NOTE

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

These consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) and are presented in United States dollars. All inter-company transactions and balances have been eliminated upon consolidation.

Effective

August 1, 2018,

we adopted ASU

2016

18,

“Restricted Cash”, which requires the statement of cash flows present the change in restricted cash and restricted cash equivalents during the period. As a result, restricted cash presented as a separate line item in statement of cash flows in prior periods are included in cash, cash equivalent and restricted cash in the statement of cash flows to conform to the current year’s presentation.

Exploration Stage

We have established the existence of mineralized materials for certain uranium projects, including the Palangana Mine. We have

not

established proven or probable reserves, as defined by the United States Securities and Exchange Commission (the “SEC”) under Industry Guide

through the completion of a “final” or “bankable” feasibility study for any of our uranium projects, including the Palangana Mine. Furthermore, we have

plans to establish proven or probable reserves for any of our uranium projects for which we plan on utilizing in-situ recovery (“ISR”) mining, such as the Palangana Mine. As a result, and despite the fact that we commenced extraction of mineralized materials at the Palangana Mine in

November 2010,

we remain in the Exploration Stage as defined under Industry Guide

and will continue to remain in the Exploration Stage until such time proven or probable reserves have been established.

Since we commenced extraction of mineralized materials at the Palangana Mine without having established proven or probable reserves, any mineralized materials established or extracted from the Palangana Mine should

not

in any way be associated with having established or produced from proven or probable reserves.

In accordance with U.S. GAAP, expenditures relating to the acquisition of mineral rights are initially capitalized as incurred while exploration and pre-extraction expenditures are expensed as incurred until such time we exit the Exploration Stage by establishing proven or probable reserves. Expenditures relating to exploration activities, such as drill programs to establish mineralized materials, are expensed as incurred. Expenditures relating to pre-extraction activities such as the construction of mine wellfields, ion exchange facilities and disposal wells, are expensed as incurred until such time proven or probable reserves are established for that project, after which expenditures relating to mine development activities for that particular project are capitalized as incurred.

Companies in the Production Stage as defined under Industry Guide

having established proven and probable reserves and exited the Exploration Stage, typically capitalize expenditures relating to ongoing development activities, with corresponding depletion calculated over proven and probable reserves using the units-of-production method and allocated to future reporting periods to inventory and, as that inventory is sold, to cost of goods sold. We are in the Exploration Stage which has resulted in our Company reporting larger losses than if it had been in the Production Stage due to the expensing, instead of capitalization, of expenditures relating to ongoing mill and mine development activities. Additionally, there would be

corresponding depletion allocated to future reporting periods of our Company since those costs would have been expensed previously, resulting in both lower inventory costs and cost of goods sold and results of operations with higher gross profits and lower losses than if we had been in the Production Stage. Any capitalized costs, such as expenditures relating to the acquisition of mineral rights, are depleted over the estimated extraction life using the straight-line method. As a result, our consolidated financial statements

may

not

be directly comparable to the financial statements of companies in the Production Stage.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities as of the balance sheet date and the corresponding revenues and expenses for the periods reported. By their nature, these estimates and assumptions are subject to measurement uncertainty and the effect on the financial statements of changes in such estimates and assumptions in future periods could be significant. Significant areas requiring management’s estimates and assumptions include determining the fair value of transactions involving shares of common stock, valuation and impairment losses on mineral rights and properties, valuation of stock-based compensation, valuation of equity-accounted investment, and valuation of long-term debt and asset retirement obligations. Other areas requiring estimates include allocations of expenditures to inventories, depletion and amortization of mineral rights and properties and depreciation of property, plant and equipment. Actual results could differ significantly from those estimates and assumptions.

Foreign Currency Translation

The functional currency of our Company, including its subsidiaries, is the United States dollar. UEC Resources Ltd., UEC Resources (SK) Ltd. and Cue Resources Ltd. maintain their accounting records in their local currency, the Canadian dollar. Piedra Rica Mining S.A., Transandes Paraguay S.A., MYNM, Trier S.A. and other Paraguayan subsidiaries maintain their accounting records in their local currency, the Paraguayan Guarani. In accordance with ASC

830:

Foreign Currency Matters, the financial statements of our subsidiaries are translated into United States dollars using period-end exchange rates as to monetary assets and liabilities and average exchange rates as to revenues and expenses. Non-monetary assets are translated at their historical exchange rates. Net gains and losses resulting from foreign exchange translations and foreign currency exchange gains and losses on transactions occurring in a currency other than our Company’s functional currency are included in the determination of net loss in the period.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash balances and term deposits with an original maturity of

three

months or less.

