SECURITIES AND EXCHANGE COMMISSION

SEC FORM 17-Q

QUARTERLY REPORT PURSUANT TO SECTION 17 OF THE SECURITIES REGULATION CODE AND SECTION 141

OF THE CORPORATION CODE

1. For the period ended 30 June 2012 2. SEC Identification No. 427A 3. BIR Tax Identification No 000-707-286 4. Exact Name of Issuer as specified in its charter ATOK-BIG WEDGE CO., INC.

Metro Manila

6. SEC Use Only Industry Classification Code

5. Province, Country or other jurisdiction of Incorporation or Organization

10th Floor, Alphaland Southgate Tower, Chino Roces cor EDSA, Makati 1231 7. Address of Principal Office Postal Code

(632) 338-5599 8. Issuers telephone number, including area code

NA 9. Former name, former address, and former fiscal year, if changed since last report 10. Securities registered pursuant to Section 4 and 8 of the RSA Title of Each Class Number of Shares of

Common Stock Outstanding Amount of Debt/

Liabilities Outstanding Common Shares 2,545,000,000shares P 2,499,071.00

11. Are any of the securities listed on the Philippine Stock Exchange? Yes / No

12. Check whether the issuer has filed all reports required to be filed by Section 17 of the SRC and SRC Rule 17 thereunder or Section 11 of the RSA and RSA Rule 11(a)-1 thereunder, and Sections 26 and 141 of the Corporate Code of the Philippines during the preceding twelve (12) months (or for such shorter period that the registrant was required to file such reports);

Yes / No

(a) has been subject to such filing requirements for the past ninety (90) days

Yes / No

PPAARRTT II -- FFIINNAANNCCIIAALL IINNFFOORRMMAATTIIOONN

Item 1. Financial Statements

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Please find attached herein the Unaudited Consolidated Financial Statements of Atok-Big Wedge Co., Inc. (the Company) as well as AB Stock Transfers Corporation (ABSTC) as Exhibit 1 for the Second (2nd) Quarter ending June 30, 2012. The following discussion summarizes the significant factors affecting the operating results, financial condition, and liquidity and cash flows of the Company for the period ended June 30, 2012 and 2011 and the audited financial statements for the year ended December 31, 2011. The following discussion should be read in conjunction with the accompanying unaudited financial statements as of and for the period ended June 30, 2012 and 2011 and notes thereto which form part of this Report. Such financial statements and notes thereto have been prepared in compliance with accounting principles generally accepted in the Philippines (GAAP) as set forth in Philippine Financial Reporting Standards (PFRS). The Companys financial statements are presented in the functional currency of Philippine pesos.

Other than those items disclosed in the notes to financial statements and the managements discussion and analysis of financial condition and results of operations, the Company is not aware of any event, change, contingency or transaction which would have a material effect on the Companys operation or financial performance.

Other than those items disclosed in the notes to financial statements and the managements discussion and analysis of financial condition and results of operations, the Company is not aware of any material off-balance transactions, arrangements, obligations, or any other relationship of the Company created during the reporting period.

Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations Description of Business The Company, formerly Atok-Big Wedge Mining Co., Inc., was incorporated and registered with the Securities and Exchange Commission (the SEC) on September 4, 1931. Its corporate life was extended on September 25, 1981 for another fifty (50) years to expire on September 25, 2031. The common shares of the Company are listed in the Philippine Stock Exchange (the PSE; ticker symbol: AB).

Since its incorporation, the Company engaged in mining as its primary purpose, producing gold as its major product and silver as a by-product. Its production was all sold to the Central Bank of the Philippines at a price subsidized by the Philippine Government, and later on at the prevailing world market price. Gold bullions are used by the Philippine Government as one of the components in the monetary reserve. Although the Company changed its primary purpose in 1996 from mining to general investment, it reverted to its original purpose of engaging in exploration and development of mining, oil, gas, and other natural resources when it amended its Articles of Incorporation, which was approved by the Securities and Exchange Commission on May 24, 2010. The Company has two wholly-owned subsidiaries, ABSTC and Tidemark Holdings Limited (Tidemark). ABSTC was incorporated on June 24, 2010, with the purpose of establishing, operating, and acting as a transfer agent and/or registrar of corporations. On the other hand, Tidemark is a company registered and domiciled in Hong Kong SAR, which the Company bought on October 3, 2011. Tidemark owns 9,646,757 ordinary shares of Forum Energy plc (Forum), a company registered and domiciled in the United Kingdom representing approximately 27.14% of Forums outstanding capital. The ordinary shares of Forum are traded and listed in the Alternative Investment Market of the London Stock Exchange (ticker symbol: FEP). Forum is a gas & oil exploration and production company with a portfolio of projects in the Philippines. Among these projects is 70% of the equity in the

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license for the Sampaguita offshore gas discovery covered by Service Contract No. 72. The block is located off the North West coast of Palawan Island in the Philippines. Atok Gold Mining Co., Inc. (Atok Gold) used to be a wholly-owned subsidiary of the Company. On 3 June 2011, the Company sold its entire interest in Atok Gold to Progressive Development Corporation (PDC). PDC is an existing shareholder of the Company and belongs to the Araneta Group of Companies. As of this date, PDC owns 99,159,824 shares (representing about 3.9%) of the Company. PDC paid a total consideration of Php12,776,000.00 for 33,075,121 shares at Php0.3863 per share. The sale price was paid in cash and in full on the date of execution (June 3, 2011) of the sale documents. The proceeds forms part of the Companys operating funds and is being used for operations (including ongoing exploration and business development activities). The Company is a regular member and signatory of the Chamber of Mines. It has adopted the spirit and substance of the Chamber of Mines Code of Conduct which calls for sustainable mineral resources development, environmental responsibility and a social commitment to the general welfare and economic development of the people in the localities in which it operates.

Over the past seven decades, the Company has established a strong foundation in the Philippine mining industry. Pursuant to its goal of seeking out projects to put into operation, the Company made a continued careful and diligent evaluation of multiple metallic and non-metallic prospects for possible investment throughout the past year. It concentrated its efforts in the Philippines and in Laos, with priority on projects in the advanced stage, but not disregarding greenfield exploration prospects with potential. Negotiations also continued for mines with confirmed potential and previously operated but closed down during the period with low metal prices.

In 2011, a total of twenty (20) metallic, non-metallic and oil project sites were evaluated, including four (4) projects in the Philippines and sixteen (16) in Laos. Out of these projects, one (1) oil investment materialized, two (2) metallic projects are on continued evaluation/negotiation stage and five (5) projects were considered with potential but in low-priority because they are in the greenfield stage. Management Plan of Operations The Company is evaluating several investment opportunities and looks to acquiring other mining, oil, gas, and other natural resource assets in order to be profitable. Given its current money market placements, the Company can fund its operations in the next year or two depending on the activities that will materialize. The Companys Representative Office in Laos was granted a business permit last April 2011. Since then, it has been rigorously conducting project assessments. It is currently in the initial stage of evaluating an operating medium-scale gold mine for possible take-over in the southern province of Attepue in Laos. The gold mine has been operating for 5 years. Mine development is concentrated in a 3km2 site, inside the 250km2 tenement coverage. Several other prospects were reported within the tenement but needs further exploration to develop. A more comprehensive study will be conducted on this project to verify the reported data. Another gold prospect in west central Laos shows polymetallic mineralization, which also includes potential iron and copper. This greenfield prospect is also lined up for site evaluation.

