Accounting Changes and Error Corrections

9 Months Ended

Nov. 30, 2013

Accounting Changes and Error Corrections:

New Accounting Pronouncements and Changes in Accounting Principles

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations

Schedule of Error Corrections and Prior Period Adjustments

Company management subsequently discovered certain errors in our condensed consolidated financial statements included in our Form 10-Q as previously filed for the quarter ended November 30, 2013. The restatement primarily comprises adjustments for the correct accounts payables, notes payables, third party settlement, and the recording of a derivative liability on a convertible note payable.

FOCUS GOLD CORPORATION
(An Exploration Stage Company)
Condensed Consolidated Balance Sheets
ASSETS
	November 30, 2013	Adjustments		Restated
	(Unaudited)			(Unaudited)
Current Assets
Cash and cash equivalents	$            5,025			$            5,025
Total Current Assets	5,025			5,025
Long term note receivable	-			-
Mineral royalty interest	1,892,000			1,892,000
Total Assets	$     1,897,025			$     1,897,025
LIABILITIES & STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable and accrued expenses	$        471,289	70	(a)	$        471,359
Accounts payable and accrued expenses - related	50,000	(40,000)	(b)	10,000
Notes payable, net of discounts	1,117,935	(95,735)	(c)	1,022,200
Derivative liabilities	641,036	1,190,363	(d)	1,831,399
Total Current Liabilities	2,280,260			3,334,958
Stockholders' Deficit
Preferred stock, $0.00001 par value, authorized shares    100,000,000 shares
Series A, 1,000,000 authorized and outstanding    as of August 31, 2013 and 3,000,000 shares issued  and outstanding at February 28, 2013	-			-
Series B, 7,000,000 authorized, 0 issued and outstanding  as of November 30, 2013 and at February 28, 2013	-			-
Common stock, $0.00001 par value, authorized    500,000,000 shares, 375,235,752 shares issued and     outstanding as of  November 30, 2013 and 8,734,877      shares issued and outstanding as of February 28, 2013	37,524			37,524
Additional paid-in capital	18,688,348	848,092	(e)	19,536,440
Accumulated deficit prior to exploration stage	(414,284)			(414,284)
Accumulated deficit during exploration stage	(18,498,998)	(1,902,790)	(f)	(20,401,788)
Treasury stock	(195,825)			(195,825)
Total Stockholders' Deficit	( 383,235)			( 1,437,933)
Total Liabilities and Stockholders' Deficit	$     1,897,025			$     1,897,025

FOCUS GOLD CORPORATION
(An Exploration Stage Company)
Condensed Consolidated Statements of Operations
(Unaudited)
	For the Three Months Ended
	November 30, 2013	Adjustments		Restated
Revenues	$                      -			$                   -
Operating Expenses
Exploration expense	-	10,000	(g)	10,000
Mineral property impairment	-			-
General & administrative expenses	319,372	253,548	(h)	572,920
Total Operating Expenses	319,372			582,920
Other Income (Expenses)
Interest income	-			-
Amortization of debt discount	( 46,230)	( 67,270)	(i)	( 113,500)
Interest and financial fees	( 102,852)	( 235,670)	(j)	( 338,522)
Change in derivative liabilities	945,239	( 847,193)	(k)	98,046
Gain on extinguishment of debt	-			-
Note receivable impairment	-			-
Loss on settlement	-	( 128,918)	(l)	( 128,918)
Total Other Income (Expenses)	796,158			(482,894)
Net Income (Loss) from Continuing Operations	$           476,786			$   (1,065,815)
Loss from operations of the discontinued entities	-			-
Loss on disposal of the discontinued entities	-			-
Loss from discontinued operations attributable to non-controlling interest	-			-
Loss from Discontinuing Operations attributable to Focus Gold	-			-
Net Income (Loss)	476,786			(1,065,815)
Preferred Share Dividends	-			-
Net Income (Loss) Attributable to Focus Gold Common Stockholders	$           476,786			$   (1,065,815)

