UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

_______________

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2010

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to __________.

 

YINFU GOLD CORP..

(Exact name of registrant as specified in Charter)

 

              WYOMING                                    333-152242                               20-8531222

  (State  or other jurisdiction of                (Commission  File No.                  (IRS  Employee  

 incorporation  or organization)                                                                Identification No.)

 

Level 19,
Two International Finance Centre,
8 Finance St., Central, Hong Kong

(Address of Principal Executive Offices)

 

(852 2251 1695

 (Issuer Telephone number)

 

 

 (Former Name or Former Address if Changed Since Last Report)

 

Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the issuer 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 filer.  See definition of “accelerated filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act (Check one): Large Accelerated Filer        Accelerated Filer         Non-Accelerated Filer      Smaller Reporting Company X

 

Indicate by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act. Yes           No  X

 

State the number of shares outstanding of each of the issuer’s classes of common equity, as of September 30, 2010:  88,047,000 shares of Common Stock.

 

 

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YINFU GOLD CORP.

FORM 10-Q

September 30, 2010

INDEX

 

PART I-- FINANCIAL INFORMATION

 

Item  1.            Financial Statements

                                    Balance Sheet F-1

            Statement of Operations F-2

            Statement of Stockholders’ Equity F-3

            Statement of Cash Flows F-4

            Notes to the Financial Statements F-5

 

Item  2.            Management’s Discussion and Analysis of Financial Condition

Item  3 Quantitative  and Qualitative Disclosures About Market Risk

Item  4 Control  and Procedures

 

PART II-- OTHER INFORMATION

 

Item  1 Legal  Proceedings

Item  1 A Risk Factors

Item  2.            Unregistered  Sales of Equity Securities and Use of Proceeds

Item  3.            Defaults  Upon Senior Securities

Item  4.            Submission  of Matters to a Vote of Security Holders

Item  5.            Other  Information

Item  6.            Exhibits  and Reports on Form 8-K

 

SIGNATURES

 

 

 

 

 

Wilson Huang Dong-sheng

Chairman, Acting CEO and CFO

 

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YINFU GOLD CORP.

(An Exploration Stage Company)

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

Approved By The Board:

 

                        Wilson Huang Dong-sheng

                        Chairman, Acting Chief Executive Officer and Chief Financial Officer

 

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YINFU GOLD CORP.

(An Exploration Stage Company)

STATEMENTS OF OPERATIONS

FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2010 AND 2009 AND FOR THE PERIOD SEPTEMBER 1, 2005 (DATE OF INCEPTION) TO SEPTEMBER 30, 2010

(UNAUDITED)

 

 

 

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YINFU GOLD CORP.

(An Exploration Stage Company)

STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2010 AND 2009 AND FOR THE PERIOD SEPTEMBER 1, 2005 (DATE OF INCEPTION) TO SEPTEMBER 30, 2010

 (UNAUDITED)

 

 

 

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YINFU GOLD CORP.

(An Exploration Stage Company)

STATEMENTS OF STOCKHOLDERS’ EQUITY

FOR THE PERIOD SEPTEMBER 1, 2005 (DATE OF INCEPTION) TO SEPTEMBER 30, 2010

(UNAUDITED)

 

 

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1. NATURE OF OPERATIONS AND GOING CONCERN

 

The Company was incorporated on September 1, 2005 in the State of Wyoming under the name Ace Lock & Security, Inc. and on March 3, 2007 changed its name to Element92 Resources Corporation. On July 20, 2010, the Company changed the name to Yinfu Gold Corporation. The Company is an Exploration Stage Company, as defined by Statement of Financial Accounting Standard (“SFAS”) No.7 “Accounting and Reporting by Development Stage Enterprises”. The Company’s principal business plan is to acquire, explore and develop mineral properties and ultimately seek earnings by exploiting mineral claims.

