10-Q/A

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

(Amendment No. 1) 

(Mark One)

[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2017

OR

[ ] TRANSITION REPORT UNDER SECTION 13 OF 15(d) OF THE EXCHANGE ACT OF 1934

From the transition period ___________ to ____________.

Commission File Number 000-30371

DYNARESOURCE, INC.

(Exact name of small business issuer as specified in its charter)

Delaware	94-1589426
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

222 W Las Colinas Blvd., Suite 744 East Tower, Irving, Texas 75039

(Address of principal executive offices)

(972) 868-9066

(Issuer's telephone number)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:

Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:

Large Accelerated Filer [ ]	Accelerated Filer [ ]
Non-Accelerated Filer [ ]	Smaller Reporting Company [X]

 Indicate by a check mark whether the company is a shell company (as defined by Rule 12b-2 of the Exchange Act):

Yes [ ] No [X].

As of August 21, 2017, there were 16,722,825 shares of Common Stock of the issuer outstanding.

1

AMENDMENT NO. 1 TO THE QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED JUNE 30, 2017

EXPLANATORY NOTE

The purpose of this Amendment No. 1 to our Quarterly Report on Form 10-Q for the period ended June 30, 2017 as filed with the Securities and Exchange Commission on August 21, 2017 is to furnish Exhibits 101 to the Form 10-Q.

No changes have been made to the Quarterly Report other than the furnishing of Exhibit 101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB and 101.PRE described above. This Amendment No. 1 to Form 10-Q does not reflect subsequent events occurring after the original filing date of the Form 10-Q or modify or update in any way disclosures made in the Form 10-Q, as amended.

In addition, pursuant to Rule 12b-15 under the Securities Exchange Act of 1934, as a result of this Amended Report, the certifications pursuant to Section 302 and Section 906 of the Sarbanes-Oxley Act of 2002, filed and furnished, respectively as exhibits to the Original Report have been re-executed and re-filed as of the date of this Amended Report and are included as exhibits hereto.

2

ITEM 6.  EXHIBITS

The following exhibits are included herein:

Exhibit Number		Name of Exhibit
31.1	Certification of Chief Executive Officer, pursuant to Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer, pursuant to Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer and Chief Financial Officer, pursuant to 18 United States Code Section 1350, as enacted by Section 906 of the Sarbanes-Oxley Act of 2002.
101	XBRL

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

DynaResource, Inc.

By /s/ K.W. (“K.D.”) Diepholz

K.W. (“K.D.”) Diepholz, Chairman / CEO

Date:   August 28, 2017

3

EX-31.1

Exhibit 31.1

CHIEF EXECUTIVE OFFICER CERTIFICATION

I, K.W. (“K.D.”) Diepholz, certify that:

1. I have reviewed this report on Form 10-Q/A of DYNARESOURCE, INC.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15 (f) for the registrant and  have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared.

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:  August 28, 2017       

/s/ K.W. (“K.D.”) Diepholz

K.W. (“K.D.”) Diepholz

Chairman and Chief Executive Officer 

EX-31.2

EXHIBIT 31.2

CHIEF FINANCIAL OFFICER CERTIFICATION

I, K.W. (“K.D.”) DIEPHOLZ, certify that:

1.

I have reviewed this report on Form 10-Q/A of DYNARESOURCE, INC.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 (e) and 15d-15(e) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)       

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)       

Designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)       

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d) Disclosed in this report any change to the registrant's internal controls over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal controls over financial reporting; and,

5.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and,

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: August 28, 2017

/s/ K.W. (“K.D.”) Diepholz

K.W. (“KD”) Diepholz;

Chairman and Chief Financial Officer

/s/ K.W. (“K.D.”) Diepholz

K.W. (“K.D.”) Diepholz

Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Report of DynaResource, Inc. on Form 10-Q/A for the period ended June 30, 2017 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned, in the capacities and on the dates indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

/s/ K.W. (“K.D.”) DIEPHOLZ

 K.W. (“K.D.”) Diepholz

Chairman of the Board of Directors

Dated: August 24, 2017

/s/ K.W. (“K.D.”) DIEPHOLZ

K.W. (“K.D.”) Diepholz

Chief Executive Officer

Dated: August 28, 2017

/s/ K.W. (“K.D.”) Diepholz

K.W. (‘KD”) Diepholz;

Chief Financial Officer

Dated: August 28, 2017

/s/ K.W. (“K.D.”) Diepholz

K.W. (“KD”) Diepholz;

Principal Accounting Officer

Dated: August 28, 2017

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

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Document and Entity Information - shares

6 Months Ended

Jun. 30, 2017

Aug. 21, 2017

Document And Entity Information

Entity Registrant Name

DYNARESOURCE INC

Entity Central Index Key

0001111741

Document Type

10-Q/A

Document Period End Date

Jun. 30, 2017

Amendment Flag

true

Amendment Description

The purpose of this Amendment No. 1 to our Quarterly Report on Form 10-Q for the period ended June 30, 2017 as filed with the Securities and Exchange Commission on August 21, 2017 is to furnish Exhibits 101 to the Form 10-Q.

No changes have been made to the Quarterly Report other than the furnishing of Exhibit 101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB and 101.PRE described above. This Amendment No. 1 to Form 10-Q does not reflect subsequent events occurring after the original filing date of the Form 10-Q or modify or update in any way disclosures made in the Form 10-Q, as amended.

In addition, pursuant to Rule 12b-15 under the Securities Exchange Act of 1934, as a result of this Amended Report, the certifications pursuant to Section 302 and Section 906 of the Sarbanes-Oxley Act of 2002, filed and furnished, respectively as exhibits to the Original Report have been re-executed and re-filed as of the date of this Amended Report and are included as exhibits hereto.

Current Fiscal Year End Date

--12-31

Is Entity a Well-known Seasoned Issuer?

No

Is Entity a Voluntary Filer?

No

Is Entity's Reporting Status Current?

Yes

Entity Filer Category

Smaller Reporting Company

Entity Common Stock, Shares Outstanding

16,722,825

Document Fiscal Period Focus

Q2

Document Fiscal Year Focus

2017

XML

CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Current Assets:
Cash and Cash Equivalents	$ 1,679,279	$ 2,197,005
Accounts Receivable	343,321	454,140
Inventories	873,562	561,238
Foreign Tax Receivable	1,150,159	1,083,364
Other Current Assets	58,721	73,871
Total Current Assets	4,105,042	4,369,618
Mining Equipment and Fixtures (Net of Accumulated Depreciation of $913,599 and $821,132)	854,388	578,743
Mining Concessions (Net of Accumulated Amortization)	4,132,678	4,132,678
Investments in Affiliate	70,000	70,000
Other Assets	109,786	15,450
TOTAL ASSETS	9,271,894	9,166,489
Current Liabilities:
Accounts Payable	835,216	851,197
Convertible Notes Payable	950,625	956,250
Due to Non-controlling Interest	231,500	231,500
Accrued Expenses	1,517,644	1,367,510
Derivative Liabilities	3,402,653	5,106,090
Total Current Liabilities	6,937,638	8,512,547
Long-Term Liabilities:
Accrued Expenses	309,069	0
TOTAL LIABILITIES	7,246,707	8,512,547
Preferred Stock, Series C, $.0001 par value, 1,733,221 shares authorized, 1,733,221 outstanding as of 2017 and 2016	4,333,053	4,333,053
Stockholders’ Equity Deficit
Preferred Stock, Series A, $.0001 par value, 1,000 shares authorized, 1,000 and 1,000 issued and outstanding	1	1
Common Stock, $.01 par value, 25,000,000 shares authorized, 16,722,825 shares outstanding as of 2017 and 2016	167,228	167,228
Preferred Rights	40,000	40,000
Additional Paid In Capital	55,083,783	55,083,783
Treasury Stock, 1,112,313 outstanding as of 2017 and 2016	(3,175,515)	(3,175,515)
Accumulated Other Comprehensive Income	1,913,945	3,771,532
Accumulated Deficit	(51,243,114)	(53,581,567)
Total DynaResource, Inc. Stockholders' Equity	2,786,328	2,305,462
Non-controlling Interest	(5,094,194)	(5,984,573)
TOTAL (DEFICIT)	(2,307,866)	(3,679,111)
TOTAL LIABILITIES AND EQUITY (DEFICIT)	$ 9,271,894	$ 9,166,489

