Gungnir Resources : Q1 2024 Financial Statements

GUNGNIR

Interim Financial Statements

March 31, 2024 and 2023

(expressed in Canadian dollars)

Unaudited - Prepared by Management

Gungnir Resources Inc.

Statements of Financial Position

(expressed in Canadian dollars)			Unaudited - Prepared by Management
As at			March 31,		December 31,
			2024		2023
	Note
Assets
Current assets
Cash and cash equivalents	3	$	1,161,930	$	1,309,657
Accounts receivable and prepaids	4		9,402		13,268
			1,171,332		1,322,925
Non-current assets
Deposits	3		29,590		29,590
Reclamation bonds	5		25,496		25,496
Exploration and evaluation properties	6		3,714,743		3,703,950
Total assets			4,941,161		5,081,961
Liabilities and equity
Current liabilities
Accounts payable and accrued liabilities			29,547		49,500
Total liabilities			29,547		49,500
Equity
Share capital	7		33,375,967		33,375,967
Stock-based payment reserve	7		1,036,845		1,109,417
Warrants	7		338,879		1,211,948
Contributed surplus	7		7,757,311		6,811,670
Deficit			(37,597,388)		(37,476,541)
Total equity			4,911,614		5,032,461
Total liabilities and equity		$	4,941,161	$	5,081,961
Nature and continuance of operations (Note 1)
Subsequent event (Note 13)

See accompanying notes to the interim financial statements

Gungnir Resources Inc.

Statements of Comprehensive Loss

(expressed in Canadian dollars)			Unaudited - Prepared by Management
For the Periods Ended March 31,	Note		2024		2023
Operating expenses
General and administration	10	$	12,759	$	67,731
Compensation	10		134,373		191,673
Professional fees	10		3,470		1,036
			(150,602)		(260,440)
Other items
Other Income			30,000		-
Interest income			-		2,302
Foreign exchange			(245)		(431)
Net loss and comprehensive loss		$	(120,847)	$	(258,569)
Weighted average number of shares			119,629,786		119,618,126
outstanding
Basic and diluted loss per share		$	(0.00)	$	(0.00)

See accompanying notes to the interim financial statements

Gungnir Resources Inc.

Statements of Cash Flows

(expressed in Canadian dollars)		Unaudited - Prepared by Management
For the Periods Ended March 31,		2024		2023
Operating activities
Net loss for the year	$	(120,847)	$	(258,569)
Adjustments for:
Accrued interest		-		(366)
Stock-based compensation		-		58,183
Foreign exchange		-		(61)
Impairment of exploration and evaluation assets		-		-
		(120,847)		(200,813)
Net change in non-cash working capital:
GST/VAT and other accounts receivable		3,346		2,896
Prepaid expenses		520		3,462
Accounts payable and other accrued liabilities		(19,953)		(32,718)
Net cash used in operating activities		(136,934)		(227,173)
Financing activity
Issue of units, net of share issue costs		-		-
Exercise of options		-		-
Exercise of warrants		-		-
Net cash from financing activities		-		-
Investing activities
Reclamation Bonds		-		-
Deposits		-		-
Exploration and evaluation expenditures		(10,793)		(34,642)
Option proceeds		-		-
Net cash used in investing activities		(10,793)		(34,642)
Net increase (decrease) in cash		(147,727)		(261,815)
Cash and cash equivalents, beginning of year		1,309,657		2,498,312
Cash and cash equivalents, end of year	$	1,161,930	$	2,236,497

See accompanying notes to the interim financial statements

Gungnir Resources Inc.

