10-Q

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED FEBRUARY 28, 2014

ý QUARTERLY REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐ TRANSITION REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________________ to _________________

Commission file number 000-51707

PANEX RESOURCES INC.

(Exact name of registrant as specified in its charter)

Incorporated in the State of Nevada

(State or other jurisdiction of incorporation or organization)

00-0000000

(I.R.S. Employer Identification No.)

Coresco AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland

(Address of principal executive offices)

+41 7887 96966

(Issuer’s telephone number)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

ý Yes   ☐ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

ý Yes   ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated filer”, “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Larger accelerated filer ☐  Accelerated filer  ☐  Non-accelerated filer ☐  Smaller reporting company ☐

(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

ý Yes   ☐ No

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding at April 11, 2014
Common Stock - $0.001 par value	417,236,507

Documents incorporated by reference: Refer to Exhibits

1 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

INDEX

PART I - FINANCIAL INFORMATION	3
ITEM 1 - FINANCIAL STATEMENTS	3
BALANCE SHEETS	3
STATEMENTS OF OPERATIONS	4
STATEMENTS OF CASH FLOWS	5
STATEMENTS OF STOCKHOLDER’S EQUITY (DEFICIENCY)	6
NOTES TO FINANCIAL STATEMENTS	8
ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION	17
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	20
ITEM 4 - CONTROLS AND PROCEDURES	20
PART II - OTHER INFORMATION	21
ITEM 1 - LEGAL PROCEEDINGS	21
ITEM 1A - RISK FACTORS	21
ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	21
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES	21
ITEM 4 - MINING SAFETY DISCLOSURES	21
ITEM 5 - OTHER INFORMATION	21
ITEM 6 - EXHIBITS	21
SIGNATURES	23

2 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

PART I - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

BALANCE SHEETS

PANEX RESOURCES INC.	As at	As at
(An exploration stage enterprise)	28 February	31 August
Balance Sheets	2014	2013
	(Unaudited)	(Audited)
(Expressed in U.S. Dollars)	$	$
ASSETS
Current assets
Cash	22,737	519
Total current assets	22,737	519
Total assets (all current)	22,737	519
Liabilities and Stockholders' Equity (Deficiency)
Current liabilities
Accounts payable and accrued expenses	237,415	63,344
Accounts payable and accrued expenses related parties (Note 4(b))	170,759	163,643
Advances received for common stock subscriptions	814,275	-
Loans and borrowings	-	110,000
Total liabilities (all current)	1,222,449	336,987
Stockholders’ Equity (Deficiency)
Common stock
Authorized: 500,000,000 (2013: 500,000,000)
common shares with par value of $0.001 each
Issued and outstanding:
417,236,507 (August 31, 2013: 118,261,507) common shares	417,236	118,261
Additional paid-in capital	13,131,129	13,080,699
Donated capital	77,627	77,627
Accumulated deficit during the exploration stage	(14,825,704)	(13,613,055)
Stockholder’ equity (deficiency)	(1,199,712)	(336,468)
Total liabilities and stockholders’ equity (deficiency)	22,737	519

The accompanying notes are an integral part of these financial statements.

3 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

STATEMENTS OF OPERATIONS

PANEX RESOURCES INC.	Cumulative	For the	For the	For the	For the
(An exploration stage enterprise)	May 28, 2004	Three Months	Three Months	Six Months	Six Months
Statements of Operations	(inception)	Ended	Ended	Ended	Ended
	28 February	28 February	28 February	28 February	28 February
(Unaudited)	2014	2014	2013	2014	2013
(Expressed in U.S. Dollars)	$	$	$	$	$
Donated rent	5,250	-	-	-	-
Donated services	72,377	-	-	-	-
Listing and filing fees	9,297	3,270	-	6,901	-
Investor relation expenses	133,189	52,214	-	133,189	-
Directors fees	-	-	-	-	-
Management fees	783,254	-	27,028	-	61,431
Stock option compensation	221,756	-	-	-	-
Professional fees	1,515,710	34,920	20,492	77,820	63,201
Travel costs	348,055	12,640	-	12,640	-
General and administrative	712,486	39,766	26,552	116,056	72,946
Foreign currency transaction loss (gain)	100,719	(3,876)	293	(3,876)	1,001
Mineral property and exploration costs	5,609,698	540,841	-	869,921	-
Write-off deferred acquisition cost	400,000	-	-	-	-
Provision against Minanca loan	6,100,000	-	-	-	-
	16,011,791	679,775	74,365	1,212,651	198,579
Other income (expense)
Interest income	42,707	-	-	-	-
Interest expense	(304,413)	-	-	-	(36)
Loss on sale of investment	(126,182)	-	-	-	-
Extinguishment of liabilities	197,745	-	-	-	-
Gain on sale of mineral property right	1,376,228	-	-	-	-
	1,186,085	-	-	-	(36)
(Net Loss) / Income	(14,825,704)	(679,775)	(74,365)	(1,212,651)	(198,615)
Net Loss Per Share - Basic and Diluted		*	*	*	*
Weighted Average Shares Outstanding		417,236,507	103,261,507	313,903,174	103,261,507

* Amounts are less than $0.01 per share

The accompanying notes are an integral part of these financial statements.

4 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

STATEMENTS OF CASH FLOWS

PANEX RESOURCES INC.	Cumulative	For the	For the
(An exploration stage enterprise)	May 28, 2004	Six Months	Six Months
Statements of Cash Flows	(inception)	Ended	Ended
	28 February	28 February	28 February
(Unaudited)	2014	2014	2013
(Expressed in U.S. Dollars)	$	$	$
Cash Flows From Operating Activities
(Net loss) income	(14,825,704)	(1,212,651)	(198,615)
Adjustments to reconcile net loss to cash used in operating activities
Foreign currency transaction loss (gain)	100,713	(3,876)	1,001
Gain on sale of mineral property rights	(586,228)	-	-
Loss on sale of investment	126,181	-	-
Extinguishment of debt	(208,171)	-	-
Donated services and expenses	77,627	-	-
Expenses paid by issue of common stock	500	-	-
Options expense	221,756	-	-
Write-off deferred acquisition costs	400,000	-	-
Provision against Minanca loan	6,100,000	-	-
Change in operating assets and liabilities		-	-
Increase (decrease) in accounts payable and accrued liabilities	1,484,944	413,474	(24,954)
Increase (decrease) in amounts due to related parties	301,275	7,116	64,740
Net Cash Used in Operating Activities	(6,807,109)	(795,937)	(157,828)
Cash Flows From Investing Activities
Cash received from sale of investment	250,047	-	-
Cash received from sale of mineral property rights	210,000	-	-
Deferred acquisition costs	(400,000)	-	-
Loan advances	(7,100,000)	-	-
Repayment of loan advance	1,000,000	-	-
Net Cash Used in Investing Activities	(6,039,953)	-	-
Cash Flows From Financing Activities		-	-
Loan from related parties	644,313	50,000	-
Loan repaid to related parties	(576,483)	-	-
Loan from unrelated third parties	340,000	-	100,000
Advances received for common stock subscriptions	804,275	764,275	-
Common shares issued for cash	11,647,739	-	-
Net Cash Provided by Financing Activities	12,859,844	814,275	100,000
Effect of Exchange Rates on Cash	9,955	3,880	(1,001)
Increase (decrease) in Cash	22,737	22,218	(58,829)
Cash at Beginning of Period	-	519	65,799
Cash at End of Period	22,737	22,737	6,970

The accompanying notes are an integral part of these financial statements.

5 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

STATEMENTS OF STOCKHOLDER’S EQUITY (DEFICIENCY)

PANEX RESOURCES INC (An exploration stage enterprise) Statements of Stockholder's Equity (Deficiency) and Comprehensive income (Loss)	Common Stock		Additional paid-in capital	Donated Capital	Accumulated (deficit) during exploration stage	Total stockholders' equity (deficiency)
May 28, 2004 (inception) to Balance Date	Shares	Amount	$	$	$	$
(Expressed in U.S. Dollars)	#	$
Balances, May 28, 2004 (Date of inception)
Common stock issued for services to president	6,000,000	6,000	(5,500)	-	-	500
Return and cancellation of shares	(6,000,000)	(6,000)	6,000	-	-	-
Net loss					(500)	(500)
Balances, August 31, 2004	-	-	500	-	(500)	-
Common stock issued for cash	64,500,000	64,500	(17,750)	-	-	46,750
Return and cancellation of shares	(30,000,000)	(30,000)	30,000	-	-	-
Donated rent	-	-	-	3,000	-	3,000
Donated services	-	-	-	6,000	-	6,000
Net loss					(15,769)	(15,769)
Balances, August 31, 2005	34,500,000	34,500	12,750	9,000	(16,269)	39,981
Common stock issued for cash	1,964,285	1,964	4,498,036	-	-	4,500,000
Donated rent	-	-	-	2,250	-	2,250
Donated services	-	-	-	4,500	-	4,500
Net loss					(848,560)	(848,560)
Balances, August 31, 2006	36,464,285	36,464	4,510,786	15,750	(864,829)	3,698,171
Common stock issued for cash	7,632,500	7,632	6,098,368			6,106,000
Net loss					(10,943,990)	(10,943,990)
Balances, August 31, 2007	44,096,785	44,096	10,609,154	15,750	(11,808,819)	(1,139,819)
Net loss					(66,651)	(66,651)
Balances, August 31, 2008	44,096,785	44,096	10,609,154	15,750	(11,875,470)	(1,206,470)
Common stock issued for cash	1,600,000	1,600	14,400			16,000
Common stock issued for settlement of debt	14,000,000	14,000	126,000			140,000
Shares to be issued	-	-	30,000			30,000
Net loss					(154,585)	(154,585)
Balances, August 31, 2009	59,696,785	59,696	10,779,554	15,750	(12,030,055)	(1,175,055)
Common stock issued for cash received in	4,000,000	4,000	6,000	-	-	10,000
December 2008						-
Common stock issued for settlement of debt	3,350,000	3,350	30,150	-	-	33,500
Net loss					(213,860)	(213,860)
Balances, August 31, 2010	67,046,785	67,046	10,815,704	15,750	(12,243,915)	(1,345,415)
Common stock issued for settlement of accounts	12,303,123	12,303	602,853	-	-	615,156
payable, accrued liabilities and debt						-
Donated services	-	-	-	31,617	-	31,617
Net loss					(299,498)	(299,498)
Balances, August 31, 2011	79,349,908	79,349	11,418,557	47,367	(12,543,413)	(998,140)

The accompanying notes are an integral part of these financial statements.

6 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

STATEMENTS OF STOCKHOLDER’S EQUITY (DEFICIENCY) (Continued)

PANEX RESOURCES INC (An exploration stage enterprise) Statements of Stockholder's Equity (Deficiency) and Comprehensive income (Loss)	Common Stock		Additional paid-in capital	Donated Capital	Accumulated (deficit) during exploration stage	Total stockholders' equity (deficiency)
May 28, 2004 (inception) to Balance Date	Shares	Amount	$	$	$	$
(Expressed in U.S. Dollars)	#	$
Balances, August 31, 2011	79,349,908	79,349	11,418,557	47,367	(12,543,413)	(998,140)
Donated services	-	-	-	30,260	-	30,260
Issuance of common stock for settlement of debt and accounts payable in February 2012)	8,477,553	8,478	161,073	-	-	169,551
Common stock issued for cash at $0.08 per share	12,237,075	12,237	966,752	-	-	978,989
Common stock issued for settlement of debt and accounts payable in March 2012	3,196,971	3,197	252,561	-	-	255,758
Stock option compensation expense	-	-	221,756	-	-	221,756
Net loss	-	-	-	-	(926,016)	(926,016)
Balances, August 31, 2012	103,261,507	103,261	13,020,699	77,627	(13,469,429)	(267,842)
Net loss	-	-	-	-	(124,250)	(124,250)
Balances, November 30, 2012	103,261,507	103,261	13,020,699	77,627	(13,593,679)	(392,092)
Net loss	-	-	-	-	(74,365)	(74,365)
Balances, February 28, 2013	103,261,507	103,261	13,020,699	77,627	(13,668,044)	(466,457)
Net loss (income)	-	-	-	-	81,885	81,885
Common stock issued for settlement of liabilities on April 11, 2013 at 0.5 cents per share	15,000,000	15,000	60,000	-	-	75,000
Balances, May 31, 2013	118,261,507	118,261	13,080,699	77,627	(13,586,159)	(309,572)
Net loss (income)	-	-	-	-	(26,896)	(26,896)
Balances, August 31, 2013	118,261,507	118,261	13,080,699	77,627	(13,613,055)	(336,468)
Common stock issued for settlement of liabilities on November 15, 2013 at $0.001 per share	248,000,000	248,000	-	-	-	248,000
Extinguishment of liabilities with a related party			50,430	-	-	50,430
Net loss	-	-	-	-	(532,876)	(532,876)
Balances, November 30, 2013	366,261,507	366,261	13,131,129	77,627	(14,145,930)	(570,913)
Net loss	-	-	-	-	(679,775)	(679,775)
Common stock issued for settlement of liabilities  during quarter ended February 28, 2014 at 0.001 cents per share	50,975,000	50,975	-	-	-	50,975
Balances, February 28, 2014	417,236,507	417,236	13,131,129	77,627	(14,825,704)	(1,199,712)

The accompanying notes are an integral part of these financial statements.

