Report on Form 10-Q filed with the SEC on July 16, 2009.

(3)

Previously filed as an exhibit to our Annual Report on Form 10-K filed with the SEC on December 15, 2009.

(4)

Previously filed as an exhibit to our Quarterly Report on Form 10-Q filed with the SEC on April 19, 2010.

(5)

Previously filed as an exhibit to our Quarterly Report on Form 10-Q filed with the SEC on July 15, 2010.

(6)

Previously filed as an exhibit to our Current Report on Form 8-K filed with the SEC on November 10, 2010.

(7)

Previously filed as an exhibit to our Annual Report on Form 10-K filed with the SEC on December 14, 2010.

(8)

Previously filed as an exhibit to our Quarterly Report on Form 10-Q filed with the SEC on January 19, 2011.

(9)

Previously filed as an exhibit to our Quarterly Report on Form 10-Q filed with the SEC on July 20, 2011.

14


SIGNATURES

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.

    YATERRA VENTURES CORP.
     
     
     
Date: April 23, 2012 By:

/s/ Cedric Atkinson

   

CEDRIC ATKINSON

   

President, Secretary and Treasurer

(Principal Executive Officer and Principal Accounting Officer)