 

The Company’s major activities are the acquisition and exploration of mineral interests and the production therefrom. The recoverability of amounts shown for mineral interests and their related deferred exploration expenditures is dependent upon the discovery of economically recoverable reserves. The Company does not generate sufficient cash flow from operations to adequately fund its exploration activities, and has therefore relied principally upon the issuance of securities for financing. The Company intends to continue relying upon the issuance of securities to finance its operations and exploration activities to the extent such instruments are issuable under terms acceptable to the Company.

 

The Company’s financial statements are presented on a going concern basis, which assumes that the Company will continue to realize its assets and discharge its liabilities in the normal course of operations.

 

As of September 30, 2010, the Company has a working capital deficit of $1,516,172 and has incurred losses totaling $866,769. If future financing is unavailable, the Company may not be able to meet its ongoing obligations, in which case the realizable values of its assets may decline materially from current estimates. The Company plans to improve its financial condition by obtaining new financing.

 

2. SIGNIFICANT ACCOUNTING POLICIES

 

a) Basis of Presentation

 

These financial statements and related notes are prepared in conformity with accounting principles generally accepted in the United States generally accepted accounting principles (“GAAP”) and are expressed in U.S. dollars. The Company’s fiscal year-end is March 31. The Company will only consolidate investments once control of the management of the investment concerned has been placed in the hands of the Company’s management.

 

b) Use of Estimates

 

The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period.

 

The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.

 

The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

 

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c) Cash and Cash Equivalents

 

The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.

 

d) Financial Instruments

 

The fair values of financial instruments, which include cash, accounts payable and due to related parties were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. The Company is not exposed to significant interest rate, currency exchange rate or credit risk arising from these financial instruments.

 

e) Mineral Property Costs

 

The Company is primarily engaged in the acquisition and exploration of mining properties. Mineral property exploration costs are expensed as incurred. Mineral property acquisition costs are initially capitalized when incurred using the guidance in EITF 04-02,  “Whether Mineral Rights Are Tangible or Intangible Assets” . The Company assesses the carrying costs for impairment under SFAS No. 144,  “Accounting for Impairment or Disposal of Long Lived Assets”  at each fiscal quarter end. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs then incurred to develop such property, are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.

 

f) Basic and Diluted Net Income (Loss) Per Share

 

The Company computes net income (loss) per share in accordance with SFAS No. 128, "Earnings per Share" which requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. Shares underlying these securities totaled 88,047,000 as at September 30, 2010 (9,248,000 as at March 31, 2010).

 

3. MINERAL INTERESTS

 

On March 30, 2007, the Company was granted an option to acquire a 100% interest in mineral claims located in the Huddersfield Township and Clapham Township, in the Province of Quebec, Canada.  Under the terms of the option agreement, the Company was to make cash payments of US$45,000 in various stages as follows: US$10,000 on execution of option agreement (paid), US$15,000 on or before April 30, 2008 (paid); and US$20,000 on or before November 30, 2009. The Company was also to issue 1,500,000 shares in various stages as follows: 500,000 common shares upon execution of option agreement (issued), 500,000 common shares on or before April 30, 2008 (issued); and 500,000 common shares on or before November 30, 2009. On December 15, 2009, following discussions between the Optionor and the Company and based on the progress of the Company, the Optionor has agreed to forgive both the outstanding cash payment of $20,000 and the issuance of the final 500,000 shares.  The Company was to incur exploration expenditures of not less than US$10,000 or US$1,250 per claim on eight of its claims, on or before November 30, 2008 (completed) not less than $7,500 on the remaining six claims on or before July 15, 2010.  Exploration expenditures incurred any date in excess of the minimum required to be incurred by such date to maintain the Claims interest, shall carry forward to the following period.  If any of the minimum exploration expenditures have not been incurred for the immediately preceding year, the Company may maintain its interest in the claims by paying the deficiency in cash to the Province of Quebec within two months of the close of the period in which the deficiency occurred, and such payment shall be deemed to be exploration expenditures incurred by the Company for the purposes of the option agreement.

 

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4. RELATED PARTY TRANSACTIONS

 

During the six months ended September 30, 2010, the following were paid or accrued to persons having a 10% or greater interest in the Company and to a company controlled a director and officer of the Company.

