10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2011

OR

¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission File Number:  333-134549

CALIFORNIA GOLD CORP.

(Exact Name of Registrant as Specified in its Charter)

Nevada	83-483725
(State of Incorporation)	(IRS Employer Identification No.)

c/o Gottbetter & Partners, LLP

488, Madison Avenue, 12th Floor, New York, NY 10022

(212) 400-6900

(Address of principal executive offices and telephone number)

Indicate whether the registrant (1) filed all reports required to be filed by Section 13 or 15 (d) of the Exchange Act during the preceding 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.  Yes x   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).   Yes x  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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check One):

Large accelerated filer    ¨	Accelerated filer ¨	Non-accelerated filer ¨	Smaller reporting company ¨
		(Do not check if a smaller  Reporting company)

Indicate by a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes ¨   No x

There were 93,201,260 shares of common stock issued and outstanding as of September 14, 2011.

CALIFORNIA GOLD CORP.

INDEX

		Page
Part I Financial Information
Item 1	Financial Statements	2
	Balance Sheets (unaudited)	3
	Statements of Expenses (unaudited)	4
	Statements of Cash Flows (unaudited)	5
	Notes to the Financial Statements (unaudited)	6
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 4	Controls and Procedures	17
Part II Other Information
Item 2	Unregistered Sale of Equity Securities and Use of Proceeds	19
Item 6	Exhibits	19
Signatures		20
Exhibit – Certification of Principal  Executive Officer and Principal Financial Officer		21
Exhibit – Certification of Chief Executive Officer and Chief Financial Officer		23

PART I

FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

The financial statements of California Gold Corp. (the “Company”) required to be filed with this Quarterly Report on Form 10-Q were prepared by management and commence on the following page, together with the related Notes.  In the opinion of management, these financial statements fairly present the financial condition of the Company, but should be read in conjunction with the financial statements of the Company for the period ended January 31, 2011, previously filed on Form 10-K with the Securities and Exchange Commission, File No. 333-134549.

2

CALIFORNIA GOLD CORP.

(AN EXPLORATION STAGE COMPANY)

BALANCE SHEETS

(Unaudited)

	July 31, 2011			January 31, 2011
ASSETS
Current assets:
Cash	$	1,245,755		$	1,268,254
Prepaid expenses		34,250			-
Prepaid expenses – related party		6,000			33,784
Total current assets		1,286,005			1,302,038
Property and equipment, net		8,746			-
Mining rights		20,000			20,000
Total assets	$	1,314,751		$	1,322,038
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable	$	11,851		$	27,129
Accounts payable – related party		6,000			52,250
Derivative liabilities		2,335,849			2,305,770
Other accrued liabilities		-			2,500
Total current liabilities		2,353,700			2,387,649
Total  liabilities		2,353,700			2,387,649
Commitments and contingencies		-			-
Stockholders' deficit:
Preferred stock, par value $0.001 per share, 22,000,000 shares authorized ; 22,000,000 shares issued and outstanding		22,000			22,000
Common stock, par value $0.001 per share, 300,000,000 shares authorized ; 109,201,260 and 92,701,260 shares issued and outstanding , respectively		109,201			92,701
Additional paid-in capital		1,855,301			1,678,791
Deficit accumulated during the exploration stage		(3,025,451	)		(2,859,103	)
Total stockholders' deficit		(1,038,949	)		(1,065,611	)
Total liabilities and stockholders' deficit	$	1,314,751		$	1,322,038

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

3

CALIFORNIA GOLD CORP.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF EXPENSES

 (Unaudited)

	Three Months Ended						Six Months Ended						Cumulative
	July 31, 2011			July 31, 2010			July 31, 2011			July 31, 2010			From Inception
Expenses:
Mineral property expenses	$	64,234		$	-		$	130,408		$	-		$	208,510
Bad debt expense		-			-			-			-			559,483
Depreciation expense		63			-			63			-			63
General and administrative expenses		449,167			86,128			550,864			128,338			1,699,045
Total operating expenses		513,464			86,128			681,335			128,338			2,467,101
Loss from operations		(513,464	)		(86,128	)		(681,335	)		(128,338	)		(2,467,101	)
Other income (expenses):
Interest income		478			-			1,032			-			1,323
Interest expense		-			(665	)		-			(1,056	)		(1,763	)
Realized and unrealized gain (loss) on derivatives, net		826,978			-			513,955			-			(548,292	)
Amortization of debt discount		-			-			-			-			(9,618	)
Total other income (expenses)		827,456			(665	)		514,987			(1,056	)		(558,350	)
Net income (loss)	$	313,992		$	(86,793	)	$	(166,348	)	$	(129,394	)	$	(3,025,451	)
Income (loss) per common share:
Income (loss) per common share - basic and diluted	$	0.00		$	(0.00	)	$	(0.00	)	$	(0.00	)
Weighted average number of common shares outstanding - basic and diluted		104,256,205			58,063,002			99,392,927			58,063,002

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

4

CALIFORNIA GOLD CORP.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF CASH FLOWS

(Unaudited)

	Six Months Ended						Cumulative
	July 31,						From
	2011			2010			Inception
Cash flows from operating activities:
Net loss	$	(166,348	)	$	(129,394	)	$	(3,025,451	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		63			-			63
Stock-based compensation		340,544			-			843,657
Amortization of debt discount		-			-			9,618
Unrealized and realized (gain) loss on derivatives, net		(513,955	)		-			548,292
Changes in operating assets and liabilities:
Prepaid expenses		(34,250	)		-			(34,250	)
Prepaid expenses – related party		27,784			-			27,784
Accounts payable		(15,278	)		38,121			(46,496	)
Accounts payable – related party		(46,250	)		67,967			129,881
Accrued expenses		(2,500	)		750			142
Interest accrued on notes payable from related party		-			1,056			1,621
Net cash used in operating activities		(410,190	)		(21,500	)		(1,545,139	)
Cash flows from investing activities:
Purchase of property and equipment		(8,809	)		-			(8,809	)
Investment in mining rights		-			-			(20,000	)
Net cash used in investing activities		(8,809	)		-			(28,809	)
Cash flows from financing activities:
Proceeds from related party loans		-			21,500			92,430
Proceeds from common and preferred stock issued, net of offering costs of $3,500		396,500			-			2,790,273
Payments from cancellation of common stock		-			-			(63,000	)
Net cash provided by financing activities		396,500			21,500			2,819,703
Net increase (decrease) in cash		(22,499	)		-			1,245,755
Cash - beginning of period		1,268,254			373			-
Cash - end of period	$	1,245,755		$	373		$	1,245,755
Noncash investing and financing activities:
Contributed capital - loss on extinguishment of debt owed to related party	$	-		$	-		$	374
Debt discount due to derivative liabilities		-			-			9,618
Contributed capital - payables settled by stockholder		-			-			157,665
Issuance of common stock for convertible notes		-			-			3,660
Derecognition of derivatives related to convertible notes		-			-			91,365
Issuance of derivative warrant instruments		544,035			-			1,867,168
Related party note receivable write-off		-			-			557,927
Common stock cancellation		-			-			61,700

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

5

CALIFORNIA GOLD CORP.

 (AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 – GENERAL ORGANIZATION AND BUSINESS

California Gold Corp. (“California Gold” or the “Company”) is a Nevada corporation whose principal focus is the identification, acquisition, and development of rare and precious metals mining properties in the Americas. The Company is still in the exploration stage and has not generated any revenues from its mining properties to date.

The Company was incorporated on April 19, 2004 under the name of Arbutus Resources, Inc. On August 9, 2007, the Company changed its name to US Uranium, Inc. On March 9, 2009, the Company changed its name to California Gold Corp.

NOTE 2 – BASIS OF PRESENTATION

The accompanying unaudited interim financial statements as of July 31, 2011 and 2010 and for the three and six months then ended have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information, and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (“SEC”) and on the same basis as the annual audited financial statements. The financial statements as of and for the three and six months ended July 31, 2011 and 2010 are unaudited. In the opinion of management, these financial statements include all adjustments, which, unless otherwise disclosed, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The balance sheet at January 31, 2011 has been derived from audited financial statements; however, the notes to the financial statements do not include all of the information and notes required by accounting principles generally accepted in the United States of America for complete financial statements. The accompanying unaudited interim financial statements should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended January 31, 2011 as filed with the SEC.

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Reclassifications

Certain amounts in prior periods have been reclassified to conform to current period presentation.