Statements of Changes in Equity

(expressed in Canadian dollars)					Unaudited - Prepared by Management
	Shares		Share		Stock-based				Contributed				Total
	(Note 7)		Capital		compensation		Warrants		surplus		Deficit		equity
January 1, 2023	119,629,786	$	33,375,967	$	1,067,519	$	1,211,948	$	6,795,385	$	(36,765,190)	$	5,685,629
Re-allocated on expiry of options and warrants	-		-		-		-		-		-		-
Stock-based compensation	-		-		58,183		-		-		-		58,183
Net loss	-		-		-		-		-		(258,569)		(258,569)
March 31, 2023	119,629,786		33,375,967		1,125,702		1,211,948		6,795,385		(37,023,759)		5,485,243
Re-allocated on expiry of options and warrants	-		-		(16,285)		-		16,285		-		-
Stock-based compensation	-		-		-		-		-		-		-
Net loss	-		-		-		-		-		(452,782)		(452,782)
December 31, 2023	119,629,786	$	33,375,967	$	1,109,417	$	1,211,948	$	6,811,670	$	(37,476,541)	$	5,032,461
Re-allocated on expiry of options and warrants	-		-		(72,572)		(873,069)		945,641		-		-
Stock-based compensation	-		-		-		-		-		-		-
Net loss	-		-		-		-		-		(120,847)		(120,847)
March 31, 2024	119,629,786	$	33,375,967	$	1,036,845	$	338,879	$	7,757,311	$	(37,597,388)	$	4,911,614

See accompanying notes to the interim financial statements

Gungnir Resources Inc.

Notes to the Interim Financial Statements

For the periods ended March 31, 2024 and 2023

(expressed in Canadian dollars)

Unaudited - Prepared by Management

1. NATURE AND CONTINUANCE OF OPERATIONS
   The Company is incorporated in British Columbia, Canada and is involved in the acquisition and exploration of mineral property interests. At the date of these financial statements, the Company has not been able to identify a known body of commercial grade ore on any of its properties and the ability of the Company to recover the costs it has incurred to date on these properties is dependent upon the Company being able to identify a commercial ore body, to finance its exploration and development costs and to resolve any environmental, regulatory, or other constraints which may hinder the successful development of the property. The Company is in the development stage with no major source of operating revenue and is dependent upon equity financing to maintain its current operations. These financial statements have been prepared on the basis of the Company being a going concern and able to realize its assets and discharge its liabilities in the normal course of business.
   The Company will eventually need to seek additional financing to meet its ultimate exploration and development objectives. The Company has a reasonable expectation that additional funds will be available when necessary to meet ongoing exploration and development costs. However, there can be no assurance that the Company will continue to be able to obtain additional financial resources or will achieve profitability or positive cash flows. If the Company is unable to obtain adequate additional financing, the Company will be required to re-evaluate its planned expenditures until additional funds can be raised through financing activities.
   The primary office of the Company is located at 1688 - 152nd Street, Suite 404, Surrey, BC, V4A 4N2.
2. MATERIAL ACCOUNTING POLICY INFORMATION

(a) Statement of Compliance

These unaudited interim financial statements have been prepared in accordance with International Accounting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") applicable to the preparation of interim financial statements, including IAS 34, Interim Financial Reporting and interpretations of the International Financial Reporting Interpretations Committee ("IFRIC"). These unaudited interim financial statements should be read in conjunction with the Company's audited annual financial statements for the year ended December 31, 2023.

(b) Basis of presentation

These financial statements have been prepared on a going concern basis, under the historical cost basis except for financial instruments designated at fair value through profit and loss, which are stated at their fair value. These financial statements have been prepared using the accrual basis of accounting, except for cash flow information.

(c) Significant accounting judgments and estimates

The preparation of these financial statements require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the financial statement date and the reported amounts of revenues and expenses during the period. On an ongoing basis, management evaluates its judgments and estimates by using its experience and other factors it believes to be reasonable. Actual results could differ from those estimates.

These financial statements include estimates which are uncertain, the impacts of which are pervasive and may require accounting adjustments based on future occurrences. Revisions to accounting estimates are

Gungnir Resources Inc.

Notes to the Interim Financial Statements

For the periods ended March 31, 2024 and 2023

(expressed in Canadian dollars)Unaudited - Prepared by Management recognized in the period in which the estimate is revised and in future periods if it affects both current and future periods.

2. MATERIAL ACCOUNTING POLICY INFORMATION (CONTINUED)

(c) Significant accounting judgments and estimates (continued)

Significant estimates and judgments include, but are not limited to, valuation of exploration and evaluation properties, inputs used in the valuation of the Company's warrants and stock options and income taxes.

