1. Restatement (Tables)

3 Months Ended

Mar. 31, 2013

Restatement Tables

Restatement of financials

The following is a summary of the impact of these restatements on the Company’s Consolidated Statements of Operations as of March 31, 2012:

	Three Months Ended March 31, 2012							Inception (January 26, 2012) to March 31, 2012
	As previously reported			Error correction				As restated
Revenue	$	12,532		$	8,354		(a)(b)	$	20,886
Gross profit		12,532			8,354				20,886
Operating expenses
General and administrative		398,835			73,553		(a)(b)		472,388
Depreciation		–			15,146		(a)(b)		15,146
Payroll		–			(27,091	)	(a)(b)		(27,091	)
Legal and accounting		1,633			26		(a)(b)		1,659
Mining costs		12,775			14,646		(a)(b)		27,421
Research and development		3,445			(3,069	)	(a)(b)		376
Total expenses		416,688			73,211				489,899
Ordinary loss from continued operations		(404,156	)		(64,857	)			(469,013	)
Loss from discontinued operations		18,903			(18,903	)	(a)(b)		–
Net loss	$	(385,253	)	$	(83,760	)		$	(469,013	)
Net loss attributable to minority interest				$	(180,861	)	(c)	$	(180,861	)
Net loss attributable to Lustros, Inc.				$	(288,152	)	(c)	$	(288,152	)
Loss per share, basic	$	(0.02	)					$	(0.02	)
Weighted average common share, basic		18,021,261							23,765,517

(a) Record 100% of expenses for subsidiary rather than 60% controlling interest.
(b) Adjust expenses from 1/1/2012 to 1/26/2012, the inception date of Bluestone.
(c) Reclassify 40% minority interest in subsidiary.

The following is a summary of the impact of these restatements on the Company’s Statement of Cash Flows as of March 31, 2012:

	Sulfatos Inception (September 15, 2010) to March 31, 2012							Bluestone Inception (January 26, 2012) to March 31, 2012
	As previously reported			Error correction				As restated
Cash flows from operating activities
Net loss	$	(964,128	)	$	495,115		(b)(c)	$	(469,013	)
Non-cash transactions to reconcile cash used in operations
Loss from discontinued operations		(18,903	)		18,903		(b)(c)		–
Depreciation and amortization		–			15,146		(e)		15,146
Cash used in operations
Increase in notes receivable		(52,004	)		(34,669	)	(a)		(86,673	)
Decrease/(increase) in prepaid expenses		(663,990	)		321,783		(a)		(342,207	)
Increase/(decrease) in accounts payable		327,236			(610,546	)	(a)		(283,310	)
Total cash used in operations		(1,371,789	)		205,732				(1,166,057	)
Cash flows from investing activities
Acquisition of Sulfatos Chile by Bluestone		–			892,294		(a)		892,294
Cash received in Power Save merger		–			38,572		(a)		38,572
Disposal of Power Save operations		–			(20,642	)	(a)		(20,642	)
Purchase of fixed assets		(4,432,817	)		4,361,298		(a)(e)		(71,519	)
Total cash used in investing activities		(4,432,817	)		5,271,522				838,705
Cash from financing activities
Proceeds from notes payable, related parties		–			1,670,988		(f)		1,670,988
Repayment of notes payable, related parties		–			(1,670,988	)	(f)		(1,670,988	)
Proceeds from the issuance of stock		6,158,558			(6,158,558	)	(a)		–
Total cash provided by financing activities		6,158,558			(6,158,558	)			–
Effect of foreign currency exchange rate on cash		(50,548	)		883,573		(c)		833,025
INCREASE/(DECREASE) IN CASH		303,404			202,269	)	(a)		505,673
BEGINNING CASH		–			–				–
ENDING CASH	$	303,404		$	202,269			$	505,673

(a) Record 100% of assets and liabilities for subsidiary rather than 60% controlling interest.

(b) Record 100% of expenses for subsidiary rather than 60% controlling interest.

(c) Adjust expenses from 1/1/2012 to 1/26/2012, the inception date of Bluestone.

(d) Reclassify 40% minority interest in subsidiary.

(e) Reclassify note payable previously included in accounts payable.