 

                                                                                                            $91,561                                $48,746

 

Mr. Geoffrey Armstrong was the director of the board of the Company as of September 30, 2009 and resigned on April 5, 2010. Mr. Armstrong continues as a consultant to the Company. His contract was bought out by the Company for the sum of $300,000 and he is being paid at the rate of $5,000 per month. This rate has continued since December 1, 2009 and all amounts owed are being accrued.

 

Mr. Mckinney is owed $71,385 for all expenses paid on behalf of the Company and was money advanced to the Company.

 

5. COMMON STOCK

 

The Company is currently authorized to issue 1,000,000,000 shares of common stock with a par value of $0.001 per share.  All shares have equal voting rights and have one vote per share.  Voting are rights are not cumulative and, therefore, the holders of more than 50% of the common stock, if they choose to do so, elect all of the directors of the Company.

 

During the year ended March 31, 2006, the Company issued 5,000 shares for cash proceeds of $500. The shares were subsequently split 1,000 for 1, thereby at March 31, 2006 the Company had 5,000,000 shares of common stock outstanding.

 

During the year ended March 31, 2007, the Company issued 500,000 shares for consulting services at a deemed price of $0.01 per share for total consideration of $5,000.  The Company issued 50,000 shares for accounting services at a deemed price of $0.10 per share, for total consideration of $5,000.  As well, the Company issued 500,000 shares at a deemed price of $0.10 per share for property acquisition.

 

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 During the year ended March 31, 2008, the Company raised $78,200 from the sale of shares at $0.10 per share, a total of 782,000 shares were issued.  The Company issued 200,000 shares at a deemed price of $0.10 per share for consulting fees.  The Company issued 20,000 shares at a deemed price of $0.10 per share for referral fee with regards to the Quebec property option.

 

During the year ended March 31, 2009, the Company issued 500,000 shares at a deemed price of $0.10 per share as per the property acquisition agreement dated March 31, 2007.  On September 30, 2008, the Company settled $20,000 of debt at a deemed price of $0.25 per share.  The 80,000 shares were issued to a director of the Company.  On December 31, 2008, the Company settled $3,000 of debt at a deemed price of $0.25 per share.  The 12,000 shares were issued to a director of the Company.   On March 31, 2009, the Company settled $3,000 of debt at a deemed price of $0.25 per share.  The 12,000 shares were issued to a director of the Company.

 

 During the year ended March 31, 2010, the Company issued 12,000 shares at a deemed price of $0.25 to settle $3,000 of debt (due to an administrative error, shares to be issued for settlement of debt were not issued.  The Company has rebooked the payable and decreased share capital).  On July 30, 2009, the Company issued 950,000 shares, at a deemed price of $0.10 per share, for services rendered by a corporation held by a director of the Company.  On September 15, 2009, the Company issued 200,000 shares, at a deemed price of $0.10 per share, for non-payment of advanced funds. On November 4, 2009, the Company issued 230,000 restricted shares to an employee and owner of more than 10% of the Company’s issued and outstanding shares for services.  On January 25, 2010, the Company issued 200,000 restricted shares at a deemed price of $1.03 to a consultant for investor relation services.

 

On January 26, 2010, the Company issued 76,500,000 shares at a deemed price of $1.03, for the acquisition of 100% of Joyous Fame International Limited. During the period ended September 30, 2010, the Company issued 300,000 shares at a deemed price of $1.03 to a consultant for investor relation services. On May 13, 2010, the Company issued 1,098,000 shares at a deemed price of $3.15 for the acquisition of a 28% equity interest in Legarleon Precious Metals Limited and a further 901,000 shares at a deemed price of $3.15 for a further 23% equity interest in Legarleon Precious Metals Limited on 12 July 2010. These issuances resulted in a significant increase in additional paid in capital in the period from April 1, 2010 to September 30, 2010. 

 

As at September 30, 2010, the Company has not granted any incentive stock options.