7 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

NOTES TO FINANCIAL STATEMENTS

1.  Organization, Nature of Business, Going Concern and Management’s Plans

Panex Resources Inc. (‘Panex” or the “Company”) was incorporated in the State of Nevada on May 28, 2004. The Company is considered to be an Exploration Stage Company. The Company’s principal business is the acquisition and exploration of mineral resources.

Going concern and management’s plans:

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  Since its inception on May 28, 2004, the Company has not generated revenue and has incurred net losses.  

The Company incurred a net loss of $1,212,651 for the six months ended February 28, 2014, and a deficit accumulated during the exploration stage of $14,825,704 for the period May 28, 2004 (inception) through February 28, 2014.  

Accordingly, it has not generated cash flow from operations and has primarily relied upon advances from shareholders and proceeds from equity financings to fund its operations.  These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The Company has no mineral property interests as of the date of this report.  Certain mineral property interests are presently being considered, however it is too early to determine whether they may be considered appropriate for acquisition.

During the next 12 months, management’s objective is to recapitalize Panex, continue to raise new capital and to seek new investment opportunities in the mineral sector.  Management believes that its worldwide industry contacts will make it possible to identify and assess new projects for acquisition purposes.  

Panex is seeking a viable business opportunity through acquisition, merger or other suitable business combination method, with a focus on undervalued mineral properties for eventual acquisition.  Panex intends to concentrate its acquisition efforts on mineral properties or mineral exploration businesses that management believes to be undervalued or that management believes may realize a substantial benefit from being publicly owned.  Panex will continue to identify and assess undervalued mineral properties when capital raisings are completed.  A small number of mineral properties are presently being reviewed, but it is too early to say whether they may be considered appropriate for acquisition.

The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts or classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

2.  Summary of Significant Accounting Policies

a.  Basis of Preparation

These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States (US GAAP).  The Company’s fiscal year-end is August 31.

b.  Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

8 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

2.  Summary of Significant Accounting Policies (Continued)

c.  Basic and Diluted Net Income (Loss) Per Share

Earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the reporting period including common stock issued effective the date committed.  Common stock issuable is considered outstanding as of the original approval date for the purposes of earnings per share computations.  Diluted earnings (loss) per common share is computed by dividing net earnings (loss) by the sum of (a) the basic weighted average number of shares of common stock outstanding during the period and (b) additional shares that would have been issued and potentially dilutive securities.  During the reporting periods the diluted earnings (loss) per share was equivalent to the basic earnings (loss) per share because all potentially dilutive securities were anti-dilutive due to the net losses incurred.  Potentially dilutive securities consist of stock options outstanding at the end of the reporting period.    

d.

Cash

Cash includes deposits in banks, which are unrestricted as to withdrawal or use.

e.

Mineral Property and Exploration Costs

The Company has been in the exploration stage since its formation on May 28, 2004 and has not realized any revenues from its planned operations.  It has been primarily engaged in the acquisition and exploration of mining properties.  Mineral property acquisition and exploration costs are expensed as incurred.  When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property are capitalized.  Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve.  If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.

f.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or most advantageous market. The Company uses a fair value hierarchy that has three levels of inputs, both observable and unobservable, with use of the lowest possible level of input to determine fair value.

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 - observable inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and

Level 3 - assets and liabilities whose significant value drivers are unobservable.

As of reporting period, the Company did not have any assets or liabilities that were measured at fair value on a recurring or non-recurring basis.

Observable inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company’s market assumptions. Unobservable inputs require significant management judgment or estimation.  In some cases, the inputs used to measure an asset or liability may fall into different levels of the fair value hierarchy.  In those instances, the fair value measurement is required to be classified using the lowest level of input that is significant to the fair value measurement. Such determination requires significant management judgment.

Financial instruments, which include cash, accounts payable, and loans and borrowings, were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments.  The fair value of amounts due to related parties are not practical to estimate, due to the related party nature of the underlying transactions.  The financial risk to the Company’s operations arises from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk.

9 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

2.  Summary of Significant Accounting Policies (Continued)

g.

Income Taxes

The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their tax bases, as well as net operating losses.  

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets or liabilities of a change in tax rates is recognized in the period in which the tax change occurs.  A valuation allowance is provided to reduce the deferred tax assets to a level, that more likely than not, will be realized.

Management does not believe that the Company has any unrecognized tax positions. The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.

h.

Stock-Based Compensation

The Company accounts for share-based payments under the fair value method of accounting for stock-based compensation consistent with US GAAP.  Under the fair value method, stock-based compensation cost is measured at the grant date based on the fair value of the award using the Black-Sholes option pricing model and is recognized to expense on a straight-line basis over the requisite service period, which is generally the vesting period.  Where upon grant the options vest immediately the stock-based costs are expensed immediately.  

i.

Foreign Currency Translation and Transactions

The Company’s functional and reporting currency is the United States dollar.  Monetary assets and liabilities denominated in foreign currencies are translated into the United States dollar using the exchange rate prevailing at the balance sheet date.   Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income.

j.

Concentration of Credit Risk

The Company’s financial instruments that are exposed to concentration of credit risk consist of cash.  The Company’s cash is in demand deposit accounts placed with federally insured financial institutions in Canada.  

k.

Interim Financial Statements

In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.

l.

Recent Accounting Pronouncements

Management has evaluated any recently issued accounting pronouncements to determine their applicability and does not believe that any of these pronouncements will have a significant impact on the Company’s financial statements.

10 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

3.  Stock Options

In August 2012, the Company's Board of Directors approved the issuance of stock options as an incentive to obtain services of key employees, directors and consultants of the Company.  The following is a summary of stock option activity and the status of stock options outstanding and exercisable as at reporting date:

	Stock Options #	Weighted Average Exercise Price $	Remaining Contractual Life (years) As At	Aggregate Intrinsic value As At
Outstanding and exercisable at August, 31, 2012	8,000,000	0.08	4.92	-
Granted during the fiscal year ended August 31, 2013	-	-	-	-
Forfeited during the fiscal year ended August 31, 2013	(8,000,000)	0.08	4.17	-
Outstanding and exercisable at August 31, 2013	-	-	-	-
Granted during the quarter ended November 30, 2013	-	-	-	-
Outstanding and exercisable at November 30, 2013	-	-	-	-
Granted during the quarter ended February 28, 2014	-	-	-	-
Outstanding and exercisable at February 28, 2014	-	-	-	-

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value for all “in-the-money” options (i.e. the difference between the Company’s closing stock price on the last trading day of the reporting period and the exercise price, multiplied by the number of shares) that would have been received by the option holders had all option holders exercised their options.

Effective August 3, 2012, the Company’s board of directors granted 8,000,000 stock purchase options.  Each of the options has an issue date, effective date and vesting date of August 3, 2012, with an exercise price of $0.08 per share.  The term of these options is five years.  The options are exercisable at any time from the grant date up to and including August 2, 2017.  All related compensation expense was recognized on August 31, 2012 as the options were vested in full on that date.

On June 20, 2013, Panex reached an agreement with Klaus Eckhof and Ross Doyle to cancel all of their outstanding stock options with Panex.  As a result of the cancellation of the 8,000,000 stock options, Panex currently has no outstanding stock options as at August 31, 2013.  The Company previously expensed all compensation related to the stock options; accordingly the cancellation had no impact on earnings.

4.  Related Party Transactions

a.

There were no donated services provided by the president of the Company during the three and six months ended February 28, 2014 (February 28, 2013: Nil).   

b.

During the three and six months ended February 28, 2014 Coresco forgave money owing for an amount of $50,430, which is reported as an extinguishment of liabilities in the Statements of Stockholder’s equity (deficiency)(February 28, 2013: Nil).

c.

During November 2013, Ross Doyle, CFO, loaned the Company $50,000 as a short term unsecured bridge loan at an interest rate of 0% (November 30, 2012: Nil).  The loan was subsequently debt settled during the quarter ended February 28, 2014.

d.

The Company incurred $33,501 management fees during the six months ended February 28, 2014 (prior period: $43,076) for services provided by the president of the Company.  Management fees are 10,000 Swiss Francs per month and the agreement expires in December 2015, however can be terminated with 6 months notice. As of February 28, 2014, the Company has an accrued liability of $33,906 for management fees and travel expenses due to these related parties (February 28, 2013: $32,400).   

11 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

4.  Related Party Transactions (Continued)

e.

The Company incurred $175,384 in total for management, exploration and contractor expenses during the six months ended February 28, 2014 (February 28, 2013: $134,411).  This amount is a combination of exploration contracting services, the CEO, Non Executive Director and CFO of the Company.  Total management fees for Coresco are contracted at 20,000 Swiss Francs per month and comprise office rental, infrastructure, investor meeting rooms, company secretarial services, CEO, CFO, Technical Services and Non Executive Director fees.  This agreement was entered on December 1, 2011, and can be terminated with 6 months notice subsequent to December 31, 2012.  As of February 28, 2014, the Company has an accrued liability of $177,444 for these services due to this related party (February 28, 2013: $118,505).

f.

On June 20, 2013, Panex reached an agreement with Klaus Eckhof and Ross Doyle to cancel all of their outstanding stock options with Panex.  As a result of the cancellation of the 8 million stock options, Panex currently has no outstanding stock options as at November 30, 2013.

5.

Loans and Borrowings

In March and July 2007, the Company received loan proceeds of $240,000 and $500,000 respectively from an unrelated third party.  These loans were unsecured bearing interest at 8% per annum, with no fixed repayment date, but the understanding with the lender was that the loans will be repaid from the proceeds of future equity financings and/or the repayment of amounts lent to Minanca.  On December 20, 2010, principal of $46,892 and interest of $15,751 was assigned to this third party.  In December 2010, $267,072 of this loan as well as $200,310 of accrued interest on this loan was settled by the issue of 9,347,640 shares.  In May 31, 2012 this loan was settled in full for $560,000, resulting in a gain on extinguishment of $10,426, which is included within interest income and other for the year ended August 31, 2012.  

In January 2011, the Company received loan proceeds of $50,000, from an unrelated third party.  This loan was unsecured, and had no stated interest rate.  This amount was settled for issuance of 2,500,000 shares of common stock in February 2012.

In September 2012, November 2012 and June 2013 the Company received loan proceeds of $75,000, $25,000 and $10,000 respectively (totalling $110,000), from an unrelated third party.  The loan is unsecured, and had no stated interest rate.   $75,000 of these funds received was used to pay aged outstanding accounts payable in December 2012.  During November 2013, the Company entered into a debt settlement agreement with this unrelated third party in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished $110,000, for a total of 110,000,000 shares at a price of $0.001 per share.

During November 2013, Ross Doyle loaned the Company $50,000 as a short term unsecured bridge loan at an interest rate of 10% (November 30, 2012: Nil).  The loan was subsequently debt settled during the quarter ended February 28, 2014.

