DIVERSIFIED ROYALTY CORP .  Notes toConsolidatedFinancial Statements  (Unaudited)  (Expressed in Canadian dollars)  Year ended December 31, 2014  19. Financial risk management(continued):  (h) Capital management:  The Company’s objective is to maintain a strong capital base so as to maintain investor, creditor  and market confidence and to develop the business. Management defines capital as the Company’s total shareholders’ equity and long-term bank  loan. The Board of Directors does not establish quantitative return on capital criteria for  management. The Board of Directors reviews the capital structure on a quarte rly basis.  In order to maintain or adjust the capital structure, the Company may purchase shares for  cancellation pursuant to normal course issuer bids, issue new shares or warrants, issue new  debt, and draw on its operating line of credit .  The Company’s approach to capital management  changed during the periodpursuant to the  closing of the Franworks Acquisition. The Company used up the majority of its cash balances  on the Franworks Acquisition. However, subsequent to the Franworks transaction in the fourt h  quarter, the Company completed a bought deal  equity offering, raising $32,937,932 net of costs  and taxes, leaving the Company with a substantial cash balance as at December  31, 2014 of  $34,510,514.  Transactions with key management  personnel:  20. Related parties:  Key management personnel of the Company includes all individuals who occupied the following  positions during the reporting periods: The table below provides a breakdown of the compensation of key management personnel benefits  included in net income:  -  Membersof the Board of Directors .  -  Chief Financial Officer(“CFO”).  -  President and Chief Executive Officer  (“CEO”).  33  2014  2013  Short-term benefits  $  316,200  $  898,598  Share-based payments  280,461  413,236  Short-term benefits  $  596,661  $ 1,311,834 