NOTE 1 SUMMARY OF ACCOUNTING POLICIES
Nature of Business
New America Energy Corp (formerly Atheron,
Inc.) was incorporated in Nevada on May 8, 2006 as a development stage company, initially developing a technology for ethanol-methanol
gasoline. The Company did not progress the development of this technology.
On November 5, 2010, we underwent a
change of control and the Companys newly appointed sole director and majority shareholder approved a name change to New
America Energy Corp. and a twenty-five (25) new for one (1) old forward stock split of the Companys issued and outstanding
shares of common stock, such that its issued and outstanding shares of common stock increased from 2,150,000 to 53,750,000.
On November 16, 2010, the Nevada Secretary
of State accepted for filing of the Certificate of Amendment to the Companys Articles of Incorporation to change our name
from Atheron Inc. to New America Energy Corp.
The forward stock split and name change
has become effective with the Over-the-Counter Bulletin Board at the opening of trading on December 1, 2010 under the Companys
new symbol NECA. Our new CUSIP number is 641872 106.
The effect of the stock split has been
recognized retroactively in the stockholders equity accounts as of May 8, 2006, the date of our inception, and in all shares
and per share data in the financial statements.
On February 3, 2011 we entered into
property acquisition agreements with First Liberty Power Corp. (FLPC), and GeoXplor Inc. (GeoXplor).
Pursuant to the terms of the agreements, we acquired an option, as well as exploration rights, in certain unpatented mining claims
located in Southern Utah which we refer to the Uravan Property. On May 31, 2011, we amended
the agreement to extend the payment date for an additional 120 days. The Company did not pay the required option payments
under the agreements and the property was lost on September 30, 2011.
On May 31, 2011, we entered into a property
acquisition agreement with GeoXplor Corp. Pursuant to the terms of the agreement. Pursuant to the terms of the agreement, we acquired
an option, as well as exploration rights, in certain unpatented mining claims located in Clayton Valley, Nye County, Nevada. Subsequently
on October 27, 2011, we entered into an amended property acquisition agreement whereby we acquired additional claims. Further
on June 20, 2012, we entered into an amended property acquisition agreement which amended and replaced the May 31, 2011 agreement
and the October 27, 2011 agreement. Under the amended agreement we amended and extended the terms for payments to GeoXplor Corp.
in exchange for the issuance of additional shares:
As a result of these agreements, the
Company will be focused exclusively on the acquisition and development of mineral resource properties.
Exploration Stage Company
The Company is an Exploration Stage
Company, as defined by Financial Accounting Standards Board (FASB) Accounting Standards Codification ("ASC")
915, Development Stage Entities. The Company's principal business is the acquisition and exploration of mineral resources.
The Company has not presently determined whether its properties contain mineral reserves that are economically recoverable.
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 the financial statements
and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those
Cash and Cash Equivalents
We consider all highly liquid investments
with maturities of three months or less to be cash equivalents.
Fair Value of Financial Instruments
New America Energy Corps financial
instruments consist of cash and cash equivalents, deferred financing costs, accounts payable and accrued expenses, accrued interest
and loans payable. The carrying amount of these financial instruments approximates fair value due either to length of maturity
or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.
Mineral Properties Costs
Mineral exploration and development
costs are accounted for using the successful efforts method of accounting.
Property acquisition costs - Mineral
property acquisition costs are capitalized as mineral exploration properties. Upon achievement of all conditions necessary
for reserves to be classified as proved, the associated acquisition costs are reclassified to prove properties
Exploration costs - Geological and geophysical
costs and the costs of carrying and retaining undeveloped properties are expensed as incurred.
Impairment of Mineral Properties
Unproved mineral properties are assessed
at each reporting period for impairment of value, and a loss is recognized at the time of the impairment by providing an impairment
allowance. An asset would be impaired if the undiscounted cash flows were less than its carrying value. Impairments
are measured by the amount by which the carrying value exceeds its fair value. Because the Company uses the successful
efforts method, the Company assesses its properties individually for impairment, instead of on an aggregate pool of costs. Impairment
of unproved properties is based on the facts and circumstances surrounding each lease and is recognized based on managements
evaluation. Managements evaluation follows a two-step process where (1) recoverability of the carrying value
of the asset is reviewed to determine if there is sufficient value recoverable to support the capitalized value at the
report date; and, (2) If assets fail the recoverability test, impairment testing is conducted, including the evaluation of various
criteria such as: prior history of successful operations; production currently in place and/or future projected cash
flows (if any); reserve reports or evaluations from which management can prepare future cash flow analyses; the Companys
ability to monetize the asset(s) under evaluation; and, Managements intent regarding future development.
Income taxes are computed using the
asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined
based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently
enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available
evidence, are not expected to be realized.
Basic Loss Per Share
Basic loss per share has been calculated
based on the weighted average number of shares of common stock outstanding during the period.
Recent Accounting Pronouncements
The Company does not expect the adoption
of recently issued accounting pronouncements to have a significant impact on the Companys results of operations, financial
position or cash flow.