Term Deposits

Term deposits include short-term deposits held with banks with maturities from

three

months to

one

year from the date of the initial investments. We classify our term deposits as available-for-sale investments because they represent investments of cash available for current operations. Our available-for-sale investments are carried at fair value which approximate their costs and, as a result,

unrealized gains and losses, have been recorded in other comprehensive income (loss) for the year.

Equity-Accounted Investments

Investments in an entity in which our ownership is greater than

20%

but less than

50%,

or other facts and circumstances indicate that we have the ability to exercise significant influence over the operating and financing policies of an entity, are accounted for using the equity method in accordance with ASC

323:

Investments – Equity Method and Joint Ventures. Equity-Accounted Investments are recorded initially at cost and adjusted subsequently to recognize our share of the earnings, losses or other changes in capital of the investee entity after the date of acquisition. We periodically evaluate whether declines in fair values of its equity investments below the carrying value are other-than-temporary and if so, whether an impairment loss is required.

Other Long-Term Assets

Other long-term assets include future expenditures that we have paid in advance but will

not

receive benefits within

one

year. Expenses are recognized over the period the expenditures are used or the benefits from the expenditures are received. Transaction costs incurred in connection with acquisitions of long-term assets are also included in other long-term assets, which will be capitalized as acquisition costs if the transaction succeeds or will be written off if the transaction does

not

complete.

Mineral Rights

Acquisition costs of mineral rights are initially capitalized as incurred while exploration and pre-extraction expenditures are expensed as incurred until such time proven or probable reserves, as defined by the SEC under Industry Guide

are established for that project. Expenditures relating to exploration activities are expensed as incurred and expenditures relating to pre-extraction activities are expensed as incurred until such time proven or probable reserves are established for that project, after which subsequent expenditures relating to development activities for that particular project are capitalized as incurred.

Where proven and probable reserves have been established, in accordance with Industry Guide

the project’s capitalized expenditures are depleted over proven and probable reserves using the units-of-production method upon commencement of production. Where proven and probable reserves have

not

been established, the project’s capitalized expenditures are depleted over the estimated extraction life using the straight-line method upon commencement of extraction. We have

not

established proven or probable reserves for any of our projects.

The carrying values of the mineral rights are assessed for impairment by management on a quarterly basis and as required whenever indicators of impairment exist. An impairment loss is recognized if it is determined that the carrying value is

not

recoverable and exceeds fair value.

Databases

Expenditures relating to mineral property databases are capitalized upon acquisition while those developed internally are expensed as incurred. Mineral property databases are tested for impairment whenever events or changes indicate that the carrying values

may

not

be recoverable. An impairment loss is recognized if it is determined that the carrying value is

not

recoverable and exceeds fair value. Mineral property databases are amortized using the straight-line method over a

five

-year period during which management believes these assets will contribute to our cash flows. Databases are included in Mineral Rights and Properties on the balance sheet.

Land Use Agreements

Expenditures relating to mineral property land use agreements are capitalized upon acquisition. Mineral property land use agreements are tested for impairment whenever events or changes indicate that the carrying values

may

not

be recoverable. An impairment loss is recognized if it is determined that the carrying value is

not

recoverable and exceeds fair value. Mineral property land use agreements are amortized using the straight-line method over a

ten

-year period during which management believes these assets will contribute to our cash flows. Land use agreements are included in Mineral Rights and Properties on the balance sheet.

Property, Plant and Equipment

Property, plant and equipment are recorded at cost and depreciated to their estimated residual values using the straight-line method over their estimated useful lives, as follows:

●

Hobson processing facility:

years;

●

Mining and logging equipment and vehicles:

years;

●

Computer equipment:

years;

●

Furniture and fixtures:

years; and

●

Building:

years

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset

may

not

be recoverable. Circumstances which could trigger a review include, but are

not

limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than

not

be sold or disposed of significantly before the end of its estimated useful life. Recoverability of these assets is measured by comparison of the carrying amounts to the future undiscounted cash flows expected to be generated by the assets. An impairment loss is recognized when the carrying amount is

not

recoverable and exceeds fair value.