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Accumulated Depreciation, Mining Equipment and Fixtures	$ 913,599	$ 821,132
Series C, par value	$ 0.0001	$ 0.0001
Series C, shares authorized	1,733,221	1,733,221
Series C, shares outstanding	1,733,221	1,733,221
Series A, par value	$ .0001	$ 0.0001
Series A, shares authorized	1,000	1,000
Series A, shares issued	1,000	1,000
Series A, shares outstanding	1,000	1,000
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	25,000,000	25,000,000
Common stock, shares issued	16,722,825	16,722,825
Common stock, shares outstanding	16,722,825	16,722,825
Treasury stock	1,112,313	1,112,313

XML

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Income Statement [Abstract]
REVENUES	$ 3,217,802	$ 3,156,746	$ 4,559,314	$ 5,164,925
COSTS AND EXPENSES OF MINING OPERATIONS
Production Costs Applicable to Sales	1,139,128	563,160	1,657,890	865,155
Mine Operating Costs	1,091,983	1,311,942	1,558,145	1,975,350
Property Holding Costs	139,467	42,308	263,070	217,700
General and Administrative	650,821	557,221	1,189,337	1,012,600
Depreciation and Amortization	75,667	34,310	92,467	48,130
Total Operating Expenses	3,097,066	2,508,941	4,760,909	4,118,935
NET OPERATING INCOME (LOSS)	120,736	647,805	(201,595)	1,045,990
OTHER INCOME (EXPENSE)
Foreign Currency Gains (Losses)	256,669	(1,242,740)	695,449	(1,142,873)
Interest Expense	(32,057)	(29,883)	(61,670)	(59,766)
Derivatives Adj. Mark-to-Market Gain (Loss)	(644,641)	0	1,703,437	204,279
Other Income	252	174	397	360
Total Other Income (Expense)	(419,777)	(1,272,449)	2,337,613	(998,000)
NET INCOME (LOSS) BEFORE TAXES	(299,041)	(624,644)	2,136,018	47,990
TAXES	0	0	0	0
NET INCOME (LOSS)	(299,041)	(624,644)	2,136,018	47,990
Cumulative Dividend for Series C Preferred	(42,737)	(37,263)	(85,474)	(80,000)
ATTRIBUTABLE TO NON-CONTROLLING INTERESTS	348,323	128,537	202,435	164,780
ATTRIBUTABLE TO COMMON SHAREHOLDERS	$ 6,545	$ (533,370)	$ 2,252,979	$ 132,770
EARNINGS PER SHARE DATA ATTRIBUTABLE TO THE EQUITY HOLDERS OF DYNARESOURCE, INC.:
Basic Loss per Common Share	$ (.00)	$ (0.03)	$ 0.13	$ 0.01
Diluted Loss per Common Share	$ (.00)	$ (0.03)	$ 0.03	$ 0.00
Weighted Average Shares Outstanding, Basic	16,722,825	16,722,825	16,722,825	16,722,825
Weighted Average Shares Outstanding, Diluted	16,722,825	16,722,825	18,595,886	18,590,365
OTHER COMPREHENSIVE INCOME:
NET INCOME (LOSS) PER ABOVE	$ (299,041)	$ (642,644)	$ 2,136,018	$ 47,990
Foreign Currency Exchange Gains (Losses)	603,836	(734,433)	(257,872)	(729,937)
TOTAL OTHER COMPREHENSIVE INCOME (LOSS)	603,836	(734,433)	(257,872)	(729,937)
TOTAL COMPREHENSIVE INCOME (LOSS)	304,795	(1,359,077)	1,878,146	(681,947)
ATTRIBUTABLE TO:
Equity Holders of DynaResource, Inc.	(557,020)	(1,029,836)	2,970,960	(362,127)
NON-CONTROLLING INTERESTS	861,815	(329,241)	(1,092,814)	(319,820)
Total	$ 304,795	$ (1,359,077)	$ 1,878,146	$ (681,947)

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss)	$ 2,136,018	$ 47,990
Adjustments to reconcile net loss to cash provided by (used in) Operating activities
Gain on Derivative Liabilities	(1,703,437)	(204,279)
Depreciation and Amortization	92,467	48,130
Change in Operating Assets and Liabilities
Accounts Receivable	163,885	(315,678)
Inventory	(214,111)	(13,163)
Other Current Assets	15,150	1,205
Receivables from Affiliate	(25,848)	(5,121)
Foreign Tax Receivable	83,849	(245,131)
Other Assets	(84,120)	(1,314)
Accounts Payable	937,906	16,037
Accrued Liabilities	413,205	150,636
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES	1,814,964	(520,688)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of Equipment	(301,667)	(37,572)
CASH FLOWS (USED IN) INVESTING ACTIVITIES	(301,667)	(37,572)
CASH FLOWS FROM FINANCING ACTIVITIES
Payment on Advances to Related Party	0	(50,000)
Payment of Dividends	0	(160,000)
Payment of Note Payable	(5,625)	0
Payment on L-T Payables	(111,315)	0
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES	(116,940)	(210,000)
Effect of Foreign Exchange	(1,914,083)	1,188,491
NET DECREASE IN CASH	(517,726)	420,231
CASH AT BEGINNING OF PERIOD	2,197,005	1,922,599
CASH AT END OF PERIOD	1,679,279	2,342,830
SUPPLEMENTAL DISCLOSURES
Cash Paid for Interest	61,764	59,766
Cash Paid for Income Taxes	$ 0	$ 0

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1. NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2017

Accounting Policies [Abstract]

NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES

Nature of Activities, History and Organization

DynaResource, Inc. (The “Company”, “DynaResource”, or “DynaUSA”) was organized September 28, 1937, as a California corporation under the name of West Coast Mines, Inc.  In 1998, the Company re-domiciled to Delaware and changed its name to DynaResource, Inc.  The Company is in the business of acquiring, investing in, and developing precious metal properties, and in the test mining and pilot milling production of precious metals. 

The interim consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).  Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) has been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures included are adequate to make the information presented not misleading. 

In management’s opinion, the unaudited Consolidated Statements of Operations and Comprehensive Income for the six months ended June 30, 2017 and 2016, the Consolidated Balance Sheets as at June 30, 2017 (unaudited) and December 31, 2016, and the unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and 2016, contained herein, reflect all adjustments, consisting solely of normal recurring items, which are necessary for the fair presentation of the Company’s financial position, results of operations and cash flows on a basis consistent with that of the Company’s prior audited annual consolidated financial statements.  However, the results of operations for the interim periods may not be indicative of results to be expected for the full fiscal year.  Therefore, these financial statements should be read in conjunction with the audited financial statements and notes thereto and summary of significant accounting policies included in the Company’s Form 10-K for the year ended December 31, 2016.  Except as noted below, there have been no material changes in the footnotes from those accompanying the audited consolidated financial statements contained in the Company’s Form 10-K for the year ended December 31, 2016. The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated.

In the second quarter 2017, we identified certain property taxes amounting to $541,245 from 2014, 2015, and $169,232 for 2016, which were not expensed as required and an over accrual of $150,000 for legal expenses at December 31, 2016. Based on Staff Accounting Bulletin No. 108 (“SAB 108”), we have determined that these amounts are immaterial to each of the time periods affected and, therefore, we are not required to amend our previously filed reports. However, if these adjustments were recorded in 2017, we believe the impact could be material to this year. Therefore, we plan to adjust our previously reported results for 2014, 2015, and 2016 for these immaterial amounts as required by SAB 108. Such previous periods will be restated upon the next filing of our quarterly and annual consolidated financial statements. The balance sheet as of December 31, 2016 has been adjusted to reflect the cumulative impact of such errors. As a result, Accounts payable has been increased by $541,245, accrued expenses increased by $169,232 and retained earnings decreased by $710,477. For additional information, see Footnote 14.

Reclassifications

Certain financial statement reclassifications have been made to prior period balances to reflect the current period’s presentation format; such reclassifications had no impact on the Company’s consolidated statements of operations or consolidated statements of cash flows and had no material impact on the Company’s consolidated balance sheets.

Computation of Profit (Loss) per Share

Basic Income (Loss) per share is computed by dividing the period Income (Loss) available to common shareholders by the weighted average number of common shares outstanding. Diluted Profit (Loss) per share is computed by dividing the Income (Loss) available to common shareholders by the weighted average number of common shares outstanding plus additional common shares that would have been outstanding if dilutive potential common shares had been issued. For purposes of this calculation, convertible preferred stock, common stock dividends, warrants and options to acquire common stock, are all considered common stock equivalents in periods in which they have a dilutive effect and are excluded from this calculation in periods in which these are anti-dilutive or to the net loss. The securities for the three month period ending June 30, 2017 and June 30, 2016 were deemed antidilutive. 