6.  Material Contingencies and Commitments

Panex has no material contingencies or long-term commitments.  

While Panex has raised capital to meet its working capital and financing needs in the past, additional financing is required in order to fully complete its plan of operation and launch its business operations.  Panex is seeking financing in the form of equity in order to provide the necessary working capital.  Panex currently has no commitments for financing.  There are no assurances Panex will be completely successful in raising the funds required.

7.  Stockholders’ Equity

Common Stock

Panex’s authorized capital stock consists of 500,000,000 shares of common stock at a par value of $0.001 per share.

Stock cancellations and recapitalization:

On May 25, 2006 and June 9, 2006, the Company completed the return and cancellation of 30,000,000 and 6,000,000 common shares to the treasury, respectively.  The shares were returned by the former president of the Company.

12 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

7.  Stockholders’ Equity (Continued)

The net loss per share amounts and stockholders’ equity (deficit) have been retroactively restated (accounted for as a recapitalization) to reflect the return and cancellation of 36,000,000 common shares by the former president of the Company.

Common stock issuances

On May 28, 2004, the Company issued 6,000,000 shares of common stock to the then President of the Company for reimbursement of legal expenses of $500 incurred on behalf of the Company.

On June 30, 2005, the Company issued 6,000,000 shares of common stock for cash proceeds of $25,000.

On April 15, 2005, the Company issued 22,500,000 shares of common stock for cash proceeds of $18,750.

On March 22, 2005 the Company issued 36,000,000 shares of common stock for cash proceeds of $3,000.

On June 8, 2006, the Company completed a private placement with a director of the Company for 714,285 common shares at a price of $2.80 per share for proceeds of $2,000,000.

On August 30, 2006, the Company completed a private placement of 1,250,000 units at a price of $2.00 per unit for proceeds of $2,500,000. Each unit consisted of one common share and one common share purchase warrant.

Each share purchase warrant entitles the holder to acquire one additional common share at an exercise price of $2.50 per share for a period of two years. All warrants expired unexercised on August 31, 2008.

During November 2006, the Company completed private placements for 3,095,000 shares of restricted common stock at $0.80 per share, raising proceeds of $2,476,000.

In January 2007 the Company completed two private placements for 3,187,500 shares of restricted common stock at $0.80 per share raising proceeds of $2,550,000.

In February 2007 the Company completed two private placements for 1,350,000 shares of restricted common stock at $0.80 per share raising proceeds of $1,080,000.

On February 28, 2009, the board of directors authorized the issuance of 14,100,000 restricted shares of common stock at a subscription price of $0.01 per restricted share, for cash proceeds of $16,000 and the settlement of $125,000 accrued liabilities and debt. The shares were issued on June 19, 2009.

On May 29, 2009, the Company completed a private placement for 1,500,000 shares of restricted common stock at price of $0.01 per restricted share in exchange for the settlement of $15,000 debt.

In October 2009, the Company issued 6,350,000 restricted shares of common stock at a subscription price of $0.01 per restricted share, for cash proceeds of $40,000 and the settlement of $23,500 in accrued liabilities and debt due to a related party.  The cash was received in December 2008.

In January 2010, the Company issued 1,000,000 restricted shares of common stock at a subscription price of $0.01 per restricted share, for the settlement of $10,000 in accrued liabilities and debt due to a related party.

On December 20, 2010, the Company issued 2,955,483 restricted shares of common stock at a subscription price of $0.05 per share, for the settlement of $147,774 in accounts payable and accrued liabilities and issued 9,347,640 restricted shares of common stock at a subscription price of $0.05 per share for the settlement of loans and accrued interest totaling $467,382 from an unrelated third party.

13 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

7.  Stockholders’ Equity (Continued)

On June 15, 2012, the Securities and Exchange Commission declared Panex’s Form S-1 Registration Statement effective, file number 333-172375, permitting Panex to offer up to 30,000,000 shares of common stock at $0.08 per share.  The offering was being conducted on a best efforts basis and there was no underwriter involved in this public offering.  Through August 31, 2012, Panex received and accepted 22 subscription agreements and received an aggregate $978,989 in proceeds from those subscriptions and issued 12,237,075 shares of common stock.  No further subscriptions were received and the offering was closed on December 12, 2012.  Panex utilized the proceeds to ongoing operations, paying accounts payable, paying for offering expenses, assessing and evaluating possible new mineral project opportunities, and, subject to acquiring any such new projects, funding the exploration on such projects.

Effective August 3, 2012, the Company’s board of directors granted 8,000,000 stock purchase options.  Each of the options has an issue date, effective date and vesting date of August 3, 2012, with an exercise price of $0.08 per share.  The term of these Options are five years.  The Options are exercisable at any time from the grant date up to and including August 2, 2017.

On April 11, 2013, the Company issued 15,000,000 restricted shares of common stock at a subscription price of $0.005 per share, for the settlement of $75,000 in accounts payable and accrued liabilities.

On June 20, 2013, Panex reached an agreement with Klaus Eckhof and Ross Doyle to cancel all of their outstanding stock options with Panex.  As a result of the cancellation of the 8,000,000 stock options, Panex currently has no outstanding stock options as at August 31, 2013.

During November 2013, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $248,000, for a total of 248,000,000 shares at a price of $0.001 per share.  The $0.001 per share value is consistent with the cash per share value received by the Company in a November 2013 stock transaction (described below).

During November 2013 (share certificates issued during quarter ended February 28, 2014), the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $50,975, for a total of 50,975,000 shares at a price of $0.001 per share.

On December 7, 2013 the Company entered into an agreement to acquire 85% of Amani Consulting SPRL currently in Joint Venture with state entity La Société Minière de Kilo Moto (Sokimo).  Upon completion of the acquisition the Company will own an ultimate 55% interest in Giro Goldfields SPRL (Giro).  Amani has a 65% interest and Sokimo has a 35% free carried interest in Giro which is comprised of two exploitation permits, PE’s 5046 and 5049, covering a surface area of 610sqkm.  The permits lie within 20-30km west of Randgold/Ashanti’s 20Moz Kibali gold deposits.  

The Giro Project is located within twenty-thirty kilometers to the west of Randgold Resources’ multi-million ounce Kibali Gold deposits.  Randgold and partners Ashanti commenced first production in September 2013 and are expecting to produce 550,000oz of gold in 2014.  Both projects occur within the Kilo-Moto Belt, one of the world’s principal greenstone belts which hosts Anglogold Ashanti’s deposits to the east, Loncore and Kilogold deposits to the south and 50Moz of gold discovered in Tanzania since 1994.  The Giro Project area is underlain by highly prospective volcano-sedimentary lithologies in a similar structural and lithological setting as the Kibali gold deposits.  Both primary and alluvial gold was mined from two main areas, the Giro and Tora areas, during Belgian rule and today these areas are mined extensively by artisanal miners.  At Giro, a wide quartz vein with an average grade of 16g/t Au was mined within a shear potentially 2km long and 100m wide.  Channel samples from the base of artisanal workings within the shear returned significant grades including 3.5m @ 36.6g/t Au and 8m @ 3.6g/t Au confirming the potential for significant grade and widths within the shear.  Two Belgian pits located along a 4km west-east trending structure were mined at Tora.  Historic focus was on high grade quartz veins which returned grades of of 0.8m @ 21.6g/t Au, 0.6m @ 37g/t Au and 0.35m @ 485g/t Au from Belgian drilling.  The area has not been explored for over 50 years (since the Belgian colonial era) and has never been subjected to modern exploration.  The Company is targeting broad mineralised shear structures with excellent potential to host multi-million ounce gold resources from surface from at least 5 target areas within the project.

14 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

7.  Stockholders’ Equity (Continued)

The acquisition terms are summarized as follows:

1.

Two months after the successful conclusion of the due diligence (February 7, 2014), Panex will make a payment of US$100,000 to the current shareholders of Amani.  Six months after the commencement date (June 7, 2014), Panex will pay a further $300,000 to the current shareholders of Amani.

2.

On signing of a Share Purchase Agreement, Panex will issue 1,593,636,507 shares in Panex to current partners of Amani.

3.

Should Panex identify 3moz (measured and indicated) gold resources at a cut off grade of 2.5g/t, Panex will pay a further $5,350,000 to the current shareholders in Amani.

4.

On successful completion of the due diligence, Panex will fund a 3,000m RC drilling programme to test the mineralised potential on the two main target areas mined previously by the Belgians on the Giro Project.

Panex may at its discretion withdraw from this agreement by written notice to Amani at any time without penalty.

Subsequent to the signing of the agreement with Amani, both parties (Amani and Panex) agreed to remove the time constraint for issuing shares to each party. This has provided comfort to Panex management that work may continue unimpeded while the authorised capital of Panex is increased. As such point 1 and 4 above were completed during the quarter ending 28 February 2014.

Financing Activities:

During November 2013, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $248,000, for a total of 248,000,000 shares at a price of $0.001 per share.

During November 2013, Ross Doyle loaned the Company $50,000 as a short term unsecured bridge loan at an interest rate of 0% (November 30, 2012: Nil), which was subsequently debt settled.

Through February 28, 2014, $814,275 was received in advance for subscriptions for 814,275,000 shares of common stock paid at $0.001 per share.  In addition, 50,975,000 shares of common stock at $0.001 per share were issued in consideration of settlement of liabilities of $50,975 during the quarter ended February 28, 2014.  These 814,275,000 shares have not been issued as at February 28, 2014.  As of February 28, 2014, the Company did not have sufficient authorized common stock available for issuance to fulfill the subscriptions.  Therefore, the transaction has been classified outside of equity, as a current liability.  In November 2013, holders of a majority of shares of common stock approved a resolution to increase the number of authorized shares from 500,000,000 to 3,000,000,000.  This resolution will be effective 21 days after appropriate disclosure to the shareholders.  At that time the Company will be able to issue the common stock underlying the subscriptions and will be able to reclassify the amounts from current liabilities to equity.

During April 2013, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.005 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $75,000, for a total of 15,000,000 shares at a price of $0.005 per share.

During March 2012, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.08 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $255,758, for a total of 3,196,971 shares at a price of $0.08 per share.  

15 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

THE FOLLOWING PRESENTATION OF MANAGEMENT’S DISCUSSION AND ANALYSIS OF PANEX RESOURCES INC. SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION INCLUDED HEREIN.

Uncertainties Relating To Forward-Looking Statements

This Form 10-Q Quarterly Report for the quarterly report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  These forward-looking statements involve risks and uncertainties, including statements regarding Panex Resources Inc. capital needs, business strategy and expectations.  Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or “continue”, the negative of such terms or other comparable terminology.  Actual events or results may differ materially.  In evaluating these statements, you should consider various factors, including the risks outlined from time to time, in other reports Panex files with the Securities and Exchange Commission.  

The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  The forward-looking statements in this Form 10-Q Quarterly Report for quarterly report, are subject to risks and uncertainties that could cause actual results to differ materially from the results expressed in or implied by the statements contained in this report.  As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives requires the exercise of judgment.  To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and accordingly, no opinion is expressed on the achievability of those forward-looking statements.  No assurance can be given that any of the assumptions relating to the forward-looking statements specified in the following information are accurate.  

All forward-looking statements are made as of the date of filing of this Form 10-Q and Panex disclaims any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. Panex may, from time to time, make oral forward-looking statements.  Panex strongly advises that the above paragraphs and the risk factors described in this Quarterly Report and in Panex’s other documents filed with the United States Securities and Exchange Commission should be read for a description of certain factors that could cause the actual results of Panex to materially differ from those in the oral forward-looking statements.  Panex disclaims any intention or obligation to update or revise any oral or written forward-looking statements whether as a result of new information, future events or otherwise.

Background

Panex Resources Inc. (“Panex” or the “Company”) is a Nevada corporation that was incorporated on May 28, 2004.

The Company conducts principal and technical activities from Coresco AG, Level 3, Gotthardstrasse 20, 6304 Zug, Switzerland.  The telephone number is (+41) 41 711 0281.  These offices are provided to the Company on a month-to-month basis.  The Company believes these offices are adequate for the business requirements during the next 12 months.  The Company does not own any real property.  Panex maintains its statutory registered agent’s office at 1859 Whitney Mesa Drive, Henderson, Nevada, 89014.

