Note 1 Nature of Operations and Ability to Continue as a Going Concern
The Company was incorporated in the state of Nevada, United States of America on August 17, 2010. The Company is an exploration stage company and was formed for the purpose of acquiring exploration and development stage mineral properties. The Companys year-end is August 31.
On August 31, 2010, the Company incorporated a wholly-owned subsidiary, LRE Exploration LLC, (LRE) in the State of Nevada, United States of America (USA) for the purpose of mineral exploration in the USA.
On November 30, 2010, LRE entered into a property option agreement with Arbutus Minerals LLC. (Arbutus) whereby the Company was granted an option to earn up to a 100% interest in 20 mineral claims (the ABR Claims) located approximately 15 miles north of Elko, Nevada. (Note 4). During the year ended August 31, 2012, the Company abandoned the property.
Effective October 30, 2012, the Company increased the number of authorized common shares of the Company from 90,000,000 to 4,500,000,000 shares per directors resolution dated October 30, 2012. The Company also conducted a fifty to one forward stock split of the Companys issued and outstanding common shares per directors resolution. Following this stock split, the number of outstanding shares of the Companys common stock increased from 3,570,000 shares to 178,500,000 shares. All share and per share information in these financial statements has been retro-actively restated for all periods presented to give effect of this stock split.
These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for its next fiscal year. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. The Company has yet to achieve profitable operations, has accumulated losses of $120,470 since its inception and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Companys ability to continue as a going concern.
The Companys ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing from shareholders or other sources to meet its obligations and repay its liabilities arising from normal business operations when they become due. Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or related party advances, however there is no assurance of additional funding being available or on acceptable terms, if at all. 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.