Basis Of Presentation

12 Months Ended

Dec. 31, 2011

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of Operations [Text Block]

BASIS OF PRESENTATION AND LIQUIDITY RISK

Golden Star Resources Ltd (“Golden Star” or “Company”) is a Canadian federally-incorporated, international gold mining and exploration company headquartered in the United States (“U.S.”). Prior to 2011, Golden Star reported to security regulators in Canada, Ghana and the U.S. using financial statements prepared in accordance with Canadian generally accepted accounting principles ("Canadian GAAP") with a footnote reconciliation showing financial results prepared in accordance with United States generally accepted accounting principles ("U.S. GAAP"). However, a change in SEC position in late 2009 required Canadian companies such as Golden Star, which do not qualify as foreign private issuers, to file their financial statements in the U.S. using U.S. GAAP after December 31, 2010. We therefore adopted U.S. GAAP as of January 1, 2011 for all of our subsequent U.S., Ghanaian and Canadian filings. All comparative financial information presented in these consolidated financial statements is reported in accordance with U.S. GAAP.

These consolidated financial statements include the accounts of the Company and its subsidiaries, whether owned directly or indirectly. All inter-company balances and transactions have been eliminated. Subsidiaries are defined as entities in which the company holds a controlling interest, is the general partner or where it is subject to the majority of expected losses or gains.

Our consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and discharge of all liabilities in the normal course of business. With the exception of a few exploration offices, the functional currency, including the Ghanaian operations, is the U.S. dollar.

As of December 31, 2011, the company had a negative working capital position of $33.2 million, which includes cash of $103.6 million and a current liability for our convertible debenture of $125.0 million (measured at fair value of $121.2 million at December 31, 2011). Our convertible debentures, due on November 30, 2012, became a current liability in the fourth quarter of 2011, which caused our current liabilities to exceed current assets. The options available to settle this liability include: 1.) cash; 2.) re-financing of the debt; 3.) payment in common shares; or 4.) a combination of shares and cash.

While it is our current intent to redeem the debentures with cash in November 2012, or depending upon market conditions, refinance the debentures using long term debt, the debentures contain a provision for settlement in common shares. On maturity, we may, at our option, satisfy the repayment obligation by paying the full $125.0 million principal amount of the Debentures in cash or, alternatively by issuing up to 46.7 million common shares to the debenture holders. If we opt to settle in shares, we must redeem all, and not less than all, of the debentures by issuing up to 46.7 million shares. The value assigned to the shares issued will be determined as 95% of the weighted average trading price of our common shares on the NYSE Amex stock exchange for the 20 consecutive trading days ending five trading days preceding the maturity date. If the value assigned to the shares multiplied by 46.7 million shares is insufficient to cover the entire $125.0 million liability, we would be required to pay cash, in addition to the shares issued, in an amount that when added to the value of the shares will equal $125.0 million. If required, the share issuance option would not impact our cash position to the extent shares are used to retire the debt.