via GBN.V website - 2011 MD&A

Any place they refer to depletion, amortization and accretion, or accounts payable requires major attention now. Download the quarterly report and use the search function in Adobe to find the quote. Start with '470.'

On page 6, they state that depletion, amortization and accretion are non-cash costs that amount to $470/oz. per ounce poured. That means a little over half the gold went into escrow, leaving a cost of $438/oz.

That means the grade as reported accounts for almost double the production. Instead of grading 14.15 g/t, its actually more like 29.33g/t. This is how they have been hiding results for years. And they are very anxious that people absolutely positively do not figure this out.

On page 11, the short statement on Financial Instruments is very important, because any depletion, amortization and accretion is carried by the ounces produced out of escrow, and not necessarily gold poured at the mill.

If they report that grades are 8g/t, then that indicates that throughput has increased to 1000tpd, and gold produced out of escrow rather than poured gold at the mill to pay costs is only roughly 25% of production.

In the 2009 MD&A, they state that should Federal Ministerial approval not be obtained, that an in-pit tailings deposition may be required, but what they don't tell you is that they intend to mine an open pit under Mallard Lake Tailings Management Facility, and the deposit tailings in the newly formed open pit.

They will mine the top of the Decade deposit, and then use the former open pit as an enlarged TMF.

Golden Band Resources Financial Report Archive

-F6