 

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6. INCOME TAXES

 

A. Income Tax Provision

 

Current tax laws limit the amount of loss available to be offset against future taxable income when a substantial change in ownership occurs. Therefore, the amount available to offset future taxable income may be limited. The provision for income taxes differs from the result which would be obtained by applying the statutory income tax rate of 34% (2009 – 34%) to income before income taxes.

 

B. Significant components of the Company’s deferred income tax assets are as follows:

 

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C. The Company has incurred operating losses of $1,365,534 which, if unutilized, will expire through to 2031. Future tax benefits, which may arise as a result of these losses, have not been recognized in these financial statements, and have been offset by a valuation allowance. The following table lists the fiscal year in which the loss was incurred and the expiration date of the operating loss carry forwards:

 

 

 

7. COMMITMENTS

 

On March 1, 2009, the Company entered into a consulting agreement with Capital Path Securities, LLC, (“CPS”) of Rocky Point, New York. CPS will be the Company’s investment banker providing advice relating to corporate finance matters, developing a network of traders making markets in the Company’s securities, presenting the Company to broker dealers interested in retailing the Company’s securities, and other financial consulting and/or investment banking services as needed by the Company. Services are payable when rendered by CPS, a retainer of $5,000 has been paid to CPS. The retainer will be increased upon additional financing or generation of income.

 

On December 1, 2009, the Company reviewed the Executive Services Agreement (the “Agreement”) dated February 28, 2007, between the Company and Geoffrey Armstrong, an Officer and Director of the Company (the Executive”). As of December 1, 2009, the Company has increased the monthly remuneration of the Executive to $5,000 per month and extended the Expiration Date of the Agreement from February 28, 2012 to February 28, 2014. Due to earlier termination of Mr. Armstrong’s Executive Services Agreement, the Company bought out Mr. Armstrong’s outstanding contract for the sum of $300,000 which has not been paid. Although Mr. Armstrong abstained from voting on the changes, the transaction cannot be considered as an arms length transaction.

 

8. SUBSEQUENT EVENTS

 

No significant event has been noted for the Group in respect of the period subsequent to September 30, 2010.

 

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The information contained in Item 2 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results may materially differ from those projected in the forward-looking statements as a result of certain risks and uncertainties set forth in this report. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report.

 

Plan of Operation

 

We were incorporated in the State of Wyoming as a for-profit company on September 1, 2005 and established a fiscal year at the end of March 31. Element92 Resources was incorporated under the laws of the State of Wyoming as Ace Lock & Security. On March 5, 2007, we filed a Certificate of Amendment with the Wyoming Secretary of State changing our name to Element92 Resources Corp., and increased our authorized capital to 100,000,000 common shares. The Company changed its name to YINFU GOLD CORP. on July 20, 2010.  Yinfu Gold is a start-up, exploration stage company engaged in the search for commercially viable minerals, most notably, gold. We have optioned 14 mineral claims in the Province of Quebec, Canada. We have acquired the claims however, there is no assurance that a commercially viable mineral deposit exists on our claims or can be shown to exist until sufficient and appropriate exploration is done and a comprehensive evaluation of such work concludes economic and legal feasibility. The Company will proceed only if minerals are found and their extraction be deemed economically feasible.

 

The Company will continue to manage its operations and cash resources in a manner consistent with its expectation that it will only be able to satisfy cash requirements through fiscal 2010 through loans, through an equity offering or by a suitable joint venture. The main operating costs for the Company include:

 

 

1. The Company will have to conduct exploration work to better define the size of possible ore bodies in the Roncheng operation, but at this time, it is impossible to determine the full cost of such a program.

 

2. The Company plans to increase the operating capacity of the mine and processing plant at Penglai Huwei, but at this time, it is not possible to determine the full cost of such a plan.

 

There are no significant capital equipment purchases expected during the next 12 months over and above planned requirements as currently comprised within the Company's business plan. The Company will add up to 3 part time or as needed employees, trained in geological exploration to manage a short term work program on the claims, subject, however, to the Company's cash resources and operational requirements at the relevant time. We continue to seek a Joint Venture partner to assist is to explore and develop our claims.

 

The Company will have to initiate an additional equity offering within the next 12 months. In this case, the use of proceeds would center on the acceleration of work on the claims and meeting our general operating costs.

 

 

 

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RESULTS OF OPERATIONS

 

Results Of Operations For The Period From Inception Through March 31, 2007

 

We have not earned any revenues from the time of our incorporation on September 1, 2005 to March 31, 2007. We do not anticipate earning revenues unless we enter into commercial production on the optioned claims, which is doubtful. We have not commenced the exploration stage of our business and can provide no assurance that we will discover economic mineralization on any of the claims, or if such minerals are discovered, that we will enter into commercial production.

 

We incurred operating expenses in the amount of $63,333 for the period from our inception on September 1, 2005 to March 31, 2007. These operating expenses were comprised of mineral property acquisition costs of $60,000, legal and accounting fees of $41, bank and interest charges of nil, shareholder information nil, organizational costs of $2,916 and office and sundry fees of nil.

 

Results Of Operations For The Period From April 1, 2007 Through March 31, 2008.

 

We incurred operating expenses in the amount of $60,504 for the period from March 31, 2007 to March 31, 2008. These operating expenses were comprised of mineral property acquisition costs of $2,000, legal and accounting fees of $21,635, bank and interest charges of $40, shareholder information $157, organizational costs of $36,584 and office and sundry fees of $88.

 

We have not attained profitable operations and are dependent upon obtaining financing to pursue exploration activities. For these reasons our auditors believe that there is substantial doubt that we will be able to continue as a going concern.

 

Results Of Operations For The Period From April 1, 2008 Through March 31, 2009.

 

We incurred operating expenses in the amount of $102,170 this total is comprised of Mineral Property Interest of $76,047. These Mineral Property Interest consisted of $50,000 in shares at $0.10 per share issued to the Optionor of the claims, cash payment of $15,000 paid to the Optionor and $11,047 for exploratory work on the claims. Additionally, our operating expenses included Consulting Fees of $12,000, paid to a Director, in restricted shares at an agreed upon price of $0.25 per share, $10,682 in professional fees, bank fees and interest charges of $3, shareholder information $102, transfer agent fees of $2,773 and office and sundry fees of $563.

 

Results Of Operations For The Period From April 1, 2009. Through March 31, 2010.

 

We incurred operating expenses in the amount of $446,708 this total is comprised of operating expenses including consulting fees of $200,500, paid in restricted shares, $24,202 in professional fees, bank fees and interest charges of $224, shareholder information $212,264, transfer agent fees and regulatory fees of $8,631 and office and sundry fees of $887.

 

Results Of Operations For The Period From April 1, 2010 Through September 30, 2010

 

We have achieved a turnover of $2,701,535 and a gross profit of ~$839,000 for the period.  After taking into account administration expenses of $1,002,671 we arrived at a net loss of the period of $194,054.

 

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Capital Resources and Liquidity

 

As of September 30, 2010 we had cash and cash equivalents of $477,719. This cash was as a result of a loan of $20,000 from a director of the Company and $46,675 loan from related parties being, Joyous Fame International Group Limited and its subsidiaries, therefore we have very limited capital resources and will rely upon the issuance of common stock to fund expenses including legal and auditing fees, exploration expenses, required payments for our claims and office expenses. Cash and cash equivalents from inception to date have been insufficient to cover expenses involved in starting our business. We will require additional funds to continue to implement our business plan during the next twelve months

 

We currently do not have enough cash to satisfy our minimum cash requirements for the next twelve months. The Company's financial statements have been presented on the basis that it is a going concern, which contemplates the realization of the mineral properties and other assets and the satisfaction of liabilities in the normal course of business. The Company has incurred losses from inception to September 30, 2010. The Company has not realized economic production from its mineral properties as of September 30, 2010. These factors raise substantial doubt about the Company's ability to continue as a going concern.