The following table illustrates the computation of Profit (loss), for the three months and six months ended June 30, 2016 and 2017:

	Three Months June 30, 2017			Three Months June 30, 2016			Six Months June 30, 2017			Six Months June 30, 2016
Numerator
Profit (Loss)	$	6,545		$	(533,370	)	$	2,252,979		$	132,770
Preferred dividends accrued		—			—			85,474			80,000
Gain on Derivatives		—			—			(1,703,437	)		(204,279	)
Net Profit (Loss) applicable to common shareholders Denominator for basic and dilutive loss per share:	$	6,545		$	(533,370	)	$	635,016		$	8,491
Weighted average common stock shares outstanding		16,722,825			16,722,825			16,722,825			16,722,825
Net effect of dilutive common stock equivalents		—			—			1,873,061			1,867,540
Weighted average shares outstanding – diluted		16,722,825			18,578,175			18,595,886			18,590,365
Income Profit (Loss) per share - basic	$	(.00	)	$	(.03	)	$	.13		$	.01
Income Profit (Loss) per share – diluted	$	(.00	)		(.03	)		.03			.00

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2. INVENTORIES

6 Months Ended

Jun. 30, 2017

Inventory Abstract

INVENTORIES

The Company commenced underground test mining and pilot milling activities (“pilot production”) in the 2nd quarter of 2014. Rehabilitation of the San Pablo Mine and refurbishing of the Pilot Mill Facility and construction of the adjacent tailings pond continued through 2016, and expansion of these activities commenced in second quarter 2017. Inventories are carried at the lower of cost or fair value and consist of mined tonnage, gravity-flotation concentrates, and gravity tailings (or, flotation feed material). Inventory balances of June 30, 2017 and December 31, 2016, respectively, were as follows:

	2017		2016
Mined Tonnage Stockpiled	$	604,445	$	445,082
Mill Tonnage Stockpiled		269,117		116,156
Total Inventories	$	873,562	$	561,238

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3. PROPERTY

6 Months Ended

Jun. 30, 2017

Property, Plant and Equipment [Abstract]

PROPERTY

Property consists of the following at June 30, 2017 and December 31, 2016:

	2017			2016
Mining camp equipment	$	630,335		$	399,180
Transportation equipment		282,379			282,379
Machinery and equipment		602,250			470,741
Office furniture and fixtures		78,709			75,829
Office equipment		174,314			171,746
Sub-total		1,767,987			1,399,875
Less: Accumulated depreciation		(913,599	)		(821,132	)
Total Property	$	854,388		$	578,743

 The Company purchased equipment of $301,667 and $37,572 in the six months ended June 30, 2017 and June 30, 2016, respectively.

Depreciation has been provided over each asset’s estimated useful life.  Depreciation expense was $92,467 and $48,130 for the six months ended June 30, 2017 and 2016, respectively. 

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4. MINING CONCESSIONS

6 Months Ended

Jun. 30, 2017

Property, Plant and Equipment [Abstract]

MINING CONCESSIONS

Mining properties consist of the following at June 30, 2017 and December 31, 2016:	2017		2016
San Jose de Gracia (“SJG”):
Total Mining Concessions	$	4,132,678	$	4,132,678

Depletion expense was $nil and $nil for the six months ended June 30, 2017 and 2016 respectively, respectively.

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6. CONVERTIBLE PROMISSORY NOTES

6 Months Ended

Jun. 30, 2017

Debt Disclosure [Abstract]

CONVERTIBLE PROMISSORY NOTES

Notes Payable – Series I

In April and May 2013, the Company entered into note agreements with shareholders in the principal amount of $1,495,000, of which $340,000 was then converted to preferred shares within the same year, netting to proceeds of $1,155,000 (the “Series I Notes”). The Series I Notes bear simple interest at twelve and a half percent (12.5%), accrued for twelve months, and with the accrued interest to be added to the principal, and then interest will be paid by the Company, quarterly in arrears. The holders of the Series I Notes (in aggregate) are also entitled to receive ten percent (10%) of the net profits received by the Company, on the first fifty thousand tons processed through the mill facilities at San Jose de Gracia. Such net profits (if any) are to be calculated after deducting “all expenses related to the production”, and after a prior deduction of thirty-three percent (33%) from the net profits, to be deposited into a sinking fund cash reserve. To date, the Company has not produced any net profits as calculated in accordance with the Series I Notes.

The Notes originally matured on December 31, 2015. In April 2015, the Company received note extensions (allonges) from all Series I note holders to ensure that all Series I Notes were in good standing and also extended the maturity date of the Series I Notes to December 31, 2016. At December 31, 2016, one of the Series I Notes remained outstanding for a total of $5,800.78 and was paid in 2017, one of the Series I Notes was further extended to June 30, 2017, and the remaining Series I Notes were further extended to December 31, 2017.

The Company has the right to prepay the Series I Notes with a ten percent (10%) penalty.

The Series I Note holder retains the option, at any time prior to maturity or prepayment, to convert any unpaid principal and accrued interest into Common Stock at $5.00 per share. If the Series I Note is converted into Common Stock, at the time of conversion, the holder would also receive warrants, in the same number as the number of common shares received upon conversion, to purchase additional common shares of the Company for $7.50 per share, with such warrants expiring on December 31, 2018.

Notes Payable – Series II

In 2013 and 2014, the Company entered into additional note agreements of $199,808 and $250,000, respectively (the “Series II Notes”) with similar terms as the Series I Notes. The Series II Notes bear simple interest at twelve and a half percent (12.5%), accrued for twelve months, and with the accrued interest to be added to the principal, and then interest will be paid by the Company, quarterly in arrears. The holders of the Series II Notes (in aggregate) are also entitled to receive ten percent (10%) of the net profits received by the Company, on the second fifty thousand tons processed through the mill facilities at San Jose de Gracia. Such net profits (if any) are to be calculated after deducting “all expenses related to the production” l, and after a prior deduction of thirty-three percent (33%) from the net profits, to be deposited into a sinking fund cash reserve. To date, the Company has not produced any net profits as calculated in accordance with the Series II Notes. 

The Notes originally matured on December 31, 2015. In April 2015, the Company received allonges (note extensions) from all noteholders to ensure that all notes were in good standing and also confirmed the maturity of the Series II notes to be December 31, 2016. At December 31, 2016, the remaining Series II Notes were further extended to December 31, 2017.

The Company has the right to prepay the Series II Notes with a ten percent (10%) penalty.

The Note holder may, at any time prior to maturity or prepayment, convert any unpaid principal and accrued interest into common stock of the Company at $5.00 per share. At the time of conversion, the holder would receive a warrant to purchase additional common shares of the Company for $7.50 per share, such warrant expiring on December 31, 2018.

On June 30, 2015, the Company entered into conversion agreements with six (6) note holders. Principal and interest in the amount of $809,784 plus $33,120 of accrued interest (total of $842,903) was contracted to convert into 337,162 common shares. In addition, 337,162 warrants were issued which provide the option to purchase common shares at $2.50, with all warrants expiring December 31, 2017. The Company recorded $826,347 inducement expense related to these conversion transactions. On August 17, 2015, these common shares and warrants were issued.

At June 30, 2017, the principal and capitalized interest balance on the remaining Series I Notes was $759,375, and the principal and capitalized interest on the Series II Notes was $191,250, for a total Note balance of $950,625. The accrued interest for these notes was $29,613 and $29,883 as of June 30, 2017 and 2016, respectively.

Notes Payable

In June 2017, the Company entered into financing agreements in the amount of $541,245 in order to retain the rights to, and maintain exploratory mineral concessions. The Company paid twenty percent as an initial payment, $108,249, and financed the balance, payable over thirty-six months. In accordance with the Company’s policy of treatment of exploratory mineral concessions or properties, the Company capitalized all costs associated with the financing of the exploratory mineral concessions, including annual taxes or fees, and the Company expects to prepare an annual impairment analysis.

During the first quarter of 2017 the Company purchased $5,625 of the Notes Payable.

The following is a summary of the Notes Payable at June 30, 2017 and December 31, 2016:

	2017			2016
Convertible Promissory Notes Current Portion	$	956,250		$	956,250
Purchase of Note		(5,625	)		—
Total Notes Payable	$	950,625			956,250

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7. L-T ACCRUED EXPENSE

6 Months Ended

Jun. 30, 2017

L-t Accrued Expense

L-T ACCRUED EXPENSE

In June 2017, the Company entered into financing agreements for unpaid mining concession taxes for the period July 1, 2014 through December 31, 2015 in the amount of $541,245. The Company paid 20% as an initial payment, $108,249, and financed the balance over thirty six months

The following is a summary of the transactions during the second quarter:

		June 30, 2017
Property Holding Taxes June 1, 2014 – December 31, 2015	$	541,245
Initial payment of 20%		(108,249	)
June 2017 principal payment		(3,066	)
Balance at June 30, 2017	$	429,430
Short-Term Portion	$	120,361
Long-Term Portion		309,069
Total	$	429,430

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8. STOCKHOLDERS’ EQUITY

6 Months Ended

Jun. 30, 2017

Equity [Abstract]

STOCKHOLDERS’ EQUITY

There were no changes in our stockholders’ equity in the three and six months ended June 30, 2017.