Panex is an exploration stage company engaged in the acquisition and exploration of mineral properties.  The Company’s plan of operations is to conduct mineral exploration activities on mineral properties in order to assess whether these claims possess commercially exploitable mineral deposits.  Panex’s exploration program will be designed to explore for commercially viable deposits of base and precious minerals, such as gold, silver, lead, barium, mercury, copper, and zinc minerals.  

On June 15, 2006, Panex entered into an agreement with Emco Corporation (“Emco”) to acquire an 80% interest in Minanca Minera Nanguipa, Compañía Anónima (“Minanca”), subject to certain conditions.  Minanca owns certain mineral exploration property, including plant and equipment, in Ecuador, South America (the “Ecuador Property”).  However, on December 9, 2007 Panex entered into an agreement with Emco to cancel the previously executed acquisition agreement, as the Company concluded that it was not in its best interests to settle the acquisition.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

Panex has an authorized capital of 500,000,000 shares of common stock with a par value of $0.001 per share with 417,236,507 shares of common stock currently issued and outstanding.  On August 30, 2010, the authorized capital was increased from 75,000,000 shares of common stock to 500,000,000 shares of common stock.

Panex has not been involved in any bankruptcy, receivership or similar proceedings.  There have been no material reclassifications, mergers, consolidations or purchases or sales of a significant amount of assets not in the ordinary course of Panex’s business.

Currently, Panex has not obtained an employer identification number for the purpose of registering to do business in the United States.  Panex does not currently conduct any business in the United States nor employ any staff in the United States and is therefore not required by law to obtain an employer identification number at this time.  Panex will take immediate steps to obtain an employer identification number if it becomes necessary to do so at any time in the future.

Plan of Operation

Panex is an Exploration Stage Company.  Panex’s principal business is the acquisition and exploration of mineral resources.  Panex currently has no interest in any mineral resources or properties but is continuing to identify and assess viable mineral properties or mineral projects.

Panex is also a “shell” company as defined by the SEC as a result of only having nominal operations and nominal assets.

Panex has not generated any revenues from its mineral exploration activities.  From the time of its incorporation in 2004 to early 2008, Panex was actively engaged in the exploration of various mineral projects that were prospective for gold, silver and copper.  Since 2008, a combination of limited exploration success and a dwindling of its working capital caused Panex to withdraw from its mineral exploration projects.

During the next 12 months, management’s objective is to recapitalize Panex, continue to raise new capital and to seek new investment opportunities in the mineral sector.  As is evident from the “Background” section above and previous SEC filings, Panex has in the past successfully negotiated agreements enabling it to earn an interest in a number of different mineral properties.  Consequently, management believes that its worldwide industry contacts will make it possible to identify and assess new projects for acquisition purposes.  

Panex is seeking a viable business opportunity through acquisition, merger or other suitable business combination method, with a focus on undervalued mineral properties for eventual acquisition.  Panex intends to concentrate its acquisition efforts on mineral properties or mineral exploration businesses that management believes to be undervalued or that management believes may realize a substantial benefit from being publicly owned.  Panex will continue to identify and assess undervalued mineral properties when capital raisings are completed.  A small number of mineral properties are presently being reviewed, but it is too early to say whether they may be considered appropriate for acquisition.

On June 15, 2012, the Securities and Exchange Commission declared Panex’s Form S-1 Registration Statement effective, file number 333-172375, permitting Panex to offer up to 30,000,000 shares of common stock at $0.08 per share.  The offering was being conducted on a best efforts basis and there was no underwriter involved in this public offering.  Through August 31, 2012, Panex received and accepted 22 subscription agreements and received an aggregate $978,989 in proceeds from those subscriptions and issued 12,237,075 shares of common stock.  No further subscriptions were received and the offering was closed on December 12, 2012.  Panex utilized the proceeds to ongoing operations, paying accounts payable, paying for offering expenses, assessing and evaluating possible new mineral project opportunities, and, subject to acquiring any such new projects, funding the exploration on such projects.

The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts or classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

Results of Operations

Panex has generated no operating revenues since its inception on May 28, 2004 through to reporting date.  

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

For the three and six month periods ended February 28, 2014, Panex had net interest expense of $nil and $nil respectively, compared to $nil and $36 for the three and six month periods ended February 28, 2013.  Total expenses for the three and six months ended February 28, 2014 were $679,775 and $1,212,651 respectively, compared to $74,365 and $198,579 for the three and six months ended February 28, 2013.  Expenses were higher in the three and six month periods ended February 28, 2014 than the three and six-month periods ended February 28, 2013 largely in consideration of more exploration activities.

Liquidity and Capital Resources

The financial statements have been prepared assuming the Company will continue as a going concern.  Since inception in May 2004, the Company has not generated revenue and has incurred net losses.  

The Company has a working capital deficit of $570,913 at November 30, 2013, incurred net losses of $532,876 for the three months ended November 30, 2013, and has a deficit accumulated during the exploration stage of $14,145,930 for the period from May 28, 2004 (inception) through November 30, 2013.

The Company has a working capital deficit of $1,199,712 at February 28, 2014, incurred net losses of $1,212,651 for the six months ended February 28, 2014, and has a deficit accumulated during the exploration stage of $14,825,704 for the period from May 28, 2004 (inception) through to the reporting period.

Accordingly, the Company has not generated cash flows from operations and have primarily relied upon loans from related and unrelated parties and equity financing to fund operations.  These conditions (as indicated in the 2013 audit report by the Independent Registered Public Accounting Firm) raise substantial doubt about the Company’s ability to continue as a going concern.

During the six months ended February 28, 2014, Panex used cash of $984,910 in operating activities compared to $157,828 in the six months ended February 28, 2013.  The proceeds from the capital raised during the period has been used to repay liabilities incurred by the Company.  The company intends to conserve cash reserves to the greatest extent possible and use the cash for investment opportunities.  As previously noted, Panex is not generating revenues and accordingly has not generated any significant cash flow from operations.  Panex is uncertain as to when it will produce cash flows from operations that are required to meet operating and capital requirements and will require significant funding from external sources to continue its operations.  During the six months ended February 28, 2014 and 2013 respectively, no cash was used to repay any debt.  

During November 2013, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $248,000, for a total of 248,000,000 shares at a price of $0.001 per share.

During the quarter ended November 30, 2013 Coresco forgave money owing to Coresco for an amount of $50,430, which is reported as an extinguishment of liabilities in the Statements of Stockholder’s equity (deficiency) (November 30, 2012: Nil).

During November 2013, Ross Doyle loaned the Company $50,000 as a short term unsecured bridge loan at an interest rate of 10% (November 30, 2012: Nil).

During November 2013, $278,400 was received in advance for subscriptions for 278,400,000 shares of common stock paid at $0.001 per share not issued at reporting date.  In addition, 50,975,000 shares of common stock at $0.001 per share are agreed to be issued in consideration of settlement of liabilities of $50,975.

During April 2013, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.005 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $75,000, for a total of 15,000,000 shares at a price of $0.005 per share.

During March 2012, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.08 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $255,758, for a total of 3,196,971 shares at a price of $0.08 per share.

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PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

In September 2012, November 2012 and June 2013 the Company received loan proceeds of $75,000, $25,000 and $10,000 respectively (totalling $110,000), from an unrelated third party.  The loan is unsecured, and had no stated interest rate.   $75,000 of these funds received was used to pay aged outstanding accounts payable in December 2012.  During November 2013, the Company entered into a debt settlement agreement with this unrelated third party in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished $110,000, for a total of 110,000,000 shares at a price of $0.001 per share.

Material Contingencies and Commitments

Except for the related party management consulting agreements described in Note 4 to the financial statements, Panex has no contingencies or long-term commitments.  

While Panex has raised capital to meet its working capital and financing needs in the past, additional financing is required in order to fully complete its plan of operation and launch its business operations.  Panex is seeking financing in the form of equity in order to provide the necessary working capital.  Panex currently has no commitments for financing.  There are no assurances Panex will be completely successful in raising the funds required.

Off-Balance Sheet Arrangements

Panex has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on Panex’s financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors, nor did Panex have any non-consolidated, special-purpose entities during this quarter.

Recent Accounting Pronouncements

Management has evaluated any recently issued accounting pronouncements to determine their applicability and does not believe that any of these pronouncements will have a significant impact on the Company’s financial statements.

ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Panex is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

ITEM 4 - CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Mark Gasson, Panex’s Chief Executive Officer and Ross Doyle, Panex’s Chief Financial Officer, have evaluated the effectiveness of Panex’s disclosure controls and procedures (as such term is defined in Rules 13a-15 and 15d-15 under the Securities Exchange Act of 1934 (the “Exchange Act”) as of the end of the period covered by this quarterly report (the “Evaluation Date”).  Based on such evaluation, Mr Gasson and Mr Doyle have concluded that, as of the Evaluation Date, Panex’s disclosure controls and procedures are not effective in alerting Panex on a timely basis to material information required to be included in its reports filed or submitted under the Exchange Act, for the reasons listed in Item 9A of the Company’s Form 10-K filing for the year ended August 31, 2013.

While management strives to segregate duties as much as practicable, there is an insufficient volume of transactions at this point in time to justify additional full time staff. Management believes that this is typical in most exploration stage companies. Panex may not be able to fully remediate the material weakness until we commence mining operations at which time management expects to employ more staff. Management will continue to monitor and address the costs and benefits of additional staffing.

Changes in Internal Controls over Financial Reporting

During the fiscal quarter covered by this report, there were no changes in Panex’s internal controls over financial reporting that have materially affected, or are reasonably likely to materially affect, Panex’s internal control over financial reporting.

19 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

PART II - OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS

Panex is not a party to any pending legal proceedings and, to the best of Panex’s knowledge, none of Panex’s assets are the subject of any pending legal proceedings.

ITEM 1A - RISK FACTORS

Panex is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

During the quarter of the fiscal year covered by this report, (i) Panex did not modify the instruments defining the rights of its shareholders, (ii) no rights of any shareholders were limited or qualified by any other class of securities, and (iii) Panex did not sell any unregistered equity securities:

On June 15, 2012, the Securities and Exchange Commission declared Panex’s Form S-1 Registration Statement effective, file number 333-172375, permitting Panex to offer up to 30,000,000 shares of common stock at $0.08 per share.  The offering is being conducted on a best efforts basis and there is no underwriter involved in this public offering.  At the close of the public offer on December 12, 2012, Panex received and accepted 22 subscription agreements and received an aggregate $978,989 in proceeds from those subscriptions and issued 12,237,075 shares of common stock.  Panex utilized the proceeds to ongoing operations, paying accounts payable, paying for offering expenses, assessing and evaluating possible new mineral project opportunities, and, subject to acquiring any such new projects, funding the exploration on such projects.

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES

During the quarter of the fiscal year covered by this report, no material default has occurred with respect to any indebtedness of Panex.  Also, during this quarter, no material arrearage in the payment of dividends has occurred.

ITEM 4 - MINING SAFETY DISCLOSURES

There are no current mining activities at the date of this report.

ITEM 5 - OTHER INFORMATION

During the quarter of the fiscal year covered by this report, Panex reported all information that was required to be disclosed in a report on Form 8-K.

ITEM 6 - EXHIBITS

(a)

Index to and Description of Exhibits

All Exhibits required to be filed with the Form 10-Q are included in this quarterly report or incorporated by reference to Panex’s previous filings with the SEC which can be found in their entirety at the SEC website at www.sec.gov under SEC File Number 000-51707 and SEC File Number 333-130264.

