EDC PR 2016 (FS section)

Financial Statement
Audit Response
We obtained an understanding of the Company’s capitalization policy and tested whether the policy has
been applied consistently. We obtained management’s assessment on the recoverability of the
exploration and evaluation assets, and inquired into the status of these projects and their future plan of
operation. We obtained the status of each exploration project as of December 31, 2016, as certified by the
Company’s technical group head, and compared it with the disclosures submitted to regulatory agency.
We reviewed the terms of contracts and agreements, and budget for exploration costs. We inspected the
licenses and permits of each exploration project to determine that the period for which the Company has
the right to explore in the specific area has not expired or is not expiring in the near future. We also
inquired of management about the project areas that are expected to be abandoned or any exploration
activities that are planned to be discontinued in those areas.
Other Information
Management is responsible for the other information. The other information comprises the
SEC Form 17-A for the year ended December 31, 2016 but does not include the consolidated financial
statements and our auditor’s report thereon, which we obtained prior to the date of this auditor’s report,
and the SEC Form 20-IS (Definitive Information Statement) and Annual Report for the year ended
December 31, 2016, which is expected to be made available to us after that date.
Our opinion on the consolidated financial statements does not cover the other information and we will not
express any form of assurance conclusion thereon.
In connection with our audits of the consolidated financial statements, our responsibility is to read the
other information identified above when it becomes available and, in doing so, consider whether the other
information is materially inconsistent with the consolidated financial statements or our knowledge
obtained in the audits, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of
this auditor’s report, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Consolidated
Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with PFRSs, and for such internal control as management determines is
necessary to enable the preparation of consolidated financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless management either intends to liquidate
the Company or to cease operations, or has no realistic alternative but to do so.
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