Notes to the Consolidated Financial Statements (All tabular amounts stated in thousands of United States dollars unless otherwise indicated) (a) Balances with SAMAX Services Limited (“SSL”), a company of which Michael Martineau and Jonathan Forster, both Directors of the Company, were shareholders until August 31, 2001, represent amounts advanced by the Company to fund its activities managed by SSL. Administration services provided by SSL comprise exploration, administrative and financial services. With effect from January 1, 2002 the contract for services with SSL has been renegotiated and as a result SSL renders fees on flat fee basis. Previously SSL’s fees were calculated as a percentage of expenditures under management. (b) Balances with Adryx Mining & Metals Limited, the Company’s major shareholder, represent amounts owing for expenses paid on behalf of and cash advances made to the Company less interest receivable by the Company. (c) Balances with M.D. Coulter & Associates Inc., a company owned by Michael Coulter a Director and Secretary of the Company, represent amounts owing for fees, services and disbursements. Administration services provided by M.D. Coulter & Associates Inc. comprise administrative, accounting, rent and secretarial services. (d) Professional services provided by Fasken Martineau DuMoulin, a law firm of which Robert Shirriff, a Director of the Company, is a partner. (e) Professional services provided by Macleod Dixon, a law firm of which Richard Lachcik (a former Director of the Company, retired November 26, 2001) is a partner. (f) Consulting services provided by Strathcona Mineral Services Limited, a company of which Henrik Thalenhorst,  a Director of the Company, is a principal. (g) Consulting services provided by J.L. Tindale & Associates Inc., a company of which John Tindale (a former Director of the Company, retired November 26, 2001) is a shareholder. The major components of the future tax assets and liabilities classified by the source of temporary differences that gave rise to the benefit are as follows: In assessing the realizability of the future tax assets, management considers whether it is more likely than not  that some portion or all of the future tax assets will not be realized. The ultimate realization of future tax assets and liabilities is dependent upon the generation of future taxable income during the periods in which those temporary dif- ferences become deductible. Management considers the projected future taxable income and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods which the future tax assets are deductible, management believes it is more likely than not the Company will not realize the benefits of these deductible differences at December 31, 2001. As at the year end the Company had the following approximate tax loss carry forwards available, to the extent  permitted by tax regulations, to reduce future income taxes: (a) Non-capital losses of US$819,900 expiring between 2002 and 2008. (b) Canadian exploration and development costs of approximately US$1,207,000. Of this amount US$169,800 is restricted. (c) Foreign exploration and development costs of approximately US$157,200. The carrying amounts of the Company’s financial assets and liabilities including cash and short term investments, accounts receivable, prepaid expenses, sundry debtors, accounts payable and accrued liabilities approximate the  fair value due to the short-term maturity of these items. 20 7. Financial Instruments 6. Income Taxes 2001 2000 Assets Net operating losses (expiring 2001-2008) 410 431 Canadian exploration and development costs 518 480 Foreign exploration and development costs 79 83 Total 1,007 994 Valuation allowances (1,007) (994) – –