20 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

Exhibit	Description	Status
3.1	Articles of Incorporation of Panex Resources Inc. filed as an Exhibit to Panex’s Form SB-2 (Registration Statement) filed on December 12, 2005 and incorporated herein by reference.	Filed
3.2	By-Laws of Panex Resources Inc. filed as an Exhibit to Panex’s Form SB-2 (Registration Statement) filed on December 12, 2005 and incorporated herein by reference.	Filed
3.3	Certificate of Amendment of Panex Resources Inc., filed as an Exhibit to Panex’s Form 8-K (Current Report) filed on September 30, 2010 and incorporated herein by reference.	Filed
10.1	Management Agreement dated April 19, 2006 between Panex Resources Inc. and Reg Gillard, filed as Exhibit 10.2 to Panex’s Form 8-K (Current Report) filed on May 10, 2006 and incorporated herein by reference.	Filed
10.2	Letter of Understanding dated May 6, 2006 among Panex Resources Inc., Goldplata Corporation Limited, Goldplata Resources Inc, and Goldplata Resources, Sucursal-Columbia, filed as an Exhibit to Panex’s Form 8-K (Current Report) filed on May 25, 2006 and incorporated herein by reference.	Filed
10.3	Letter Agreement dated June 15, 2006 between Panex Resources Inc. and Emco Corporation, filed as an Exhibit to Panex’s Form 8-K (Current Report) filed on June 29, 2006 and incorporated herein by reference.	Filed
10.4	Share Sale Agreement dated July 10, 2006, between Panex Resources Inc. and Emco Corporation Inc. S.A., filed as an Exhibit to Panex’s Form 8-K (Current Report) filed on July 17, 2006, and incorporated herein by reference.	Filed
10.5	Heads of Agreement dated July 26, 2007 among Panex Resources Inc., Goldplata Resources Peru S.A.C., Goldplata Resources Inc., Goldplata Resources Sucursal-Colombia, Goldplata Corporation Limited, and Goldplata Mining International Corporation, filed as an Exhibit to Panex’s Form 10-K (Annual Report) filed on July 28, 2009 and incorporated herein by reference.	Filed
10.6	Letter Agreement dated December 6, 2007 among Panex Resources Inc., Emco Corporation Inc. S.A. and Minanca Minera Nanguipa, Compania Anonima, filed as an Exhibit to Panex’s Form 10-K (Annual Report) filed on July 28, 2009 and incorporated herein by reference.	Filed
10.7	Deed dated January 11, 2008 among Panex Resources Inc., Windy Knob Resources Limited, Goldplata Mining International Corporation, Goldplata Resources Inc., and Goldplata Resources Sucursal-Colombia, filed as an Exhibit to Panex’s Form 10-K (Annual Report) filed on July 28, 2009 and incorporated herein by reference.	Filed
10.8	Share Purchase Agreement dated December 7, 2013 between Panex Resources Inc. and Amani Consulting SPRL, filed as a subsequent event note to Panex’s Form 8-K (Current Report) filed on December 23, 2013 and incorporated herein by reference.	Filed
14.1	Financial Code of Ethics filed as an Exhibit to Panex’s Form SB-2 (Registration Statement) filed on December 12, 2005 and incorporated herein by reference.	Filed
31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 from chief executive officer.	Included
31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 from chief financial officer.	Included
32	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Included
99.1	Disclosure Committee Charter, filed as an Exhibit to Panex’s Form 10-K (Annual Report) filed on July 28, 2009 and incorporated herein by reference.	Filed
101 *	Financial statements from the quarterly reports on Form 10-Q of Panex Resources Inc. for the quarter ended May 31, 2013, 2012 and beyond are formatted in XBRL:  (ii) the Balance Sheets, (ii) the Statements of Operations; (iii) the Statements of Cash Flows, and (iv) the Statements of Stockholders’ Equity (Deficit).	Included
	* In accordance with Rule 406T of Regulation S-T, the XBRL (“eXtensible Business Reporting Language”) related information is furnished and not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

21 PANEX RESOURCES INC.

PANEX RESOURCES INC.

FINANCIAL STATEMENTS (EXPRESSED IN U.S. DOLLARS)

QUARTERLY REPORT FOR THE PERIOD ENDED FEBRUARY 28, 2014 (UNAUDITED)

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, Panex Resources Inc. has caused this report to be signed on its behalf by the undersigned duly authorized persons.

Panex Resources Inc.

/s/ Mark Gasson

Name: Mark Gasson

Title: President and CEO

Principal Executive Officer

April 15, 2014

/s/ Ross Doyle

Name: Ross Doyle

Title: CFO

Principal Financial Officer

April 15, 2014

22 PANEX RESOURCES INC.

EX-31.1

PANEX RESOURCES INC. CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Mark Gasson, certify that:

1.  I have reviewed this quarterly report on Form 10-Q for the quarter ended February 28, 2014 of Panex Resources Inc.;

2.  Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.  Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.  The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.  The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 /s/ Mark Gasson

Mark Gasson

Chief Executive Officer

April 15, 2014

EX-31.2

PANEX RESOURCES INC. CERTIFICATIONS PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Ross Doyle, certify that:

1.  I have reviewed this quarterly report on Form 10-Q for the quarter ended February 28, 2014 of Panex Resources Inc.;

2.  Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.  Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.  The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.  The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Ross Doyle

Ross Doyle

Chief Financial Officer

April 15, 2014

EX-32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Panex Resources Inc. (the “Company”) on Form 10-Q for the period ended February 28, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Mark Gasson, President, Chief Executive Officer of the Company and member of the Board of Directors, certify, pursuant to s.906 of the Sarbanes-Oxley Act of 2002, that:

1.

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.

The information contained in the Report fairly presents, in all material aspects, the financial condition and result of operations of the Company.

/s/ Mark Gasson

Mark Gasson

Chief Executive Officer

April 15, 2014

EX-32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Panex Resources Inc. (the “Company”) on Form 10-Q for the period ended February 28, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ross Doyle, Chief Financial Officer, Treasurer, and Corporate Secretary of the Company, certify, pursuant to s.906 of the Sarbanes-Oxley Act of 2002, that:

1)

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2)

The information contained in the Report fairly presents, in all material aspects, the financial condition and result of operations of the Company.

/s/ Ross Doyle

Ross Doyle

Chief Financial Officer

April 15, 2014

XML

Summary of Significant Accounting Policies: Recent Accounting Pronouncements (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Recent Accounting Pronouncements

l.  Recent Accounting Pronouncements

Management has evaluated any recently issued accounting pronouncements to determine their applicability and does not believe that any of these pronouncements will have a significant impact on the Company’s financial statements.

XML

Stock Options

3 Months Ended

Feb. 28, 2014

Notes

Stock Options

3.  Stock Options

In August 2012, the Company's Board of Directors approved the issuance of stock options as an incentive to obtain services of key employees, directors and consultants of the Company.  The following is a summary of stock option activity and the status of stock options outstanding and exercisable as at reporting date:

	Stock Options #	Weighted Average Exercise Price $	Remaining Contractual Life (years) As At	Aggregate Intrinsic value As At
Outstanding and exercisable at August, 31, 2012	8,000,000	0.08	4.92	-
Granted during the fiscal year ended August 31, 2013	-	-	-	-
Forfeited during the fiscal year ended August 31, 2013	(8,000,000)	0.08	4.17	-
Outstanding and exercisable at August 31, 2013	-	-	-	-
Granted during the quarter ended November 30, 2013	-	-	-	-
Outstanding and exercisable at November 30, 2013	-	-	-	-
Granted during the quarter ended February 28, 2014	-	-	-	-
Outstanding and exercisable at February 28, 2014	-	-	-	-

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value for all “in-the-money” options (i.e. the difference between the Company’s closing stock price on the last trading day of the reporting period and the exercise price, multiplied by the number of shares) that would have been received by the option holders had all option holders exercised their options.

Effective August 3, 2012, the Company’s board of directors granted 8,000,000 stock purchase options.  Each of the options has an issue date, effective date and vesting date of August 3, 2012, with an exercise price of $0.08 per share.  The term of these options is five years.  The options are exercisable at any time from the grant date up to and including August 2, 2017.  All related compensation expense was recognized on August 31, 2012 as the options were vested in full on that date.

On June 20, 2013, Panex reached an agreement with Klaus Eckhof and Ross Doyle to cancel all of their outstanding stock options with Panex.  As a result of the cancellation of the 8,000,000 stock options, Panex currently has no outstanding stock options as at August 31, 2013.  The Company previously expensed all compensation related to the stock options; accordingly the cancellation had no impact on earnings.

XML

Related Party Transactions (Details) (USD $)	6 Months Ended
	Feb. 28, 2014	Feb. 28, 2013
Coresco
Extinguishment of liability	$ 50,430
Accrued liability	177,444	118,505
Management, exploration and contractor expenses	175,384	134,411
Chief Financial Officer
Loan received	50,000
President
Related party management fees	33,501	43,076
Accrued liability	$ 33,906	$ 32,400

XML

Stock Options: Schedule of Share-based Compensation, Stock Options, Activity (Details) (USD $)	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2012
Details
Stock options outstanding		8,000,000
Weighted average exercise price		$ 0.08
Remaining contractual life in years		4.92
Options forfeited	(8,000,000)
weighted average exercise price of options forfeited	$ 0.08

XML

Loans and Borrowings (Details) (USD $)	1 Months Ended										12 Months Ended	6 Months Ended
	Nov. 30, 2013	Jun. 30, 2013	Nov. 30, 2012	Sep. 30, 2012	May 31, 2012	Feb. 29, 2012	Jan. 31, 2011	Dec. 31, 2010	Jul. 31, 2007	Mar. 31, 2007	Aug. 31, 2012	Feb. 28, 2014 Chief Financial Officer
Loan proceeds		$ 10,000	$ 25,000	$ 75,000			$ 50,000		$ 500,000	$ 240,000
Loan amount paid/settled	110,000				560,000			267,072
Interest amount paid/settled								200,310
Shares issued for debt settlement	110,000,000					2,500,000		9,347,640
gain on extinguishment of debt											10,426
Loan received												$ 50,000

XML

Stockholders' Equity Note (Details) (USD $)			6 Months Ended									1 Months Ended										0 Months Ended							6 Months Ended	3 Months Ended	12 Months Ended
	Feb. 28, 2014	Aug. 31, 2013	Feb. 28, 2014 Chief Financial Officer	May 27, 2004 Common Stock for reimbursement of legal expenses	Jun. 30, 2005 Common stock for cash proceeds	Apr. 15, 2005 Common stock for cash proceeds	Mar. 22, 2005 Common stock for cash proceeds	Feb. 28, 2007 Private placement of common stock	Jan. 31, 2007 Private placement of common stock	Nov. 30, 2006 Private placement of common stock	Jun. 08, 2006 Private placement of common stock	Aug. 31, 2006 Private placement of units	Aug. 30, 2006 Private placement of units	Oct. 31, 2009 Common stock for cash and debt	Jun. 19, 2009 Common stock for cash and debt	Apr. 11, 2013 Common stock for debt settlement	Dec. 20, 2010 Common stock for debt settlement	Jan. 31, 2010 Common stock for debt settlement	May 29, 2009 Common stock for debt settlement	Dec. 20, 2010 Common stock for debt and interest settlement	Aug. 31, 2012 Registration Statement	Jun. 20, 2013 Stock purchase options	Aug. 03, 2012 Stock purchase options	Feb. 28, 2014 Debt settlement agreements	Nov. 30, 2013 Debt settlement agreements	Apr. 30, 2013 Debt settlement agreements	Mar. 31, 2012 Debt settlement agreements	Dec. 07, 2013 Amani Consulting SPRL	Feb. 28, 2014 Advance for subscriptions	Aug. 31, 2004 Stock cancellations and recapitalization	Aug. 31, 2005 Stock cancellations and recapitalization
Authorized capital stock	500,000,000	500,000,000
Common stock par value	$ 0.001	$ 0.001
Return and cancellation of common stock																														6,000,000	30,000,000
Shares issued				6,000,000	6,000,000	22,500,000	36,000,000	1,350,000	3,187,500	3,095,000	714,285		1,250,000	6,350,000	14,100,000	15,000,000	2,955,483	1,000,000	1,500,000	9,347,640	12,237,075			50,975,000	248,000,000	15,000,000	3,196,971
Debt/expenses settled				$ 500										$ 23,500	$ 125,000	$ 75,000	$ 147,774	$ 10,000	$ 15,000	$ 467,382					$ 50,975	$ 75,000	$ 255,758
Proceeds					25,000	18,750	3,000	1,080,000	2,550,000	2,476,000	2,000,000		2,500,000	40,000	16,000						978,989
Price per share/unit								$ 0.80	$ 0.80	$ 0.80	$ 2.80		$ 2.00
Description of units												Each share purchase warrant entitles the holder to acquire one additional common share at an exercise price of $2.50 per share for a period of two years. All warrants expired unexercised on August 31, 2008.
Options granted																							8,000,000
Exercise price per share																							$ 0.08
Options cancelled																						8,000,000
Percentage to be acquired																												85.00%
Loan received			50,000
Advance for subscriptions																													814,275
Settlement of liabilities for subscriptions																													$ 50,975
Common stock subscribed for but unissued																													814,275,000