Income Taxes

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income for the years in which those differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment. We recognize deferred taxes on unrealized gains directly within other comprehensive income, and concurrently release part of the valuation allowance resulting in

impact within other comprehensive income or on the balance sheet. Our policy is to accrue any interest and penalties related to unrecognized tax benefits in its provision for income taxes. Additionally, ASC

740:

Income Taxes, requires that we recognize in its financial statements the impact of a tax position that is more likely than

not

to be sustained upon examination based on the technical merits of the position.

Restoration and Remediation Costs (Asset Retirement Obligations)

Various federal and state mining laws and regulations require our Company to reclaim the surface areas and restore underground water quality for its mine projects to the pre-existing mine area average quality after the completion of mining.

Future reclamation and remediation costs, which include extraction equipment removal and environmental remediation, are accrued at the end of each period based on management’s best estimate of the costs expected to be incurred for each project. Such estimates consider the costs of future surface and groundwater activities, current regulations, actual expenses incurred, and technology and industry standards.

In accordance with ASC

410:

Asset Retirement and Environmental Obligations, we capitalize the measured fair value of asset retirement obligations to underlying assets, that being primarily mineral rights and properties. The asset retirement obligations are accreted to an undiscounted value until the time at which they are expected to be settled. The accretion expense is charged to earnings and the actual retirement costs are recorded against the asset retirement obligations when incurred. Any difference between the recorded asset retirement obligations and the actual retirement costs incurred will be recorded as a gain or loss in the period of settlement.

On a quarterly basis we review changes in assumptions for asset retirement obligation estimates, including changes in estimated probabilities, amounts and timing of cash flows for settlement of the asset retirement obligations, as well as changes in any regulatory or legal obligations for each of its mineral projects. Changes in any

one

or more of these assumptions

may

cause revision of asset retirement obligations and the associated underlying assets. Revisions to the asset retirement obligations associated with fully depleted assets (with a carrying value of

$Nil

) are charged to the statement of operations.

Stock-Based

Compensation

We measure stock-based compensation awards at fair value on the date of the grant and expense the awards in the Consolidated Statements of Operations and Comprehensive Loss over the requisite service period of employees or consultants. The fair value of stock options is determined using the Black-Scholes valuation model. The fair value of restricted stock units (“RSUs”) are based on the share price of the Company at the date of grant. The fair value of performance based restricted stock units (“PRSUs”) is determined using the Monte Carlo simulation model. Stock-based compensation expense related to stock option awards is recognized over the requisite service period on an accelerating basis. Forfeitures are accounted for as they occur.

The Company’s estimates

may

be impacted by certain variables including, but

not

limited to, stock price volatility, employee stock option exercise behaviors, additional stock option grants, the Company's performance and related tax impacts.

Earnings (Loss)

er Common Share

Basic earnings or loss per share includes

potential dilution and is computed by dividing the earnings or loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings or loss per share reflect the potential dilution of securities that could share in the earnings or loss of our Company. Since our Company has reported net losses since inception, all outstanding stock options, share purchase warrants, RSUs and PSUs were excluded from the computation of diluted loss per share as their effects would be anti-dilutive.

Recent

Adopted

Accounting

Standards

May 2014,

the Financial Accounting Standards Board (“FASB”) issued ASU

No.

2014

09,

as amended by ASU

No.

2016

12,

“Revenue from Contracts with Customers” (“Topic

606”

), which requires revenue to be recognized based on the amount an entity is expected to be entitled to for promised goods or services provided to customers. The standard also requires expanded disclosures regarding contracts with customers. The guidance in this standard supersedes the revenue recognition requirements in Topic

605,

“Revenue Recognition”, and most industry-specific guidance. Adoption of the standard

may

be applied retrospectively to each prior period presented (the full retrospective method) or retrospectively with the cumulative effect recognized as of the date of initial application (the modified retrospective method). The standard is effective for fiscal periods beginning after

December 15, 2017

and early adoption is

not

permitted. Accordingly, we have adopted this standard effective

August 1, 2018

and have elected to apply the modified retrospective method.