Authorized Capital. The total number of shares of all classes of capital stock which the corporation shall have the authority to issue is 45,001,000 shares, consisting of (i) twenty million and one thousand (20,001,000) shares of Preferred Stock, par value $0.0001 per share (“Preferred Stock”), of which one thousand (1,000) shares shall be designated as Series A Preferred Stock and (ii) twenty-five million (25,000,000) shares of Common Stock, par value $.01 per share (“Common Stock”).

Series A Preferred Stock

The Company has designated 1,000 shares of its Preferred Stock as Series A, having a par value of $0.0001 per share. Holders of the Series A Preferred Stock have the right to elect a majority of the Board of Directors of the Company. In October 2007, the Company issued 1,000 shares of Series A Preferred Stock to its CEO. At June 30, 2017 and December 31, 2016, there were 1,000 shares and 1,000 shares of Series A Preferred Stock outstanding, respectively.

Series C Senior Convertible Preferred Shares

On June 30, 2015, the Company issued 1,600,000 Series C Senior Convertible Preferred Shares (the “Series C Preferred Shares”) at $2.50 per share for gross proceeds of $ 4,000,000, as well as issuing 133,221 additional Series C Preferred Shares due to anti-dilution provisions (with no cash remuneration). Legal fees of $45,000 were deducted from the proceeds of this transaction at closing. These Series C Preferred Shares are convertible to common shares at $2.50 per share, through February 20, 2020. The Series C Preferred Shares may receive a 4% per annum dividend, payable if available, and in arrears. A description of the transaction which included the issuance of the Series C Preferred Shares is included below. During 2016, the company paid Dividends of $160,000 to the holder of Series C Convertible Preferred Stock. The Dividend is calculated at 4.0% of $4,000,000 payable annually on June 30. For the three and six months ending June 30, 2017 and June 30, 2016, the Company accrued $42,737 and $37,263 respectively for the cumulative dividends. For the six months ending June 30, 2017 and June 30, 2016, the Company accrued $85,474 and $80,000 respectively for the cumulative dividends.

Common Stock

The Company is authorized to issue 25,000,000 common shares at a par value of $0.01 per share. These shares have full voting rights. At June 30, 2017 and December 31, 2016, there were 16,722,825 shares outstanding, respectively. No dividends were paid for the periods ended June 30, 2017.

Preferred Rights

The Company issued “Preferred Rights” for the rights to percentages of revenues generated from the San Jose de Gracia Pilot Production Plant, and received $158,500 in 2003 and $626,000 in 2002. This has been reflected as “Preferred Rights” in stockholders’ equity. As of December 31, 2004, $558,312 was repaid and as of December 31, 2005, an additional $186,188 was repaid, leaving a current balance of $40,000 and $40,000 as of June 30, 2017 and March 31, 2016, respectively.

Stock Issuances

2016 Activity – None.

2017 Activity – None.

Treasury Stock

At June 30, 2017 and 2016, 1,112,313 treasury shares were outstanding.

Warrants

There were no changes in the number of warrants outstanding in the three or six months ended June 30, 2017.

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9. RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2017

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

Related Party Transactions

The Company follows FASB ASC subtopic 850-10, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions. Pursuant to ASC 850-10-20, related parties include: a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825–10–15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. 

Material related party transactions are required to be disclosed in the consolidated financial statements, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which statements of operation are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for each of the periods for which statements of operations are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

Dynacap Group Ltd.

The Company paid $73,500 and $59,000 to Dynacap Group, Ltd. (“Dynacap”, an entity controlled by the CEO of the Company) for consulting and other fees during the six months ended June 30, 2017 and 2016, respectively. Dynacap retains 2 individuals who are family members of the CEO, as well as 2 consultants, as independent contractors who provide administrative and executive support services to the Company. Dynacap has provided these services to the Company for recent years.

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10. DERIVATIVE LIABILITIES

6 Months Ended

Jun. 30, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE LIABILITIES

Preferred Series C Stock

As discussed in Note 8, the Company analyzed the embedded conversion features of the Series C Preferred Stock and determined that the stock qualified as a derivative liability and is required to be bifurcated and accounted for as such since the host and the embedded instrument are not clearly and closely related. The Company performed a valuation of the conversion feature. In performing the valuation, the Company applied the guidance in ASC 820, “Fair Value Measurements”, to nonfinancial assets and liabilities that are recognized or disclosed at fair value on a nonrecurring basis. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). To measure fair value, the Company incorporates assumptions that market participants would use in pricing the asset or liability, and utilizes market data to the maximum extent possible.

In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

The Company considered the inputs in this valuation to be level 3 in the fair value hierarchy under ASC 820 and used an equity simulation model to determine the value of conversion feature of the Series C Preferred Stock based on the assumptions below for the six months ended June 30, 2017 and year ended December 31, 2016:

	June 30, 2017			Dec 31, 2016
Annual volatility rate		105	%		123	%
Risk free rate		1.50	%		1.93	%
Holding Period		5 years			5 years
Fair Value of common stock	$	1.63		$	1.75

The below table represents the change in the fair value of the derivative liability (Preferred Series C Stock) during the six months ending June 30, 2017 and the year ending December 31, 2016:

Period Ended	June 30, 2017			Dec 31, 2016
Fair value of derivative (Preferred Series C Stock), beginning of year	$	2,592,452		$	2,419,359
Change in fair value of derivative (Preferred Series C Stock)		(1,213,672	)		173,093
Fair value of derivative (Preferred Series C Stock), end of period	$	1,378,780		$	2,592,452

 Preferred Series C Warrants

As discussed in Note 9, the Company analyzed the embedded conversion features of the Series C Preferred Stock and determined that the Warrants qualified as a derivative liability and is required to be bifurcated and accounted for as such since the host and the embedded instrument are not clearly and closely related. The Company performed a valuation of the conversion feature. In performing the valuation, the Company applied the guidance in ASC 820, “Fair Value Measurements”, to nonfinancial assets and liabilities that are recognized or disclosed at fair value on a nonrecurring basis. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). To measure fair value, the Company incorporates assumptions that market participants would use in pricing the asset or liability, and utilizes market data to the maximum extent possible.

In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

The Company considered the inputs in this valuation to be level 3 in the fair value hierarchy under ASC 820 and used an equity simulation model to determine the value of conversion feature of the Warrants based on the assumptions below for the periods ended June 30, 2017 and December 31, 2016:

	June 30, 2017			Dec 31, 2016
Annual volatility rate		105	%		123	%
Risk free rate		1.50	%		1.93	%
Holding Period		5 years			5 years
Fair Value of common stock	$	1.63		$	1.75

The below table represents the change in the fair value of the derivative liability (Preferred Series C Warrants) for the period ended June 30, 2017 and the year ending December 31, 2016.

Period Ended	June 30, 2017			Dec 31, 2016
Fair value of derivative liability (Warrants), beginning of year	$	2,513,638		$	2,963,378
Change in fair value of derivative liability (Warrants)		(489,765	)		(449,740	)
Fair value of derivative liability (Warrants), end of period	$	2,023,873			2,513,638

Total (Gain) Loss on Derivative Liability (Preferred Series C Stock and Warrants)

The below table represents the total (gain) or loss, of the derivative liability (Preferred Series C Stock and Warrants) for the period ended June 30, 2017 and the year ending December 31, 2016.