1. • Impairment of exploration and evaluation properties. Management applies judgment in determining whether there are indicators of impairment in connection with properties on which costs have been deferred, as described in note 2 (g).
   • Valuation of warrants and stock options. Management makes certain estimates when determining the fair value of warrants and stock options awards, and the number of warrants and stock options that are expected to vest. For warrants issued, these estimates affect their amounts recognized either within assets or equity. For stock option awards, these estimates affect the amounts recognized in the statement of comprehensive income.
   • Income taxes. Income taxes payable and deferred income tax assets and liabilities require management to make judgments in the interpretation and application of the relevant tax laws. The actual amount of income taxes becomes certain only when filed and accepted by the relevant authorities.
2. Functional currency and foreign currency transactions

The functional and presentation currency of the Company is the Canadian dollar. Transactions in currencies other than the functional currency are recorded at the rates of exchange prevailing on dates of transactions. At each financial position reporting date, monetary assets and liabilities that are denominated in foreign currencies are translated at the rates prevailing at the date. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.

(e) Financial instruments and financial risk

The Company recognizes financial assets and liabilities on the statement of financial position when it becomes party to the contractual provisions of the instrument.

1. Financial assets
   Cash and cash equivalents are classified as subsequently measured at amortized cost. Financial assets at fair value through gain or loss are measured at fair value.
   Amounts receivable, exclusive of GST, are non-interest bearing and are recognized at the face amount, except when fair value is materially different, and are subsequently measured at amortized cost. Amounts receivable recorded are net of lifetime expected credit losses. The Company applies the simplified approach to determining expected credit losses, which requires expected credit losses to be recognized upon initial recognition of the receivables.
   Reclamation bonds are classified as subsequently measured at amortized cost.

Gungnir Resources Inc.

Notes to the Interim Financial Statements

For the periods ended March 31, 2024 and 2023

(expressed in Canadian dollars)

Unaudited - Prepared by Management

2. MATERIAL ACCOUNTING POLICY INFORMATION (CONTINUED)

1. Financial instruments and financial risk (continued)

1. Financial liabilities

Accounts payable and accrued liabilities are classified as subsequently measured at amortized cost.

Financial liabilities are recognized initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition these financial instruments liabilities are measured at amortized cost using the effective interest method.

1. Impairment of financial assets and non-financial assets
2. 1. Financial assets
      A financial asset is assessed at each reporting date to determine whether there is any objective evidence that it is impaired. A financial asset is considered to be impaired if objective evidence indicates that one or more events have a negative effect on the estimated future cash flows of that asset.
      An impairment loss in respect of a financial asset measured at amortized cost is calculated as the difference between its carrying amount and the present value of the estimated cash flows, discounted at the original effective interest rate. Individually significant financial assets are tested for impairment on an individual basis. The remaining financial assets are collectively assessed in groups that share similar credit risk characteristics.
      An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was recognized. For financial assets measured at amortized cost, this reversal is recognized in profit or loss.
   2. Non-financialassets
      Non-financial assets are evaluated at least annually by management for indicators that the carrying value is impaired and may not be recoverable. When indicators of impairment are present the recoverable amount of an asset is estimated to determine the extent of the impairment loss. An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount. Impairment losses are recognized in the statement of comprehensive income (loss). The recoverable amount of the asset is the greater of its fair value less cost to sell and value in use.
3. Exploration and evaluation properties

Acquisition costs of resource properties together with direct exploration expenditures thereon are deferred until the property to which they relate is placed into production, sold, abandoned, or become impaired.

Option or other payments received in respect of property interests are applied to reduce the carrying value of the properties. The carrying values of mineral properties are, where necessary, written down to the estimated fair value based on discounted estimated future net cash flows. Exploration and evaluation assets will be depreciated on a unit of production basis when the property is placed into production.

Gungnir Resources Inc.

Notes to the Interim Financial Statements

For the periods ended March 31, 2024 and 2023

(expressed in Canadian dollars)

Unaudited - Prepared by Management

2. MATERIAL ACCOUNTING POLICY INFORMATION (CONTINUED)

1. Exploration and evaluation properties (continued)

The Company reviews the carrying values of its resource properties whenever events or circumstances indicate that there may be a potential impairment. Where estimates of future cash flows are not available and where exploration results or other information suggest impairment has occurred, management assesses whether the carrying value can be recovered, and if not, an appropriate write-down is recorded.