FOCUS GOLD CORPORATION
(An Exploration Stage Company)
Condensed Consolidated Statements of Operations
(Unaudited)
	For the Nine Months Ended
	November 30, 2013	Adjustments		Restated
Revenues	$                      -			$                      -
Operating Expenses
Exploration expense	51,638	10,000	(g)	61,638
Mineral property impairment	-			-
General & administrative expenses	663,047	253,548	(h)	916,595
Total Operating Expenses	714,685			978,233
Other Income (Expenses)
Interest income	-			-
Amortization of debt discount	( 291,122)	( 67,270)	(i)	(358,392)
Interest and financial fees	( 421,804)	( 235,670)	(j)	(657,474)
Change in derivative liabilities	1,389,119	( 847,193)	(k)	541,926
Gain on extinguishment of debt	-			-
Note receivable impairment	-			-
Loss on settlement	-	( 128,918)	(l)	( 128,918)
Total Other Income (Expenses)	676,194			(602,857)
Net Income (Loss) from Continuing Operations	$           (38,491)			$     (1,581,090)
Loss from operations of the discontinued entities	-			-
Loss on disposal of the discontinued entities	-			-
Loss from discontinued operations attributable to non-controlling interest	-			-
Loss from Discontinuing Operations attributable to Focus Gold	-			-
Net Income (Loss)	(38,491)			(1,581,090)
Preferred Share Dividends	5,551			5,551
Net Income (Loss) Attributable to Focus Gold Common Stockholders	$           (44,042)			$     (1,586,641)

FOCUS GOLD CORPORATION
(An Exploration Stage Company)
Condensed Consolidated Statements of Operations
(Unaudited)
	For the period October 1, 2010 (Entry into Exploration Stage)to November 30, 2013			Restated
Revenues	$                        -			$                        -
Operating Expenses
Exploration expense	377,657	( 9,974)	(g)	367,683
Mineral property impairment	50,000			50,000
General & administrative expenses	5,007,182	( 831,265)	(h)	4,175,917
Total Operating Expenses	5,434,839			4,593,600
Other Income (Expenses)
Interest income	107,445			107,445
Amortization of debt discount	( 1,055,977)	( 15,636)	(i)	( 1,071,613)
Interest and financial fees	( 2,630,550)	( 235,670)	(j)	( 2,866,221)
Change in derivative liabilities	1,993,081	( 847,195)	(k)	1,145,887
Gain on extinguishment of debt	207,927			207,927
Note receivable impairment	( 545,849)			( 545,849)
Loss on settlement	( 111,736)	( 128,918)	(l)	( 240,654)
Total Other Income (Expenses)	(2,035,659)			(3,263,078)
Net Income (Loss) from Continuing Operations	$       (7,470,497)			$        (7,856,678)
Loss from operations of the discontinued entities	( 6,951,187)	1,685,460	(m)	( 5,265,727)
Loss on disposal of the discontinued entities	( 4,558,050)	( 2,841,880)	(n)	( 7,399,930)
Loss from discontinued operations attributable to non-controlling interest	127,023	-		127,023
Loss from Discontinuing Operations attributable to Focus Gold	( 11,382,214)			( 12,538,634)
Net Income (Loss)	(18,852,711)			(20,395,312)
Preferred Share Dividends	6,476			6,476
Net Income (Loss) Attributable to Focus Gold Common Stockholders	$     (18,859,187)			$      (20,401,788)

FOCUS GOLD CORPORATION
(An Exploration Stage Company)
Condensed Consolidated  Statements of Cash Flows
(Unaudited)
	For the Nine Month Period Ended
	November 30, 2013	Adjustments		Restated
Cash Flows from Operating Activities
Net Loss	$        (38,491)	(1,542,599)		$     (1,581,090)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	-			-
Amortization of debt discount	291,122	67,270	(i)	358,392
Non-cash interest and financial fees	421,804	235,670	(j)	657,474
Change in derivative liabilities	(1,389,119)	847,193	(k)	(541,926)
Loss on settlement	-	118,918	(h)	118,918
Common stock issued for services	2,262	400,010	(h)	402,272
Change in operating assets and liabilities:
Increase in accounts payable and accrued expenses	3,953	86,738	(a)	90,691
(Decrease)/Increase in accounts payable and accrued expenses - related	21,907	53,548	(b)	75,455
Discontinued operations	-			-
Net Cash Used in Operating Activities	(686,564)			(419,814)
Cash Flows From Investing Activities
Redemption of preference stock	( 40,000)	40,000	(b)	-
Net Cash Used in Investing Activities	( 40,000)			-
Cash Flows From Financing Activities
Proceeds from the sale of common stock	100,000			100,000
Proceeds from notes payable	130,000			130,000
Proceeds from note receivable	193,602			193,602
Discontinued operations	306,750	(306,750)	(o)	-
Net Cash Provided by Financing Activities	730,352			423,602
Net Increase in Cash	$           3,788			$             3,788
Foreign currency translation adjustment	-			-
Cash and Cash Equivalents at Beginning of Period	$           1,237			$             1,237
Cash and Cash Equivalents at End of Period	$           5,025			$             5,025

