RELATED PARTIES

12 Months Ended

Dec. 31, 2018

Disclosure Of Related Party [Abstract]

Disclosure of related party [text block]

16. RELATED PARTIES

The Company’s related parties include the Operator of the GK Mine, Dermot Desmond, Bottin and Vertigol Unlimited Company (“Vertigol”) (corporations ultimately beneficially owned by Dermot Desmond), key management and their close family members, and the Company’s directors. During the year ended December 31, 2018, Dermot Desmond and Bottin transferred all owned shares of the Company to Vertigol. Dermot Desmond, indirectly through Vertigol, is the ultimate beneficial owner of greater than 10% of the Company’s shares. Kennady Diamonds Inc. (“Kennady Diamonds”) was also a related party since the Company and Kennady Diamonds had a common member of key management, until the date of acquisition on April 13, 2018. International Investment and Underwriting Unlimited (“IIU”) is also a related party since it is ultimately beneficially owned by Mr. Dermot Desmond.

Related party transactions are recorded at their exchange amount, being the amount agreed to by the parties.

The Company had the following transactions and balances with its related parties including key management personnel including the Company’s directors, Dermot Desmond, Vertigol, IIU, the Operator of the GK Mine, and Kennady Diamonds. The transactions with key management personnel are in the nature of remuneration. The transactions with the Operator of the GK Mine relate to the funding of the Company’s interest in the GK Mine for the current year’s expenditures, capital additions, management fee, and production sales related to the 49% share of fancies and special diamonds. The transactions with Kennady Diamonds are for a monthly management fee charged by the Company for reimbursement of expenses paid on behalf of Kennady Diamonds. The transactions with IIU are for the director fees and travel expenses of the Chairman of the Company.

Between 2014 and 2016, the Company and De Beers signed agreements allowing De Beers (“the Operator”) to utilize De Beers’ credit facilities to issue reclamation and restoration security deposits to the federal and territorial governments. In accordance with these agreements, the Company agreed to a 3% fee annually for their share of the letters of credit issued. As at December 31, 2018, the Company’s share of the letters of credit issued were $23.4 million (December 31, 2017 - $23.4 million).

The balances as at December 31, 2018 and 2017 were as follows:

	December 31,		December 31,
	2018		2017
Payable De Beers Canada Inc. as the operator of the GK Mine*	$	1,430	$	523
Payable to De Beers Canada Inc. for interest on letters of credit		352		339
Receivable from De Beers Canada Inc. for sunk cost overpayment		-		21
Payable to International Investment and Underwriting		-		32
Payable to key management personnel		57		178

*included in accounts payable and accrued liabilities

The transactions for the years ended December 31, 2018 and 2017 were as follows:

	Year ended		Year ended
	December 31, 2018		December 31, 2017
The total of the transactions:
Kennady Diamonds	$	30	$	90
International Investment and Underwriting		99		82
Remuneration to key management personnel		2,917		3,828
Sunk cost repayment to De Beers Canada Inc.		-		49,063
Diamonds sold to De Beers Canada Inc.		2,028		8,791
Diamonds purchased from De Beers Canada Inc.		29,774		19,470
Finance costs incurred from De Beers Canada Inc.		705		339
Assets purchased from De Beers Canada Inc.		-		324
Management fee charged by the Operator of the GK Mine		4,153		4,153

The remuneration expense of directors and other members of key management personnel for the years ended December 31, 2018 and 2017 were as follows:

	Year ended		Year ended
	December 31, 2018		December 31, 2017
Consulting fees, payroll, director fees, bonus and other short-term benefits	$	1,643	$	2,707
Share-based payments		1,324		1,171
	$	2,967	$	3,878

In accordance with International Accounting Standard 24 Related Parties, key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Company directly or indirectly, including any directors (executive and non-executive) of the Company.