Although the Company has taken steps to verify title to mineral properties in which it has an interest, according to the usual industry standards for the stage of exploration of such properties, these procedures do not guarantee the Company's title. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects in title registration.

Once mineral reserves are determined and the decision to proceed into project development has been approved, the expenditures related to development will be amortized over the life of the project based on estimated economic reserves.

Exploration costs renounced to shareholders due to flow-through share subscription agreements remain capitalized; however, for income tax purposes the Company has no right to claim these costs as tax deductible expenses.

(h) Reclamation bonds

Cash which is subject to contractual restrictions on use imposed by government agencies as a condition of granting permits in connection with exploration and evaluation assets is classified separately as reclamation bonds.

(i) Cash and cash equivalents

Cash and cash equivalents consist of balances with banks and investments in financial instruments that are readily convertible into known amounts of cash and have original maturities within 365 days held for the purpose of meeting short-term cash commitments rather than for investing or other purposes. At March 31, 2024, the Company had cash and cash equivalents of $1,161,930 (2023 - $1,309,657).

(j) Flow-through shares

The Company from time to time issues flow-through common shares to finance a significant portion of its exploration programs. Pursuant to the terms of the applicable flow-through share subscription agreements, the tax deductibility of qualifying resource expenditures funded from the proceeds of the sales of such shares is transferred to the investors who purchased the flow-through shares. Under IFRS, on issuance of such shares, the Company bifurcates the flow-through share into: (i) a flow-through share premium, equal to the

Gungnir Resources Inc.

Notes to the Interim Financial Statements

For the periods ended March 31, 2024 and 2023

(expressed in Canadian dollars)

Unaudited - Prepared by Management

2. MATERIAL ACCOUNTING POLICY INFORMATION (CONTINUED)

1. Flow-throughshares (continued)

estimated premium, if any, investors pay for the flow-through feature, which is recognized as a liability, and (ii) share capital. Upon expenses being incurred the Company derecognizes a deferred tax liability for the amount of tax reduction renounced to the shareholders. The premium is recognized as other income and a deferred tax liability is recognized. To the extent that the Company has suitable unrecognized deductible temporary differences, an offsetting recovery of deferred income taxes would be recorded.

Proceeds received from the issuance of flow-through shares are restricted to be used only for Canadian resource property exploration expenditures within a two-year period.

The Company may also be subject to a Part XII.6 tax on flow-through proceeds renounced under the "Look-back" Rule, in accordance with flow-through regulations pursuant to the Income Tax Act (Canada). When applicable, this tax is accrued until paid.

(k) Share capital

Common shares are classified as equity. Transaction costs directly attributable to the issue of common shares and share options are recognized as a deduction from equity, net of any tax effects. Common shares issued for consideration other than cash, are valued based on their market value at the date the shares are issued. Proceeds from unit placements are allocated between shares and warrants issued according to their relative fair value.

(l) Share-based payment transactions

The Company has a stock option plan that allows certain officers, directors, consultants, and related company employees to acquire shares of the Company. The fair value of the options granted is recognized as an expense with a corresponding increase in equity.

Share-based payments to employees and others providing similar services are measured at grant date at the fair value of the instruments issued. Fair value is determined using the Black-Scholes option pricing model considering the terms and conditions upon which the options were granted. The amount recognized as an expense is adjusted to reflect the actual number of share options that are expected to vest. Each tranche is an award with graded vesting and is considered a separate grant with a different vesting date and fair value. Each grant is accounted for on that basis.

Share-based payments to non-employees are measured at the fair value of the goods or services received, unless that fair value cannot be estimated reliably, in which case the fair value of the equity instruments issued is used. The value of the goods or services is recorded at the earlier of the vesting date, or the date the goods or services are received.

The offset to the recorded cost is to share-based payment reserve. Consideration received on the exercise of stock options is recorded as share capital and the related share-based payments originally recorded as contributed surplus are transferred to share capital. Upon cancellations or expiry of an option, the recorded value is transferred to contributed surplus.