The Company’s primary listing is on the TSX Venture Exchange (“TSXV”). The consolidated financial statements filed on that exchange are now filed in terms of US GAAP. Previously the consolidated financial statements were filed in terms of International Financial Reporting Standards (“IFRS”) (Note 1).

The Company’s comparative consolidated financial statements were prepared using US GAAP, therefore a reconciliation of the comparative IFRS and US GAAP presentation was performed for the comparative period. 

The main differences between IFRS and US GAAP are as follows: 

Share-based compensation 

The Company granted certain directors, officers and consultants of the Company stock options with vesting terms attached thereto, 25% vested immediately and a further 25% per annum, will vest on the grant date of the stock options. These stock options were valued using a Black Scholes valuation. 

Under IFRS share-based compensation paid to certain directors, consultants and employees were amortized over the vesting period of the stock option grant using a weighted average expense over the vesting period, including the immediately vesting stock options. 

Under US GAAP, the stock options issued to consultants were expensed immediately and the stock options issued to directors and officers were amortized as follows; (i) the value of the 25% of the stock options that vested immediately were expensed immediately; (ii) the remaining value of the 75% of the stock options which vest equally on an annual basis are being expensed over the vesting period on a straight line basis. 

This gave rise to a reduction in expense of $325,265 for the three months ended November 30, 2018.

Capital raising fees

the company incurred certain shared based compensation on convertible debt and certain letter of credit funding arrangements. The share-based compensation was initially expensed immediately under IFRS. In terms of US GAAP, the capital raising fee is directly attributable to the debt and is recorded as a discount against the debt and amortized over the life of the debt. The capital raising fee of $1,276,980 less the amortization of the debt discount of $258,895 reduced the loss for the three months ended November 30, 2018 by $1,018,085.