XML

Summary of Significant Accounting Policies

3 Months Ended

Feb. 28, 2014

Notes

Summary of Significant Accounting Policies

2.  Summary of Significant Accounting Policies

a.  Basis of Preparation

These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States (US GAAP).  The Company’s fiscal year-end is August 31.

b.  Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

c.  Basic and Diluted Net Income (Loss) Per Share

Earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the reporting period including common stock issued effective the date committed.  Common stock issuable is considered outstanding as of the original approval date for the purposes of earnings per share computations.  Diluted earnings (loss) per common share is computed by dividing net earnings (loss) by the sum of (a) the basic weighted average number of shares of common stock outstanding during the period and (b) additional shares that would have been issued and potentially dilutive securities. During the reporting periods the diluted earnings (loss) per share was equivalent to the basic earnings (loss) per share because all potentially dilutive securities were anti-dilutive due to the net losses incurred. Potentially dilutive securities consist of stock options outstanding at the end of the reporting period.

d.  Cash

Cash includes deposits in banks, which are unrestricted as to withdrawal or use.

e.  Mineral Property and Exploration Costs

The Company has been in the exploration stage since its formation on May 28, 2004 and has not realized any revenues from its planned operations.  It has been primarily engaged in the acquisition and exploration of mining properties.  Mineral property acquisition and exploration costs are expensed as incurred.  When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property are capitalized.  Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve.  If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.

f.  Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or most advantageous market. The Company uses a fair value hierarchy that has three levels of inputs, both observable and unobservable, with use of the lowest possible level of input to determine fair value.

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 - observable inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and

Level 3 - assets and liabilities whose significant value drivers are unobservable.

As of reporting period, the Company did not have any assets or liabilities that were measured at fair value on a recurring or non-recurring basis.

Observable inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company’s market assumptions. Unobservable inputs require significant management judgment or estimation.  In some cases, the inputs used to measure an asset or liability may fall into different levels of the fair value hierarchy.  In those instances, the fair value measurement is required to be classified using the lowest level of input that is significant to the fair value measurement. Such determination requires significant management judgment.

Financial instruments, which include cash, accounts payable, and loans and borrowings, were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments.  The fair value of amounts due to related parties are not practical to estimate, due to the related party nature of the underlying transactions.  The financial risk to the Company’s operations arises from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk.

g.  Income Taxes

The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their tax bases, as well as net operating losses.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets or liabilities of a change in tax rates is recognized in the period in which the tax change occurs.  A valuation allowance is provided to reduce the deferred tax assets to a level, that more likely than not, will be realized.

Management does not believe that the Company has any unrecognized tax positions. The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.

h.  Stock-Based Compensation

The Company accounts for share-based payments under the fair value method of accounting for stock-based compensation consistent with US GAAP.  Under the fair value method, stock-based compensation cost is measured at the grant date based on the fair value of the award using the Black-Sholes option pricing model and is recognized to expense on a straight-line basis over the requisite service period, which is generally the vesting period.  Where upon grant the options vest immediately the stock-based costs are expensed immediately.

i.  Foreign Currency Translation and Transactions

The Company’s functional and reporting currency is the United States dollar.  Monetary assets and liabilities denominated in foreign currencies are translated into the United States dollar using the exchange rate prevailing at the balance sheet date. Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income.

j.  Concentration of Credit Risk

The Company’s financial instruments that are exposed to concentration of credit risk consist of cash.  The Company’s cash is in demand deposit accounts placed with federally insured financial institutions in Canada.

k.  Interim Financial Statements

In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.

l.  Recent Accounting Pronouncements

Management has evaluated any recently issued accounting pronouncements to determine their applicability and does not believe that any of these pronouncements will have a significant impact on the Company’s financial statements.

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Balance Sheets (USD $)	Feb. 28, 2014	Aug. 31, 2013
Current Assets
Cash	$ 22,737	$ 519
Total Current Assets	22,737	519
Total Assets	22,737	519
Current Liabilities
Accounts payable and accrued expenses	237,415	63,344
Accounts payable and accrued expenses, related party	170,759	163,643
Advances received for common stock subscriptions	814,275
Loans and borrowings		110,000
Total Current Liabilities	1,222,449	336,987
Total Liabilities	1,222,449	336,987
Stockholders' Equity (Deficit)
Common stock value	417,236	118,261
Additional paid-in capital	13,131,129	13,080,699
Donated capital	77,627	77,627
Deficit accumulated during the exploration stage	14,825,704	13,613,055
Total Stockholders' Equity (Deficit)	(1,199,712)	(336,468)
Total Liabilities and Stockholders' Equity (Deficit)	$ 22,737	$ 519

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Statement of Stockholders' Equity (USD $)	Common Stock	Additional Paid-in Capital	Donated Capital	Deficit Accumulated during the Exploration Stage	Total Stockholders' Equity (Deficiency)
Beginning Balance, amount at May. 27, 2004
Common stock issued for services, shares	6,000,000
Common stock issued for services, value	$ 6,000	$ (5,500)			$ 500
Return and cancellation of shares, shares	(6,000,000)
Return and cancellation of shares, value	(6,000)	6,000
Net income (loss) for the period				(500)	(500)
Ending Balance, amount at Aug. 31, 2004		500		(500)
Return and cancellation of shares, shares	(30,000,000)
Return and cancellation of shares, value	(30,000)	30,000
Common stock issued for cash, shares	64,500,000
Common stock issued for cash, value	64,500	(17,750)			46,750
Donated rent			3,000		3,000
Donated services			6,000		6,000
Net income (loss) for the period				(15,769)	(15,769)
Ending Balance, amount at Aug. 31, 2005	34,500	12,750	9,000	(16,269)	39,981
Ending Balance, shares at Aug. 31, 2005	34,500,000
Common stock issued for cash, shares	1,964,285
Common stock issued for cash, value	1,964	4,498,036			4,500,000
Donated rent			2,250		2,250
Donated services			4,500		4,500
Net income (loss) for the period				(848,560)	(848,560)
Ending Balance, amount at Aug. 31, 2006	36,464	4,510,786	15,750	(864,829)	3,698,171
Ending Balance, shares at Aug. 31, 2006	36,464,285
Common stock issued for cash, shares	7,632,500
Common stock issued for cash, value	7,632	6,098,368			6,106,000
Net income (loss) for the period				(10,943,990)	(10,943,990)
Ending Balance, amount at Aug. 31, 2007	44,096	10,609,154	15,750	(11,808,819)	(1,139,819)
Ending Balance, shares at Aug. 31, 2007	44,096,785
Net income (loss) for the period				(66,651)	(66,651)
Ending Balance, amount at Aug. 31, 2008	44,096	10,609,154	15,750	(11,875,470)	(1,206,470)
Beginning Balance, shares at Aug. 31, 2008	44,096,785
Common stock issued for cash, shares	1,600,000
Common stock issued for cash, value	1,600	14,400			16,000
Common stock issued for settlement of debt, shares	14,000,000
Common stock issued for settlement of debt, value	14,000	126,000			140,000
Shares to be issued		30,000			30,000
Net income (loss) for the period				(154,585)	(154,585)
Ending Balance, amount at Aug. 31, 2009	59,696	10,779,554	15,750	(12,030,055)	(1,175,055)
Ending Balance, shares at Aug. 31, 2009	59,696,785
Common stock issued for cash, shares	4,000,000
Common stock issued for cash, value	4,000	6,000			10,000
Common stock issued for settlement of debt, shares	3,350,000
Common stock issued for settlement of debt, value	3,350	30,150			33,500
Net income (loss) for the period				(213,860)	(213,860)
Ending Balance, amount at Aug. 31, 2010	67,046	10,815,704	15,750	(12,243,915)	(1,345,415)
Ending Balance, shares at Aug. 31, 2010	67,046,785
Donated services			31,617		31,617
Common stock issued for settlement of debt, shares	12,303,123
Common stock issued for settlement of debt, value	12,303	602,853			615,156
Net income (loss) for the period				(299,498)	(299,498)
Ending Balance, amount at Aug. 31, 2011	79,349	11,418,557	47,367	(12,543,413)	(998,140)
Ending Balance, shares at Aug. 31, 2011	79,349,908
Common stock issued for cash, shares	12,237,075
Common stock issued for cash, value	12,237	966,752			978,989
Donated services			30,260		30,260
Common stock issued for settlement of debt, shares	8,477,553
Common stock issued for settlement of debt, value	8,478	161,073			169,551
Common stock issued for settlement of debt2, shares	3,196,971
Common stock issued for settlement of debt2, value	3,197	252,561			255,758
Stock option compensation expense		221,756			221,756
Net income (loss) for the period				(926,016)	(926,016)
Ending Balance, amount at Aug. 31, 2012	103,261	13,020,699	77,627	(13,469,429)	(267,842)
Ending Balance, shares at Aug. 31, 2012	103,261,507
Common stock issued for settlement of debt, shares	15,000,000
Common stock issued for settlement of debt, value	15,000	60,000			75,000
Net income (loss) for the period				(143,626)	(143,626)
Ending Balance, amount at Aug. 31, 2013	118,261	13,080,699	77,627	(13,613,055)	(336,468)
Ending Balance, shares at Aug. 31, 2013	118,261,507
Common stock issued for settlement of debt, shares	248,000,000
Common stock issued for settlement of debt, value	248,000				248,000
Extinguishment of liabilities with related party		50,430			50,430
Net income (loss) for the period				(532,876)	(532,876)
Ending Balance, amount at Nov. 30, 2013	366,261	13,131,129	77,627	(14,145,930)	(570,913)
Ending Balance, shares at Nov. 30, 2013	366,261,507
Common stock issued for settlement of debt, shares	50,975,000
Common stock issued for settlement of debt, value	50,975				50,975
Net income (loss) for the period				(679,775)	(679,775)
Ending Balance, amount at Feb. 28, 2014	$ 417,236	$ 13,131,129	$ 77,627	$ (14,825,704)	$ (1,199,712)
Ending Balance, shares at Feb. 28, 2014	417,236,507

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Summary of Significant Accounting Policies: Foreign Currency Translation and Transactions (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Foreign Currency Translation and Transactions

i.  Foreign Currency Translation and Transactions

The Company’s functional and reporting currency is the United States dollar.  Monetary assets and liabilities denominated in foreign currencies are translated into the United States dollar using the exchange rate prevailing at the balance sheet date. Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income.

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Summary of Significant Accounting Policies: Interim Financial Statements (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Interim Financial Statements

k.  Interim Financial Statements

In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.

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Organization, Nature of Business, Going Concern and Management's Plans

3 Months Ended

Feb. 28, 2014

Notes

Organization, Nature of Business, Going Concern and Management's Plans

1.  Organization, Nature of Business, Going Concern and Management’s Plans

Panex Resources Inc. (‘Panex” or the “Company”) was incorporated in the State of Nevada on May 28, 2004. The Company is considered to be an Exploration Stage Company. The Company’s principal business is the acquisition and exploration of mineral resources.

Going concern and management’s plans:

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  Since its inception on May 28, 2004, the Company has not generated revenue and has incurred net losses.

The Company incurred a net loss of $1,212,651 for the six months ended February 28, 2014 and a deficit accumulated during the exploration stage of $14,825,704 for the period May 28, 2004 (inception) through February 28, 2014.

Accordingly, it has not generated cash flow from operations and has primarily relied upon advances from shareholders and proceeds from equity financings to fund its operations.  These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The Company has no mineral property interests as of the date of this report.  Certain mineral property interests are presently being considered, however it is too early to determine whether they may be considered appropriate for acquisition.