FOCUS GOLD CORPORATION
(An Exploration Stage Company)
Condensed Consolidated  Statements of Cash Flows
(Unaudited)
	For the period October 1, 2010 (Entry into Exploration Stage) to November 30,2013			Restated
Cash Flows from Operating Activities
Net Loss	$                 (18,852,711)	(1,542,601)		$     (20,395,312)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	4,830			4,830
Amortization of debt discount	1,055,976	67,270	(i)	1,123,246
Non-cash interest and financial fees	2,480,465	235,670	(j)	2,716,135
Change in derivative liabilities	( 1,993,080)	847,193	(k)	( 1,145,887)
Gain on settlement of debt	( 207,927)			( 207,927)
Loss on settlement	111,736	118,918	(h)	230,654
Stock based compensation	1,842,200			1,842,200
Mineral property impairment	50,000			50,000
Note receivable impairment	545,849			545,849
Interest income	( 80,097)			( 80,097)
Common stock issued for services	490,871	200,010	(h)	890,881
Change in operating assets and liabilities:
Decrease in taxes and other amounts receivable	114,614			114,614
Decrease/(Increase) in prepaid expenses	( 6,087)			( 6,087)
Increase in accounts payable and accrued expenses	612,482	86,738	(a)	699,220
(Decrease)/Increase in accounts payable and accrued expenses - related	160,272	53,548	(b)	213,820
Discontinued operations	9,475,451			9,475,451
Net Cash Used in Operating Activities	(4,195,158)			(3,928,409)
Cash Flows From Investing Activities
Pre-acquisition loans to former subsidiary	( 1,065,347)			(1,065,347)
Post-acquisition loan to former subsidiary	( 1,089,525)			(1,089,525)
Purchase of equipment	( 4,826)			(4,826)
Redemption of preference stock	( 40,000)	40,000	(b)	-
Discontinued operations	1,194,064			1,194,064
Net Cash Used in Investing Activities	( 1,005,634)			(965,634)
Cash Flows From Financing Activities
Proceeds from the sale of preference stock	30,000			30,000
Proceeds from the sale of common stock	3,012,455			3,012,455
Proceeds from notes payable	1,304,000			1,304,000
Proceeds from note receivable	193,602			193,602
Discontinued operations	660,464	(306,750)	(o)	353,714
Net Cash Provided by Financing Activities	5,200,520			4,893,771
Net Increase in Cash	$                             (272)			$                 (272)
Foreign currency translation adjustment	5,291			5,291
Cash and Cash Equivalents at Beginning of Period	$                                   6			$                       6
Cash and Cash Equivalents at End of Period	$                            5,025			$                5,025

(a) Adjusted and correct payables to correct amount per financial reports.

(b) Adjusted related payables ($40,000) for payments made to related parties.

(c) Adjusted notes payable ($95,735) for additional discounts based on updated calculations and agreements.

(d) Adjusted derivative liabilities $1,190,363 based on updated calculations.

(e) Adjusted paid in capital $848,092 for related party settlement and updated derivative calculations and note conversions.

(f) Accumulated deficit during exploration stage adjusted $1,902,790 based on adjustments to Statement of Operations

(g) Adjusted exploration expenses $10,000 for stock-based compensation.

(h) Adjusted general & administrative expenses $253,548 for payroll expenses for related party settlement.

(i) Adjusted amortization of debt discount ($67,270) based on updated calculations.

(j) Adjusted interest and financial fees ($235,670) for derivative adjustments based on updated calculations.

(k) Adjusted change in derivative liabilities ($847,193) for derivative adjustments based on updated calculations.

(l) Adjusted loss on settlement ($128,918) based on payments and settlement to related parties.

(m) Adjusted loss from operations of the discontinued entities $1,685,460 based on operations being discontinued effecting prior year calculations.

(n) Adjusted loss from disposal of the discontinued entities ($2,841,880) based on operations being discontinued effecting prior year calculations.

(o) Adjusted discontinued operations ($306,750) based on operations being discontinued effecting prior year calculations.