K A P U S K A S ING G O L D C O RP NO T E S T O T HE FIN A N CI A L S T A T E M E NT S F O R T HE Q U A RT E R E ND E D A UG U S T 31 2 01 4 E xpre ss ed in Can ad ian d o lla r s 1 2 F INA NCI A L INS T RUM E NT S T he Com pa n y i s ex p os ed to v ar y i n g d eg r e es to a v a r i et y of f i na nc i a l i ns tr um en t r el ate d r i s k s T he B oa r d ap prov es an d m on i t ors the r i s k m an ag em en t proc es s es T he t y p e of r i s k ex po s ure an d t he wa y i n whi c h s uc h e x p os ure i s m an ag ed i s pro v i de d a s f ol l o w s Cr ed i t Ri s k Cr ed i t r i s k i s the r i s k of po ten ti al l os s to the Com pa n y i f a c ou n terpart y t o a f i n an c i al i ns tr um en t f ai l s to m ee t i ts c on tr ac tua l ob l i ga ti on s T he Com pa n y s c r ed i t r i s k i s pri m aril y att r i bu ta bl e to i ts l i q ui d f i na nc i a l as s ets i nc l ud i ng c as h T he Com pa n y l i m i ts the ex p os ure to c r ed i t r i s k b y on l y i nv es ti n g i ts c as h wi th hi gh c r ed i t q ua l i t y f i na nc i a l i ns ti tu ti o ns Li q ui d i ty R i s k Li q ui d i t y r i s k i s th e r i s k tha t the Com pa n y wi l l n ot be a bl e to m ee t i ts f i na nc i a l ob l i ga ti on s as the y f a l l du e T he Com pa n y m an ag es l i qu i di t y r i s k throug h the m an ag em en t of i ts c ap i t al s tr uc ture a nd f i na nc i a l l ev erag e a s d es c r i be d i n N ote 12 T he Co m pa n y m on i tors i ts ab i l i t y t o m ee t i ts s ho r t term ex pl orati o n an d ad m i ni s t r ati v e ex pe n di t ures b y r a i s i n g ad di t i o na l f un ds throug h s ha r e i s s ua nc e when r e qu i r ed A l l of the Com pa n y s f i na nc i a l l i a bi l i t i es ha v e c on tr ac tu al m atu r i ti es of 30 da y s or du e on d em an d an d are s ub j ec t to no r m al tr ad e term s T he Co m pa n y do es no t h av e i nv es tm en ts i n a n y as s et ba c k ed de po s i ts In th e n orm al c ou r s e o f bu s i ne s s t he C om pa n y en ters i nto c on tr ac ts t ha t gi v e r i s e to c om m i t m en ts f or f utu r e m i ni m u m pa y m en ts T he f ol l o w i n g ta bl e s um m ari z es the C om pa n y s s i g ni f i c an t c om m i t m en ts an d c orr es po nd i ng m atu r i ti es 1 ye a r 1 3 Y ea r s T o t al A c c ou nts p a y a b l e a nd ac c r ue d l i ab i l i ti es 2 00 32 5 2 00 32 5 200 32 5 2 00 32 5 F orei g n E x c ha ng e Ri s k T he Co m pa n y c urr en tl y do es no t ha v e s i gn i f i c an t f orei gn ex c ha ng e r i s k as al l of i ts tr an s ac ti on s are i n Cana di a n d ol l ars Int eres t R ate R i s k T he Com pa n y i s n ot ex p os ed to s i gn i f i c an t i nt eres t rat e ri s k Comm od i ty P r i c e Ri s k T he Co m pa n y s a bi l i t y to r ai s e c ap i tal t o f un d ex pl or a ti on ac t i v i t i e s i s s ub j ec t to r i s k s as s oc i ate d wi t h f l uc tua ti on s i n th e m ar k et pric e of m i ne r al r es ou r c es T he Com pa n y c l os el y m on i tors c o m m od i t y pric es to d ete r m i ne th e a pp r op r i at e c ou r s e o f ac ti on t o be ta k en