We had

uncompleted sales agreements as at

August 1, 2018,

and had

sales revenue generated during Fiscal

2019,

and, therefore, the adoption of this new standard had

impact on the beginning accumulated deficit at adoption and

impact on the consolidated financial statements for Fiscal

2019.

January 2016,

the FASB issued ASU

No.

2016

01,

“Recognition and Measurement of Financial Assets and Financial Liabilities” (“Topic

825”

), which requires entities to measure equity investments that do

not

result in consolidation and are

not

accounted for under the equity method at fair value and recognize any changes in fair value in net income. This new guidance also updates certain disclosure requirements for these investments. The guidance is effective for fiscal years beginning after

December 15, 2017,

and interim periods within those years. Upon adoption, the cumulative effect adjustment should be recorded at the beginning of the fiscal year in which the guidance is adopted. We adopted this standard effective

August 1, 2018.

Upon adoption, we reclassified

$103,641

unrealized gains and losses, net of taxes, related to investments in marketable securities by our Company or through our equity-accounted investee, from accumulated other comprehensive income to accumulated deficit in our consolidated balance sheets.

November 2016,

the FASB issued ASU

2016

18,

“Restricted Cash”, which requires the statement of cash flows present the change in restricted cash and restricted cash equivalents during the period. The guidance is effective for fiscal years beginning after

December 15, 2017,

and interim periods within those years. We retrospectively adopted this standard effective

August 1, 2018.

Upon adoption, we included a reconciliation of cash and cash equivalents and restricted cash (previously “reclamation deposits”) reported within our consolidated balance sheets to the total shown in the consolidated statements of cash flows. Adoption of this guidance has had

other impact on our consolidated financial statements or disclosures.

June 2018,

the FASB issued ASU

No.

2018

07,

“Improvement to Nonemployee Share-Based Payment Accounting”, with amendments to expand the scope of ASC Topic

718,

“Compensation – Stock Compensation” (“Topic

718”

), to include share-based payment transactions for acquiring goods and services from nonemployees, which were previously covered under ASC

505,

“Equity-Based Payments to Non-Employees”. According to ASU

No.

2018

07,

nonemployee share-based payment awards within the scope of Topic

718

are measured at grant-date fair value of the equity instruments that an entity is obligated to issue when the good has been delivered or the service has been rendered and any other conditions necessary to earn the right to benefit from the instruments have been satisfied. The amendments in ASU

No.

2018

are effective for public business entities for fiscal years beginning after

December 15, 2018,

including interim periods within that fiscal year. Early adoption is permitted, but

earlier than an entity’s adoption date of Topic

606.

We have early adopted this standard effective

August 1, 2018,

along with the adoption of Topic

606,

and early adoption of this standard has

not

had a significant impact on our consolidated financial statements.

Accounting Policies

Not

Yet Adopted

February 2016,

the FASB issued ASU

2016

02,

“Leases”, which, together with subsequent amendments, is included in ASC

842,

Leases. The new standard requires a lessee to recognize the assets and the liabilities that arise from leases, including operating leases. Under the new requirements, a lessee will recognize in the balance sheet a liability to make lease payments (the lease liability) and the right-of-use (“ROU”) asset representing the right to the underlying asset for the lease term. The standard is effective for fiscal years beginning after

December 15, 2018,

including interim periods within such fiscal year, with early adoption permitted.

We will adopt the standard effective

August 1, 2019

using the modified retrospective approach with a cumulative-effect adjustment recorded at the beginning of the period of adoption on

August 1, 2019.

Therefore, upon adoption, the Company will recognize and measure leases without revising comparative period information or disclosure.

We will elect the package of practical expedients permitted under the transition guidance within the new standard on adoption, including the following:

●

we will elect the short-term lease recognition exemption whereby ROU assets and lease liabilities will

not

be recognized for leasing arrangements with terms less than

one

year;

●

we will elect the land easements practical expedient whereby existing land easements are

not

reassessed under the new standard; and

●

we will

not

separate non-lease components from lease components.

We continue to finalize our adoption procedures and assess the potential impact of the adoption of this new standard to our consolidated financial statements.