Acquisition-Related Costs

For the three and six months ended July 31, 2011, the Company incurred certain costs related to the AuroTellurio Acquisition (as defined below in Note 4). Those costs included legal, valuation, travel, and other professional or consulting fees. The Company accounted for those acquisition-related costs under FASB ASC Topic 805, Business Combinations. The costs were recognized as mineral property expenses in the periods in which the costs were incurred and the services received. The Company recorded $64,234 and $130,408 in costs for the three and six months ended July 31, 2011, respectively, and none for the three and six months ended July 31, 2010.

6

CALIFORNIA GOLD CORP.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

Stock-Based Compensation

The Company accounts for its stock-based compensation in which the Company obtains employee services in share-based payment transactions under FASB ASC Topic 718, Compensation – Stock Compensation, which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of such instruments over the vesting period.

The Company also adopted FASB ASC Topic 505-50, Equity-Based Payments to Non-Employees, to account for equity instruments issued to parties other than employees for acquiring goods or services.  Such awards for services are recorded at either the fair value of the consideration received or the fair value of the instruments issued in exchange for such services, whichever is more reliably measurable.

For the three and six months ended July 31, 2011, the Company recorded $329,989 and $340,544, respectively, in stock-based compensation as a component of general and administrative expenses. The Company did not issue any share-based payments to employees and non-employees during the three and six months ended July 31, 2010.

Net Earnings (Loss) Per Share

Basic net earnings (loss) per common share are computed by dividing net earnings (loss) by the weighted-average number of common shares outstanding during the period. Diluted net earnings (loss) per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, which is the case for all periods presented in these consolidated financial statements, the diluted weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive. For the three and six months ended July 31, 2011, the Company excluded options to purchase 11,000,000 shares of common stock, as the effect would be anti-dilutive.

New Accounting Pronouncements

The Company does not expect adoption of the new accounting pronouncements will have a material effect on the Company’s financial statements.

NOTE 4 – MINING RIGHTS

On February 11, 2011, the Company entered into a property option agreement (the “AuroTellurio Option Agreement”) with Mexivada Mining Corp. (“Mexivada”), which formalized and replaced the earlier Letter Agreement with Mexivada dated October 2010. Under the terms of the AuroTellurio Option Agreement, the Company is committed to incur $3,000,000 in cumulative exploration expenditures on the Property over a four year period at an investment rate of at least $750,000 per year. The Company will earn a 20% vested interest in the AuroTellurio Property in the first year of the AuroTellurio Option Agreement by investing $750,000 in an exploration program and up to an additional 60% interest in the Property, in blocks of 20% each, by investing an additional $750,000 in the exploration program in each of the following three years, or sooner, and meeting all of the other required terms of the AuroTellurio Option Agreement. Each 20% interest will vest earlier if each year’s cash and stock payments to Mexivada and $750,000 exploration expenditure investment are completed earlier than scheduled.

Under the terms of the Agreement, the Company will act as “Operator,” exclusively responsible, in consultation with Mexivada, for carrying out and administering exploration, development and mining work on the AuroTellurio Property. If costs of the exploration program exceed the agreed upon $3,000,000 investment, the Company will share additional costs with Mexivada on a proportionate share basis. Once the Company has earned its full 80% interest in the AuroTellurio Property, the Company will form a joint venture with Mexivada applicable to the further development and commercialization of the AuroTellurio Property.

7

CALIFORNIA GOLD CORP.

 (AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

 (Unaudited)

Mexivada and its Mexican subsidiary hold only the mineral rights in the AuroTellurio Property, which rights were granted by the government of Mexico. Neither Mexivada nor its Mexican subsidiary owns the real property rights to the land underlying the La Viuda Concessions. Prior to the first closing under the AuroTellurio Option Agreement on August 4, 2011, the Company obtained a surface rights agreement with the landowner on whose property the La Viuda Concessions are located to conduct its mineral exploration program. The agreement became effective June 17, 2011, runs for a term of 12 months and may be extended for two additional years under the same terms.

NOTE 5 – RELATED PARTY TRANSACTIONS

Compensation of Officers and Directors

In January 2011, the Company entered into an arrangement with George Duggan to serve as the Company’s Chief Operating Officer effective January 17, 2011. Under the terms of the arrangement, the Company pays Mr. Duggan a $2,500 fee per month for his services.

On February 1, 2011, the Company entered into an independent contractor consulting agreement with James Davidson, pursuant to which the Company agreed to pay Mr. Davidson $5,000 per month for 12 months beginning February 1, 2011 for his services rendered to the Company as the Chief Executive Officer. Per an amendment to the consulting agreement between James Davidson and the Company, Mr. Davidson’s monthly compensation for his services rendered to the Company as the consultant was reduced from $5,000 to $2,000 effective June 2011.

The total compensation to Mr. Duggan and Mr. Davidson amounted to $16,500 and $36,500 for the three and six months ended July 31, 2011, respectively, and was recorded as a component of general and administrative expenses.

Legal, Consulting and Other Professional Fees

The Company has entered into a 12-month retainer agreement with Gottbetter & Partners, LLP (“G&P”), effective December 1, 2010, pursuant to which the Company will pay G&P, a stockholder of the Company, a monthly fee of $5,500 for providing legal services relating to SEC regulatory compliance and reporting requirements.

For the three months ended July 31, 2011 and 2010, professional legal fees to G&P totaled $23,446 and $41,805 respectively, and primarily related to SEC filings, private placement offerings, and other general corporate matters. For the six months ended July 31, 2011 and 2010, legal fees to G&P totaled $46,168 and $67,967, respectively, and primarily related to SEC filings, acquisitions, private placement offerings, and other general corporate matters. The legal fees incurred are included as a component of general and administrative expenses.

In December 2010, the Company entered into a consulting agreement with Oberal International, Inc. (“Oberal”), a stockholder of the Company. Oberal will provide the Company with regular and customary capital markets and corporate finance consulting advice, including recommendations concerning investor and strategic introductions to potential industry partners. The agreement became effective December 15, 2010 and ran for a term of 90 days. In consideration of services to be rendered by Oberal, the Company agreed to pay Oberal $25,250 for the term of the agreement. The Company incurred $0 and $11,783 in consulting fees during the three and six months ended July 31, 2011, which are included as a component of general and administrative expenses.

8

CALIFORNIA GOLD CORP.

 (AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

 (Unaudited)

In January 2011, the Company entered into an administrative services agreement with Incorporated Communications Services (“ICS”), a California corporation. George Duggan, the Company’s Chief Operations Officer, is the Vice President of ICS. Pursuant to the agreement with ICS, ICS will make available its address in La Canada, California to serve as the Company’s corporate headquarters and communications office, and provide the Company with basic administrative services, including coordinating and routing incoming telephone calls, handling investor inquiries, assisting in the preparation of press releases, developing an informational website and coordinating with the auditors and financial statement preparers. The Company pays ICS a monthly fee of $6,000 for these services. This agreement with ICS became effective January 1, 2011, runs for a term of 12 months and may be extended or terminated by the parties upon 60 days prior notice. The Company incurred $18,000 and $36,000 in management fees for the three and six months ended July 31, 2011, which are included as a component of general and administrative expenses.

In January 2011, the Company entered into a consulting agreement with Melechdavid, Inc., a stockholder of the Company. Melechdavid, Inc. provided certain consulting services to the Company’s business for a term of 90 days, commencing on January 18, 2011, the effective date of this agreement, and fair valued at $12,500. In consideration of services to be rendered by Melechdavid, Inc., the Company issued the 500,000 restricted shares of its common stock, $0.001 per share, on February 28, 2011. The Company recorded the $0 and $10,555 of stock-based compensation expense for the services provided by Melechdavid, Inc. to the Company in the three and six months ended July 31, 2011.

On June 6, 2011, the Company entered into consulting agreement with Michael Baybak, a stockholder of the Company. The Company engaged Mr. Baybak to provide certain consulting services related to the Company’s business for a minimum period through June 5, 2013 for a monthly compensation fee of $6,000. The Company incurred $12,000 in consulting fees to Mr. Baybak for the three and six months ended July 31, 2011, which are included as a component of general and administrative expenses.

NOTE 6 – DERIVATIVE LIABILITIES

Derivative Warrant Instruments

In the December 2010 and January 2011 Unit Offering, the Company incurred liabilities for the estimated fair value of derivative warrant instruments in the form of warrants. The estimated fair value of the derivative warrant instruments was calculated using the Black-Scholes option pricing model and amounted to $1,323,133 at the grant dates as of December 22, 2010 and January 13, 2011. These estimates were re-valued as being $2,305,770 and $1,803,271 at the balance sheet dates as of January 31, 2011 and July 31, 2011, respectively. The Company recorded $754,137 and $502,498 change in value as unrealized gain in non-operating income for the three and six months ended July 31, 2011, respectively.

The fair value of each warrant granted in the private placement offering has been estimated on the dates of grant using the Black-Scholes option pricing model, under the following assumptions:

Common stock issuable upon exercise of warrants		30,739,129
Market price of the Company’s common stock on the measurement dates	$	0.05 and 0.09
Exercise price	$	0.125
Risk free interest rate		0.475	%
Dividend yield		0.00	%
Volatility		257.95	%
Expected exercise term in years		1.5

9

CALIFORNIA GOLD CORP.

 (AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

 (Unaudited)

In April 2011, the Company added to the Unit Offering a first over-allotment option. As such, the Company incurred liabilities for the estimated fair value of derivative warrant instruments in the form of warrants. The estimated fair value of the derivative warrant instruments was calculated using the Black-Scholes option pricing model and amounted to $71,973, $131,077, and $88,824 at the grant dates of April 7, 2011, April 13, 2011, and April 30, 2011, respectively. The April 2011 grants were re-valued as being $260,511 at the balance sheet date of July 31, 2011. The Company recorded a $92,747 and $31,363 change in value as unrealized gain in non-operating expense for the three and six months ended July 31, 2011, respectively.

The fair value of each warrant granted in the private placement offering has been estimated on the dates of grant using the Black-Scholes option pricing model, under the following assumptions:

Common stock issuable upon exercise of warrants		4,000,000
Market price of the Company’s common stock on the measurement dates	$	0.08 and 0.10
Exercise price	$	0.125
Risk free interest rate range		0.61 – 0.81	%
Dividend yield		0.00	%
Volatility range		268.16 – 284.75	%
Expected exercise term in years		1.5

In June and July 2011, the Company closed its first and second over-allotment options. The Company incurred liabilities for the estimated fair value of derivative warrant instruments in the form of warrants. The estimated fair value of the derivative warrant instruments was calculated using the Black-Scholes option pricing model and amounted to $149,203 and $102,957 at the grant dates of June 15, 2011 and July 15, 2011, respectively. The grants were re-valued as being $272,067 at the balance sheet date of July 31, 2011. The Company recorded a $19,906 change in value as unrealized loss in non-operating expense for the three and six months ended July 31, 2011.

The fair value of each warrant granted in the private placement offering has been estimated on the dates of grant using the Black-Scholes option pricing model, under the following assumptions:

Common stock issuable upon exercise of warrants		4,000,000
Market price of the Company’s common stock on the measurement dates	$	0.07 and 0.08
Exercise price	$	0.125
Risk free interest rate range		0.37 – 0.38	%
Dividend yield		0.00	%
Volatility range		315.50 – 317.98	%
Expected exercise term in years		1.5

NOTE 7 – FAIR VALUE MEASUREMENTS

As defined in FASB ASC Topic 820, fair value is the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This Topic requires disclosure that establishes a framework for measuring fair value and expands disclosure about fair value measurements. The statement requires fair value measurements be classified and disclosed in one of the following categories:

10

CALIFORNIA GOLD CORP.

 (AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

 (Unaudited)

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. The Company considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2: Pricing inputs other than quoted market prices included in Level 1 that are based on observable market data and are directly or indirectly observable for substantially the full term of the asset or liability. These include quoted market prices for similar assets or liabilities, quoted market prices for identical or similar assets in markets that are not active, adjusted quoted market prices, inputs from observable data such as interest rate and yield curves, volatilities or default rates observable at commonly quoted intervals or inputs derived from observable market data by correlation or other means.

Level 3: Pricing inputs that are unobservable or less observable from objective sources. Unobservable inputs should only be used to the extent observable inputs are not available. These inputs maintain the concept of an exit price from the perspective of a market participant and should reflect assumptions of other market participants. An entity should consider all market participant assumptions that are available without unreasonable cost and effort. These are given the lowest priority and are generally used in internally developed methodologies to generate management's best estimate of the fair value when no observable market data is available.

Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels.

Certain assets and liabilities are reported at fair value on a recurring or nonrecurring basis in the Company’s balance sheet. The following methods and assumptions were used to estimate the fair values:

Cash, Prepaid assets, Mining rights (deposits), Accounts payable, and Accrued liabilities

The carrying amounts approximate fair value because of the short-term nature or maturity of the instruments.

Derivative liabilities

The Company’s determination of fair value of its derivative instruments incorporates various factors required under FASB Topic ASC 815. The fair values of the Company’s derivatives are valued using less observable data from objective sources as inputs into internal valuation models. Therefore, the Company considers the fair value of its derivatives to be Level 3 hierarchy. At July 31, 2011 and January 31, 2011, the aggregate Level 3 fair value of the derivative liabilities was $2,335,849 and $2,305,770, respectively.

NOTE 8 – EQUITY

Private Placement Offering

On December 22, 2010, the Company sold to various persons (collectively, the “Investors”) 58,478,258 units of its securities (the “Units”) for gross proceeds of $1,461,956, at an offering price of $0.025 per Unit. Each of 36,478,258 of the Units consists of one common share and a warrant to purchase one-half share at $0.125 per whole share. Each of the remaining 22,000,000 Units consists of one share of the Company’s Series A Convertible Preferred Stock and warrants to purchase one-half of one share of common stock. The warrants will be exercisable from issuance until eighteen months after the closing of the PPO. 

11

CALIFORNIA GOLD CORP.

 (AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

 (Unaudited)

On January 13, 2011, the Company sold an additional 5,000,000 Units for a total price of $125,000. The Company repurchased and cancelled 2,000,000 Units for $50,000.

In connection with the aforementioned over-allotment options, the Company sold an additional 8,000,000 Units for a total price of $200,000 in the quarter ended April 30, 2011. Additionally, the Company sold 8,000,000 units for a total purchase price of $200,000 in the quarter ended July 31, 2011.

As of July 31, 2011, cumulatively, the Company has sold a total of 77,478,258 Units for a total price of $1,936,956. The Company incurred closing costs of $19,000, resulting in net proceeds from the Offering of $1,917,956. The Company plans to apply the net proceeds of the closing primarily towards the AuroTellurio Acquisition (see Note 4), for the relief of certain outstanding accounts payable, and for working capital purposes.

NOTE 9 – STOCK-BASED COMPENSATION

Shares for Services

The Company recognized non-cash stock-based compensation expense of $0 and $10,555 during the three and six months ended July 31, 2011 in connection with a Consulting Services Agreement between the Company and Melechdavid, Inc. No shares for services were issued in the three and six months ended July 31, 2010.

Stock Options

The Company has a stock-based compensation plan known as the 2007 Stock Option Plan (the “Plan”). The Plan provides for the granting of incentive and non-qualified stock options to acquire common shares in the capital of California Gold Corp. The number of shares authorized under the Plan is 16,000,000. As of July 31, 2011, 5,000,000 shares remain available for future grants under the Plan.

On July 27, 2011, the Company granted options to purchase 11,000,000 shares of its common stock to its employees and outside consultants. These options have a 10-year term and were granted with an exercise price of $0.09. The one third of these options, or 3,666,667, vested on the date of the grant, with the remaining two thirds vesting on the first and second anniversaries of the date of grant. The Company recorded stock-based compensation expense attributable to options of $329,989 during the three and six months ended July 31, 2011. As of July 31, 2011, there was approximately $659,979 of total unrecognized compensation cost related to non-vested stock options, which is expected to be recognized over the next two years.

The fair value of options granted in July 2011 was measured at the date of grant using the Black-Scholes option-pricing model with the following assumptions:

Market price of the Company’s common stock on grant date	$	0.09
Risk free interest rate		3.01	%
Dividend yield		0.00	%
Volatility		260.65	%
Expected life	6 years
Expected forfeiture rate		0.00	%

12

CALIFORNIA GOLD CORP.

 (AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

(Unaudited)

NOTE 10 – SUBSEQUENT EVENTS

The Company evaluates subsequent events through the date when financial statements are filed with the SEC.

First Closing under the AuroTellurio Option Agreement

On August 4, 2011, the Company conducted the first closing (the “First Closing”) under the AuroTellurio Option Agreement (See Note 4).  On the date of the First Closing, the Company paid Mexivada an additional $10,000 in cash and issued to Mexivada 250,000 shares of its restricted common stock.  In exchange, the Company received from Mexivada four fully executed title deeds, each transferring to the Company a twenty percent (20%) interest in the La Viuda Concessions comprising the AuroTellurio Property, to be held in escrow by the Company's counsel until fully vested in accordance with their terms or returned to Mexivada.  

13

ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This report contains forward-looking statements. All statements other than statements of historical facts included in this Quarterly Report on Form 10-Q, including without limitation, statements in this Management’s Discussion and Analysis of Financial Condition and Results of Operations regarding our financial position, estimated working capital, business strategy, the plans and objectives of our management for future operations and those statements preceded by, followed by or that otherwise include the words “believe”, “expects”, “anticipates”, “intends”, “estimates”, “projects”, “target”, “goal”, “plans”, “objective”, “should”, or similar expressions or variations on such expressions are forward-looking statements. We can give no assurances that the assumptions upon which the forward-looking statements are based will prove to be correct. Because forward-looking statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by the forward-looking statements. There are a number of risks, uncertainties and other important factors that could cause our actual results to differ materially from the forward-looking statements, including, but not limited to, our ability to identify and successfully participate in any future acquisition, joint venture or other new business initiative.

OVERVIEW

California Gold is an exploration stage mining company whose principal focus is the identification, acquisition, and development of rare and precious metals mining properties in the Americas.

Our primary focus is on the exploration and development of the La Viuda Concessions south of Moctezuma, Sonora, Mexico, where, we believe, deposits of tellurium, gold and silver may exist in economically minable quantities. We are still in the exploration stage and have not generated any revenues from our mining properties in Mexico.

The Mexivada Property Option Agreement

On February 11, 2011, we entered into a property option agreement (the “AuroTellurio Option Agreement”) with Mexivada Mining Corp. (“Mexivada”) to acquire up to an 80% interest in Mexivada’s La Viuda and La Viuda-1 concessions comprising its AuroTellurio tellurium-gold-silver property (the “La Viuda Concessions,” the “AuroTellurio Property” or, the “Property”) south of Moctezuma, Sonora, Mexico.

Under the terms of the AuroTellurio Option Agreement, we will acquire up to an 80% legal and beneficial ownership interest in the AuroTellurio Property by, in addition to making certain cash payments and share issuances to Mexivada (as discussed above), incurring up to $3,000,000 in cumulative exploration expenditures on the Property over a four year period at an investment rate of at least $750,000 per year. We will earn a 20% vested interest in the AuroTellurio Property in the first year of the AuroTellurio Option Agreement by investing $750,000 in an exploration program (the “Exploration Program”) and up to an additional 60% interest in the Property, in blocks of 20% each, by investing an additional $750,000 in the exploration program in each of the following three years, or sooner, and meeting all of the other required terms of the AuroTellurio Option Agreement. Each 20% interest will vest earlier if each year’s cash and stock payments to Mexivada and $750,000 exploration expenditure investment are completed earlier than scheduled.

First Closing under the AuroTellurio Option Agreement

On August 4, 2011, we conducted the first closing (the “First Closing”) under the AuroTellurio Option Agreement.  Prior to the First Closing, we had made cash payments to Mexivada totaling $20,000.  On the date of the First Closing, we paid Mexivada an additional $10,000 in cash and issued to Mexivada 250,000 shares of our restricted common stock.  In exchange, we received from Mexivada four fully executed title deeds, each transferring to us a twenty percent (20%) interest in the La Viuda Concessions comprising the AuroTellurio Property.  We will hold these title deeds in escrow until we meet the terms of the AuroTellurio Option Agreement for the vesting of each twenty percent (20%) interest.  At that time, the relevant title deed will be released to us from escrow and filed with the Ministry of Mines in Mexico, to evidence our ownership in that specific twenty percent interest in the AuroTellurio Property. If we default on our commitments under the AuroTellurio Option Agreement or otherwise determine not to proceed with the acquisition of the AuroTellurio Property, all unvested interests and related title deeds in the AuroTellurio Property will be returned to Mexivada.

14

The La Viuda Concessions

The La Viuda Concessions, which cover approximately 18,840 acres (7,624 hectares) south of Moctezuma, Sonora Mexico, comprise two exploration concessions granted by the Mexican government to Compania Minera Mexivada, S.A. de C.V., a wholly owned subsidiary of Mexivada.

The AuroTellurio Property Exploration Program

On May 16, 2011, we entered into a surface rights agreement with a land owner in Moctezuma, Sonora, Mexico where the La Viuda Concessions are located. In return for the easement for our exploration of the La Viuda Concessions, we will pay the land owner $14,400 for each year in which we conduct exploration work on this land.

We have begun Phase 1 of our exploration program and we are currently conducting mapping, trenching and sampling programs at the AuroTellurio Property.  These activities will be followed by planned gravity and magnetic geophysical surveys in preparation for an initial 3,000-meter drilling program that is planned for implementation by the end of the year.

The La Bambolla mine where gold-tellurium mineralization was discovered in the early 1900’s, is located less than a mile from the AuroTellurio Property.  Historical data suggest that tellurium-gold mineralization at the adjoining La Bambolla mine occurs along a regional structural system with an average S 70° E trend where a swarm of relatively narrow, sub-parallel, silica-rich mineralized veins are present. At La Bambolla, these veins are either vertical, or have steep dips, and range from 0.14 to 2.60 meters in width.  Based on analytical results of more than 500 underground channel samples taken at La Bambolla in the 1980's, the grades in the mine range from 0.01 to 3.26 % tellurium and 0.03 to 4.90 oz/ton gold, respectively.

Geologic mapping and sampling on the AuroTellurio Property have thus far confirmed that the regional structure hosting the tellurium-gold vein system at La Bambolla extends east-southeasterly onto the AuroTellurio Property. Zones of fracture-controlled silicification, strikingly similar to those described at La Bambolla, have been mapped in our grounds to the east-southeast.  We believe that these features could be spatially located at a higher level than similar alteration-mineralization features found at La Bambolla.  This interpretation, furthermore, appears to support our initial geologic model that a series of essentially north-trending, post-mineral faults could have down-dropped segments of the original mineralized system to the east.  Our current belief, based on projections from the existing data, is that ore-grade tellurium-gold mineralization is highly likely to exist at depth within our La Viuda Concessions. We expect that our planned gravity and ground magnetics surveys will help us corroborate this structural model, and guide us to select favorable diamond drilling sites.

RESULTS OF OPERATIONS

Three Months Ended July 31, 2011 and 2010

We are still in our exploration stage and have generated no revenues to date.

We incurred total operating expenses of $513,464 and $86,128 for the three months ended July 31, 2011 and 2010, respectively. These expenses increased in the three months ended July 31, 2011, primarily as a result of increased general and administrative expenses. General and administrative expenses increased from $86,128 in the three months ended July 31, 2010 to $449,167 in the three months ended July 31, 2011, primarily due to stock-based compensation expenses relating to certain consulting services provided to the Company, as well as management fees, salaries and wages, and other consulting expenses. Additionally, we incurred acquisition-related costs recorded as mineral property expenses on the statements of expenses, as a result of the Company entering into the AuroTellurio Option Agreement in February 2011 with Mexivada, pursuant to which we have been granted an option to acquire up to an 80% legal and beneficial ownership interest in Mexivada’s La Viuda Concessions in Moctezuma, Sonora, Mexico. We did not have such costs in the prior year.

In the three months ended July 31, 2011, we had non-operating income of $827,456, compared to non-operating expenses of $665. The increase of $828,121 over the prior year was primarily due to a $826,978 unrealized gain on derivative instruments relating to the issuance of the 2010 and 2011 warrants as a result of the private placement offering completed in December 2010 and January 2011, and the over-allotment in April, June and July 2011.

15

We had net income of $313,992 for the three months ended July 31, 2011, compared to net loss of $86,793.

We have generated no operating revenues and our net loss from inception through July 31, 2011 was $3,025,451.

Six Months Ended July 31, 2011 and 2010

We incurred total operating expenses of $681,335 and $128,338 for the six months ended July 31, 2011 and 2010, respectively. The $552,997 increase over the prior year was primarily due to increased general and administrative expenses. General and administrative expenses increased from $128,338 for the six months ended July 31, 2010 to $550,864 for the six months ended July 31, 2011, primarily due to stock-based compensation expenses relating to certain consulting services provided to the Company, as well as management fees, salaries and wages, and other consulting expenses. Additionally, we incurred acquisition-related costs, as discussed above, relating to the AuroTellurio Option Agreement in the amount of $130,408 for the six months ended July 31, 2011.

We also reported non-operating income of $514,987 for the six months ended July 31, 2011, compared to non-operating expenses of $1,056 for the six months ended July 31, 2010. The increase of $516,043 over the prior year was primarily due to a $513,955 unrealized gain on derivative instruments relating to the issuance of the 2010 and 2011 warrants as a result of the private placement offering completed in December 2010 and January 2011, and the over-allotment in April, June and July 2011.

Our net losses for six months ended July 31, 2011 and 2010 were $166,348 and $129,394, respectively.

LIQUIDITY AND CAPITAL RESOURCES

Our cash and cash equivalents balance as of July 31, 2011 was $1,245,755, compared to $1,268,254 as of January 31, 2011.

On January 13, 2011, we completed the second closing of a private placement (the “2010/2011 Private Placement”), in which we sold an aggregate of 61,478,258 units (the “Units”) of our securities for gross proceeds of $1,536,956, at an offering price of $0.025 per Unit. 39,478,258 of the Units consisted of one share of our common stock and an 18-month warrant to purchase one-half of one share of our common stock at an exercise price of $0.125 per whole share. The remaining 22,000,000 Units included our Series A Preferred Stock instead of our common stock and warrants exercisable for our common stock.

In April 2011, we entered into a PPO over-allotment option and sold an additional 8,000,000 Units of our securities for gross proceeds of $200,000 at an offering price of $0.025 per Unit. The Units consisted of one share of our common stock and an 18-month warrant to purchase one-half of one share of our common stock at an exercise price of $0.125 per whole share.

On July 15, 2011, we completed the second and final closing of an over-allotment option on the 2010/2011 Private Placement.  Under this over-allotment option, we sold to various institutional and accredited investors and non-U.S. persons 8,000,000 additional Units for gross proceeds of $200,000. In total, the Company sold 77,478,258 Units in the 2010/2011 Private Placement for aggregate gross proceeds of $1,936,956.

Due to our brief history and historical operating losses, our operations have not been a source of liquidity, and our sources of liquidity primarily have been debt and proceeds from the sale of Units in our 2010/2011 Private Placement. Although we have begun the acquisition of the AuroTellurio Property, this property will require exploration and development that could take years to complete before it begins to generate revenues. There can be no assurances that the AuroTellurio Property will be successfully developed to the revenue producing stage. If we are not successful in our proposed rare and precious metals mining operations, our business, results of operations, liquidity and financial condition will suffer materially.

16

As a result of the 2010/2011 Private Placement, we have sufficient funds to meet our first year requirements under the AuroTellurio Agreement, including the requirement that we pay Mexivada an additional $10,000 at the First Closing (this payment was made) and invest $750,000 in the Exploration Program.  If we determine to proceed with the exploration of the AuroTellurio Property after the first year, we will be required under the terms of the AuroTellurio Agreement to invest an additional $750,000 in the Exploration Program per year for each of the following three years. We will also be required to pay Mexivada $40,000 upon the first anniversary of the First Closing, $50,000 upon the second anniversary of the First Closing, $70,000 upon the third anniversary of the First Closing, and $100,000 upon the fourth anniversary of the First Closing, for a total of $290,000. We do not have this capital at this time and we will have to raise these amounts, plus additional amounts for general working capital purposes, in the capital markets. We plan to seek to raise such capital through additional sales of our equity or debt securities. There can be no assurance, however, that such financing will be available to us or, if it is available, that it will be available on terms acceptable to us and that it will be sufficient to fund our expected needs. If we are unable to obtain sufficient financing, we may not be able to proceed with our exploration and development plans for the AuroTellurio Property or meet our ongoing operational working capital needs.

Various factors outside of our control, including the price of rare and precious metals, overall market and economic conditions, the downturn and volatility in the US equity markets, and the trading price of our common stock may limit our ability to raise the capital needed to execute our plan of operations in the following years. We recognize that the US economy is currently experiencing a period of uncertainty and that the capital markets have been depressed from recent levels. These or other factors could adversely affect our ability to raise additional capital.  As a result of an inability to raise additional capital, our short-term or long-term liquidity and our ability to execute our plan of operations, including our ability to exercise our rights to acquire up to an additional 60% interest in the La Viuda Concessions, could be significantly impaired.

OFF-BALANCE SHEET ARRANGEMENTS

We have no off-balance sheet arrangements.

SIGNIFICANT ACCOUNTING POLICIES

It is suggested that these financial statements be read in conjunction with our January 31, 2011, audited financial statements and notes thereto, which can be found in our Form 10-K filing on the SEC website at www.sec.gov under our SEC File Number 333-134549.

ITEM 4.  CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act of 1934 (the “Exchange Act”) is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

The management of California Gold Corp. is responsible for establishing and maintaining an adequate system of internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act. Under the supervision and with the participation of our senior management, consisting of James D. Davidson, our chief executive officer and chief financial officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of the end of the period covered by this report (the “Evaluation Date”). Based on this evaluation, our chief executive officer and chief financial officer concluded, as of the Evaluation Date, that our disclosure controls and procedures were not effective because of the identification of what might be deemed a material weakness in our internal control over financial reporting which is identified below.

17

Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes of accounting principles generally accepted in the United States.  Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives. In evaluating the effectiveness of our internal control over financial reporting, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework. Based on this evaluation, our sole officer concluded that, during the period covered by this quarterly report, our internal controls over financial reporting were not operating effectively. Management did not identify any material weaknesses in our internal control over financial reporting as of July 31, 2011; however, it has identified the following deficiencies that, when aggregated, may possibly be viewed as a material weakness in our internal control over financial reporting as of that date:

1. We do not have an audit committee. While we are not currently obligated to have an audit committee, including a member who is an “audit committee financial expert,” as defined in Item 407 of Regulation S-K, under applicable regulations or listing standards; however, it is management’s view that such a committee is an important internal control over financial reporting, the lack of which may result in ineffective oversight in the establishment and monitoring of internal controls and procedures.

2. We did not maintain proper segregation of duties for the preparation of our financial statements. We currently only have one officer overseeing all transactions. This has resulted in several deficiencies including the lack of control over preparation of financial statements, and proper application of accounting policies:

Management believes that the material weaknesses set forth the two items above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.

Management's Remediation Initiatives

In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we plan to initiate the following series of measures once we have raised sufficient capital to do so:

We will create a position to segregate duties consistent with control objectives and will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us. And, we plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us.

Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, would remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board.

Changes in Internal Controls over Financial Reporting

There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

18

PART II

OTHER INFORMATION

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

None.

ITEM 6.  EXHIBITS

The following exhibits are included with this quarterly report.

Exhibit
Number	Description
31.1	Certification of Principal Executive and Principal Financial Officer, pursuant to SEC Rules 13a-14(a) and 15d-14(a), adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

**	101.INS	XBRL Instance Document
**	101.SCH	XBRL Taxonomy Extension Schema Document
**	101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
**	101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.
**	101.LAB	XBRL Taxonomy Extension Label Linkbase Document
**	101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

*

This certification is being furnished and shall not be deemed “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the Registrant specifically incorporates it by reference.

**

Furnished herewith.Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of any registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise are not subject to liability under those sections.

19

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date:  September 14, 2011	California Gold Corp.
	By	/s/ James D. Davidson
		James D. Davidson
		President, Treasurer, Principal Executive
		Officer, Principal Financial Officer

20

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE AND FINANCIAL OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT

I, James D. Davidson, certify that:

1.  I have reviewed this quarterly report on Form 10-Q for the period ended July 31, 2011 of California Gold Corp.;

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 quarterly 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 small business issuer as of, and for, the period presented in this report;

4.  I am 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 small business issuer and have:

a.  designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to me 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 my 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 small business issuer’s disclosure controls and procedures and presented in this report my 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 small business issuer’s internal control over financial reporting that occurred during the small business issuer’s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting; and

5.  I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the small business issuer’s auditors and the audit committee of small business issuer’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 small business issuer’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 small business issuer’s internal controls over financial reporting.

Date: September 14, 2011

/s/ James D. Davidson

James D. Davidson

Principal Executive Officer and

Principal Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION OF CHIEF EXECUTIVE AND FINANCIAL OFFICER

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 California Gold Corp. (the “Company”) on Form 10-Q for the period ended July 31, 2011, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, James D. Davidson, Chief Executive Officer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss.1350, as adopted pursuant to ss.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 respects, the financial condition and result of operations of the Company.

IN WITNESS WHEREOF, the undersigned has executed this certification as of September 14, 2011.

/s/ James D. Davidson

James D. Davidson

Chief Executive Officer and

Chief Financial Officer

A signed original of this written statement, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement, has been provided to California Gold Corp., and will be retained by California Gold Corp., and furnished to the Securities and Exchange Commission or its staff upon request.

XML



BALANCE SHEETS (Parenthetical) (USD $)	Jul. 31, 2011	Jan. 31, 2011
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	22,000,000	22,000,000
Preferred stock, shares issued	22,000,000	22,000,000
Preferred stock, shares outstanding	22,000,000	22,000,000
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	109,201,260	92,701,260
Common stock, shares outstanding	109,201,260	92,701,260

XML



STATEMENTS OF EXPENSES (USD $)	3 Months Ended		6 Months Ended		88 Months Ended
	Jul. 31, 2011	Jul. 31, 2010	Jul. 31, 2011	Jul. 31, 2010	Jul. 31, 2011
Expenses:
Mineral property expenses	$ 64,234		$ 130,408		$ 208,510
Bad debt expense					559,483
Depreciation expense	63		63		63
General and administrative expenses	449,167	86,128	550,864	128,338	1,699,045
Total operating expenses	513,464	86,128	681,335	128,338	2,467,101
Loss from operations	(513,464)	(86,128)	(681,335)	(128,338)	(2,467,101)
Other income (expenses):
Interest income	478		1,032		1,323
Interest expense		(665)		(1,056)	(1,763)
Realized and unrealized gain (loss) on derivatives, net	826,978		513,955		(548,292)
Amortization of debt discount					(9,618)
Total other income (expenses)	827,456	(665)	514,987	(1,056)	(558,350)
Net income (loss)	$ 313,992	$ (86,793)	$ (166,348)	$ (129,394)	$ (3,025,451)
Income (loss) per common share:
Income (loss) per common share - basic and diluted	$ 0.00	$ 0.00	$ 0.00	$ 0.00
Weighted average number of common shares outstanding - basic and diluted	104,256,205	58,063,002	99,392,927	58,063,002

XML



Document and Entity Information	6 Months Ended
	Jul. 31, 2011	Sep. 14, 2011
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 31, 2011
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	Q2
Trading Symbol	CLGL
Entity Registrant Name	CALIFORNIA GOLD CORP.
Entity Central Index Key	0001363573
Current Fiscal Year End Date	--01-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		93,201,260

XML



DERIVATIVE LIABILITIES

6 Months Ended

Jul. 31, 2011

DERIVATIVE LIABILITIES

NOTE 6 – DERIVATIVE LIABILITIES

Derivative Warrant Instruments

In the December 2010 and January 2011 Unit Offering, the Company incurred liabilities for the estimated fair value of derivative warrant instruments in the form of warrants. The estimated fair value of the derivative warrant instruments was calculated using the Black-Scholes option pricing model and amounted to $1,323,133 at the grant dates as of December 22, 2010 and January 13, 2011. These estimates were re-valued as being $2,305,770 and $1,803,271 at the balance sheet dates as of January 31, 2011 and July 31, 2011, respectively. The Company recorded $754,137 and $502,498 change in value as unrealized gain in non-operating income for the three and six months ended July 31, 2011, respectively.

The fair value of each warrant granted in the private placement offering has been estimated on the dates of grant using the Black-Scholes option pricing model, under the following assumptions:

Common stock issuable upon exercise of warrants		30,739,129
Market price of the Company’s common stock on the measurement dates	$	0.05 and 0.09
Exercise price	$	0.125
Risk free interest rate		0.475	%
Dividend yield		0.00	%
Volatility		257.95	%
Expected exercise term in years		1.5

In April 2011, the Company added to the Unit Offering a first over-allotment option. As such, the Company incurred liabilities for the estimated fair value of derivative warrant instruments in the form of warrants. The estimated fair value of the derivative warrant instruments was calculated using the Black-Scholes option pricing model and amounted to $71,973, $131,077, and $88,824 at the grant dates of April 7, 2011, April 13, 2011, and April 30, 2011, respectively. The April 2011 grants were re-valued as being $260,511 at the balance sheet date of July 31, 2011. The Company recorded a $92,747 and $31,363 change in value as unrealized gain in non-operating expense for the three and six months ended July 31, 2011, respectively.

The fair value of each warrant granted in the private placement offering has been estimated on the dates of grant using the Black-Scholes option pricing model, under the following assumptions:

Common stock issuable upon exercise of warrants		4,000,000
Market price of the Company’s common stock on the measurement dates	$	0.08 and 0.10
Exercise price	$	0.125
Risk free interest rate range		0.61 – 0.81	%
Dividend yield		0.00	%
Volatility range		268.16 – 284.75	%
Expected exercise term in years		1.5

In June and July 2011, the Company closed its first and second over-allotment options. The Company incurred liabilities for the estimated fair value of derivative warrant instruments in the form of warrants. The estimated fair value of the derivative warrant instruments was calculated using the Black-Scholes option pricing model and amounted to $149,203 and $102,957 at the grant dates of June 15, 2011 and July 15, 2011, respectively. The grants were re-valued as being $272,067 at the balance sheet date of July 31, 2011. The Company recorded a $19,906 change in value as unrealized loss in non-operating expense for the three and six months ended July 31, 2011.

The fair value of each warrant granted in the private placement offering has been estimated on the dates of grant using the Black-Scholes option pricing model, under the following assumptions:

Common stock issuable upon exercise of warrants		4,000,000
Market price of the Company’s common stock on the measurement dates	$	0.07 and 0.08
Exercise price	$	0.125
Risk free interest rate range		0.37 – 0.38	%
Dividend yield		0.00	%
Volatility range		315.50 – 317.98	%
Expected exercise term in years		1.5

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BASIS OF PRESENTATION

6 Months Ended

Jul. 31, 2011

BASIS OF PRESENTATION

NOTE 2 – BASIS OF PRESENTATION

The accompanying unaudited interim financial statements as of July 31, 2011 and 2010 and for the three and six months then ended have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information, and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (“SEC”) and on the same basis as the annual audited financial statements. The financial statements as of and for the three and six months ended July 31, 2011 and 2010 are unaudited. In the opinion of management, these financial statements include all adjustments, which, unless otherwise disclosed, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The balance sheet at January 31, 2011 has been derived from audited financial statements; however, the notes to the financial statements do not include all of the information and notes required by accounting principles generally accepted in the United States of America for complete financial statements. The accompanying unaudited interim financial statements should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended January 31, 2011 as filed with the SEC.

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EQUITY

6 Months Ended

Jul. 31, 2011

EQUITY

NOTE 8 – EQUITY

Private Placement Offering

On December 22, 2010, the Company sold to various persons (collectively, the “Investors”) 58,478,258 units of its securities (the “Units”) for gross proceeds of $1,461,956, at an offering price of $0.025 per Unit. Each of 36,478,258 of the Units consists of one common share and a warrant to purchase one-half share at $0.125 per whole share. Each of the remaining 22,000,000 Units consists of one share of the Company’s Series A Convertible Preferred Stock and warrants to purchase one-half of one share of common stock. The warrants will be exercisable from issuance until eighteen months after the closing of the PPO. 

On January 13, 2011, the Company sold an additional 5,000,000 Units for a total price of $125,000. The Company repurchased and cancelled 2,000,000 Units for $50,000.

In connection with the aforementioned over-allotment options, the Company sold an additional 8,000,000 Units for a total price of $200,000 in the quarter ended April 30, 2011. Additionally, the Company sold 8,000,000 units for a total purchase price of $200,000 in the quarter ended July 31, 2011.

As of July 31, 2011, cumulatively, the Company has sold a total of 77,478,258 Units for a total price of $1,936,956. The Company incurred closing costs of $19,000, resulting in net proceeds from the Offering of $1,917,956. The Company plans to apply the net proceeds of the closing primarily towards the AuroTellurio Acquisition (see Note 4), for the relief of certain outstanding accounts payable, and for working capital purposes.

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STOCK-BASED COMPENSATION

6 Months Ended

Jul. 31, 2011

STOCK-BASED COMPENSATION

NOTE 9 – STOCK-BASED COMPENSATION

Shares for Services

The Company recognized non-cash stock-based compensation expense of $0 and $10,555 during the three and six months ended July 31, 2011 in connection with a Consulting Services Agreement between the Company and Melechdavid, Inc. No shares for services were issued in the three and six months ended July 31, 2010.

Stock Options

The Company has a stock-based compensation plan known as the 2007 Stock Option Plan (the “Plan”). The Plan provides for the granting of incentive and non-qualified stock options to acquire common shares in the capital of California Gold Corp. The number of shares authorized under the Plan is 16,000,000. As of July 31, 2011, 5,000,000 shares remain available for future grants under the Plan.

On July 27, 2011, the Company granted options to purchase 11,000,000 shares of its common stock to its employees and outside consultants. These options have a 10-year term and were granted with an exercise price of $0.09. The one third of these options, or 3,666,667, vested on the date of the grant, with the remaining two thirds vesting on the first and second anniversaries of the date of grant. The Company recorded stock-based compensation expense attributable to options of $329,989 during the three and six months ended July 31, 2011. As of July 31, 2011, there was approximately $659,979 of total unrecognized compensation cost related to non-vested stock options, which is expected to be recognized over the next two years.

The fair value of options granted in July 2011 was measured at the date of grant using the Black-Scholes option-pricing model with the following assumptions:

Market price of the Company’s common stock on grant date	$	0.09
Risk free interest rate		3.01	%
Dividend yield		0.00	%
Volatility		260.65	%
Expected life	6 years
Expected forfeiture rate		0.00	%

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FAIR VALUE MEASUREMENTS

6 Months Ended

Jul. 31, 2011

FAIR VALUE MEASUREMENTS

NOTE 7 – FAIR VALUE MEASUREMENTS

As defined in FASB ASC Topic 820, fair value is the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. This Topic requires disclosure that establishes a framework for measuring fair value and expands disclosure about fair value measurements. The statement requires fair value measurements be classified and disclosed in one of the following categories:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. The Company considers active markets as those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2: Pricing inputs other than quoted market prices included in Level 1 that are based on observable market data and are directly or indirectly observable for substantially the full term of the asset or liability. These include quoted market prices for similar assets or liabilities, quoted market prices for identical or similar assets in markets that are not active, adjusted quoted market prices, inputs from observable data such as interest rate and yield curves, volatilities or default rates observable at commonly quoted intervals or inputs derived from observable market data by correlation or other means.

Level 3: Pricing inputs that are unobservable or less observable from objective sources. Unobservable inputs should only be used to the extent observable inputs are not available. These inputs maintain the concept of an exit price from the perspective of a market participant and should reflect assumptions of other market participants. An entity should consider all market participant assumptions that are available without unreasonable cost and effort. These are given the lowest priority and are generally used in internally developed methodologies to generate management's best estimate of the fair value when no observable market data is available.

Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels.

Certain assets and liabilities are reported at fair value on a recurring or nonrecurring basis in the Company’s balance sheet. The following methods and assumptions were used to estimate the fair values:

Cash, Prepaid assets, Mining rights (deposits), Accounts payable, and Accrued liabilities

The carrying amounts approximate fair value because of the short-term nature or maturity of the instruments.

Derivative liabilities

The Company’s determination of fair value of its derivative instruments incorporates various factors required under FASB Topic ASC 815. The fair values of the Company’s derivatives are valued using less observable data from objective sources as inputs into internal valuation models. Therefore, the Company considers the fair value of its derivatives to be Level 3 hierarchy. At July 31, 2011 and January 31, 2011, the aggregate Level 3 fair value of the derivative liabilities was $2,335,849 and $2,305,770, respectively.

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STATEMENTS OF CASH FLOWS (Parenthetical) (USD $)	6 Months Ended	88 Months Ended
	Jul. 31, 2011	Jul. 31, 2011
Proceeds from common and preferred stock issued, offering costs	$ 3,500	$ 3,500

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jul. 31, 2011

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Reclassifications

Certain amounts in prior periods have been reclassified to conform to current period presentation.

Acquisition-Related Costs

For the three and six months ended July 31, 2011, the Company incurred certain costs related to the AuroTellurio Acquisition (as defined below in Note 4). Those costs included legal, valuation, travel, and other professional or consulting fees. The Company accounted for those acquisition-related costs under FASB ASC Topic 805, Business Combinations. The costs were recognized as mineral property expenses in the periods in which the costs were incurred and the services received. The Company recorded $64,234 and $130,408 in costs for the three and six months ended July 31, 2011, respectively, and none for the three and six months ended July 31, 2010.

Stock-Based Compensation

The Company accounts for its stock-based compensation in which the Company obtains employee services in share-based payment transactions under FASB ASC Topic 718, Compensation – Stock Compensation, which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of such instruments over the vesting period.

The Company also adopted FASB ASC Topic 505-50, Equity-Based Payments to Non-Employees, to account for equity instruments issued to parties other than employees for acquiring goods or services.  Such awards for services are recorded at either the fair value of the consideration received or the fair value of the instruments issued in exchange for such services, whichever is more reliably measurable.

For the three and six months ended July 31, 2011, the Company recorded $329,989 and $340,544, respectively, in stock-based compensation as a component of general and administrative expenses. The Company did not issue any share-based payments to employees and non-employees during the three and six months ended July 31, 2010.

Net Earnings (Loss) Per Share

Basic net earnings (loss) per common share are computed by dividing net earnings (loss) by the weighted-average number of common shares outstanding during the period. Diluted net earnings (loss) per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, which is the case for all periods presented in these consolidated financial statements, the diluted weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive. For the three and six months ended July 31, 2011, the Company excluded options to purchase 11,000,000 shares of common stock, as the effect would be anti-dilutive.

New Accounting Pronouncements

The Company does not expect adoption of the new accounting pronouncements will have a material effect on the Company’s financial statements.

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MINING RIGHTS

6 Months Ended

Jul. 31, 2011

MINING RIGHTS

NOTE 4 – MINING RIGHTS

On February 11, 2011, the Company entered into a property option agreement (the “AuroTellurio Option Agreement”) with Mexivada Mining Corp. (“Mexivada”), which formalized and replaced the earlier Letter Agreement with Mexivada dated October 2010. Under the terms of the AuroTellurio Option Agreement, the Company is committed to incur $3,000,000 in cumulative exploration expenditures on the Property over a four year period at an investment rate of at least $750,000 per year. The Company will earn a 20% vested interest in the AuroTellurio Property in the first year of the AuroTellurio Option Agreement by investing $750,000 in an exploration program and up to an additional 60% interest in the Property, in blocks of 20% each, by investing an additional $750,000 in the exploration program in each of the following three years, or sooner, and meeting all of the other required terms of the AuroTellurio Option Agreement. Each 20% interest will vest earlier if each year’s cash and stock payments to Mexivada and $750,000 exploration expenditure investment are completed earlier than scheduled.

Under the terms of the Agreement, the Company will act as “Operator,” exclusively responsible, in consultation with Mexivada, for carrying out and administering exploration, development and mining work on the AuroTellurio Property. If costs of the exploration program exceed the agreed upon $3,000,000 investment, the Company will share additional costs with Mexivada on a proportionate share basis. Once the Company has earned its full 80% interest in the AuroTellurio Property, the Company will form a joint venture with Mexivada applicable to the further development and commercialization of the AuroTellurio Property.

Mexivada and its Mexican subsidiary hold only the mineral rights in the AuroTellurio Property, which rights were granted by the government of Mexico. Neither Mexivada nor its Mexican subsidiary owns the real property rights to the land underlying the La Viuda Concessions. Prior to the first closing under the AuroTellurio Option Agreement on August 4, 2011, the Company obtained a surface rights agreement with the landowner on whose property the La Viuda Concessions are located to conduct its mineral exploration program. The agreement became effective June 17, 2011, runs for a term of 12 months and may be extended for two additional years under the same terms.

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RELATED PARTY TRANSACTIONS

6 Months Ended

Jul. 31, 2011

RELATED PARTY TRANSACTIONS

NOTE 5 – RELATED PARTY TRANSACTIONS

Compensation of Officers and Directors

In January 2011, the Company entered into an arrangement with George Duggan to serve as the Company’s Chief Operating Officer effective January 17, 2011. Under the terms of the arrangement, the Company pays Mr. Duggan a $2,500 fee per month for his services.

On February 1, 2011, the Company entered into an independent contractor consulting agreement with James Davidson, pursuant to which the Company agreed to pay Mr. Davidson $5,000 per month for 12 months beginning February 1, 2011 for his services rendered to the Company as the Chief Executive Officer. Per an amendment to the consulting agreement between James Davidson and the Company, Mr. Davidson’s monthly compensation for his services rendered to the Company as the consultant was reduced from $5,000 to $2,000 effective June 2011.

The total compensation to Mr. Duggan and Mr. Davidson amounted to $16,500 and $36,500 for the three and six months ended July 31, 2011, respectively, and was recorded as a component of general and administrative expenses.

Legal, Consulting and Other Professional Fees

The Company has entered into a 12-month retainer agreement with Gottbetter & Partners, LLP (“G&P”), effective December 1, 2010, pursuant to which the Company will pay G&P, a stockholder of the Company, a monthly fee of $5,500 for providing legal services relating to SEC regulatory compliance and reporting requirements.

For the three months ended July 31, 2011 and 2010, professional legal fees to G&P totaled $23,446 and $41,805 respectively, and primarily related to SEC filings, private placement offerings, and other general corporate matters. For the six months ended July 31, 2011 and 2010, legal fees to G&P totaled $46,168 and $67,967, respectively, and primarily related to SEC filings, acquisitions, private placement offerings, and other general corporate matters. The legal fees incurred are included as a component of general and administrative expenses.

In December 2010, the Company entered into a consulting agreement with Oberal International, Inc. (“Oberal”), a stockholder of the Company. Oberal will provide the Company with regular and customary capital markets and corporate finance consulting advice, including recommendations concerning investor and strategic introductions to potential industry partners. The agreement became effective December 15, 2010 and ran for a term of 90 days. In consideration of services to be rendered by Oberal, the Company agreed to pay Oberal $25,250 for the term of the agreement. The Company incurred $0 and $11,783 in consulting fees during the three and six months ended July 31, 2011, which are included as a component of general and administrative expenses.

In January 2011, the Company entered into an administrative services agreement with Incorporated Communications Services (“ICS”), a California corporation. George Duggan, the Company’s Chief Operations Officer, is the Vice President of ICS. Pursuant to the agreement with ICS, ICS will make available its address in La Canada, California to serve as the Company’s corporate headquarters and communications office, and provide the Company with basic administrative services, including coordinating and routing incoming telephone calls, handling investor inquiries, assisting in the preparation of press releases, developing an informational website and coordinating with the auditors and financial statement preparers. The Company pays ICS a monthly fee of $6,000 for these services. This agreement with ICS became effective January 1, 2011, runs for a term of 12 months and may be extended or terminated by the parties upon 60 days prior notice. The Company incurred $18,000 and $36,000 in management fees for the three and six months ended July 31, 2011, which are included as a component of general and administrative expenses.

In January 2011, the Company entered into a consulting agreement with Melechdavid, Inc., a stockholder of the Company. Melechdavid, Inc. provided certain consulting services to the Company’s business for a term of 90 days, commencing on January 18, 2011, the effective date of this agreement, and fair valued at $12,500. In consideration of services to be rendered by Melechdavid, Inc., the Company issued the 500,000 restricted shares of its common stock, $0.001 per share, on February 28, 2011. The Company recorded the $0 and $10,555 of stock-based compensation expense for the services provided by Melechdavid, Inc. to the Company in the three and six months ended July 31, 2011.

On June 6, 2011, the Company entered into consulting agreement with Michael Baybak, a stockholder of the Company. The Company engaged Mr. Baybak to provide certain consulting services related to the Company’s business for a minimum period through June 5, 2013 for a monthly compensation fee of $6,000. The Company incurred $12,000 in consulting fees to Mr. Baybak for the three and six months ended July 31, 2011, which are included as a component of general and administrative expenses.

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STATEMENTS OF CASH FLOWS (USD $)	6 Months Ended		88 Months Ended
	Jul. 31, 2011	Jul. 31, 2010	Jul. 31, 2011
Cash flows from operating activities:
Net loss	$ (166,348)	$ (129,394)	$ (3,025,451)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	63		63
Stock-based compensation	340,544		843,657
Amortization of debt discount			9,618
Unrealized and realized (gain) loss on derivatives, net	(513,955)		548,292
Changes in operating assets and liabilities:
Accounts payable	(15,278)	38,121	(46,496)
Accounts payable - related party	(46,250)	67,967	129,881
Accrued expenses	(2,500)	750	142
Interest accrued on notes payable from related party		1,056	1,621
Net cash used in operating activities	(410,190)	(21,500)	(1,545,139)
Cash flows from investing activities:
Purchase of property and equipment	(8,809)		(8,809)
Investment in mining rights			(20,000)
Net cash used in investing activities	(8,809)		(28,809)
Cash flows from financing activities:
Proceeds from related party loans		21,500	92,430
Proceeds from common and preferred stock issued, net of offering costs of $3,500	396,500		2,790,273
Payments from cancellation of common stock			(63,000)
Net cash provided by financing activities	396,500	21,500	2,819,703
Net increase (decrease) in cash	(22,499)		1,245,755
Cash - beginning of period	1,268,254	373
Cash - end of period	1,245,755	373	1,245,755
Noncash investing and financing activities:
Issuance of common stock for convertible notes			3,660
Derecognition of derivatives related to convertible notes			91,365
Common stock cancellation			61,700
All Other
Changes in operating assets and liabilities:
Prepaid expenses	(34,250)		(34,250)
Related Party Transactions
Changes in operating assets and liabilities:
Prepaid expenses	27,784		27,784
Noncash investing and financing activities:
Contributed capital			374
Related party note receivable write-off			557,927
Derivative
Noncash investing and financing activities:
Debt discount due to derivative liabilities			9,618
Issuance of derivative warrant instruments	544,035		1,867,168
Stockholders
Noncash investing and financing activities:
Contributed capital			$ 157,665

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GENERAL ORGANIZATION AND BUSINESS

6 Months Ended

Jul. 31, 2011

GENERAL ORGANIZATION AND BUSINESS

NOTE 1 – GENERAL ORGANIZATION AND BUSINESS

California Gold Corp. (“California Gold” or the “Company”) is a Nevada corporation whose principal focus is the identification, acquisition, and development of rare and precious metals mining properties in the Americas. The Company is still in the exploration stage and has not generated any revenues from its mining properties to date.

The Company was incorporated on April 19, 2004 under the name of Arbutus Resources, Inc. On August 9, 2007, the Company changed its name to US Uranium, Inc. On March 9, 2009, the Company changed its name to California Gold Corp.

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SUBSEQUENT EVENTS

6 Months Ended

Jul. 31, 2011

SUBSEQUENT EVENTS

NOTE 10 – SUBSEQUENT EVENTS

The Company evaluates subsequent events through the date when financial statements are filed with the SEC.

First Closing under the AuroTellurio Option Agreement

On August 4, 2011, the Company conducted the first closing (the “First Closing”) under the AuroTellurio Option Agreement (See Note 4).  On the date of the First Closing, the Company paid Mexivada an additional $10,000 in cash and issued to Mexivada 250,000 shares of its restricted common stock.  In exchange, the Company received from Mexivada four fully executed title deeds, each transferring to the Company a twenty percent (20%) interest in the La Viuda Concessions comprising the AuroTellurio Property, to be held in escrow by the Company's counsel until fully vested in accordance with their terms or returned to Mexivada.

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BALANCE SHEETS (USD $)	Jul. 31, 2011	Jan. 31, 2011
Current assets:
Cash	$ 1,245,755	$ 1,268,254
Prepaid expenses	34,250
Prepaid expenses - related party	6,000	33,784
Total current assets	1,286,005	1,302,038
Property and equipment, net	8,746
Mining rights	20,000	20,000
Total assets	1,314,751	1,322,038
Current liabilities:
Accounts payable	11,851	27,129
Accounts payable - related party	6,000	52,250
Derivative liabilities	2,335,849	2,305,770
Other accrued liabilities		2,500
Total current liabilities	2,353,700	2,387,649
Total liabilities	2,353,700	2,387,649
Commitments and contingencies
Stockholders' deficit:
Preferred stock, par value $0.001 per share, 22,000,000 shares authorized ; 22,000,000 shares issued and outstanding	22,000	22,000
Common stock, par value $0.001 per share, 300,000,000 shares authorized ; 109,201,260 and 92,701,260 shares issued and outstanding , respectively	109,201	92,701
Additional paid-in capital	1,855,301	1,678,791
Deficit accumulated during the exploration stage	(3,025,451)	(2,859,103)
Total stockholders' deficit	(1,038,949)	(1,065,611)
Total liabilities and stockholders' deficit	$ 1,314,751	$ 1,322,038