 

Management continues to actively seek additional sources of capital to fund current and future operations. There is no assurance that the Company will be successful in continuing to raise additional capital, establishing probable or proven reserves, or determining if the mineral properties can be mined economically. These financial statements do not include any adjustments that might result from the outcome of these uncertainties. If we are unable to raise a sufficient amount of capital to continue to implement our business plan, we may be forced to pursue a definitive agreement for the acquisition of our Company through a reverse merger.

 

RECENT ACCOUNTING PRONOUNCEMENTS

 

Critical Accounting Policies

 

Our financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (“GAAP”). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenues and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.

 

Off Balance Sheet Arrangements

 

We have no off-balance sheet arrangements.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

The Company is subject to certain market risks, including changes in interest rates and currency exchange rates. The Company does not undertake any specific actions to limit those exposures.

 

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ITEM 4. CONTROLS AND PROCEDURES

 

Pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”), the Company carried out an evaluation, with the participation of the Company’s management, , of the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Company’s management concluded that the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, , as appropriate, to allow timely decisions regarding required disclosure.

 

Management’s Report on Internal Controls over Financial Reporting

 

Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of consolidated financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. There has been no change in the Company’s internal control over financial reporting during the quarter ended September 30, 2010 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

The Company’s management, does not expect that the Company’s disclosure controls and procedures or the Company’s internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of the controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected.

 

Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in  Internal Control – Integrated Framework  issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that the Company’s internal control over financial reporting was effective as of September 30, 2010.

 

This quarterly report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management's report in this quarterly report.

 

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

In July, 2010, Robert Rosenblat, an insider of Element92 Resources Corp. engaged in the sale of approximately 50,000 shares of Element92 Resources Corp stock based on insider information and while he was the holder of more than 10% of the Company’s issued stock at the time of the sale.  The Company has reported his insider share sales to the U.S. SEC and intends to pursue a lawsuit against him.

 

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Item 1A. Risk Factors.

 

Not required because we are a smaller reporting Company.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

None.

 

Item 3. Defaults Upon Senior Securities.

 

None.

 

Item 4. Submission of Matters to a Vote of Security Holders.

 

None.

 

Item 5. Other Information.

 

None.

 

Item 6. Exhibits and Reports of Form 8-K.

 

(a) Exhibits

 

31.1 Certifications pursuant to Section 302 of Sarbanes Oxley Act of 2002

 

32.1 Certifications pursuant to Section 906 of Sarbanes Oxley Act of 2002

 

(b) Reports of Form 8-K

 

On June 29, 2010, the Company filed a Current Report on Form 8-K (Entry into a Material Definitive Agreement) reporting that it had hat it has closed on the acquisition of an additional 23% interest in Legarleon Precious Metals, Ltd. (“LPM” or “Legarleon”), bringing the Company’s interest in LPM to a majority interest total of 51%. The Company previously announced the acquisition of a 28% interest in LPM on May 11, 2010. E92R will pay 901,000 restricted shares for the additional 23% stake, bringing the total cost for the full 51% stake in LPM to 1,999,000 restricted shares.

On August 9, 2010 filed a Current Report on Form 8-K (Changes in Company's Certifying Accountant) reporting that it had received formal notice from its auditor, Paula Morelli, CPA P.C. (“Morelli CPA”). that the firm would no longer be representing the Company as its accountant. As of that date, the Company was informed that Morelli CPA was voluntarily resigning as the Company's accounting firm. The resignation of the Company's Certifying Accountant was not the result of any disagreements.

Additionally, the Company reported that it had engaged Parker Randall CF (H.K.) CPA Limited, Chartered Accountants as its new independent accountants.

 

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SIGNATURES

 

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

/s/ Wilson Huang Dong-sheng                                                           November 16, 2010

Wilson Huang Dong-sheng Chairman,

Acting Chief Executive Officer and Chief Financial Officer

YINFU GOLD CORP.

 

 

 

 

 

 

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