2007 annual report aveiro investment corp. - First West Properties

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STATEMENTS OF CASH FLOWS Years ended June 30, 2007 and 2006 Cash provided by (used in): 34 | Aveiro Investment Corp. | 2007 Annual Report 2007 2006 OPERATIONS Net loss Adjustments for non-cash items: $ (872,750 ) $ (6,863 ) Amortization 5,692 – Stock based compensation 249,207 – Changes in non-cash operating working capital 65,125 2,669 (552,726 ) (4,194 ) FINANCING Issuance of mortgages payable 10,823,950 – Repayment of mortgages payable (3,746,000 ) – Shares issued for cash 11,430,000 – Restricted cash (10,000 ) – Advances from related parties – 4,194 Share issue costs (1,059,688 ) – 17,438,262 4,194 INVESTING Purchase of income-producing property (5,579,409 ) – Purchase of property held for development (9,321,561 ) – Purchase of equipment (54,143 ) – (14,955,113 ) – Net increase in cash 1,930,423 – Cash, beginning of period – – Cash, end of period $ 1,930,423 $ – Interest paid $ 142,240 $ – See accompanying notes to the fi nancial statements
NOTES TO THE FINANCIAL STATEMENTS June 30, 2007 and 2006 1. ORGANIZATION AND NATURE OF BUSINESS The Company (formerly Dagger Resources Inc.) was incorporated under the Alberta Business Corporations Act on June 7, 1996 and its articles were amended on June 24, 1996. The Company was an inactive public company until August 21, 2006, when the Board of Directors and management were changed and a new business plan was adopted. The Company is an Alberta based real estate investment company building a portfolio of real estate assets in secondary markets in western Canada consisting primarily of income producing properties in addition to other real estate to which management can conduct activity to provide fundamental value growth. These fi nancial statements have been prepared on the basis of a going concern. Should the going concern assumption not be applicable, then adjustments would be required to the carrying value of the Company’s net assets and to its statements of operations. 2. BASIS OF PRESENTATION The Company prepares fi nancial statements in accordance with Canadian generally accepted accounting principles. 3. SIGNIFICANT ACCOUNTING POLICIES (a) Income taxes The Company uses the liability method of accounting for future income taxes whereby future income tax assets and liabilities are determined based on temporary differences between the accounting basis and the tax basis of the assets and liabilities, and are measured using the substantively enacted tax rates and laws expected to apply when these differences reverse. In assessing whether the future tax assets are realizable, management considers whether it is more likely than not that some portion or all of the future tax assets will not be realized. The ultimate realization of future tax assets, consisting of loss carryforwards and taxable temporary differences, is dependent upon the generation of future taxable income during the periods in which those temporary differences and tax loss carryforwards can be utilized. (b) Revenue recognition Revenue from income-producing properties includes rents earned from tenants under lease agreements, realty tax and operating costs recoveries and other incidental income and is recognized as revenue over the term of the underlying leases. All rent increases based on escalation clauses in lease agreements are accounted for on a straight-line basis over the term of the respective leases. (c) Per share amounts Basic earnings per share is computed by dividing the net loss by the weighted average shares outstanding during the reporting year. Diluted earnings per share is calculated by using the treasury stock method. This method assumes that proceeds received from the exercise of in-the-money options are used to repurchase shares at the average market price for the period. Aveiro Investment Corp. | 2007 Annual Report | 35
Page 1 and 2: AVEIRO INVESTMENT CORP. 2007 ANNUAL
Page 3 and 4: CHAIRMAN’S LETTER DEAR FELLOW SHA
Page 5 and 6: ASSETS SASKATOON TOTAL OF APPROXIMA
Page 7 and 8: ASSETS AIRDRIE 77 ACRES OF UNDEVELO
Page 9 and 10: Harold Kunik, Chief Financial Offic
Page 11 and 12: JULY 2007 Private Placement In July
Page 13 and 14: WHY SASKATCHEWAN? Once solely an ag
Page 15 and 16: OVERVIEW About Aveiro Aveiro is an
Page 17 and 18: OVERALL PERFORMANCE Financial Posit
Page 19 and 20: The Warehouse Mortgage is a fi rst
Page 21 and 22: a company with common management. I
Page 23 and 24: During the 2008 fi scal year, the C
Page 25 and 26: properties. The ability of Aveiro t
Page 27 and 28: OUTSTANDING SHARE DATA Common Share
Page 29 and 30: The rates are determined based on m
Page 31 and 32: AUDITOR’S REPORT To the sharehold
Page 33: STATEMENTS OF LOSS AND DEFICIT Year
Page 37 and 38: NOTES TO THE FINANCIAL STATEMENTS J
Page 47 and 48: AUDITORS Grant Thornton LLP 1000, 1

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