In the coming year, the Company will continue with the evaluation of the projects pending in Laos, and with positive results, it can work towards a joint venture agreement with the existing owners. In the Philippines, the Company will go on evaluating potential projects while vigilantly waiting for possible

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developments in the mining atmosphere within the year so it can start submitting applications for mining permits on areas of interest. Greenfield areas with positive potential will also be pursued. The Companys entry into the energy sector is the first step towards its goal to becoming a major contributor to the development of natural resources in the Philippines. The Company shall continue to be firm on its commitment to be a significant contributor to the mining industry in the country and the ASEAN region. The Company does not expect to have any significant changes in the number of employees during the next 12 months. Financial Condition-Consolidated (Unaudited)

June 30, 2012 December 31, 2011

Notes Unaudited Audited %

CURRENT ASSETS

Cash and cash equivalents 4 220,428,230 334,047,916 -34% (113,619,686)

Receivables-net 5 1,972,563 989,158 99% 983,404

Inventories 6 - - -

Input value added taxes and other current

assets 7 5,176,853 3,333,731 55% 1,843,122

Total Current Assets 227,577,645 338,370,805 -33% (110,793,160)

NON-CURRENT ASSETS

Investment in associate 753,439,391 669,613,945 13% 83,825,446

Property and Equipment -net 9 5,537,911 6,682,127 -17% (1,144,216)

Mining exploration and project

development cost 8 - - -

Deferred Tax Assets 11 79,604 79,604 0% (0)

Other noncurrent assets 10 2,241,150 2,178,596 3% 62,554

Available-for-sale investment 999,950 999,950 0% (0)

Total Non-Current Assets 762,298,006 679,554,222 12% 82,743,784

TOTAL ASSETS 989,875,651 1,017,925,027 -3% (28,049,376)

LIABILITIES AND STOCKHOLDERS EQUITY

CURRENT LIABILITIES

Accounts payable and accrued expenses 12 2,144,079 4,775,381 -55% (2,631,302)

Other current liabilities 13 354,992 302,739 17% 52,253

Total Current Liabilities 2,499,071 5,078,120 -51% (2,579,049)

NON-CURRENT LIABILITIES

Due to related parties 13 0 - 0

Total Non-Current Liabilities 0 - 0

Total Liabilities 2,499,071 5,078,120 -51% (2,579,049)

STOCKHOLDERS' EQUITY

Capital Stock - Paid-up 14 1,060,000,000 1,060,000,000 0% -

Retained Earnings (Deficit) 15 (72,623,420) (48,953,865) 48% (23,669,555)

Other Comprehensive Income 1,800,772 -100% (1,800,772)

Total Stockholders' Equity 987,376,580 1,012,846,907 -3% (25,470,327)

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY 989,875,651 1,017,925,027 -3% (28,049,376)

(With Comparative Figures As of December 31, 2011) (With Comparative Figures As of December 31, 2011)

Inc/(Dec)

ASSETS

ATOK-BIG WEDGE CO., INC. and SUBSIDIARY ATOK-BIG WEDGE CO., INC. and SUBSIDIARY

CONSOLIDATED STATEMENT OF FINANCIAL POSITION CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS OF JUNE 30, 2012 AS OF JUNE 30, 2012

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June 30, 2012 vs. December 31, 2011 As of June 30, 2012, the Companys balance sheet remains healthy, with consolidated assets of Php990million from Php1.018 billion as of December 31, 2011. The Companys indebtedness remains manageable in the amount of Php2.5 million. Cash and cash equivalents totaled Php220 million as of June 30, 2012, a decrease of Php114 million from as of December 31, 2011 Receivables went up to Php983k from Php989k as of December 31, 2011 Equity attributable to stockholders went down to Php987 million as of June 30, 2012 from Php1.013 billion at the end of 2011 Results of Operation

June 30, 2012 December 31, 2011

Notes Unaudited Audited

16 11,986,815 35,523,239

Interest Income 5,280,628 29,717,720

Gain on disposal of Atok Gold 9,270,726

Share on the net results of operations of an associate (19,689,553) 4,168,305

Impairment Loss -

Interest Expense - (2,673,373)

Others 925,414 1,752,929

(13,483,511) 42,236,307

(25,470,326) 6,713,068

INCOME TAX (EXPENSE) BENEFIT - DEFERRED (34,503)

NET INCOME (LOSS) (25,470,326) 6,678,565

Gain from translating the financial statements of

Tidemark - 1,800,772

- -

TOTAL COMPREHENSIVE INCOME (LOSS) (25,470,326) 8,479,337

BASIC AND DILUTED LOSS PER SHARE 17 (0.0240) 0.0063

INCOME (LOSS)BEFORE INCOME TAX FROM

CONTINUING OPERATIONS

OTHER COMPREHENSIVE INCOME

ATOK-BIG WEDGE CO., INC. and SUBSIDIARY

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX (6) MONTHS ENDED JUNE 30, 2012

With Comparative Figures for CY ended December 31, 2011

GENERAL AND ADMINISTRATIVE EXPENSES

OTHER INCOME (EXPENSES)-Net

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Consolidated net loss for the 2nd quarter of 2012 amounted to Php25.5 million. This is the result of general and administrative expenses amounting Php12.0 million, share on the net results of operations of an associate amounting to Php19.69 million, net income from interest in money market placement amounting to Php5.3 million and other income amounting to Php925k. Discussion and Analysis of Material Events and Uncertainties Other than the issuance of Executive Order No. 79, s. 2012 (INSTITUTIONALIZING AND IMPLEMENTING REFORMS IN THE PHILIPPINE MINING SECTOR PROVIDING POLICIES AND GUIDELINES TO ENSURE ENVIRONMENTAL PROTECTION AND RESPONSIBLE MINING IN THE

UTILIZATION OF MINERAL RESOURCES) on July 6, 2012, as of reporting date: There are no known trends or events, which may have a material effect on the Companys short-term or long-term liquidity. There were no events that will trigger direct or contingent financial obligation that is material to the Company, including any default or acceleration of an obligation. Funding of maturing obligations shall be sourced from internally generated cash flow or from borrowings under the available credit facilities. There were no material off-balance sheet transactions, arrangements, obligations, and other relationships of the company with unconsolidated entities or other persons during the reporting period. The commitment for capital expenditures is those within the ordinary course of trade or business and will be funded partly from short term credit and operations. There were no significant trends, events, or uncertainties that will have a material impact on the registrants sales. There are no significant elements of income or loss not arising from the Companys continuing operations. There are no seasonal aspects that had or have a material effect on the financial condition or results of operations. The effects of seasonality or cyclicality on the operations of the Companys business are not material. There are no items this year affecting assets, liabilities and equity, net income or cash flows that are unusual because of their nature, size, or incidents, except those stated in the Managements Discussion and Analysis. There were no material changes in estimates of amounts reported in the current year or changes in estimates of amount reported in prior financial years. There are no changes in contingent liabilities or contingent assets since the last annual balance sheet date. No material contingencies and any other events or transactions exist that are material to an understanding of the current year. There are no issuances, repurchases, repayments of debt and equity securities during the year except for those which have been disclosed and those which occur within the ordinary course of business. There are no material events subsequent to the end of the period that have not been reflected in the financial statements for the year. Other than the acquisition by Tidemark of additional shares of Forum (bringing its total ownership in Forum to 27.14%), there are no effects of changes in the composition of the Company during the year, including business combinations, acquisitions or disposal of subsidiaries and long term investments, restructurings, and discontinuing operations.

