NOTE 2: SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Company have
been prepared in accordance with the generally accepted accounting principles in the United States of America. 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 that have been made using careful judgment. The financial statements have, in managements
opinion been properly prepared within reasonable limits of materiality and within the framework of the significant accounting policies
The Companys financial statements are
prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States
Cash and Cash Equivalents
For purposes of the statement of cash flows,
the Company considers all highly liquid investments and short-term debt instruments with original maturities of three months or
less to be cash equivalents. As at August 31, 2012 and 2011, there were no cash equivalents.
Use of Estimates
The preparation of financial statements in
conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements,
and the reported amounts of revenues and expenses for the reporting period. Actual results could differ from these estimates.
Concentration of Credit Risk
The Company places its cash and cash equivalents
with high credit quality financial institutions. There is no deposit insurance on the Companys accounts.
Fair Value of Financial Instruments
ASC 820 Fair Value Measurements and
Disclosures requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when
measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding
the inputs used to measure fair value. A financial instruments categorization within the fair value hierarchy is based upon
the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that
may be used to measure fair value:
Level 1 - Quoted prices in active markets for
identical assets or liabilities;
Level 2 - Inputs other than quoted prices included
within Level 1 that are either directly or indirectly observable; and
Level 3 - Unobservable inputs that are supported
by little or no market activity, therefore requiring an entity to develop its own assumptions about the assumptions that market
participants would use in pricing.
The Company's financial instruments include
cash and cash equivalents, accounts payable and accrued liabilities and promissory notes. Fair values were assumed to approximate
carrying value for these financial instruments, except where noted. Management is of the opinion that the Company is not exposed
to significant interest or credit risks arising from these financial instruments.
Mineral Property Payments and Exploration
Mineral property acquisition costs are initially
capitalized as tangible assets when purchased. The Company assesses the carrying costs for impairment when indicators of impairment
exist. If proven and probable reserves are established for a property and it has been determined that a mineral property can be
economically developed, costs will be amortized using the units-of-production method over the estimated life of the proven and
Mineral property exploration and development
costs are expensed as incurred until the establishment of economically viable reserves.
The Company adopted ASC 220, Comprehensive
Income, which establishes standards for reporting and display of comprehensive income, its components and accumulated balances.
The Company is disclosing this information on its Statement of Stockholders' Equity. Comprehensive income comprises equity except
those resulting from investments by owners and distributions to owners. The Company has no elements of other comprehensive
income for the years ended August 31, 2012 and 2011.
The Company has adopted ASC 740, Income
Taxes, which requires the Company to recognize deferred tax liabilities and assets for the expected future tax consequences
of events that have been recognized in the Companys financial statements or tax returns using the liability method. Under
this method, deferred tax liabilities and assets are determined based on the temporary differences between the financial statement
and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to
Basic and Diluted Loss Per Share
In accordance with ASC 260, Earnings Per
Share, the 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 be outstanding if the potential common
shares had been issued and if the additional common shares were dilutive.
New Accounting Pronouncements
The Company has implemented all new accounting
pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new
accounting pronouncements that have been issued that might have a material impact on our financial position or results of operations.