During the next 12 months, management’s objective is to recapitalize Panex, continue to raise new capital and to seek new investment opportunities in the mineral sector.  Management believes that its worldwide industry contacts will make it possible to identify and assess new projects for acquisition purposes. 

Panex is seeking a viable business opportunity through acquisition, merger or other suitable business combination method, with a focus on undervalued mineral properties for eventual acquisition.  Panex intends to concentrate its acquisition efforts on mineral properties or mineral exploration businesses that management believes to be undervalued or that management believes may realize a substantial benefit from being publicly owned.  Panex will continue to identify and assess undervalued mineral properties when capital raisings are completed.  A small number of mineral properties are presently being reviewed, but it is too early to say whether they may be considered appropriate for acquisition.

The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts or classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

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Balance Sheets (Parenthetical) (USD $)	Feb. 28, 2014	Aug. 31, 2013
Balance Sheet
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	417,236,507	118,261,507
Common stock, shares outstanding	417,236,507	118,261,507

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Summary of Significant Accounting Policies: Cash Policy (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Cash Policy

d.  Cash

Cash includes deposits in banks, which are unrestricted as to withdrawal or use.

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Document and Entity Information	3 Months Ended
	Feb. 28, 2014
Document and Entity Information:
Entity Registrant Name	Panex Resources Inc.
Document Type	10-Q
Document Period End Date	Feb. 28, 2014
Amendment Flag	false
Entity Central Index Key	0001345756
Current Fiscal Year End Date	--08-31
Entity Common Stock, Shares Outstanding	417,236,507
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2

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Summary of Significant Accounting Policies: Mineral Property and Exploration Costs Policy (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Mineral Property and Exploration Costs Policy

e.  Mineral Property and Exploration Costs

The Company has been in the exploration stage since its formation on May 28, 2004 and has not realized any revenues from its planned operations.  It has been primarily engaged in the acquisition and exploration of mining properties.  Mineral property acquisition and exploration costs are expensed as incurred.  When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property are capitalized.  Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve.  If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.

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Statements of Operations (USD $)	3 Months Ended				6 Months Ended				117 Months Ended
	Feb. 28, 2014		Feb. 28, 2013		Feb. 28, 2014		Feb. 28, 2013		Feb. 28, 2014
Income Statement
Revenue
Operating expenses
Donated rent									5,250
Donated services									72,377
Listing and filing fees	3,270				6,901				9,297
Investor relation expense	52,214				133,189				133,189
Management fees			27,028				61,431		783,254
Stock option compensation									221,756
Professional fees	34,920		20,492		77,820		63,201		1,515,710
Travel costs	12,640				12,640				348,055
General and administrative	39,766		26,552		116,056		72,946		712,486
Foreign currency transaction loss (gain)	(3,876)		293		(3,876)		1,001		100,719
Mineral property and exploration costs	540,841				869,921				5,609,698
Write-off deferred acquisition cost									400,000
Provision against Minanca loan									6,100,000
Total operating expenses	679,775		74,365		1,212,651		198,579		16,011,791
Other income (expense)
Interest income									42,707
Interest expense							(36)		(304,413)
Loss on sale of investment									(126,182)
Extinguishment of liabilities									197,745
Gain on sale of mineral property right									1,376,228
Total other income (expenses)							(36)		1,186,085
Net income (loss)	$ (679,775)		$ (74,365)		$ (1,212,651)		$ (198,615)		$ (14,825,704)
Net income (loss) per share - basic and diluted	$ 0	[1]	$ 0	[1]	$ 0	[1]	$ 0	[1]
Weighted average number of shares outstanding - basic and diluted	417,236,507		103,261,507		313,903,174		103,261,507

[1] Amounts are less than $0.01 per share

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Material Contingencies and Commitments

3 Months Ended

Feb. 28, 2014

Notes

Material Contingencies and Commitments

6.  Material Contingencies and Commitments

Panex has no material contingencies or long-term commitments. 

While Panex has raised capital to meet its working capital and financing needs in the past, additional financing is required in order to fully complete its plan of operation and launch its business operations.  Panex is seeking financing in the form of equity in order to provide the necessary working capital.  Panex currently has no commitments for financing.  There are no assurances Panex will be completely successful in raising the funds required.

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Loans and Borrowings

3 Months Ended

Feb. 28, 2014

Notes

Loans and Borrowings

5.  Loans and Borrowings

In March and July 2007, the Company received loan proceeds of $240,000 and $500,000 respectively from an unrelated third party.  These loans were unsecured bearing interest at 8% per annum, with no fixed repayment date, but the understanding with the lender was that the loans will be repaid from the proceeds of future equity financings and/or the repayment of amounts lent to Minanca.  On December 20, 2010, principal of $46,892 and interest of $15,751 was assigned to this third party.  In December 31 2010, $267,072 of this loan as well as $200,310 of accrued interest on this loan was settled by the issue of 9,347,640 shares.  In May 2012 this loan was settled in full for $560,000, resulting in a gain on extinguishment of $10,426, which is included within interest income and other for the year ended August 31, 2012.

In January 2011, the Company received loan proceeds of $50,000, from an unrelated third party.  This loan was unsecured, and had no stated interest rate.  This amount was settled for issuance of 2,500,000 shares of common stock in February 2012.

In September 2012, November 2012 and June 2013 the Company received loan proceeds of $75,000, $25,000 and $10,000 respectively (totalling $110,000), from an unrelated third party.  The loan is unsecured, and had no stated interest rate. $75,000 of these funds received was used to pay aged outstanding accounts payable in December 2012.  During November 2013, the Company entered into a debt settlement agreement with this unrelated third party in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished $110,000, for a total of 110,000,000 shares at a price of $0.001 per share.

During November 2013, Ross Doyle loaned the Company $50,000 as a short term unsecured bridge loan at an interest rate of 10% (November 30, 2012: Nil). The loan was subsequently debt settled during the quarter ended February 28, 2014.

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Summary of Significant Accounting Policies: Concentration of Credit Risk (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Concentration of Credit Risk

j.  Concentration of Credit Risk

The Company’s financial instruments that are exposed to concentration of credit risk consist of cash.  The Company’s cash is in demand deposit accounts placed with federally insured financial institutions in Canada.

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Summary of Significant Accounting Policies: Fair Value Measurements (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Fair Value Measurements

f.  Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or most advantageous market. The Company uses a fair value hierarchy that has three levels of inputs, both observable and unobservable, with use of the lowest possible level of input to determine fair value.

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 - observable inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and

Level 3 - assets and liabilities whose significant value drivers are unobservable.

As of reporting period, the Company did not have any assets or liabilities that were measured at fair value on a recurring or non-recurring basis.

Observable inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company’s market assumptions. Unobservable inputs require significant management judgment or estimation.  In some cases, the inputs used to measure an asset or liability may fall into different levels of the fair value hierarchy.  In those instances, the fair value measurement is required to be classified using the lowest level of input that is significant to the fair value measurement. Such determination requires significant management judgment.

Financial instruments, which include cash, accounts payable, and loans and borrowings, were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments.  The fair value of amounts due to related parties are not practical to estimate, due to the related party nature of the underlying transactions.  The financial risk to the Company’s operations arises from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk.

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Summary of Significant Accounting Policies: Use of Estimates (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Use of Estimates

b.  Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

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Stockholders' Equity Note

3 Months Ended

Feb. 28, 2014

Notes

Stockholders' Equity Note

7.  Stockholders’ Equity

Common Stock

Panex’s authorized capital stock consists of 500,000,000 shares of common stock at a par value of $0.001 per share.

Stock cancellations and recapitalization:

On May 25, 2006 and June 9, 2006, the Company completed the return and cancellation of 30,000,000 and 6,000,000 common shares to the treasury, respectively.  The shares were returned by the former president of the Company.

The net loss per share amounts and stockholders’ equity (deficit) have been retroactively restated (accounted for as a recapitalization) to reflect the return and cancellation of 36,000,000 common shares by the former president of the Company.

Common stock issuances

On May 28, 2004, the Company issued 6,000,000 shares of common stock to the then President of the Company for reimbursement of legal expenses of $500 incurred on behalf of the Company.

On June 30, 2005, the Company issued 6,000,000 shares of common stock for cash proceeds of $25,000.

On April 15, 2005, the Company issued 22,500,000 shares of common stock for cash proceeds of $18,750.

On March 22, 2005 the Company issued 36,000,000 shares of common stock for cash proceeds of $3,000.

On June 8, 2006, the Company completed a private placement with a director of the Company for 714,285 common shares at a price of $2.80 per share for proceeds of $2,000,000.

On August 30, 2006, the Company completed a private placement of 1,250,000 units at a price of $2.00 per unit for proceeds of $2,500,000. Each unit consisted of one common share and one common share purchase warrant.

Each share purchase warrant entitles the holder to acquire one additional common share at an exercise price of $2.50 per share for a period of two years. All warrants expired unexercised on August 31, 2008.

During November 2006, the Company completed private placements for 3,095,000 shares of restricted common stock at $0.80 per share, raising proceeds of $2,476,000.

In January 2007 the Company completed two private placements for 3,187,500 shares of restricted common stock at $0.80 per share raising proceeds of $2,550,000.

In February 2007 the Company completed two private placements for 1,350,000 shares of restricted common stock at $0.80 per share raising proceeds of $1,080,000.

On February 28, 2009, the board of directors authorized the issuance of 14,100,000 restricted shares of common stock at a subscription price of $0.01 per restricted share, for cash proceeds of $16,000 and the settlement of $125,000 accrued liabilities and debt. The shares were issued on June 19, 2009.

On May 29, 2009, the Company completed a private placement for 1,500,000 shares of restricted common stock at price of $0.01 per restricted share in exchange for the settlement of $15,000 debt.

In October 2009, the Company issued 6,350,000 restricted shares of common stock at a subscription price of $0.01 per restricted share, for cash proceeds of $40,000 and the settlement of $23,500 in accrued liabilities and debt due to a related party.  The cash was received in December 2008.

In January 2010, the Company issued 1,000,000 restricted shares of common stock at a subscription price of $0.01 per restricted share, for the settlement of $10,000 in accrued liabilities and debt due to a related party.

On December 20, 2010, the Company issued 2,955,483 restricted shares of common stock at a subscription price of $0.05 per share, for the settlement of $147,774 in accounts payable and accrued liabilities and issued 9,347,640 restricted shares of common stock at a subscription price of $0.05 per share for the settlement of loans and accrued interest totaling $467,382 from an unrelated third party.

On June 15, 2012, the Securities and Exchange Commission declared Panex’s Form S-1 Registration Statement effective, file number 333-172375, permitting Panex to offer up to 30,000,000 shares of common stock at $0.08 per share. The offering was being conducted on a best efforts basis and there was no underwriter involved in this public offering. Through August 31, 2012, Panex received and accepted 22 subscription agreements and received an aggregate $978,989 in proceeds from those subscriptions and issued 12,237,075 shares of common stock. No further subscriptions were received and the offering was closed on December 12, 2012.  Panex utilized the proceeds to ongoing operations, paying accounts payable, paying for offering expenses, assessing and evaluating possible new mineral project opportunities, and, subject to acquiring any such new projects, funding the exploration on such projects.

Effective August 3, 2012, the Company’s board of directors granted 8,000,000 stock purchase options.  Each of the options has an issue date, effective date and vesting date of August 3, 2012, with an exercise price of $0.08 per share.  The term of these Options are five years.  The Options are exercisable at any time from the grant date up to and including August 2, 2017.

On April 11, 2013, the Company issued 15,000,000 restricted shares of common stock at a subscription price of $0.005 per share, for the settlement of $75,000 in accounts payable and accrued liabilities.

On June 20, 2013, Panex reached an agreement with Klaus Eckhof and Ross Doyle to cancel all of their outstanding stock options with Panex.  As a result of the cancellation of the 8,000,000 stock options, Panex currently has no outstanding stock options as at August 31, 2013.

During November 2013, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $248,000, for a total of 248,000,000 shares at a price of $0.001 per share.  The $0.001 per share value is consistent with the cash per share value received by the Company in a November 2013 stock transaction (described below).