Period Ended	June 30, 2017			Dec 31, 2016
Fair value of derivative liability (Preferred C Stock and Warrants), beginning of year	$	5,106,090		$	5,382,737
Change in fair value of derivative liability (Stock and Warrants)		(1,703,437	)		(276,647	)
Fair value of derivative liability (Stock and Warrants), end of period	$	3,402,653			5,106,090

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11. NON-CONTROLLING INTEREST

6 Months Ended

Jun. 30, 2017

Noncontrolling Interest [Abstract]

NON-CONTROLLING INTEREST

The Company’s Non-Controlling Interest recorded in the consolidated financial statements relates to an interest in DynaResource de México, S.A. de C.V. of 50% through May 13, 2013, and 20% thereafter. Changes in Non-Controlling Interest for the periods ended June 30, 2017 and December 31, 2016, respectively were as follows:

	Qtr. Ended June 30, 2017			Year Ended December 31, 2016
Beginning balance	$	(5,984,537	)	$	(6,498,190	)
Operating income (loss)		(202,435	)		(317,179	)
Share of Other Comprehensive Income		1,092,778			830,832
Ending balance	$	(5,094,194	)	$	(5,984,537	)

The Company began allocating a portion of other comprehensive income (loss) to the non-controlling interest with the adoption of ASC 160 as of January 1, 2009. However, this amount is only reflected in the income statement. 

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12. FAIR VALUE OF FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2017

Fair Value Of Financial Instruments

FAIR VALUE OF FINANCIAL INSTRUMENTS

The ASC guidance for fair value measurements and disclosure establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).  The three levels of the fair value hierarchy are described below:

Level 1 Inputs – Quoted prices for identical instruments in active markets.

Level 2 Inputs – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

Level 3 Inputs – Instruments with primarily unobservable value drivers.

As of June 30, 2017 and December 31, 2016, the Company’s financial assets were measured at fair value using Level 3 inputs, except for cash, which was valued using Level 1 inputs. A description of the valuation of the Level 3 inputs is discussed in Note 11.

Fair Value Measurement at June 30, 2017 using:

	Total Fair Market Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
None	$	—	$	—	$	—	$	—
Totals	$	—	$	—	$	—	$	—
Liabilities
Derivative Liabilities	$	3,402,653		—		—	$	3,402,653
Totals	$	3,402,653	$	—	$	—	$	3,402,653
Fair Value Measurement at December 31, 2016 Using:
Assets:
None		—		—		—		—
Totals	$	—	$	—	$	—	$	—
Liabilities:
Derivative Liabilities	$	5,106,090		—		—	$	5,106,090
Totals	$	5,106,090	$	—	$	—	$	5,106,090

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13. REVENUE CONCENTRATION

6 Months Ended

Jun. 30, 2017

Revenue Concentration

REVENUE CONCENTRATION

The Company receives revenues from certain customers who individually represented 10% or more of the Company’s total revenue, and the Company’s accounts receivable balances are represented by customers who individually represented 10% or more of the Company’s total accounts receivable, as described below:

For the three months ended June 30, 2017 one customer accounted for 100% of revenue and for the three months ended June 30, 2016, one customer accounted for 100% of revenue.

For the six months ended June 30, 2017 two customers accounted for 100% of revenue and for the six months ended June 30, 2016, two customers accounted for 100% of revenue.

At June 30, 2017, one customer accounted for 100% of accounts receivable.  At December 31, 2016, one customer accounted for 100% of accounts receivable.

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14. ADJUSTMENT OF PRIOR PERIODS

6 Months Ended

Jun. 30, 2017

Adjustment Of Prior Periods

ADJUSTMENT OF PRIOR PERIODS

In the second quarter 2017, we identified certain property taxes amounting to $541,245 from 2014 and 2015, and $169,232 from 2016, which were not expensed as required, and an over accrual of $150,000 for legal expenses at December 31, 2016. The Company assessed the materiality of this misstatement in the 2016 and 2015 periods financial statements in accordance with the SEC’s Staff Accounting Bulletin (SAB) No. 99, codified in ASC No. 250, Presentation of Financial Statements, and concluded that the misstatement was not material to any prior periods. In accordance with SAB 108, the Company has adjusted the three and six months ended June 30, 2016 and the balance sheet as of December 31, 2016. The following presents these adjustments in detail:

BALANCE SHEET		Previously Reported Dec 31, 2016			Adjustments			Adjusted Balance Dec, 2016
Accounts Payable	$	309,952		$	541,245		$	951,197
Accrued Expenses		1,198,278			169,232			1,367,510
Total Liabilities		7,802,070			710,477			8,512,547
Accumulated Deficit		(53,013,185	)		(568,382	)		(53,581,567	)
Total Equity (Deficit)		2,873,844			(568,382	)		2,305,462
Non-Controlling Interest		(5,842,478	)		(142,095	)		(5,984,573	)
Total Equity (Deficit)		(2,968,634	)		(710,477	)		(3,679,111	)
Total Liabilities and Equity	$	9,166,489	)	$	—		$	9,166,489

INCOME STATEMENT
	Three Months Ended June 30, 2016									Six Months Ended June 30, 2016
		Previously  Reported			Adjustments			Adjusted			Previously Reported		Adjustments			Adjusted
COSTS AND EXPENSES OF MINING OPERATIONS
Property Holding Costs	$	—		$	42,308		$	42,308			133,084	$	84,616		$	217,700
Total Operating Expenses		2,466,663			42,308			2,508,941			4,034,319		84,616			4,118,935
NET OPERATING INCOME (LOSS)		690,113			(42,308	)		647,805			1,130,616		(84,616	)		1,045,900
NET INCOME (LOSS) BEFORE TAXES		(582,336	)		(42,308	)		(624,644	)		132,606		(84,616	)		47,990
NET INCOME (LOSS)		(582,336	)		(42,308	)		(624,644	)		132,606		(84,616	)		47,990
ATTRIBUTABLE TO NON-CONTROLLING INTERESST		120,076			8,461			128,537			147,857		16,923			164,780
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS		(499,532	)		(33,847	)		(533,370	)	$	200,463	$	(67,693	)	$	132,770
Basic Loss Per Common Share		(0.03	)	$	0.00			(0.03	)	$	0.01	$	0.00		$	0.01
Diluted Loss Per Common Share	$	(0.03	)	$	0.00		$	(0.03	)	$	0.01	$	0.00		$	0.00

STATEMENT of CASH FLOWS		Previously Reported June 30, 2016			Adjustments			Adjusted Balance June 30, 2016
Net Income (Loss)	$	132,606		$	(84,616	)	$	47,990
Accrued Liabilities		66,020			84,616			150,636
Cash Flows Used in Operating	$	(520,688	)	$	—		$	(520,688	)

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1. NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2017

Nature Of Activities And Significant Accounting Policies Policies

Nature of Activities, History and Organization

DynaResource, Inc. (The “Company”, “DynaResource”, or “DynaUSA”) was organized September 28, 1937, as a California corporation under the name of West Coast Mines, Inc.  In 1998, the Company re-domiciled to Delaware and changed its name to DynaResource, Inc.  The Company is in the business of acquiring, investing in, and developing precious metal properties, and in the test mining and pilot milling production of precious metals.

The interim consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).  Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) has been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures included are adequate to make the information presented not misleading.

In management’s opinion, the unaudited Consolidated Statements of Operations and Comprehensive Income for the six months ended June 30, 2017 and 2016, the Consolidated Balance Sheets as at June 30, 2017 (unaudited) and December 31, 2016, and the unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and 2016, contained herein, reflect all adjustments, consisting solely of normal recurring items, which are necessary for the fair presentation of the Company’s financial position, results of operations and cash flows on a basis consistent with that of the Company’s prior audited annual consolidated financial statements.  However, the results of operations for the interim periods may not be indicative of results to be expected for the full fiscal year.  Therefore, these financial statements should be read in conjunction with the audited financial statements and notes thereto and summary of significant accounting policies included in the Company’s Form 10-K for the year ended December 31, 2016.  Except as noted below, there have been no material changes in the footnotes from those accompanying the audited consolidated financial statements contained in the Company’s Form 10-K for the year ended December 31, 2016. The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated.

In the second quarter 2017, we identified certain property taxes amounting to $541,245 from 2014, 2015, and $169,232 for 2016, which were not expensed as required and an over accrual of $150,000 for legal expenses at December 31, 2016. Based on Staff Accounting Bulletin No. 108 (“SAB 108”), we have determined that these amounts are immaterial to each of the time periods affected and, therefore, we are not required to amend our previously filed reports. However, if these adjustments were recorded in 2017, we believe the impact could be material to this year. Therefore, we plan to adjust our previously reported results for 2014, 2015, and 2016 for these immaterial amounts as required by SAB 108. Such previous periods will be restated upon the next filing of our quarterly and annual consolidated financial statements. The balance sheet as of December 31, 2016 has been adjusted to reflect the cumulative impact of such errors. As a result, Accounts payable has been increased by $541,245, accrued expenses increased by $169,232 and retained earnings decreased by $710,477. For additional information, see Footnote 14.

Reclassifications

Certain financial statement reclassifications have been made to prior period balances to reflect the current period’s presentation format; such reclassifications had no impact on the Company’s consolidated statements of operations or consolidated statements of cash flows and had no material impact on the Company’s consolidated balance sheets.

Computation of Profit (Loss) per Share

Basic Income (Loss) per share is computed by dividing the period Income (Loss) available to common shareholders by the weighted average number of common shares outstanding. Diluted Profit (Loss) per share is computed by dividing the Income (Loss) available to common shareholders by the weighted average number of common shares outstanding plus additional common shares that would have been outstanding if dilutive potential common shares had been issued. For purposes of this calculation, convertible preferred stock, common stock dividends, warrants and options to acquire common stock, are all considered common stock equivalents in periods in which they have a dilutive effect and are excluded from this calculation in periods in which these are anti-dilutive or to the net loss. The securities for the three month period ending June 30, 2017 and June 30, 2016 were deemed antidilutive. 

The following table illustrates the computation of Profit (loss), for the three months and six months ended June 30, 2016 and 2017:

	Three Months June 30, 2017			Three Months June 30, 2016			Six Months June 30, 2017			Six Months June 30, 2016
Numerator
Profit (Loss)	$	6,545		$	(533,370	)	$	2,252,979		$	132,770
Preferred dividends accrued		—			—			85,474			80,000
Gain on Derivatives		—			—			(1,703,437	)		(204,279	)
Net Profit (Loss) applicable to common shareholders Denominator for basic and dilutive loss per share:	$	6,545		$	(533,370	)	$	635,016		$	8,491
Weighted average common stock shares outstanding		16,722,825			16,722,825			16,722,825			16,722,825
Net effect of dilutive common stock equivalents		—			—			1,873,061			1,867,540
Weighted average shares outstanding – diluted		16,722,825			18,578,175			18,595,886			18,590,365
Income Profit (Loss) per share - basic	$	(.00	)	$	(.03	)	$	.13		$	.01
Income Profit (Loss) per share – diluted	$	(.00	)		(.03	)		.03			.00

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1. NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2017

Nature Of Activities And Significant Accounting Policies Tables

Computation of profit (loss)

	Three Months June 30, 2017			Three Months June 30, 2016			Six Months June 30, 2017			Six Months June 30, 2016
Numerator
Profit (Loss)	$	6,545		$	(533,370	)	$	2,252,979		$	132,770
Preferred dividends accrued		—			—			85,474			80,000
Gain on Derivatives		—			—			(1,703,437	)		(204,279	)
Net Profit (Loss) applicable to common shareholders Denominator for basic and dilutive loss per share:	$	6,545		$	(533,370	)	$	635,016		$	8,491
Weighted average common stock shares outstanding		16,722,825			16,722,825			16,722,825			16,722,825
Net effect of dilutive common stock equivalents		—			—			1,873,061			1,867,540
Weighted average shares outstanding – diluted		16,722,825			18,578,175			18,595,886			18,590,365
Income Profit (Loss) per share - basic	$	(.00	)	$	(.03	)	$	.13		$	.01
Income Profit (Loss) per share – diluted	$	(.00	)		(.03	)		.03			.00

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2. INVENTORIES (Tables)

6 Months Ended

Jun. 30, 2017

Inventories Tables

Schedule of inventory

	2017		2016
Mined Tonnage Stockpiled	$	604,445	$	445,082
Mill Tonnage Stockpiled		269,117		116,156
Total Inventories	$	873,562	$	561,238

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3. PROPERTY (Tables)

6 Months Ended

Jun. 30, 2017

Property Tables

Property

	2017			2016
Mining camp equipment	$	630,335		$	399,180
Transportation equipment		282,379			282,379
Machinery and equipment		602,250			470,741
Office furniture and fixtures		78,709			75,829
Office equipment		174,314			171,746
Sub-total		1,767,987			1,399,875
Less: Accumulated depreciation		(913,599	)		(821,132	)
Total Property	$	854,388		$	578,743

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4. MINING CONCESSIONS (Tables)

6 Months Ended

Jun. 30, 2017

Mining Concessions Tables

Mining properties

	2017		2016
San Jose de Gracia (“SJG”):
Total Mining Concessions	$	4,132,678	$	4,132,678

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6. CONVERTIBLE PROMISSORY NOTES (Tables)

6 Months Ended

Jun. 30, 2017

Convertible Promissory Notes Tables

Notes Payable

Notes Payable – Series I

In April and May 2013, the Company entered into note agreements with shareholders in the principal amount of $1,495,000, of which $340,000 was then converted to preferred shares within the same year, netting to proceeds of $1,155,000 (the “Series I Notes”). The Series I Notes bear simple interest at twelve and a half percent (12.5%), accrued for twelve months, and with the accrued interest to be added to the principal, and then interest will be paid by the Company, quarterly in arrears. The holders of the Series I Notes (in aggregate) are also entitled to receive ten percent (10%) of the net profits received by the Company, on the first fifty thousand tons processed through the mill facilities at San Jose de Gracia. Such net profits (if any) are to be calculated after deducting “all expenses related to the production”, and after a prior deduction of thirty-three percent (33%) from the net profits, to be deposited into a sinking fund cash reserve. To date, the Company has not produced any net profits as calculated in accordance with the Series I Notes.

The Notes originally matured on December 31, 2015. In April 2015, the Company received note extensions (allonges) from all Series I note holders to ensure that all Series I Notes were in good standing and also extended the maturity date of the Series I Notes to December 31, 2016. At December 31, 2016, one of the Series I Notes remained outstanding for a total of $5,800.78 and was paid in 2017, one of the Series I Notes was further extended to June 30, 2017, and the remaining Series I Notes were further extended to December 31, 2017.

The Company has the right to prepay the Series I Notes with a ten percent (10%) penalty.

The Series I Note holder retains the option, at any time prior to maturity or prepayment, to convert any unpaid principal and accrued interest into Common Stock at $5.00 per share. If the Series I Note is converted into Common Stock, at the time of conversion, the holder would also receive warrants, in the same number as the number of common shares received upon conversion, to purchase additional common shares of the Company for $7.50 per share, with such warrants expiring on December 31, 2018.

Notes Payable – Series II

In 2013 and 2014, the Company entered into additional note agreements of $199,808 and $250,000, respectively (the “Series II Notes”) with similar terms as the Series I Notes. The Series II Notes bear simple interest at twelve and a half percent (12.5%), accrued for twelve months, and with the accrued interest to be added to the principal, and then interest will be paid by the Company, quarterly in arrears. The holders of the Series II Notes (in aggregate) are also entitled to receive ten percent (10%) of the net profits received by the Company, on the second fifty thousand tons processed through the mill facilities at San Jose de Gracia. Such net profits (if any) are to be calculated after deducting “all expenses related to the production” l, and after a prior deduction of thirty-three percent (33%) from the net profits, to be deposited into a sinking fund cash reserve. To date, the Company has not produced any net profits as calculated in accordance with the Series II Notes. 

The Notes originally matured on December 31, 2015. In April 2015, the Company received allonges (note extensions) from all noteholders to ensure that all notes were in good standing and also confirmed the maturity of the Series II notes to be December 31, 2016. At December 31, 2016, the remaining Series II Notes were further extended to December 31, 2017.

The Company has the right to prepay the Series II Notes with a ten percent (10%) penalty.

The Note holder may, at any time prior to maturity or prepayment, convert any unpaid principal and accrued interest into common stock of the Company at $5.00 per share. At the time of conversion, the holder would receive a warrant to purchase additional common shares of the Company for $7.50 per share, such warrant expiring on December 31, 2018.

On June 30, 2015, the Company entered into conversion agreements with six (6) note holders. Principal and interest in the amount of $809,784 plus $33,120 of accrued interest (total of $842,903) was contracted to convert into 337,162 common shares. In addition, 337,162 warrants were issued which provide the option to purchase common shares at $2.50, with all warrants expiring December 31, 2017. The Company recorded $826,347 inducement expense related to these conversion transactions. On August 17, 2015, these common shares and warrants were issued.

At June 30, 2017, the principal and capitalized interest balance on the remaining Series I Notes was $759,375, and the principal and capitalized interest on the Series II Notes was $191,250, for a total Note balance of $950,625. The accrued interest for these notes was $29,613 and $29,883 as of June 30, 2017 and 2016, respectively.

Notes Payable

In June 2017, the Company entered into financing agreements in the amount of $541,245 in order to retain the rights to, and maintain exploratory mineral concessions. The Company paid twenty percent as an initial payment, $108,249, and financed the balance, payable over thirty-six months. In accordance with the Company’s policy of treatment of exploratory mineral concessions or properties, the Company capitalized all costs associated with the financing of the exploratory mineral concessions, including annual taxes or fees, and the Company expects to prepare an annual impairment analysis.

During the first quarter of 2017 the Company purchased $5,625 of the Notes Payable.

The following is a summary of the Notes Payable at June 30, 2017 and December 31, 2016:

	2017			2016
Convertible Promissory Notes Current Portion	$	956,250		$	956,250
Purchase of Note		(5,625	)		—
Total Notes Payable	$	950,625			956,250

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7. L-T ACCRUED EXPENSE (Tables)

6 Months Ended

Jun. 30, 2017

L-t Accrued Expense Tables

Summary of the transactions for unpaid mining concession taxes

		June 30, 2017
Property Holding Taxes June 1, 2014 – December 31, 2015	$	541,245
Initial payment of 20%		(108,249	)
June 2017 principal payment		(3,066	)
Balance at June 30, 2017	$	429,430
Short-Term Portion	$	120,361
Long-Term Portion		309,069
Total	$	429,430

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10. DERIVATIVE LIABILITIES (Tables)

6 Months Ended

Jun. 30, 2017

Total (gain) or loss, of the derivative liability

Period Ended	June 30, 2017			Dec 31, 2016
Fair value of derivative liability (Preferred C Stock and Warrants), beginning of year	$	5,106,090		$	5,382,737
Change in fair value of derivative liability (Stock and Warrants)		(1,703,437	)		(276,647	)
Fair value of derivative liability (Stock and Warrants), end of period	$	3,402,653			5,106,090

Preferred Series C Stock

Valuation assumption

	June 30, 2017			Dec 31, 2016
Annual volatility rate		105	%		123	%
Risk free rate		1.50	%		1.93	%
Holding Period		5 years			5 years
Fair Value of common stock	$	1.63		$	1.75

Change in the fair value of the derivative liability

Period Ended	June 30, 2017			Dec 31, 2016
Fair value of derivative (Preferred Series C Stock), beginning of year	$	2,592,452		$	2,419,359
Change in fair value of derivative (Preferred Series C Stock)		(1,213,672	)		173,093
Fair value of derivative (Preferred Series C Stock), end of period	$	1,378,780		$	2,592,452

Preferred Series C Warrant

Valuation assumption

	June 30, 2017			Dec 31, 2016
Annual volatility rate		105	%		123	%
Risk free rate		1.50	%		1.93	%
Holding Period		5 years			5 years
Fair Value of common stock	$	1.63		$	1.75

Change in the fair value of the derivative liability

Period Ended	June 30, 2017			Dec 31, 2016
Fair value of derivative liability (Warrants), beginning of year	$	2,513,638		$	2,963,378
Change in fair value of derivative liability (Warrants)		(489,765	)		(449,740	)
Fair value of derivative liability (Warrants), end of period	$	2,023,873			2,513,638

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11. NON-CONTROLLING INTEREST (Tables)

6 Months Ended

Jun. 30, 2017

Non-controlling Interest Tables

Changes in Non-controlling Interest

	Qtr. Ended June 30, 2017			Year Ended December 31, 2016
Beginning balance	$	(5,984,537	)	$	(6,498,190	)
Operating income (loss)		(202,435	)		(317,179	)
Share of Other Comprehensive Income		1,092,778			830,832
Ending balance	$	(5,094,194	)	$	(5,984,537	)

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12. FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2017

Fair Value Of Financial Instruments Tables

Fair Value Measurement

	Total Fair Market Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
None	$	—	$	—	$	—	$	—
Totals	$	—	$	—	$	—	$	—
Liabilities
Derivative Liabilities	$	3,402,653		—		—	$	3,402,653
Totals	$	3,402,653	$	—	$	—	$	3,402,653
Fair Value Measurement at December 31, 2016 Using:
Assets:
None		—		—		—		—
Totals	$	—	$	—	$	—	$	—
Liabilities:
Derivative Liabilities	$	5,106,090		—		—	$	5,106,090
Totals	$	5,106,090	$	—	$	—	$	5,106,090

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14. ADJUSTMENT OF PRIOR PERIODS (Tables)

6 Months Ended

Jun. 30, 2017

Adjustment Of Prior Periods Tables

Prior period adjustments

BALANCE SHEET		Previously Reported Dec 31, 2016			Adjustments			Adjusted Balance Dec, 2016
Accounts Payable	$	309,952		$	541,245		$	951,197
Accrued Expenses		1,198,278			169,232			1,367,510
Total Liabilities		7,802,070			710,477			8,512,547
Accumulated Deficit		(53,013,185	)		(568,382	)		(53,581,567	)
Total Equity (Deficit)		2,873,844			(568,382	)		2,305,462
Non-Controlling Interest		(5,842,478	)		(142,095	)		(5,984,573	)
Total Equity (Deficit)		(2,968,634	)		(710,477	)		(3,679,111	)
Total Liabilities and Equity	$	9,166,489	)	$	—		$	9,166,489

INCOME STATEMENT
	Three Months Ended June 30, 2016									Six Months Ended June 30, 2016
		Previously  Reported			Adjustments			Adjusted			Previously Reported		Adjustments			Adjusted
COSTS AND EXPENSES OF MINING OPERATIONS
Property Holding Costs	$	—		$	42,308		$	42,308			133,084	$	84,616		$	217,700
Total Operating Expenses		2,466,663			42,308			2,508,941			4,034,319		84,616			4,118,935
NET OPERATING INCOME (LOSS)		690,113			(42,308	)		647,805			1,130,616		(84,616	)		1,045,900
NET INCOME (LOSS) BEFORE TAXES		(582,336	)		(42,308	)		(624,644	)		132,606		(84,616	)		47,990
NET INCOME (LOSS)		(582,336	)		(42,308	)		(624,644	)		132,606		(84,616	)		47,990
ATTRIBUTABLE TO NON-CONTROLLING INTERESST		120,076			8,461			128,537			147,857		16,923			164,780
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS		(499,532	)		(33,847	)		(533,370	)	$	200,463	$	(67,693	)	$	132,770
Basic Loss Per Common Share		(0.03	)	$	0.00			(0.03	)	$	0.01	$	0.00		$	0.01
Diluted Loss Per Common Share	$	(0.03	)	$	0.00		$	(0.03	)	$	0.01	$	0.00		$	0.00

STATEMENT of CASH FLOWS		Previously Reported June 30, 2016			Adjustments			Adjusted Balance June 30, 2016
Net Income (Loss)	$	132,606		$	(84,616	)	$	47,990
Accrued Liabilities		66,020			84,616			150,636
Cash Flows Used in Operating	$	(520,688	)	$	—		$	(520,688	)

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1. NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Nature Of Activities And Significant Accounting Policies Details
Profit (Loss)	$ 6,545	$ (533,370)	$ 2,252,979	$ 132,770
Preferred dividends accrued	0	0	85,474	80,000
Gain on Derivatives	0	0	(1,703,437)	(204,279)
Net Profit (Loss) applicable to common shareholders	$ 6,545	$ (533,370)	$ 2,252,979	$ 132,770
Weighted average number of common shares outstanding, Basic	16,722,825	16,722,825	16,722,825	16,722,825
Net effect of dilutive common stock equivalents	0	0	1,873,061	1,867,540
Diluted weighted average number of common shares outstanding, Diluted	16,722,825	16,722,825	18,595,886	18,590,365
Income Profit (Loss) per share - basic	$ (.00)	$ (0.03)	$ 0.13	$ 0.01
Income Profit (Loss) per share – diluted	$ (.00)	$ (0.03)	$ 0.03	$ 0.00

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2. INVENTORIES (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Inventories Details
Mined Tonnage Stockpiled	$ 604,445	$ 445,082
Mill Tonnage Stockpiled	269,117	116,156
Total Inventories	$ 873,562	$ 561,238

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3. PROPERTY (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Property Details
Mining camp equipment	$ 630,335	$ 399,180
Transportation equipment	282,379	282,379
Machinery and equipment	602,250	470,741
Office furniture and fixtures	78,709	75,829
Office equipment	174,314	171,746
Sub-total	1,767,987	1,399,875
Less: Accumulated depreciation	(913,599)	(821,132)
Total Property	$ 854,388	$ 578,743

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3. PROPERTY (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Property Details Narrative
Purchase of Equipment	$ 301,667	$ 37,572
Depreciation expense	$ 92,467	$ 48,130

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4. MINING CONCESSIONS (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Mining Concessions Details
San Jose de Gracia ("SJG"): Total Mining Concessions	$ 4,132,678	$ 4,132,678

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6. CONVERTIBLE PROMISSORY NOTES (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Convertible Promissory Notes Details
Convertible Promissory Notes Current Portion	$ 956,250	$ 956,250
Purchase of Note	(5,625)	0
Convertible Notes Payable	$ 950,625	$ 956,250

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6. CONVERTIBLE PROMISSORY NOTES (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Convertible Promissory Notes Details Narrative
Accrued interest	$ 29,613	$ 29,883

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7. L-T ACCRUED EXPENSE (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
L-t Accrued Expense Details
Property Holding Taxes June 1, 2014 – December 31, 2015	$ 541,245
Initial payment of 20%	(108,249)
June 2017 principal payment	(3,066)
Balance at June 30, 2017	429,430
Short-Term Portion	120,361
Long-Term Portion	309,069	$ 0
Total	$ 429,430

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10. DERIVATIVE LIABILITIES (Details) - Preferred Series C Stock - $ / shares	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Annual volatility rate	105.00%	123.00%
Risk free rate	1.50%	1.93%
Holding Period	5 years	5 years
Fair Value of common stock	$ 1.63	$ 1.75

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10. DERIVATIVE LIABILITIES (Details 1) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Fair value of derivative, beginning	$ 5,106,090	$ 5,382,737
Change in fair value of derivative	(1,703,437)	(276,647)
Fair value of derivative, ending	3,402,653	5,106,090
Preferred Series C Stock
Fair value of derivative, beginning	2,592,452	2,419,359
Change in fair value of derivative	(1,213,672)	173,093
Fair value of derivative, ending	$ 1,378,780	$ 2,592,452

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10. DERIVATIVE LIABILITIES (Details 2) - Preferred Series C Warrant - $ / shares	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Annual volatility rate	105.00%	123.00%
Risk free rate	1.50%	1.93%
Holding Period	5 years	5 years
Fair Value of common stock	$ 1.63	$ 1.75

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10. DERIVATIVE LIABILITIES (Details 3) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Fair value of derivative, beginning	$ 5,106,090	$ 5,382,737
Change in fair value of derivative	(1,703,437)	(276,647)
Fair value of derivative, ending	3,402,653	5,106,090
Preferred Series C Warrant
Fair value of derivative, beginning	2,513,638	2,963,378
Change in fair value of derivative	(489,765)	(449,740)
Fair value of derivative, ending	$ 2,023,873	$ 2,513,638

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10. DERIVATIVE LIABILITIES (Details 4) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Derivative Liabilities Details 4
Fair value of derivative, beginning	$ 5,106,090	$ 5,382,737
Change in fair value of derivative liability	(1,703,437)	(276,647)
Fair value of derivative, ending	$ 3,402,653	$ 5,106,090

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11. NON-CONTROLLING INTEREST (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2017	Dec. 31, 2016
Non-controlling Interest Details
Beginning balance	$ (5,984,573)	$ (6,461,950)
Operating income (loss)	(202,435)	(283,333)
Share of Other Comprehensive Income	1,092,778	902,805
Ending balance	$ (5,094,194)	$ (5,984,573)

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12. FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Assets:
Total Asset	$ 0	$ 0
Liabilities:
Derivative Liabilities	3,402,653	5,106,090
Total Liabilities	3,402,653	5,106,090
Fair value Level 1
Assets:
Total Asset	0	0
Liabilities:
Derivative Liabilities	0	0
Total Liabilities	0	0
Fair value Level 2
Assets:
Total Asset	0	0
Liabilities:
Derivative Liabilities	0	0
Total Liabilities	0	0
Fair value Level 3
Assets:
Total Asset	0	0
Liabilities:
Derivative Liabilities	3,402,653	5,106,090
Total Liabilities	$ 3,402,653	$ 5,106,090

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13. REVENUE CONCENTRATION (Details Narrative)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
One Customer | Revenue
Concentration risk	100.00%	100.00%
One Customer | Accounts Receivable
Concentration risk			100.00%		100.00%
Two Customers | Revenue
Concentration risk			100.00%	100.00%

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14. ADJUSTMENT OF PRIOR PERIODS (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016	Dec. 31, 2015
BALANCE SHEET
Accounts Payable	$ 835,216	$ 851,197
Accrued Expenses	1,517,644	1,367,510
TOTAL LIABILITIES	7,246,707	8,512,547
Accumulated Deficit	(51,243,114)	(53,581,567)
Total DynaResource, Inc. Stockholders' Equity	2,786,328	2,305,462
Non-controlling Interest	(5,094,194)	(5,984,573)	$ (6,461,950)
TOTAL (DEFICIT)	(2,307,866)	(3,679,111)
TOTAL LIABILITIES AND EQUITY (DEFICIT)	$ 9,271,894	9,166,489
Previously Reported
BALANCE SHEET
Accounts Payable		309,952
Accrued Expenses		1,198,278
TOTAL LIABILITIES		7,802,070
Accumulated Deficit		(53,013,185)
Total DynaResource, Inc. Stockholders' Equity		2,873,844
Non-controlling Interest		(5,842,478)
TOTAL (DEFICIT)		(2,968,634)
TOTAL LIABILITIES AND EQUITY (DEFICIT)		9,166,489
Adjustment
BALANCE SHEET
Accounts Payable		541,245
Accrued Expenses		169,232
TOTAL LIABILITIES		710,477
Accumulated Deficit		(568,382)
Total DynaResource, Inc. Stockholders' Equity		(568,382)
Non-controlling Interest		(142,095)
TOTAL (DEFICIT)		(710,477)
TOTAL LIABILITIES AND EQUITY (DEFICIT)		$ 0

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14. ADJUSTMENT OF PRIOR PERIODS (Details 1) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
INCOME STATEMENT
Property Holding Costs	$ 139,467	$ 42,308	$ 263,070	$ 217,700
Total Operating Expenses	3,097,066	2,508,941	4,760,909	4,118,935
NET OPERATING INCOME (LOSS)	120,736	647,805	(201,595)	1,045,990
NET INCOME (LOSS) BEFORE TAXES	(299,041)	(624,644)	2,136,018	47,990
NET INCOME (LOSS)	(299,041)	(624,644)	2,136,018	47,990
ATTRIBUTABLE TO NON-CONTROLLING INTERESTS	348,323	128,537	202,435	164,780
ATTRIBUTABLE TO COMMON SHAREHOLDERS	$ 6,545	$ (533,370)	$ 2,252,979	$ 132,770
Basic Loss per Common Share	$ (.00)	$ (0.03)	$ 0.13	$ 0.01
Diluted Loss per Common Share	$ (.00)	$ (0.03)	$ 0.03	$ 0.00
Previously Reported
INCOME STATEMENT
Property Holding Costs		$ 0		$ 133,084
Total Operating Expenses		2,466,663		4,034,319
NET OPERATING INCOME (LOSS)		690,113		1,130,616
NET INCOME (LOSS) BEFORE TAXES		(582,336)		132,606
NET INCOME (LOSS)		(582,336)		132,606
ATTRIBUTABLE TO NON-CONTROLLING INTERESTS		120,076		147,857
ATTRIBUTABLE TO COMMON SHAREHOLDERS		$ (499,532)		$ 200,463
Basic Loss per Common Share		$ (0.03)		$ 0.01
Diluted Loss per Common Share		$ (0.03)		$ 0.01
Adjustment
INCOME STATEMENT
Property Holding Costs		$ 42,308		$ 84,616
Total Operating Expenses		42,308		84,616
NET OPERATING INCOME (LOSS)		(42,308)		(84,616)
NET INCOME (LOSS) BEFORE TAXES		(42,308)		(84,616)
NET INCOME (LOSS)		(42,308)		(84,616)
ATTRIBUTABLE TO NON-CONTROLLING INTERESTS		8,461		16,923
ATTRIBUTABLE TO COMMON SHAREHOLDERS		$ (33,847)		$ (67,693)
Basic Loss per Common Share		$ 0.00		$ 0.00
Diluted Loss per Common Share		$ 0		$ 0.00

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14. ADJUSTMENT OF PRIOR PERIODS (Details 2) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
STATEMENT of CASH FLOWS
Net Income (Loss)	$ (299,041)	$ (642,644)	$ 2,136,018	$ 47,990
Accrued Liabilities			413,205	150,636
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES			$ 1,814,964	(520,688)
Previously Reported
STATEMENT of CASH FLOWS
Net Income (Loss)				132,606
Accrued Liabilities				66,020
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES				(520,688)
Adjustment
STATEMENT of CASH FLOWS
Net Income (Loss)				(84,616)
Accrued Liabilities				84,616
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES				$ 0