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Top Five Key Performance Indicators The top 5 key performance indicators of the Company are as follows:

as of as of

June 2012 Dec 2011

Current/Liquidity Ratio = (CA/CL)

91.06

66.63

Current Assets 227,577,645

338,370,805

Current Liabilities 2,499,071

5,078,120

Solvency Ratio = The sum of net income/loss (after tax) and depreciation divided by total liabilities

(9.72)

1.74

Net Income (loss) after tax less depreciation (24,301,706)

8,822,176

Total Liablities 2,499,071

5,078,120

Debt-to-equity ratio = Total liabilities/Total equity

0.00

0.01

Total Liabilities 2,499,071

5,078,120

Total Equity 987,376,580

1,012,846,907

Asset-to-equity Ratio = Total assets/Total equity

1.00

1.01

Total Assets 989,875,651

1,017,925,027

Total Equity 987,376,580

1,012,846,907

Interest rate coverage ratio = Income before interest and taxes/interest expense

-

-

Income before interest and taxes (25,470,326)

6,713,068

Interest expense -

-

Profitability Ratio = Net income(loss) after tax/Total equity

(0.03)

0.01

Net Income (loss) after tax (25,470,326)

6,678,565

Total equity 987,376,580

1,012,846,907

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Financial Risk Management Objectives and Policies Financial Risk Management Objectives and Policies The main purpose of the Companys principal financial instruments is to fund its operational and capital expenditures. The Companys risk management is coordinated and in close operation with its Board of Directors (BOD), and focuses on actively securing the Companys short to medium term cash flows by minimizing the exposure to financial markets.

The Companys activities expose it to a variety of financial risks: credit risk and liquidity risk The Companys overall risk management program seeks to minimize potential adverse effects on the financial performance of the Company. The policies for managing specific risks are summarized below. Management of Financial Risk Governance Framework The Company has established a risk management function with clear terms of reference and with the responsibility for developing policies on market, credit, liquidity, and operational risk. It also supports the effective implementation of policies. The policies define the Companys identification of risk and its interpretation, limit structure to ensure the appropriate quality and diversification of assets to the corporate goals and specify reporting requirements. Capital Management Framework The Companys capital management objectives are to ensure the Companys ability to continue as a going concern. The Company monitors the basis of the carrying amount of equity as presented on the face of the balance sheet. The Companys risk management function has developed and implemented certain minimum stress and scenario tests for identifying the risks to which the Company are exposed, quantifying their impact on the volatility of economic capital. The results of these tests, particularly, the anticipated impact on the realistic balance sheet and revenue account, are reported to the Companys risk management function. The risk management function then considers the aggregate impact of the overall capital requirement revealed by the stress testing to assess how much capital is needed to mitigate the risk of insolvency to a selected remote level. Regulatory Framework The operations of the Company are also subject to the regulatory requirements of the SEC. Such regulations not only prescribe approval and monitoring of activities but also impose certain restrictive provisions. Financial Risk The Company is also exposed to financial risk through its financial assets and financial liabilities. The most important components of the financial risks are credit risk, liquidity risk and market risk. Credit Risk Credit risk is the risk of financial loss if the other party to the financial instruments fails to meet its contractual obligations, and arises principally from receivables. For risk management reporting purposes, the Company considers and consolidates all elements of credit risks exposure, such as but not limited to individual obligor default risk, country and sector risk. In monitoring receivables credit risk, receivables are grouped according to their credit characteristics, whether they are individual or legal entity, their geographical locations, industry, aging of accounts and maturity. The Company has no past due financial assets as of June 30, 2012.

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Liquidity Risk Liquidity Risk is the risk arising from potential inability to meet all payment obligations when they become due. The BOD and key officers of the Company safeguard the ability of the Company to meet all payment obligations when they become due. To limit risk, management arranges for diversified funding sources, manages assets with liquidity in mind, and monitors obligations regularly. The Treasurer is responsible for the management of liquidity risk. The Company's liquidity risk management framework is designed to identify, measure and manage the liquidity risk position. The Company's policies with regard to the risk are reviewed on a regular basis by the key officers and finally approved by the members of the Board. Market Risk Market risk is the risk on the changes in market prices of the mineral ore/gold prices, interest rates, foreign exchange rates, and credit spreads, which will affect the Companys income or the value of its holdings of its inventory and financial instruments. The objective of market risk management is to manage and control risk exposure within acceptable parameters, while optimizing the return on the risk. The Company is not exposed to interest rate risk because it does not have any loans or promissory notes. The Company follows a prudent policy on managing its assets and liabilities so as to ensure that exposure to fluctuations in prices, interest rate are kept within acceptable limits. Capital Management The primary objective of the Company's capital management is to ensure its ability to continue as a going concern and to continue its operations. The Company's overall strategy remains unchanged. The Company is not subject to externally imposed capital requirement.

PPAARRTT IIII -- OOTTHHEERR IINNFFOORRMMAATTIIOONN

There are no disclosures not reported under SEC Form 17-C.

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June 30, 2012 June 30, 2011 December 31, 2011

Notes Unaudited Unaudited Audited %

CURRENT ASSETS

Cash and cash equivalents 4 220,428,230 999,595,685 334,047,916 -34% (113,619,686)

Receivables-net 5 1,972,563 2,979,923 989,158 99% 983,404

Inventories 6 - - - -

Input value added taxes and other current assets 7 5,176,853 2,802,984 3,333,731 55% 1,843,122

Total Current Assets 227,577,645 1,005,378,593 338,370,805 -33% (110,793,160)

NON-CURRENT ASSETS

Investment in associate 753,439,391 669,613,945 13% 83,825,446

Property and Equipment -net 9 5,537,911 6,194,413 6,682,127 -17% (1,144,216)

Mining exploration and project development cost 8 - 4,224,006 - -

Deferred Tax Assets 11 79,604 114,107 79,604 0% (0)

Other noncurrent assets 10 2,241,150 2,020,498 2,178,596 3% 62,554

Available-for-sale investment 999,950 999,950 0% (0)

Total Non-Current Assets 762,298,006 12,553,023 679,554,222 12% 82,743,784

TOTAL ASSETS 989,875,651 1,017,931,616 1,017,925,027 -3% (28,049,376)

LIABILITIES AND STOCKHOLDERS EQUITY

CURRENT LIABILITIES

Accounts payable and accrued expenses 12 2,144,079 2,462,092 4,775,381 -55% (2,631,302)

Other current liabilities 13 354,992 387,502 302,739 17% 52,253

Total Current Liabilities 2,499,071 2,849,594 5,078,120 -51% (2,579,049)

NON-CURRENT LIABILITIES

Due to related parties 13 0 0 - 0

Total Non-Current Liabilities 0 0 - 0

Total Liabilities 2,499,071 2,849,594 5,078,120 -51% (2,579,049)

STOCKHOLDERS' EQUITY

Capital Stock - Paid-up 14 1,060,000,000 1,060,000,000 1,060,000,000 0% -

Retained Earnings (Deficit) 15 (72,623,420) (44,917,978) (48,953,865) 48% (23,669,555)

Other Comprehensive Income 1,800,772 -100% (1,800,772)

Total Stockholders' Equity 987,376,580 1,015,082,022 1,012,846,907 -3% (25,470,327)

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY 989,875,651 1,017,931,616 1,017,925,027 -3% (28,049,376)

June 2012 vs.

Dec.2011 Inc/(Dec)

ASSETS

ATOK-BIG WEDGE CO., INC. and SUBSIDIARY ATOK-BIG WEDGE CO., INC. and SUBSIDIARY

CONSOLIDATED STATEMENT OF FINANCIAL POSITION CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS OF JUNE 30, 2012 AS OF JUNE 30, 2012

(With Comparative Figures As of June 30, 2011 & December 31, 2011) (With Comparative Figures As of December 31, 2011)

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June 30, 2012 June 30, 2011 December 31, 2011

Notes Unaudited Unaudited Audited

16 11,986,815 13,921,824 35,523,239

Interest Income 5,280,628 16,338,009 29,717,720

Gain on disposal of Atok Gold 9,270,726

Share on the net results of operations

of an associate (19,689,553) 4,168,305

Impairment Loss -

Interest Expense (335,228) (2,673,373)

Others 925,414 436,730 1,752,929

(13,483,511) 16,439,510 - 42,236,307

(25,470,326) 2,517,686 6,713,068

INCOME TAX (EXPENSE) BENEFIT - DEFERRED (34,503)

DISCONTINUED OPERATIONS

Loss from Operations of

Discontinued Business (1,070,787)

Gain on Disposal of Discontinued

Business 1,946,680

NET INCOME (LOSS) (25,470,326) 3,393,579 6,678,565

Gain from translating the financial

statements of Tidemark - 1,800,772 - -

TOTAL COMPREHENSIVE INCOME (25,470,326) 3,393,579 8,479,337

BASIC AND DILUTED LOSS PER SHARE (0.0240) 0.0013 0.0063

INCOME (LOSS)BEFORE INCOME TAX

FROM CONTINUING OPERATIONS

OTHER COMPREHENSIVE

INCOME

ATOK-BIG WEDGE CO., INC. and SUBSIDIARY

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX (6) MONTHS ENDED JUNE 30, 2012

With Comparative Figures for 6 months ended June 30, 2011 and CY ended December 31, 2011

GENERAL AND ADMINISTRATIVE

EXPENSES

OTHER INCOME (EXPENSES)-Net

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June 30, 2012 June 30, 2011 December 31, 2011

Notes Unaudited Unaudited Audited

18 6,913,727 5,332,562 35,523,239

Interest Income 2,337,741 10,638,423 29,717,720

Gain on disposal of Atok Gold 9,270,726

Share on the net results of operations of an associate (19,689,553) 4,168,305

Impairment Loss -

Interest Expense - (335,516) (2,673,373)

Others 582,670 87,627 1,752,929

(16,769,142) - 10,390,533 42,236,307

(23,682,869) 5,057,972 6,713,068

(34,503)

- - -

Loss from Operations of Discontinued Business - (1,070,787)

Gain on Disposal of Discontinued Business 17 1,946,680

NET INCOME (LOSS) (23,682,869) 5,933,865 6,678,565

Gain from translating the financial

statements of Tidemark - 1,800,772

-

(23,682,869) 5,933,865 8,479,337

BASIC AND DILUTED LOSS PER SHARE 19 (0.0223) 0.0023 0.0063

TOTAL COMPREHENSIVE INCOME (LOSS)

OTHER COMPREHENSIVE INCOME

ATOK-BIG WEDGE CO., INC. and SUBSIDIARY

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE QUARTER (THREE MONTHS) ENDED JUNE 30, 2012

With Comparative Figures for Quarter (Three Months) ended June 30, 2011 & CY ended December 31, 2011

GENERAL AND ADMINISTRATIVE EXPENSES

OTHER INCOME (EXPENSES)-Net

INCOME (LOSS)BEFORE INCOME TAX FROM

CONTINUING OPERATIONS

INCOME TAX EXPENSE(BENEFIT) DEFERRED

DISCONTINUED OPERATIONS

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For the Year Ended

June 30, 2012 June 30, 2011 December 31, 2011

Unaudited Unaudited Audited

CAPITAL STOCK - P1 par value

Authorized - 10,000,000,000 shares in 2010

and 60,000,000 shares in 2009 & 2008

Issued and outstanding

Balance at beginning of year 1,060,000,000 1,060,000,000 60,000,000

Issuance during the year 800,000,000

Subscribed - 1,685,000,000 shares in 2010 200,000,000

(net of subscription receivables of P1,485,000,000)

Balance, end 1,060,000,000 1,060,000,000 1,060,000,000

RETAINED EARNINGS

Retained Earnings, Beginning (48,953,865) (49,382,343) (55,632,430)

Net Income (Loss) for the Period (25,470,327) 4,464,365 6,678,565

Retained Earnings, End (74,424,192) (44,917,978) (48,953,865)

OTHER COMPREHENSIVE INCOME

Balance at the beginning of year 1,800,772

Gain from translating the financial

statements of Tidemark 1,800,772

Balance at the end of year 1,800,772 - 1,800,772

Total Equity, End 987,376,579 1,015,082,022 1,012,846,907

ATOK-BIG WEDGE CO., INC. and SUBSIDIARY

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the Six Months Ended

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For the Year Ended

June 30, 2012 June 30, 2011

December 31, 2011

Audited

CASH FLOWS FROM OPERATING ACTIVITIES

Net income (loss) for the period P (25,470,326) 4,464,365 6,713,068

Adjustments for:

Interest income (5,280,628) (29,717,720)

Gain on disposal of Atok Gold - (9,270,726)

Share in the net results of operation of an associate (4,168,305)

Impairment loss 2,673,373

Depreciation and amortization 1,168,620 2,143,611

Interest expense - -

Operating loss before working capital changes (29,582,334) 4,464,365 (31,626,699)

(Increase) Decrease in receivables (811,449) (1,015,243) 543,710

(Increase) Decrease in inventories - 1,097,804 (12,114)

(Increase) Decrease in prepaid and other current assets (1,843,122) (571,118) (1,193,485)

(Increase) Decrease in other non-current assets (62,554) (18,400)

(Increase) Decrease in deferred tax assets 5,112,658

Increase (Decrease) in accounts payable (2,631,302) (352,334) 5,718,179

Increase (Decrease) in accrued expenses & other liabilities 52,253 (4,259,980) (2,400,882)

Increase (Decrease) in noncurrent liabilities - (46,588,629)

Net cash absorbed by operations (34,878,508) (42,130,877) (28,971,291)

Interest received 5,108,673 29,420,521

Interest paid -

Net cash provided by (used from) operating activities (29,769,836) (42,130,877) 449,230

CASH FLOWS FROM INVESTING ACTIVITIES

Investment in associate (83,825,447) (663,644,868)

Deffered mining explortion costs (1,237,991)

Available for sale investment (999,950)

Proceeds from disposal of: -

Atok Gold 12,776,000

Property nd equipment 75,274

(Increase ) Decrease in noncurrent assets (176,498)

Acquisition of property and equipment (24,405) 3,135,611 (1,904,739)

Effects of consolidation 6,250,087

(Increase ) Decrease in mining exploration & project develoment costs 42,927,260

Cashflow from disposal of Atok (817,916)

Net cash provided by (used in) investing activities (83,849,851) 52,312,958 (655,930,688)

CASH FLOWS FROM FINANCING ACTIVITIES

Increase (decrease) in Unearned Income

Subscription of capital stock

Issuance of capital stock

Increase (decrease) in due to related parties 0 115,770

Net cash provided by ( used from) financing activities 0 - 115,770

NET INCREASE(DECREASE) IN CASH (113,619,687) 10,182,081 (655,365,688)

CASH AND CASH EQUIVALENTS, BEGINNING 334,047,916 989,413,604 989,413,604

CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD P 220,428,229 999,595,685 334,047,916

ATOK-BIG WEDGE CO., INC. and SUBSIDIARY

CONSOLIDATED CASH FLOW STATEMENT

For Six Months Ended

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ATOK-BIG WEDGE CO., INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. CORPORATE INFORMATION

Atok-Big Wedge Co., Inc. (the Parent Company) was incorporated and registered with the Philippine Securities and Exchange Commission (SEC) on September 3, 1931. Its primary purpose is to engage in the business of exploration and development of mining, oil, gas and other natural resources. Its secondary purpose includes holding and transferring shares of stock and other securities of any corporation, among others. The Parent Company is 75.84% owned by Boerstar Corporation.

90.00% of the Parent Companys shares are listed in the Philippine Stock Exchange.

The Parent Companys registered address is 10th Floor, Alphaland Southgate Tower, 2258 Chino Roces Avenue corner EDSA, Makati City.

Business Operations In June 2011, the Parent Company entered into a Deed of Absolute Sale with Progressive Development Corporation (PDC) for the sale of its 99.99% interest in Atok Gold Mining Co., Inc. (Atok Gold).

In October 2011, the Parent Company acquired 100.00% interest in Tidemark Holdings Limited (Tidemark). Tidemark is a holding company registered in Hong Kong. It now owns 27.14% of Forum Energy plc (FEP). FEPs shares are listed and traded at the London Stock Exchanges Alternative Investment Market (see Note 5).

The Parent Companys subsidiaries are as follows:

Percentage of Ownership

Company

Place of Incorporation

Nature of Business

2011

2010

2009

AB Stock TransfersCorporation(AB Stock Transfers)

Philippines Stock Transfer Agency

99.99 99.99

Tidemark Hong Kong Holdings 99.99

Atok Gold Philippines Mining 99.99 99.99

The Parent Company and subsidiaries are collectively referred herein as the Group.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented unless otherwise stated.

Basis of Preparation Statement of Compliance

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The consolidated financial statements have been prepared in compliance with Philippine Financials Reporting Standards (PFRS). PFRS includes, Philippine Accounting Standards (PAS) and Philippine Intrepretations from International Financial Reporting Interpretations Committee (IFRIC), issued by the Philippine Financial Reporting Standards Council (FRSC) and adopted by the SEC, including SEC pronouncements. Basis of Measurement The consolidated financial statements have been prepared on the historical cost basis of accounting.

Functional and Presentation Currency The consolidated financial statements are presented in Philippine Peso (Peso), which is also the Parent Companys functional and presentation currency. All values rounded off to the nearest Peso unless otherwise stated.

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Basis of Consolidation Subsidiaries Subsidiaries are entities controlled by the Parent Company. The consolidated

financial statements include the accounts of the Parent Company and its subsidiaries. In assessing control, the existence and effect of potential voting rights that are currently exercisable or convertible are considered. Subsidiaries are consolidated from the date of acquisition or incorporation, being the date on which the Group obtains control, and continue to be consolidated until the date such control ceases.

Transactions Eliminated on Consolidation All intragroup balances, transactions, income and

expenses and unrealized gains and losses are eliminated in full Accounting Policies of Subsidiaries The financial statements of subsidiaries are prepared for

the same reporting year and using uniform accounting policies as that of the Parent Company. Functional and Presentation Currency The consolidated financial statements are presented in

Peso, which is the Parent Companys functional and presentation currency. Each entity in the Group determines its own functional currency, which is the currency that best reflects the economic substance of the underlying transactions, events and conditions relevant to that entity, and items included in the financial statements of each entity are measured using that functional currency. When there is a change in those underlying transactions, events and conditions, the entity accounts for such change in accordance with the Groups policy on change in functional currency. At the reporting date the assets and liabilities of Tidemark, a subsidiary whose functional currency is not the Peso are translated into the presentation currency of the Parent Company using the foreign exchange closing rate at the reporting date and, their statements of comprehensive income arfe translated at the foreign exchange weighted average daily exchange rates for the year. The exchange differences arising from translation are taken directly to a separate component of equity under the Other Comprehensive Income account. Upon disposal of the foreign entity, the cumulative translation adjustment shall be recognized in the consolidated statements of comprehensive income.

The accounting policies set out below have been applied consistently by the Group to all years

presented in the consolidated financial statements. Adoption of New and Revised PFRS The Group adopted new and revised PFRS effective January 1, 2011. These are summarized

below:

PAS 24, Related Party Disclosures (Amended) The amended standard simplified the definition of a related party by clarifying relationships that are considered to be related parties to assure consistency in the application of the standard.

PAS 32, Financial Instruments: Presentation Classification of Rights Issues (Amended) Rights issues (and certain options or warrants) are classified as equity instruments where the rights are given pro rata to all existing owners of the same class of an entitys non-derivative equity instruments, or given to acquire a fixed number of the entitys own equity instruments for a fixed amount in any currency.

Philippine Interpretation IFRIC 14, Prepayments of a Minimum Funding Requirement The amendment provides guidance on assessing the recoverable amount of a net pension asset and permits an entity to treat the prepayment of a minimum funding requirement as an asset.

Philippine Interpretation IFRIC 19, Extinguishing Financial Liabilities with Equity Instruments The interpretation clarifies that equity instruments issued to a creditor to extinguish a financial liability qualify as consideration paid. The equity instrument issued is measured at its fair value. If the fair value cannot be reliably measured, the instruments are

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measured at the fair value of the liability extinguished. Any gain or loss is recognized immediately in profit or loss.

Improvements to PFRS The omnibus amendments to PFRS that became effective in May 2011 were issued primarily to clarify accounting and disclosure requirements and to assure consistency in the application of the following standards. - PFRS 3, Business Combinations - PFRS 7, Financial Instruments: Disclosures - PAS 1, Presentation of Financial Statements - PAS 27, Consolidated and Separate Financial Statements - Philippine Interpretation IFRIC 13, Customer Loyalty Programmes

These new and revised PFRS have no significant impact on the amounts and disclosures in the consolidated financial statements of the Group. New and Revised PFRS Not Yet Adopted Relevant new and revised PFRS which are not yet effective for the year ended December 31, 2011 and have not been applied in preparing the consolidated financial statements are summarized below:

PAS 1, Financial Statement Presentation, Presentation of Items of Other Comprehensive Income The amendment which is effective for annual periods beginning on or after July 1, 2012, changed the presentation of items in Other Comprehensive Income (OCI). Items that could be reclassified to profit & loss at a future point in time would be presented separately from items that will never be reclassified.

PAS 12, Income taxes, Recovery of Underlying Assets The amendment which is effective for annual periods beginning on or after January 1, 2012, clarified the determination of deferred tax on investment property measured at fair value. Deferred tax on investment property measured using the fair value model in PAS 40 should be determined considering that its carrying value will be recovered through a sale transaction. Moreover, deferred tax on non-depreciable assets that are measured using the revaluation model under PAS 16 should always be measured on the sale value of the asset.

PAS 19, Employee Benefits (Amendments) The amendment is effective for annual periods beginning on or after January 1, 2013. There were numerous amendments ranging from fundamental changes such as removing the corridor mechanism and the concept of expected returns on plan assets to simple clarifications and re-wording.

PAS 27, Separate Financial Statements (as revised in 2011) The amendment is effective for annual periods beginning on or after January 1, 2013. As a consequence of the new PFRS 10 and PFRS 12, PAS 27 is now limited to accounting for subsidiaries, jointly controlled entities, and associates in separate financial statements.

PAS 28, Investments in Associates and Joint Ventures (as revised in 2011) The amendment is effective for annual periods beginning on or after January 1, 2013. As a consequence of the new PFRS 11 and PFRS 12, PAS 28 was renamed as Investments in Associates and Joint Ventures. This standard describes the application of the equity method to investments in joint ventures in addition to associates.

PFRS 7, Financial Instruments: Disclosures Enhanced Derecognition Disclosure Requirements The amendment becomes effective for annual periods beginning on or after July 1, 2011. Additional disclosure on financial assets that have been transferred but not derecognized is required to enable the user of the Groups financial statements to understand the relationship with those assets and the associated liabilities. Moreover, disclosure about continuing involvement in the derecognized assets is required to enable the user to evaluate the nature of, and risks associated with, the derecognized assets.

PFRS 7, Financial Instruments: Disclosures Transfers of Financial Assets (Amendments) The amendment is effective for annual periods beginning on or after July 1, 2011. The

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amendments will allow users of financial statements to improve their understanding of transfer transactions of financial assets (for example, securitizations), including understanding the possible effects of any risks that may remain with the entity that transferred the assets. The amendments also require additional disclosures if a dispropriate amount of transfer transactions are undertaken around the end of a reporting period.

PFRS 7, Financial Instruments: Disclosures Offsetting Financial Assets and Financial Liabilities (Amendments) The amendment is effective for annual periods beginning on or after January 1, 2013. The amendments require entities to disclose information that will enable users to evaluate the effect or potential effect of netting arrangements on an entitys financial position. The new disclosures are required for all recognized financial instruments that are set-off in accordance with PAS 32 and recognized financial instruments that are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are set-off in accordance with PAS 32. The amendments to PFRS 7 are to be retrospectively applied and are also applicable to interim periods within annual periods beginning on or after January 1, 2013.

PFRS 9, Financial Instruments: Classification and Measurement The standard, which is effective for annual periods beginning on or after January 1, 2015, is the first phase in the replacement of PAS 39 and applies to classification and measurement of financial assets as defined in PAS 39. In subsequent phases, hedge accounting and impairment if financial assets will be addressed with the expected completion of the project in the first half of 2012. The Group is currently assessing the impact of future adoption of this standard. The adoption of the first phase of PFRS 9 will have an effect on the classification and measurement of financial assets.

PAS 32, Financial Instruments: Presentation Offsetting Financial Assets and Financial Liabilities (Amendments) This standard is effective for annual periods beginning on or after January 1, 2014. These amendments to PAS 32 clarify the meaning of currently has a legally enforceable right to set-off and also clarify the application of the PAS 32 offsetting criteria to settlement systems (such as central clearing house systems) which apply gross settlement mechanisms that are not simultaneous. The amendments are to be applied retrospectively.

PFRS 10, Consolidated Financial Statements This standard is effective for annual periods beginning on or after January 1, 2013. PFRS 10 replaces the portion of PAS 27, Consolidated and Separate Financial Statements that addresses the accounting for consolidated financial statements. It also includes the issues raised in SIC-12 Consolidation Special Purpose Entities. PFRS 10 establishes a single control model that applies to all entities including special purpose entities. The changes introduced by PFRS 10 will require management to exercise significant judgment to determine which entities are controlled, and therefore, are required to be consolidated by a parent, compared with the requirements that were in PAS 27.

PFRS 11, Joint Arrangements PFRS 11 replaces PAS 31, Interests in Joint Ventures and SIC-13, Jointly-controlled Entities Non-monetary Contributions by Ventures This standard is effective for annual periods beginning on or after January 1, 2013. PFRS 11 removes the option to account for jointly controlled entities (JCEs) using proportionate consolidation. Instead, joint venture entities that meet the definition of a joint venture must be accounted for using the equity method.

PFRS 12, Disclosures of Interest in Other Entities This standard is effective for annual periods beginning on or after January 1, 2013. PFRS 12 includes all of the disclosures that were previously in PAS 27 related to consolidated financial statements, as well as all of the disclosures that were previously included in PAS 31 and PAS 28. These disclosures relate to an entitys interests in subsidiaries, joint arrangements, associates and structured entities. A number of new disclosures are also required.

PFRS 13, Fair Value Measurement This standard becomes effective for annual periods beginning on or after January 1, 2013. PFRS 13 establishes a single source of guidance under PFRS for all fair value measurements. It does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS

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when fair value is required or permitted. The Group is currently assessing the impact that this standard will have on its financial position and performance.

IFRIC 20, Stripping Costs in the Production Phase of a Surface Mine This standard becomes effective for annual periods beginning on or after January 1, 2013. This interpretation applies to waste removal costs that are incurred in surface mining activity during the production phase of the mine (production stripping costs) and provides guidance on the recognition of production stripping costs as an asset and measurement of the stripping activity asset.

Management does not expect the adoption of these new and amended PFRS except for PFRS 9 and PFRS 13 to have significant impact on the consolidated financial statements. Business Combination and Goodwill Business combinations are accounted for using the purchase method. This involves recognizing identifiable assets and liabilities of the acquired business initially at fair value. If the acquirers interest in the net fair value of the identifiable assets and liabilities exceeds the cost of the business combination, the acquirer shall (a) reassess the identification and measurement of the acquirees identifiable assets and liabilities and the measurement of the cost of the combination; and (b) recognize immediately in the consolidated statements of comprehensive income any excess remaining after that reassessment. When a business combination involves more than one exchange transaction, each exchange transaction shall be treated separately using the cost of the transaction and fair value information at the date of each exchange transaction to determine the amount of any goodwill associated with that transaction. This results in a step-by-step comparison of the cost of the individual investments with the Groups interest in the fair value of the acquirees identifiable assets, liabilities and contingent liabilities at each exchange transaction. The fair values of the acquirees identifiable assets, liabilities and contingent liabilities may be different at the date of each exchange transaction. Any adjustments to those fair values relating to previously held interests of the Group is a revaluation to be accounted for in the consolidated statements of comprehensive income. Goodwill represents the excess of the cost of an acquisition over the fair value of the Groups share in the net identifiable assets of the acquired subsidiary or associate at the date of acquisition. Goodwill on acquisitions of subsidiaries is recognized separately as a noncurrent asset. Goodwill on acquisitions of associates is included in investments in associates and is tested annually for impairment as part of the overall balance. Goodwill is reviewed for impairment, annually or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. AFS Financial Assets. AFS financial assets are non-derivative financial assets that are designated as AFS or are not classified in any of the three other categories. The Group designates financial instruments as AFS if they are purchased and held indefinitely and may be sold in response to liquidity requirements or changes in market conditions. After initial recognition, AFS financial assets are measured at cost. Loans and Receivables. Loans and receivables are non-derivative financial assets with fixed or determinable payments and maturities that are not quoted in an active market. Subsequent to initial measurement, loans and receivables are carried at cost or amortized cost using the effective interest method, less any impairment in value. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees that are integral part of the effective interest rate. Gains or losses are recognized in the consolidated statements of comprehensive income when loans and receivables are derecognized or impaired, as well as through the amortization process.

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Included in this category are cash in banks, cash equivalents, receivables and refundable deposits. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash with original maturities of three months or less and are subject to an insignificant risk of change in value. Other Financial Liabilities. This category pertains to financial liabilities that are not designated or classified as at FVPL. After initial measurement, other financial liabilities are carried at amortized cost using the effective interest method. Amortized cost is calculated by taking into account any premium or discount and any directly attributable transaction costs that are considered an integral part of the effective interest rate of the liability. Included in this category are the accounts payable and accrued expenses, other current liabilities, and due to related parties.

Accounting Policies Adopted The accounting policies adopted are consistent with those of the previous financial year particularly the adoption of the following Philippine Interpretations base on International Financial Reporting Interpretations Committee (IFRIC) which became effective on January 1, 2008.

IAS 1, Presentation of Financial Statement , explains fair presentation of financial statements, what compliance with the PFRS requires, and what a complete set of financial statements is. This prescribes the basis for presentation of general purpose financial statements to ensure comparability both with the entitys financial statements of previous periods and with the financial statements of other entities. It sets out overall requirements for the presentation of financial statements, guidelines for their structure and minimum requirements for their content.

IAS 2, Inventories, prescribes the accounting treatment for inventories. A primary issue is the amount of cost to be recognized as an asset and carried forward until the related revenues as recognized. It provides guidance on the determination of cost and its subsequent recognition as an expense, including write-down to net realizable value. It also provides guidance on the cost formulas that are used to assign costs to inventories.

IAS 7, Statement of Cash Flows, sets out the information that is to be presented in a statement of cash flows and how to present it. The statement of cash flows provides information about the changes in cash and cash equivalents of an entity for a reporting period, showing separately changes from operating activities, investing activities and financing activities.

IAS 8, Accounting Policies, Estimates and Errors, provides guidance for selecting and applying the accounting policies used in preparing financial statements. It also covers changes in accounting estimates and corrections of errors in prior period financial statements.

IAS 10, Events after the End of the Reporting Period, defines events after the end of the reporting period and sets out principles for recognizing, measuring and disclosing those events. Events after the end of the reporting period are those events, favorable and unfavorable, that occur between the end of the reporting period and the date when the financial statements are authorized for issue. Its objective is to prescribe: (a) when an entity should adjust its financial statements for events after the reporting period; and (b) the disclosures that an entity should give about the date when the financial statements were authorized for issue and about events after the reporting period. It also requires that an

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entity should not prepare its financial statements on a going concern basis if events after the reporting period indicate that the going concern assumption is not appropriate.

IAS 12, Income Taxes, prescribes the accounting treatment for income taxes. Its objective is how to account for the current and future tax consequences of: (a) the future recovery(settlement) of the carrying amount of assets(liabilities) that are recognized in an entitys statement of financial position; and (b)transactions and other events of the current period that are recognized in an entitys financial statements.

IAS 16, Property and Equipment, prescribes the accounting treatment for property equipment so that users of the financial statements can discern information about an entitys investment in its property and equipment and the changes in such investment. The principal issues in accounting for property and equipment are the recognition of the assets, the determination of their carrying amounts and the depreciation charges and impairment losses to be recognized in relation to them. An entity shall measure an item of property and equipment at initial recognition at its cost. The cost of an item of property and equipment is the cash price equivalent at the recognition date. If payment is deferred beyond normal credit terms, the cost is the present value of all future payments.

IAS 17, Leases, applies to agreements that transfer the right to use assets even though substantial services by the lessor may be called for in connection with the operation or maintenance of such assets. This section does not apply to agreements that are contracts for services that do not transfer the right to use assets from one contracting party to the other. Its objective is to prescribe, for lessees and lessors, the appropriate accounting policies and disclosure to apply in relation to leases.

IAS 18, Revenue, prescribes the accounting treatment of revenue arising from certain types of transactions and events. The primary issue in accounting for revenue is determining when to recognize revenue. Revenue is recognized when it is probable that future economic benefits will flow to the entity and these benefits can be measured reliably. This section identifies the circumstances in which these criteria will be met and, therefore, revenue will be recognized. It also provides practical guidance on the application of these criteria. An entity shall measure revenue at the fair value of the consideration received or receivable.

IAS 19, Employee Benefits, deals with accounting and reporting by the plan to all participants as a group. It does not deal with reports to individual participants about their retirement benefit rights. An entity shall recognize the cost of all employee benefits to which its employees have become entitled as a result of service rendered to the entity during the reporting period: (a) as a liability (b) as an expense. This section shall be applied in the financial statements of retirement benefit plans where such financial statements are prepared.

IAS 24, Related Party Disclosures, requires an entity to include in its financial statements the disclosures necessary to draw attention to the possibility that its financial position and profit or loss have been affected by the existence of related parties and by transactions and outstanding balances with such parties. An entity shall disclose key management personnel compensation

IAS 32, Financial Instruments: Presentation, deals with recognizing, measuring and disclosing basic financial instruments and is relevant to all entities. An entity shall recognize a financial asset or a financial liability only when the entity becomes a party to the contractual provisions of the instrument. When a financial asset or financial liability is recognized initially, an entity shall measure it at the transaction price unless the arrangement constitutes, in effect, a financing transaction.

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IAS 36, Impairment of Assets, prescribes the procedures that an entity applies to ensure that its assets are carried at no more than their recoverable amount if its carrying amount exceeds the amount to be recovered through use of or sale of the asset. If this is the case, the asset is described to be impaired and the standard requires the entity to recognize an impairment loss.

IAS 39, Financial Instruments: Recognition and Measurement, establishes principles for recognizing and measuring financial assets, financial liabilities and some contracts to buy or sell non-financial items. IFRS 7, Financial Instruments: Disclosures, enables users to evaluate (a) the significance of financial instruments for the entitys financial position and performance; and (b) the nature and extent of risk arising from financial instruments to which the entity I to early adopts exposed during the period and at the end of the reporting period and how the entity manages those risks.

As per consideration of the result of its impact evaluation, the group has decided not to early adopt either PFRS 9 (2009) or PFRS 9 (2010) for its 2011 annual financial reporting. The group shall conduct in early 2012 another impact evaluation using the outstanding balances of financial statements as of December 31,2011. A statement that the groups decision whether to early adopt either PFRS 9 (2009) or PFRS 9 (2010) for its 2012 financial reporting shall be disclosed in its financial statements as of March 31,2012. The group shall likewise state that if the decision of the group will be to early adopt the subject standard for its 2012 financial reporting, its interim report as of March 31,2012 will already reflect the application of the requirements under the said standard and will contain a quantitative and qualitative discussion of the results of the groups impact evaluation.

Financial Assets Financial assets include Cash, Trade and Other Receivables.

Cash Cash includes cash on hand, cash in banks and petty cash fund. Cash on hand as of the end of the period were deposited the next banking day. Cash in banks are deposits held at call with banks. The company reconciles the books and bank balances regularly as part of its cash monitoring and internal control measures. Petty cash fund is used for small payments not covered by checks. Trade and Other Receivables Trade receivables represent accounts receivable and are non-interest bearing measured initially at transaction price and subsequently measured at their fair value as reduced by appropriate allowances for doubtful accounts and impairment, if any. The allowance for doubtful accounts is the estimated amount of probable losses arising from non-collection based on past collection experience and managements review of the current status of the long-outstanding receivables. The doubtful accounts expense is recognized in the statements of income. Other receivables are recorded initially at transaction cost and subsequently measured at cost less impairment, if any. Other receivables include advances to officers and employees, accrued income receivable, and others. Inventories Inventories are valued at the lower of cost and net realizable value. The cost of inventories is determined using weighted average method and includes all expenditures incurred in acquiring the inventories and in bringing them to their existing location and condition. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs necessary to make the sale. Property and Equipment

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Property and equipment are carried at cost, less accumulated depreciation, amortization and impairment losses, if any. Initially, an item of property and equipment is measured at its cost, which comprises its purchase price and any directly attributable costs of bringing the asset to its working condition. Subsequent expenditures are added to the carrying amount of the asset when it is probable that future economic benefits, in excess of the originally assessed standard of performance, will flow to the Group. The costs of day-to-day servicing of an asset are recognized in the consolidated statements of comprehensive income in the period in which they are incurred. Depreciation is computed on a straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the estimated useful life of the improvements or the term of the lease whichever is shorter. Estimated useful lives are as follows::

Building and structures 10-15 years Machinery and equipment 4-5 years Furniture and fixtures 4 years Office equipment 3 years Transportation equipment 5 years Exploration equipment 3 years Software 3 years Leasehold improvements shorter of 5 years or lease term

The useful lives and depreciation and amortization method are reviewed at each reporting date to ensure that they are consistent with the expected pattern of economic benefits from items of property and equipment.

Fully depreciated and amortized assets are retained in the accounts until they are no longer in use and no further charges for depreciation are made in respect of those assets. When an asset is disposed of, or is permanently withdrawn from use and no future economic benefits are expected from its disposal, the cost and accumulated depreciation and amortization and impairment are removed from the accounts and any resulting gain or loss arising from the retirement or disposal is recognized in the consolidated statements of comprehensive income. Other Noncurrent Assets Other noncurrent assets include rental deposits, security deposits, construction bond and low value assets. Financial Liabilities Financial liabilities are recognized initially at fair value. Financial liabilities are recognized when the Company becomes a party to the contractual provisions of the instrument. Financial liabilities include Trade and Other Payables.

Trade and Other Payables Trade payables are liabilities to pay for goods or services that have been received or supplied and have been invoiced or formally agreed with the supplier. Other Payables include payables to affiliates, accrued expenses and statutory obligation such as withholding tax payable. Trade and other payables are initially recorded at transaction price and subsequently measured at their cost less settlement payments. Non-Current Liabilities

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Non-current liabilities represent account payable-others and miscellaneous deposit which initially recorded at transaction price and subsequently measured at their cost less settlement payments. Financial Instruments Date of Recognition. The Group recognizes a financial asset or financial liability in the consolidated statements of financial position when it becomes a party to the contractual provisions of the instrument. Regular way purchases or sales of financial assets, that require delivery within the timeframe established by regulation and convention in the market place are recognized on settlement date. Initial Recognition of Financial Insturments. Financial instruments are recognized initially at fair value of the consideration given (in case of an asset) or received (in case of a liability). The initial measurement of financial instruments, except for those designated at fair value through profit and loss (FVPL), includes transaction costs. Determination of Fair Value. The fair value for financial instruments traded in active markets at the reporting date is based on their quoted market price or dealer price quotations (bid price for long positions and ask price for short positions), without any deduction for transaction costs. When current bid and ask prices are not available, the price of the most recent transaction provides evidence of the current fair value as long as there is no significant change in economic circumstances since the time of the transaction. Categories of Financial Instruments. Subsequent to initial recognition, the Group classifies its financial assets into the following categories: held-to-maturity (HTM) investments, available-for-sale (AFS) financial assets, financial assets at FVPL, and loans and receivables. The Group classifies its financial liabilities as either at FVPL financial liabilities or other financial liabilities. The classification depends on the purpose for which the investments are acquired and whether they are quoted in an active market. Management determines the classification of the Groups financial assets and financial liabilities at initial recognition and, where allowed and appropriate, re-evaluates such designation at each reporting date. The Group has no HTM investments and financial assets at FVPL financial liabilities as at December 31, 2011, 2010 and 2009. There were no reclassifications within the categories of financial assets and financial liabilities in 2011 and 2010. Impairment of Financial Assets The Group assesses at each reporting date whether a financial asset or group of financial assets is impaired. Assets Carried at Amortized Cost. If there is an objective evidence that an impairment loss on assets carried at amortized cost has been incurred, the amount of the loss is measured as the difference between the assets carrying amount and the present value of estimated future cash flows (excluding future expected credit losses that have not been incurred, discounted at the financial assets original effective interest rate (i.e., the effective interest rate computed at initial recognition). The carrying amount of the asset is reduced thorugh the use of an allowance account. The amount of the loss shall be recognized in the consolidated statements of comprehensive income. The Group first assesses whether objective evidence of impairment exist individually for financial assets that are individually significant, and individually or collectively for financial assets that are not individually significant. The Group uses specific criteria in determining whether the receivables will be assessed in a specific approach such as, continuous default in payment of the customers on their maturing obligations, customers bankruptcy and status of receivables under litigation. If it is determined that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, the asset is included in a group of financial assets with similar

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credit risk characteristics and that the group of financial assets is collectively assessed for impairment. For the purpose of a collective evaluation of impairment, financial assets are grouped on the basis of such credit risk characteristics as historical collection experiences, past due status and term. Assets that are individually assessed for impairment and for which an impairment loss is or continue to be recognized are no longer included in the collective assessment of impairment. If, in a subsequent period, the amount of impairment loss decreases and the decrease can be related objectively to an event occurring after impairment was recognized, the previously recognized impairment loss is reversed, to the extent that the carrying value of the asset does not exceed its amortized cost at the reversal date. Any subsequent reversal of an impairment loss is recognized in consolidated statements of comprehensive income. Derecognition of Financial Assets and Financial Liabilities Financial assets A financial asset (or, where applicable a part of financial asset or part of a group of similar financial assets) is derecognized when:

the rights to receive cash flows from the asset have expired;

the Company retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a pass-through arrangement; or

the Company has transferred its rights to receive cash flows from the asset and either (a) has transferred substantially all the risks and rewards of the asset, or (b) has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Group has transferred its rights to receive cash flows from an asset and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognized to the extent of the Groups continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to pay. Financial Liabilities A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expired. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognized in the consolidated statements of comprehensive income. Offsetting Financial Instruments Financial assets and financial liabilities are offset and the net amount reported is reported in the consolidated statements of financial position if, and only if, there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the asset and settle the liability simultaneously. This is not generally the case with master netting agreements, and the related assets and liabilities are presented gross in the consolidated statements of financial position. Impairment of Non-Financial Assets The Company assesses as at reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the assets recoverable amount. An assets recoverable amount is calculated as the higher of the assets or cash-generating units fair value less costs to sell and its value in use or its net selling price and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those assets or groups of assets. Where the carrying amount of an asset exceeds it recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the

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estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessment of the time value of money and the risks specific to the asset. Impairment losses are recognized in the statements of income in those expense categories consistent with the function of the impaired asset. An assessment is made at each reporting date as to whether there is an indication that previously recognized impairment losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously recognized impairment loss is reversed only if there has been a change in the estimates used to determine the assets recoverable amount since the last impairment loss was recognized. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation and amortization, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the statements of income unless the asset is carried at revalued amount, in which case the reversal is treated as revaluation increase. After such a reversal, the depreciation charge is adjusted in future periods to allocate the assets revised carrying amount, less any residual value, on a systematic basis over its remaining useful life.

Provisions and Contingencies Provisions are recognized when the Company has a present obligation, either legal or constructive, as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and the amount of the obligation can be estimated reliably. When the Company expects reimbursement of some or all of the expenditure required to settle a provision, the entity recognizes a separate asset for the reimbursement only when it is virtually certain that reimbursement will be received when the obligation is settled.

The amount of the provision recognized is the best estimated of the consideration required to settle the present obligation at the balance sheet date, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

Provisions are reviewed at each reporting date and adjusted to reflect the current best estimate.

Contingent liabilities and assets are not recognized because their existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. Contingent liabilities, if any, are disclosed, unless the possibility of an outflow of resources embodying economic benefits is remote. Contingent assets are disclosed only when an inflow of economic benefits is probable.

Cumulative Fund Balances Cumulative fund balances include all current and prior period results as disclosed in the statement of revenue and expenses. Revenue and cost recognition Revenue is recognized to the extent that is probable that the economic benefits will flow to the Company and the amount of revenue can be reliably measured. However, when an uncertainty arises about the collectability of an amount already included in the revenue, the uncollectible amount, or the amount in respect of which recovery has ceased to be probable, is recognized as an expense, rather than as an adjustment of the amount of revenue originally recognized. The following specific criteria must also be met before revenue is recognized:

Interest income. Interest income is recognized as the interest accrues.

Miscellaneous income includes sales of pine seedlings. Cost, distribution, administrative and finance cost are recognized in the statement of income upon utilization of the service or in the date they are incurred.

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Employees Compensation and Other Benefits Short-term Benefits The Company recognizes a liability net of amounts already paid and an expense for services rendered by employees during the accounting period. Short-term benefits given by the Company to its employees include salaries and wages, social security contributions, short-term compensated absences, bonuses and other non-monetary benefits, if any. Income Taxes Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the balance sheet date. Deferred income tax, if any, is provided, using the balance sheet liability method, on all temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax liabilities, if any, are recognized for all taxable temporary differences. Deferred income tax assets are recognized for all deductible temporary differences and carry forward benefits of unused net operating loss carryover (NOLCO), to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and carry forward of NOLCO can be utilized. The carrying amount of deferred tax assets, if any, is reviewed at each balance sheet date and reduced to the extent that is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilized. Unrecognized deferred tax assets are reassessed at each balance date and are recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Deferred tax asset and liabilities, if any, are measured at the tax rates expected in the year when the asset is realized or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the balance sheet date. Operating Leases Leases in which a significant portion of the risks and rewards of ownerships is retained by the lessor are classified as operating leases. Payments made under operating leases are recognized in the consolidated statements of comprehensive income on a straight-line basis over the term of the lease. A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental to ownership. Operating lease payment are recognized as expense in the statement of income on a straight-line basis over the lease term. Events After the End of the Reporting Period Post-year-end events up to the date of the auditors report that provide additional information about the Companys position at the balance sheet date (adjusting events) are reflected in the financial statements. Post-year-end events that are not adjusting events are disclosed in the notes to financial statements when material. Related Party Disclosures Related party relationships exist when one party has the ability to control, directly or indirectly through one or more i