During November 2013 (share certificates issued during quarter ended February 28, 2014), the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $50,975, for a total of 50,975,000 shares at a price of $0.001 per share.

On December 7, 2013 the Company entered into an agreement to acquire 85% of Amani Consulting SPRL currently in Joint Venture with state entity La Société Minière de Kilo Moto (Sokimo).  Upon completion of the acquisition the Company will own an ultimate 55% interest in Giro Goldfields SPRL (Giro).  Amani has a 65% interest and Sokimo has a 35% free carried interest in Giro which is comprised of two exploitation permits, PE’s 5046 and 5049, covering a surface area of 610sqkm.  The permits lie within 20–30km west of Randgold/Ashanti’s 20Moz Kibali gold deposits. 

The Giro Project is located within twenty-thirty kilometers to the west of Randgold Resources’ multi-million ounce Kibali Gold deposits.  Randgold and partners Ashanti commenced first production in September 2013 and are expecting to produce 550,000oz of gold in 2014.  Both projects occur within the Kilo-Moto Belt, one of the world’s principal greenstone belts which hosts Anglogold Ashanti’s deposits to the east, Loncore and Kilogold deposits to the south and 50Moz of gold discovered in Tanzania since 1994.  The Giro Project area is underlain by highly prospective volcano-sedimentary lithologies in a similar structural and lithological setting as the Kibali gold deposits.  Both primary and alluvial gold was mined from two main areas, the Giro and Tora areas, during Belgian rule and today these areas are mined extensively by artisanal miners.  At Giro, a wide quartz vein with an average grade of 16g/t Au was mined within a shear potentially 2km long and 100m wide.  Channel samples from the base of artisanal workings within the shear returned significant grades including 3.5m @ 36.6g/t Au and 8m @ 3.6g/t Au confirming the potential for significant grade and widths within the shear.  Two Belgian pits located along a 4km west-east trending structure were mined at Tora.  Historic focus was on high grade quartz veins which returned grades of of 0.8m @ 21.6g/t Au, 0.6m @ 37g/t Au and 0.35m @ 485g/t Au from Belgian drilling.  The area has not been explored for over 50 years (since the Belgian colonial era) and has never been subjected to modern exploration.  The Company is targeting broad mineralised shear structures with excellent potential to host multi-million ounce gold resources from surface from at least 5 target areas within the project.

The acquisition terms are summarized as follows:

1.             Two months after the successful conclusion of the due diligence (February 7, 2014), Panex will make a payment of US$100,000 to the current shareholders of Amani.  Six months after the commencement date (June 7, 2014), Panex will pay a further $300,000 to the current shareholders of Amani.

2.             On signing of a Share Purchase Agreement, Panex will issue 1,593,636,507 shares in Panex to current partners of Amani.

3.             Should Panex identify 3moz (measured and indicated) gold resources at a cut off grade of 2.5g/t, Panex will pay a further $5,350,000 to the current shareholders in Amani.

4.             On successful completion of the due diligence, Panex will fund a 3,000m RC drilling programme to test the mineralised potential on the two main target areas mined previously by the Belgians on the Giro Project.

Panex may at its discretion withdraw from this agreement by written notice to Amani at any time without penalty.

Subsequent to the signing of the agreement with Amani, both parties (Amani and Panex) agreed to remove the time constraint for issuing shares to each party. This has provided comfort to Panex management that work may continue unimpeded while the authorised capital of Panex is increased. As such point 1 and 4 above were completed during the quarter ending 28 February 2014.

Financing Activities:

During November 2013, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.001 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $248,000, for a total of 248,000,000 shares at a price of $0.001 per share.

During November 2013, Ross Doyle loaned the Company $50,000 as a short term unsecured bridge loan at an interest rate of 10% (November 30, 2012: Nil).

Through February 28, 2014, $814,275 was received in advance for subscriptions for 814,275,000 shares of common stock paid at $0.001 per share.  In addition, 50,975,000 shares of common stock at $0.001 per share were issued in consideration of settlement of liabilities of $50,975 during the quarter ended February 28, 2014.  These 814,275,000 shares have not been issued as at February 28, 2014.  As of February 28, 2014, the Company did not have sufficient authorized common stock available for issuance to fulfill the subscriptions.  Therefore, the transaction has been classified outside of equity, as a current liability.  In November 2013, holders of a majority of shares of common stock approved a resolution to increase the number of authorized shares from 500,000,000 to 3,000,000,000.  This resolution will be effective 21 days after appropriate disclosure to the shareholders.  At that time the Company will be able to issue the common stock underlying the subscriptions and will be able to reclassify the amounts from current liabilities to equity.

During April 2013, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.005 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $75,000, for a total of 15,000,000 shares at a price of $0.005 per share.

During March 2012, the Company entered into debt settlement agreements with creditors in consideration for the issuance of the Company’s common stock, par value $0.001, at a per share price of $0.08 per share.  As a result, the Company extinguished certain liabilities with creditors via debt settlement agreements for a total of $255,758, for a total of 3,196,971 shares at a price of $0.08 per share. 

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Summary of Significant Accounting Policies: Basis of Preparation (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Basis of Preparation

a.  Basis of Preparation

These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States (US GAAP).  The Company’s fiscal year-end is August 31.

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Summary of Significant Accounting Policies: Basic and Diluted Net Income (loss) Per Share (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Basic and Diluted Net Income (loss) Per Share

c.  Basic and Diluted Net Income (Loss) Per Share

Earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the reporting period including common stock issued effective the date committed.  Common stock issuable is considered outstanding as of the original approval date for the purposes of earnings per share computations.  Diluted earnings (loss) per common share is computed by dividing net earnings (loss) by the sum of (a) the basic weighted average number of shares of common stock outstanding during the period and (b) additional shares that would have been issued and potentially dilutive securities. During the reporting periods the diluted earnings (loss) per share was equivalent to the basic earnings (loss) per share because all potentially dilutive securities were anti-dilutive due to the net losses incurred. Potentially dilutive securities consist of stock options outstanding at the end of the reporting period.

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Summary of Significant Accounting Policies: Stock-based Compensation Policy (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Stock-based Compensation Policy

h.  Stock-Based Compensation

The Company accounts for share-based payments under the fair value method of accounting for stock-based compensation consistent with US GAAP.  Under the fair value method, stock-based compensation cost is measured at the grant date based on the fair value of the award using the Black-Sholes option pricing model and is recognized to expense on a straight-line basis over the requisite service period, which is generally the vesting period.  Where upon grant the options vest immediately the stock-based costs are expensed immediately.

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Stock Options: Schedule of Share-based Compensation, Stock Options, Activity (Tables)

3 Months Ended

Feb. 28, 2014

Tables/Schedules

Schedule of Share-based Compensation, Stock Options, Activity

	Stock Options #	Weighted Average Exercise Price $	Remaining Contractual Life (years) As At	Aggregate Intrinsic value As At
Outstanding and exercisable at August, 31, 2012	8,000,000	0.08	4.92	-
Granted during the fiscal year ended August 31, 2013	-	-	-	-
Forfeited during the fiscal year ended August 31, 2013	(8,000,000)	0.08	4.17	-
Outstanding and exercisable at August 31, 2013	-	-	-	-
Granted during the quarter ended November 30, 2013	-	-	-	-
Outstanding and exercisable at November 30, 2013	-	-	-	-
Granted during the quarter ended February 28, 2014	-	-	-	-
Outstanding and exercisable at February 28, 2014	-	-	-	-

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Statements of Cash Flows (USD $)	6 Months Ended		117 Months Ended
	Feb. 28, 2014	Feb. 28, 2013	Feb. 28, 2014
Cash Flows from Operating Activities
Net (loss) income	$ (1,212,651)	$ (198,615)	$ (14,825,704)
Adjustment to reconcile net loss to net cash used in operating activities:
Foreign currency transaction loss (gain)	(3,876)	1,001	100,713
Gain on sale of mineral property rights			(586,228)
Loss on sale of investment			126,181
Extinguishment of debt			(208,171)
Donated services and expenses			77,627
Expenses paid by issue of common stock			500
Options expense			221,756
Write-off deferred acquisition costs			400,000
Provision againts Minanca loan			6,100,000
Changes in operating assets and liabilities:
Increase (decrease) in accounts payable and accrued liabilities	413,474	(26,954)	1,484,944
Increase (decrease) in amounts due to related parties	7,116	64,740	301,275
Net cash used in operating activities	(795,937)	(157,828)	(6,807,109)
Cash Flows from Investing Activities
Cash received from sale of investment			250,047
Cash received from sale of mineral property rights			210,000
Deferred acquisition costs			400,000
Loan advances			7,100,000
Repayment of loan advances			1,000,000
Net cash used in investing activities			(6,039,953)
Cash Flows from Financing Activities
Loan from related parties	50,000		644,313
Loan repaid to related parties			576,483
Loan from unrelated third parties		100,000	340,000
Advances received from common stock subscriptions	764,275		804,275
Common shares issued for cash			11,647,739
Net cash provided by financing activities	814,275	100,000	12,859,844
Effect of exchange rates on cash	3,880	(1,001)	9,955
Increase (decrease) in cash	22,218	(58,829)	22,737
Cash, beginning of period	519	65,799
Cash, end of period	$ 22,737	$ 6,970	$ 22,737

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Related Party Transactions

3 Months Ended

Feb. 28, 2014

Notes

Related Party Transactions

4.  Related Party Transactions

a.     There were no donated services provided by the president of the Company during the three and six months ended February 28, 2014 (February 28, 2013: Nil).

b.     During the three and six months ended February 28, 2014, Coresco forgave money owing for an amount of $50,430, which is reported as an extinguishment of liabilities in the Statements of Stockholders’ Equity (Deficiency) (February 28, 2013: Nil).

c.     During November 2013, Ross Doyle, CFO, loaned the Company $50,000 as a short term unsecured bridge loan at an interest rate of 10% (November 30, 2012: Nil). The loan was subsequently debt settled during the quarter ended February 28, 2014.

d.     The Company incurred $33,501 management fees during the six months ended February 28, 2014 (prior period: $43,076) for services provided by the president of the Company.  Management fees are 10,000 Swiss Francs per month and the agreement expires in December 2015, however can be terminated with 6 months notice. As of February 28, 2014, the Company has an accrued liability of $33,906 for management fees and travel expenses due to these related parties (February 28, 2013: $32,400).

e.     The Company incurred $175,384 in total for management, exploration and contractor expenses during the six months ended February 28, 2014 (February 28, 2013: $134,411).  This amount is a combination of exploration contracting services, the CEO, Non Executive Director and CFO of the Company.  Total management fees for Coresco are contracted at 20,000 Swiss Francs per month and comprise office rental, infrastructure, investor meeting rooms, company secretarial services, CEO, CFO, Technical Services and Non Executive Director fees.  This agreement was entered on December 1, 2011, and can be terminated with 6 months notice subsequent to December 31, 2012.  As of February 28, 2014, the Company has an accrued liability of $177,444 for these services due to this related party (February 28, 2013: $118,505).

f.     On June 20, 2013, Panex reached an agreement with Klaus Eckhof and Ross Doyle to cancel all of their outstanding stock options with Panex.  As a result of the cancellation of the 8 million stock options, Panex currently has no outstanding stock options as at November 30, 2013.

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Organization, Nature of Business, Going Concern and Management's Plans (Details) (USD $)	6 Months Ended
	Feb. 28, 2014	Aug. 31, 2013
Details
Net loss incurred	$ 1,212,651
Deficit accumulated during the exploration stage	$ 14,825,704	$ 13,613,055

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Summary of Significant Accounting Policies: Income Tax Policy (Policies)

3 Months Ended

Feb. 28, 2014

Policies

Income Tax Policy

g.  Income Taxes

The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their tax bases, as well as net operating losses.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets or liabilities of a change in tax rates is recognized in the period in which the tax change occurs.  A valuation allowance is provided to reduce the deferred tax assets to a level, that more likely than not, will be realized.

Management does not believe that the Company has any unrecognized tax positions. The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense.