10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended October 31, 2011

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

For the transition period from ________ to ________

COMMISSION FILE NUMBER  000-50569

TERRACE VENTURES INC.

(Exact name of registrant as specified in its charter)

NEVADA	91-2147101
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
Suite 202, 810 Peace Portal Drive,
Blaine, WA	98230
(Address of principal executive offices)	(Zip Code)

(360) 220-5218

(Registrant’s telephone number, including area code)

Not Applicable

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

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the 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.   x Yes    ¨ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, 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 to post such files). x Yes    ¨ No

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

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

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

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:  As of December 13, 2011, the Registrant had 29,470,659 shares of common stock outstanding.

PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS.

The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X, and, therefore, do not include all information and footnotes necessary for a complete presentation of financial position, results of operations, cash flows, and stockholders' equity in conformity with generally accepted accounting principles. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. Operating results for the three and six months ended October 31, 2011 are not necessarily indicative of the results that can be expected for the year ended April 30, 2012.

As used in this Quarterly Report, the terms “we,” “us,” “our,” “Terrace,” and the “Company” mean Terrace Ventures Inc. unless otherwise indicated.  All dollar amounts in this Quarterly Report are expressed in U.S. dollars, unless otherwise indicated.

2

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

BALANCE SHEET

	(Unaudited)			(Audited)
	October 31, 2011			April 30, 2011
ASSETS
Current Assets:
Cash	$	28,804		$	2,459
Total Current Assets		28,804			2,459
Investment in Mineral Rights		25,000			25,000
TOTAL ASSETS	$	53,804		$	27,459
LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)
Current Liabilities:
Accounts Payable and Accrued Expenses	$	89,427		$	50,817
Loans Payable		6,000			6,000
Loans Payable – Related Parties		1,000			1,000
Stock Subscriptions Payable		75,000			-0-
Note Payable		25,000			25,000
Total Current Liabilities		196,427			82,817
Stockholders' Deficit:
Common Stock, $0.001 par value 400,000,000 shares authorized, 29,470,660 shares issued		29,471			29,471
Additional Paid in Capital		1,991,424			1,991,424
Deficit Accumulated During the Exploration Stage		(2,163,518	)		(2,076,253	)
Total Stockholders' Equity/(Deficit)		(142,623	)		(55,358	)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)	$	53,804		$	27,459

See Notes to Financial Statements

3

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT

(Unaudited)

	THREE MONTHS ENDED						SIX MONTHS ENDED
	OCTOBER 31,						OCTOBER 31,						INCEPTION to
	2011			2010			2011			2010			OCTOBER 31, 2011
Revenues	$	-0-		$	-0-		$	-0-		$	-0-		$	-0-
Operating Expenses		(67,353	)		(31,130	)		(87,265	)		(41,285	)		(1,149,029	)
Loss Before Other Income and Expenses		(67,353	)		(31,130	)		(87,265	)		(41,285	)		(1,149,029	)
Other Income:
Interest Income		-0-			-0-			-0-			-0-			14,491
Other Expense:
Unrealized Loss On Investment		-0-			-0-			-0-			-0-			(1,028,980	)
Loss Before Provision for Income Taxes		(67,353	)		(31,130	)		(87,265	)		(41,285	)		(2,163,518	)
Provision for Income Taxes		-0-			-0-			-0-			-0-			-0-
Net Loss		(67,353	)		(31,130	)		(87,265	)		(41,285	)		(2,163,518	)
Accumulated Deficit, Beginning of Period		(2,096,165	)		(1,989,213	)		(2,076,253	)		(1,979,058	)		-0-
Accumulated Deficit, End of Period	$	(2,163,518	)	$	(2,020,343	)	$	(2,163,518	)	$	(2,020,343	)	$	(2,163,518	)
Net Loss per Share	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.26	)
Weighted Average Shares Outstanding		29,470,660			9,470,660			29,470,660			9,470,660			8,205,527

See Notes to Financial Statements

4

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)

(Unaudited)

							Deficit
							Accumulated
	Common Stock				Additional		During the			Total
			Dollar		Paid in		Exploration			Stockholders'
	Shares		Amount		Capital		Stage			Equity(Deficit)
Inception February 20, 2001		—	$	—	$	—	$	—		$	——
Common Stock Issued $0.001 per share April 9, 2001		4,000,000		4,000		—		—			4,000
Net Loss, April 30, 2001		—		—		—		(1,410	)		(1,410	)
Balances April 30, 2001		4,000,000		4,000		—		(1,410	)		2,590
Common Stock Issued $0.01 per share August 15, 2001		2,500,000		2,500		22,500		—			25,000
Net Loss, April 30, 2002		—		—		—		(19,196	)		(19,196	)
Balances April 30, 2002		6,500,000		6,500		22,500		(20,606	)		8,394
Common Stock Issued $0.10 per share September 30, 2002		142,500		143		14,107		—			14,250
Net Loss, April 30, 2003		—		—		—		(17,632	)		(17,632	)
Balances April 30, 2003		6,642,500		6,643		36,607		(38,238	)		5,012
Common Stock Issued $0.10 per share November 6, 2003		400,000		400		39,600		—			40,000
Net Loss, April 30, 2004		—		—		—		(58,708	)		(58,708	)
Balances April 30, 2004		7,042,500		7,043		76,207		(96,946	)		(13,696	)
Net Loss, April 30, 2005		—		—		—		(37,532	)		(37,532	)
Balances April 30, 2005		7,042,500		7,043		76,207		(134,478	)		(51,228	)

See Notes to Financial Statements

5

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) – CONTINUED

(Unaudited)

								Deficit
								Accumulated
	Common Stock				Additional			During the			Total
			Dollar		Paid in			Exploration			Stockholders'
	Shares		Amount		Capital			Stage			Equity (Deficit)
Balances, April 30, 2005		7,042,500		7,043		76,207			(134,478	)		(51,228	)
Common Stock Issued $1.00 per share November 23,2005		500,000		500		499,500			—			500,000
4-for-1 Stock Split, December 19, 2005		22,627,500		22,627		(22,627	)		—			—
Common Stock Issued $0.25 per share February 3, 2006		400,000		400		99,600			—			100,000
Common Stock Issued $0.25 per share March 13, 2006		380,000		380		94,620			—			95,000
Common Stock Issued $0.25 per share March 31, 2006		999,920		1,000		248,980			—			249,980
Net Loss, Period Ended April 30, 2006		—		—		—			(987,633	)		(987,633	)
Balances April 30, 2006		31,949,920		31,950		996,280			(1,122,111	)		(93,881	)
Common Stock Issued $0.25 per share May 24, 2006		220,080		220		54,800			—			55,020
Common Stock Issued $0.30 per share June 5, 2006		335,000		335		100,165			—			100,500
Common Stock Issued $0.10 per share January 23, 2007		1,678,200		1,678		166,142			—			167,820
Net Loss, Period Ended April 30, 2007		—		—		—			(301,060	)		(301,060	)
Balances April 30, 2007		34,183,200		34,183		1,317,387			(1,423,171	)		(71,601	)

See Notes to Financial Statements

6

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - CONTINUED

									Deficit
									Accumulated
	Common Stock						Additional		During the			Total
				Dollar			Paid in		Exploration			Stockholders'
	Shares			Amount			Capital		Stage			Equity (Deficit)
Balances April 30, 2007		34,183,200		$	34,183		$	1,317,387	$	(1,423,171	)	$	(71,601	)
Common Stock Issued $0.10 per share July 12, 2007		2,570,000			2,570			254,755		—			257,325
Net Loss, Period Ended April 30, 2008		—			—			—		(100,450	)		(100,450	)
Balances April 30, 2008		36,753,200		$	36,753		$	1,572,142	$	(1,523,621	)	$	85,274
Common Stock Issued $0.10 per share October 10, 2008		10,000,000			10,000			190,000		—			200,000
Common Stock Issued $0.02 per share April 8, 2009		600,000			600			11,400		—			12,000
Net Loss, Period Ended April 30, 2009		—			—			—		(355,923	)		(355,923	)
Balances April 30, 2009		47,353,200			47,353			1,773,542		(1,879,544	)		(58,649	)
1-for-5 Reverse Stock Split, October 1, 2009		(37,882,540	)		(37,882	)		37,882		—			—
Net Loss, Period Ended April 30, 2010		—			—			—		(99,514	)		(99,514	)
Balances April 30, 2010		9,470,660			9,471			1,811,424		(1,979,058	)		(158,163	)
Common Stock Issued $0.01 per share March 24, 2011		20,000,000			20,000			180,000		—			200,000
Net Loss, Period Ended April 30, 2011		—			—			—		(97,195	)		(97,195	)
Balances April 30, 2011		29,470,660			29,471			1,991,424		(2,076,253	)		(55,358	)
Net Loss, Period Ended October 31, 2011		—			—			—		(87,265	)		(87,265	)
Balances October 31, 2011		29,470,660			29,471			1,991,424		(2,163,518	)		(142,623	)

See Notes to Financial Statements.

7

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENT OF CASH FLOWS

(Unaudited)

	SIX MONTHS ENDED
	OCTOBER 31,						INCEPTION to
	2011			2010			OCTOBER 31, 2011
Cash Flows from Operating Activities:
Net Loss	$	(87,265	)	$	(41,285	)	$	(2,163,518	)
Adjustments to Reconcile Net Income to Net Cash Provided/(Used) by Operating  Activities:
Unrealized Loss on Investment		-0-			-0-			1,028,980
(Increase)/Decrease in:
Notes Receivable		-0-			-0-			-0-
Loan Receivable		-0-			-0-			-0-
Increase(Decrease) in:
Accounts Payable		38,610			31,626			89,427
Loans Payable		-0-			-0-			6,000
Loans Payable – Related Parties		-0-			-0-			1,000
Stock Subscriptions Payable		75,000			8,480			75,000
Net Cash Provided/(Used) by Operating Activities		26,345			(1,179	)		(963,111	)
Cash Flows from Investing Activities:
Stock Investment		-0-			-0-			(1,028,980	)
Net Cash Used by Investing Activities		-0-			-0-			(1,028,980	)
Cash Flows from Financing Activities:
Loans from Shareholders		-0-			-0-			157,395
Payments on Loans		-0-			-0-			(157,395	)
Proceeds Related to Issuance of Common Stock		-0-			-0-			2,020,895
Net Cash Provided by Financing Activities		-0-			-0-			2,020,895
Net Increase in Cash	$	26,345		$	(1,179	)	$	28,804
Cash at Beginning of Period		2,459			1,169			-0-
Cash at End of Period	$	28,804		$	(10	)	$	28,804

See Notes to Financial Statements

8

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General

Terrace Ventures Inc. was incorporated on February 20, 2001 in the state of Nevada.  The Company acquires and develops certain mineral rights in Canada.

Basis of Presentation

The Company reports revenue and expenses using the accrual method of accounting for financial and tax reporting purposes.

Use of Estimates

Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.

Exploration Stage Company

In accordance with FASB ASC 915, the Company has been in the exploration stage since its formation and has not yet realized any revenues from its planned operations.

Stock-Based Compensation

Stock-based compensation is accounted for using the Equity-Based Payments to Non-Employees Topic of the FASB ASC (FASB ASC Topic 718), which establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services.  It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of those equity instruments.  The Company determines the value of stock issued at the date of grant. It also determines at the date of grant, the value of stock at fair market value or the value of services rendered (based on contract or otherwise) whichever is more readily determinable.

Shares issued to employees are expensed upon issuance.

9

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

Stock-Based Compensation - CONTINUED

The Company uses the fair value method for equity instruments granted to employees and will use the Black Scholes model for measuring the fair value of options, if issued.  The stock based fair value compensation is determined as of the date of the grant or the date at which the performance of the services is completed (measurement date) and is recognized over the vesting periods.

No stock options have been issued by Terrace Ventures, Inc.

Mineral Property Acquisition and Exploration Costs

The Company expenses all costs related to the acquisition and exploration of mineral properties in which it has secured exploration rights prior to establishment of proven and probable reserves.  To date, the Company has not established the commercial feasibility of any exploration prospects; therefore, all costs are being expensed.

Depreciation, Amortization and Capitalization

The Company records depreciation and amortization when appropriate using both straight-line and declining balance methods over the estimated useful life of the assets (five to seven years).

Expenditures for maintenance and repairs are charged to expense as incurred.  Additions, major renewals and replacements that increase the property's useful life are capitalized.  Property sold or retired, together with the related accumulated depreciation, is removed from the appropriate accounts and the resultant gain or loss is included in net income.

Income Taxes

The Company accounts for its income taxes in accordance with FASB ASC 740, “Accounting for Income Taxes".  Under this statement, a liability method is used whereby deferred tax assets and liabilities are determined based on temporary differences between basis used for financial reporting and income tax reporting purposes.  Income taxes are provided based on tax rates in effect at the time such temporary differences are expected to reverse. A valuation allowance is provided for certain deferred tax assets if it is more likely than not, that the Company will not realize the tax assets through future operations.

10

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

Fair Value of Financial Instruments

FASB ASC 825, “Financial Instruments”, requires the Company to disclose, when reasonably attainable, the fair market values of its assets and liabilities which are deemed to be financial instruments.  The Company's financial instruments consist primarily of cash and certain investments.

Investments

Investments that are purchased in other companies are valued at cost less any impairment in the value that is other than temporary in nature.

Per Share Information

The Company follows FASB ASC 260 “Earnings Per Share” which establishes standards for the computation, presentation and disclosure requirements for basic and diluted earnings per share for entities with publicly-held common shares and potential common stock issuances. Basic earnings (loss) per share are computed by dividing net income by the weighted average number of common shares outstanding.  In computing diluted earnings per share, the weighted average number of shares outstanding is adjusted to reflect the effect of potentially dilutive securities, such as convertible notes, stock options, and warrants.  Common stock equivalent shares are excluded from the computation if their effect is antidilutive.

NOTE 2 – INVESTMENT IN MINERAL RIGHTS

On April 26, 2011, we entered into an agreement with Pengram Corporation (“Pengram”) dated April 26, 2011, as amended on June 29, 2011, (the “Earn-In Agreement”).  Under the terms of the Earn-In Agreement, the Company will earn up to a 75% interest in Pengram’s agreement with Scoonover Exploration LLC and JR Exploration LLC (the “Underlying Agreement”) to acquire the Golden Snow Property, by paying to Pengram up to $175,000 and expending up to $1,750,000 in exploration work.  The Golden Snow project consists of 111 mineral claims located in the Eureka Mining District in Eureka County, Nevada.  As of July 31, 2011, $25,000 was invested in Pengram by way of promissory note.

NOTE 3 – LOANS PAYABLE

Loans payable consist of short term monies advanced.  These loans are unsecured, bear no interest rate and no specified maturity date.

11

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

NOTE 4 – LOANS PAYABLE – RELATED PARTIES

Loans payable related parties consist of various short term monies advanced by shareholders.  These loans are unsecured, bear no interest rate and no specified maturity date.

NOTE 5 – NOTE PAYABLE

Note payable consists of short term monies due to Pengram Corporation. The company has agreed to pay Pengram Corporation $25,000 by way of promissory note (see Note 2), bearing interest at a rate of 10% per annum, due on September 27, 2011.

NOTE 6 - PROVISION FOR INCOME TAXES

The provision for income taxes for the periods ended October 31, 2011 and October 31, 2010 represents the minimum state income tax expense of the Company, which is not considered significant.

NOTE 7 - COMMITMENTS AND CONTINGENCIES

Pengram Corporation Agreement – Golden Snow Project

The Company is obligated to Pengram Corporation for up to $175,000 in direct payments and $1,750,000 in exploration expenses as follows:

(i) The first 25% interest in the Underlying Agreement upon the Company:

a.        Paying Pengram $25,000 by way of a promissory note, bearing interest at a rate of 10% per annum, due on September 27, 2011;

b.        Completing exploration expenditures on the Property totaling $250,000 by July 31, 2012.

(ii)          An additional 25% interest in the Underlying Agreement upon the Company:

a.        Paying Pengram $50,000 on or before May 31, 2013;

b.       Completing additional exploration expenditures on the Property totaling $500,000 by July 31, 2013:

(iii)                   An additional 25% interest in the Underlying Agreement upon the Company:

a.       Paying Pengram $100,000 on or before May 31, 2014;

b.       Completing additional exploration expenditures on the Property totaling $1,000,000 by July 31, 2014.

 

12

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

NOTE 7 - COMMITMENTS AND CONTINGENCIES - CONTINUED

Pengram Corporation Agreement – Golden Snow Project - Continued

The Company is also obligated to pay all advance royalties, county and BLM claim fees and Nevada state taxes during the currency of the Earn-In Agreement.

Operating Leases

The Company currently rents administrative office space under a monthly renewable contract.

Litigation

The Company is not presently involved in any litigation.

NOTE 8 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

Recently issued accounting pronouncements will have no significant impact on the Company and its reporting methods.

NOTE 9 – GOING CONCERN

Future issuances of the Company’s equity or debt securities will be required in order for the Company to continue to finance its operations and continue as a going concern.  The Company’s present revenues are insufficient to meet operating expenses.

The consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has incurred cumulative net losses of $2,163,518 since its inception and requires capital for its contemplated operational and marketing activities to take place.  The Company's ability to raise additional capital through the future issuances of common stock is unknown.  The obtainment of additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations.  The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

13

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

NOTE 10 – REVERSE STOCK SPLIT

On September 2, 2009, the Board of Directors approved a one-for-five reverse split of the Company’s common stock.  Upon the completion of the reverse stock split, which was effective on October 1, 2009, the Company’s authorized shares of common stock was decreased from 400,000,000 shares, par value $0.001 per share, to 80,000,000 shares, par value $0.001 per share.  Issued and outstanding common stock was reduced from 47,353,200 shares to approximately 9,470,660 shares.  Weighted Average Shares Outstanding and Net Loss per Share have been restated on the Statements of Operations and Accumulated Deficit for the effect of the reverse stock split.

NOTE 11 – STOCK ISSUANCES

On June 8, 2010 our Board of Directors terminated the convertible notes offering approved on March 16, 2010 and approved two private placement offerings for up to an aggregate of 10,000,000 Units for proceeds of up to $100,000 as follows:

Foreign Private Placement

On June 8, 2010, our Board of Directors approved a private placement offering of up to 5,000,000 Units at a price of $0.01 US per unit, with each Unit consisting of one share of our common stock and one share purchase warrant (the Foreign Private Placement”).  Each share purchase warrant entitled the holder to purchase an additional share of common stock exercisable for a period of two years at a price of $0.01 US per share.  The private placement offering was made to persons who are not “U.S. Persons” as defined in Regulation S.  Subsequent to the offering, the corporation received subscriptions for an aggregate of 14,700,000 shares and payment in full of the subscription proceeds.  In order to allow for the oversubscriptions to the Foreign Offering, on March 24, 2011, the Corporation increased the number of Shares being issued under the Offering to 14,700,000 Shares.  Upon the issuance of the Shares, the Corporation terminated this Foreign Offering.

14

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

NOTE 11 – STOCK ISSUANCES - CONTINUED

U.S. Private Placement

Also, on June 8, 2010, our Board of Directors approved a private placement offering of up to 5,000,000 Units at a price of $0.01 US per Unit, with each Unit consisting of one share of our common stock and one share purchase warrant (the “U.S. Private Placement”).  Each share purchase warrant entitled the holder to purchase an additional share of common stock exercisable for a period of two years at a price of $.01 US per share.  The private placement offering was made to persons who are “Accredited Investors” as defined in Regulation D. Subsequent to the offering, the corporation received subscriptions for an aggregate of 5,300,000 shares and payment in full of the subscription proceeds.  In order to allow for the oversubscriptions to the US Offering, on March 24, 2011, the Corporation increased the number of Shares being issued under the Offering to 5,300,000 Shares.  Upon the issuance of the Shares, the Corporation terminated this US Offering.

On April 26, 2011 our Board of Directors approved two concurrent private placements as follows:

Foreign Private Placement

On April 26, 2011, our Board of Directors approved a private placement offering of up to 2,500,000 shares of our common stock at a price of $0.10 US per share to persons who are not “US Persons” as defined in Regulation S if the Securities Act of 1933.

U.S. Private Placement

Also, on April 26, 2011, our Board of Directors approved a private placement offering of up to 2,500,000 shares of our common stock at a price of $0.10 US per share.  The offering will be made in the United States to persons who are accredited investors as defined in Regulation D of the Securities Act of 1933.

15

SUPPLEMENTAL STATEMENT

16

TERRACE VENTURES INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF OPERATING EXPENSES

(Unaudited)

	THREE MONTHS ENDED				SIX MONTHS ENDED
	OCTOBER 31,				OCTOBER 31,				INCEPTION to
	2011		2010		2011		2010		OCTOBER 31, 2011
Operating Expenses:
Accounting & Audit	$	11,690	$	16,460	$	16,530	$	16,460	$	173,200
Bad Debt Expense		-0-		-0-		-0-		-0-		214,892
Bank Charges		110		70		140		115		1,340
Cancelled Merger Costs		-0-		-0-		-0-		-0-		8,300
Consulting		-0-		-0-		-0-		-0-		119,650
Exploration and Development		-0-		-0-		-0-		-0-		24,266
Interest Expense		664		-0-		1,328		-0-		1,328
Legal		11,690		4,259		17,780		6,269		301,094
Office Administration		7,500		7,500		15,000		15,000		189,600
Office Expenses		-0-		-0-		-0-		-0-		4,271
Property Maintenance		29,572		-0-		29,572		-0-		29,572
Regulatory Expenses/Fees		5,527		2,241		5,715		2,241		42,552
Rent		375		375		750		750		27,075
Telephone		225		225		450		450		7,181
Travel & Entertainment		-0-		-0-		-0-		-0-		4,708
Total Operating Expenses	$	67,353	$	31,130	$	87,265	$	41,285	$	1,149,029

See Notes to Financial Statements

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

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report constitute "forward-looking statements.”  These statements, identified by words such as “plan,” "anticipate," "believe," "estimate," "should," "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. These statements reflect the current views of management with respect to future events and are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those described in the forward-looking statements. Such risks and uncertainties include those set forth under the caption "Part II – Item 1A. Risk Factors" and elsewhere in this Quarterly Report. We do not intend to update the forward-looking information to reflect actual results or changes in the factors affecting such forward-looking information. We advise you to carefully review the reports and documents, particularly our Annual Reports, Quarterly Reports and Current Reports, that we file from time to time with the United States Securities and Exchange Commission (the “SEC”).

OVERVIEW

We were incorporated on February 20, 2001 under the laws of the State of Nevada.

Our business plan is to assemble a portfolio of mineral properties with gold potential and to engage in the exploration and development of these properties.  We currently have an earn-in agreement to acquire 75% interest in Pengram Corporation's agreement with Scoonover Exploration LLC and JR Exploration LLC (the “Underlying Agreement”) to acquire the Golden Snow Property. The Golden Snow Property consists of 114 mineral claims located in the Eureka Mining District in Eureka County, Nevada.

Earn-In Agreement

On April 26, 2011, we entered into an agreement with Pengram Corporation ("Pengram") dated April 26, 2011, as amended on June 29, 2011 (the "Earn-In Agreement").  whereby we will earn up to a 75% interest in Pengram's agreement with Scoonover Exploration LLC and JR Exploration LLC (the “Underlying Agreement”) to acquire the Golden Snow Property by paying to Pengram up to $175,000 and expending up to $1,750,000 to do exploration work on the Golden Snow Property as follows:

(i) The first 25% interest in the Underlying Agreement upon the Company:

a. paying Pengram $25,000 by way of a promissory note, bearing interest at a rate of 10% per annum, due on September 27, 2011;

b. completing exploration expenditures on the Property totalling $250,000 by July 31, 2012.

(ii) An additional 25% interest in the Underlying Agreement upon the Company:

a. paying Pengram $50,000 on or before May 31, 2013;

b. completing exploration expenditures on the Property totalling $500,000 by July 31, 2013:

(iii) An additional 25% interest in the Underlying Agreement upon the Company:

a. paying Pengram $100,000 on or before May 31, 2014;

b. completing exploration expenditures on the Property totalling $1,000,000 by July 31, 2014.

The Company is also obligated to pay all advance royalties, county and BLM claim fees and Nevada state taxes during the currency of the Earn-In Agreement. We are currently in the process of negotiating an extension to the promissory note that was due on September 27, 2011. There is no assurance that we be able to reach an agreement with Pengram to extend the promissory note.

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PLAN OF OPERATION

Over the next twelve months, our plan of operation is to focus our resources on the exploration of the Gold Snow Property.  Subject to obtaining sufficient financing, we plan to retain a consulting geologist to conduct a review of the property in order to recommend an exploration program to be conducted in spring 2012.  Once our consulting geologist has provided us with their findings, we will determine whether to proceed with an exploration program on these properties.

During the next twelve months, we will be required to make a number of payments in order to maintain our interest to acquire a 75% interest in the Golden Snow Project.  Under the terms of our Earn-In Agreement, in order to keep the Golden Snow Property in good standing, we are required to pay to Pengram: (i) $25,000 being the amount due under the promissory note; and (ii) the Bureau of Land Management maintenance and claim fees of approximately $15,960 by September 1, 2012.  If we are unable to make the payments to Claremont, the Bureau of Land Management we will lose our interest in the Golden Snow Property.

As the agreement is an option, we may decide at any time not to proceed in which case we would not be liable to pay any funds beyond the amounts due at the time we provide notice that we are not proceeding.  There is no assurance that we will exercise the option.

As at October 31, 2011, we had $28,804 cash on hand.  Accordingly, we have insufficient cash on hand to proceed with our exploration on the Golden Snow Project and meet our ongoing operating costs.  As such, we will require substantial financing in order to meet our obligations.  There is no assurance that we will be able to acquire such financing on terms that are acceptable to us, or at all.

RESULTS OF OPERATIONS

Three Months and Six Months Summary

	Three Months Ended						Percentage			Six Months Ended						Percentage
	October 31, 2011			October 31, 2010			Increase / (Decrease)			October 31, 2011			October 31, 2010			Increase / (Decrease)
Revenue	$	-		$	-			n/a		$	-		$	-			n/a
Expenses		(67,353	)		(31,130	)		116.4	%		(87,265	)		(41,285	)		111.4	%
Net Loss	$	(67,353	)	$	(31,130	)		116.4	%	$	(87,265	)	$	(41,285	)		111.4	%

Revenues

We have not earned any revenues since our inception and we do not anticipate earning revenues in the near future.

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Expenses

The major components of our expenses for the three and six months ended October 31, 2011 and 2010 are outlined in the table below:

	Three Months Ended				Percentage			Six Months Ended				Percentage
	October 31, 2011		October 31, 2010		Increase / (Decrease)			October 31, 2011		October 31, 2010		Increase / (Decrease)
Accounting and Audit	$	11,690	$	16,460		(29.0	)%	$	16,530	$	16,460		0.4	%
Bank Charges		110		70		57.1	%		140		115		21.7	%
Interest Expenses		664		-		100	%		1,328		-		100	%
Legal		11,690		4,259		174.5	%		17,780		6,269		183.6	%
Office Administration		7,500		7,500		n/a			15,000		15,000		n/a
Property Maintenance		29,572		-		100	%		29,572		-		100	%
Regulatory Expenses/Fees		5,527		2,241		146.6	%		5,715		2,241		155.0	%
Rent		375		375		n/a			750		750		n/a
Telephone		225		225		n/a			450		450		n/a
Total Operating Expenses	$	67,353	$	31,130		116.4	%	$	87,265	$	41,285		111.4	%

Our operating expenses increased during the three and six months ended October 31, 2011. This increase in our operating expenses is due to increases in bank charges, interest expenses, legal expenses, property maintenance expenses and regulatory expenses.

Property maintenance expenses primarily related to expenses incurred in connection with the Earn-In Agreement with Pengram.

Accounting and legal expenses primarily related to expenses incurred in connection with meeting our ongoing reporting obligations under the Exchange Act.

Office administration expenses consist of amounts incurred to our sole executive officer and director for his management consulting services.

LIQUIDITY AND CAPITAL RESOURCES

Working Capital

	At October 31, 2011			At April 30, 2011			Percentage Increase / (Decrease)
Current Assets	$	28,804		$	2,459			1071.4	%
Current Liabilities		(196,427	)		(82,817	)		137.2	%
Working Capital Deficit	$	(167,623	)	$	(80,358	)		108.6	%

Cash Flows

	Six Months Ended
	October 31, 2011			October 31, 2010
Net Cash Used by Operating Activities	$	(26,345	)	$	(1,179	)
Net Cash From Investing Activities		-			-
Net Cash Provided By Financing Activities		-			-
Net Increase (Decrease) in Cash During Period	$	(26,345	)	$	(1,179	)

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We had cash of $28,804 and a working capital deficit of $167,623 as of October 31, 2011 compared to a working capital deficit of $80,358 as of April 30, 2011.  The increase in our working capital deficit is due to: (i) an increase in accounts payable as a result of our lack of capital to meet ongoing costs, and (ii) the fact that we recorded stock subscriptions payable of $75,000 as we have not yet issued the securities under our foreign private placement.

Financing Requirements

Currently, we do not have sufficient financial resources to meet our ongoing operating expenditures.  As such, our ability to complete our plan of operation is dependent upon our ability to obtain additional financing in the near term.

Foreign Private Placement

On August 16, 2011, our Board of Directors approved a private placement offering of up to 2,500,000 shares of our common stock at a price of $0.05 US per share to persons who are not “U.S. Persons” as defined in Regulation S of the Securities Act of 1933 (the “Act”). Under this offering, we have received proceeds of $75,000 US as at October 31, 2011 and $112,500 US as at the filing date of this Quarterly Report. We have not issued any securities under the offering

US Private Placement

As of the filing date of this Quarterly Report we have received a subscription for 400,000 shares of our common stock at a price of $0.05 US per share for total proceeds of $20,000 US. The subscriber represented that he was an “accredited investor” as defined in Regulation D of the Act. We have not issued any securities under the offering.

The proceeds of the private placement offerings will be used to retire corporate indebtedness, complete work on our mineral properties and for general corporate purposes. There is no assurance that the Foreign Private Placement offering or any part of it will be completed.

We anticipate continuing to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to our existing shareholders. There is no assurance that we will achieve any additional sales of our equity securities or arrange for debt or other financing to fund our business operations.

OFF-BALANCE SHEET ARRANGEMENTS

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

CRITICAL ACCOUNTING POLICIES

The preparation  of  financial  statements  in  conformity  with  United States generally  accepted accounting principles requires our management to make estimates and assumptions that affect the reported amount of assets and liabilities  and  disclosure of contingent assets and liabilities at the date of the financial  statements  and  the  reported  amounts of revenues and expenses during  the reporting period.  Actual results could differ from those estimates.  Our management routinely makes judgments and estimates about the effects of matters that are inherently uncertain.

Our significant accounting policies are disclosed in Note 1 to the interim financial statements included in this Quarterly Report.

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ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable.

ITEM 4.  CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

We carried out an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of October 31, 2011 (the “Evaluation Date”).  This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer.  Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of the Evaluation Date as a result of the material weaknesses in internal control over financial reporting discussed in our Annual Report on Form 10-K for the year ended April 30, 2011 (the “2011 Annual Report”).

Notwithstanding the assessment that our internal control over financial reporting was not effective and that there were material weaknesses as identified in our 2011 Annual Report, we believe that our financial statements contained in our Quarterly Report on Form 10-Q for the quarter ended October 31, 2011 fairly present our financial condition, results of operations and cash flows in all material respects.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the quarter ended October 31, 2011 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

We are not a party to any other legal proceedings and, to our knowledge, no other legal proceedings are pending, threatened or contemplated.

ITEM 1A.  RISK FACTORS.

The following are some of the important factors that could affect our financial performance or could cause actual results to differ materially from estimates contained in our forward-looking statements.  We may encounter risks in addition to those described below.  Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, may also impair or adversely affect our business, financial condition or results of operation.

If we do not obtain additional financing, our business will fail.

As at October 31, 2011, we had cash on hand of $28,804. Our plan of operation calls for significant expenses in order to meet our obligations under the Earn-In Agreement.  There is no guarantee that we will exercise our option.

On August 16, 2011, our Board of Directors approved the Foreign Private Placement offering of up to 2,500,000 shares of our common stock at a price of $0.05 US per share to persons who are not “U.S. Persons” as defined in Regulation S of the Securities Act of 1933. Under this offering, we have received proceeds of $75,000 US as at October 31, 2011 and $112,500 US as at the filing date of this Quarterly Report. We have not issued any securities under the offering. There are no assurances that any additional shares will be sold under this offering.

Obtaining financing would be subject to a number of factors outside of our control, including market conditions and additional costs and expenses that might exceed current estimates.  These factors may make the timing, amount, terms or conditions of financing unavailable to us in which case we will be unable to complete our plan of operation on our mineral properties and to meet our obligations under our option agreements.

We have yet to attain profitable operations and because we will need to obtain financing to continue our business operations, our accountants believe that there is substantial doubt about our ability to continue as a going concern.

We have incurred a net loss of $2,163,518 for the period from February 20, 2001 (inception) to October 31, 2011 and have no revenues to date. Our future is dependent upon our ability to obtain financing.  Our auditors have expressed substantial doubt about our ability to continue as a going concern given our accumulated losses.  This opinion could materially limit our ability to raise additional funds by issuing new debt or equity securities or otherwise.  If we fail to raise sufficient capital, we will not be able to complete our business plan.  As a result, we may have to liquidate our business and investors may lose their investment.

We may conduct further offerings in the future in which case investors’ shareholdings will be diluted.

Since our inception, we have relied on equity sales of our common stock to fund our operations.  We may conduct additional equity offerings in the future to finance any future business projects that we decide to undertake. If common stock is issued in return for additional funds, the price per share could be lower than that paid by our current stockholders. We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. If we issue additional stock, investors’ percentage interest in us will be diluted. The result of this could reduce the value of their stock.

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Because of the unique difficulties and uncertainties inherent in mineral exploration ventures, we face a high risk of business failure.

Investors should be aware of the difficulties normally encountered by new mineral exploration companies and the high rate of failure of such enterprises.  The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the exploration of the mineral properties that we plan to undertake.  These potential problems include, but are not limited to, unanticipated problems relating to exploration, and additional costs and expenses that may exceed current estimates.

We have no known mineral reserves and if we cannot find any, we will have to cease operations.

We have no mineral reserves.  If we do not find a mineral reserve containing gold or if we cannot explore the mineral reserve, either because we do not have the money to do it or because it will not be economically feasible to do it, we will have to cease operations and you will lose your investment.  Mineral exploration, particularly for gold, is highly speculative.  It involves many risks and is often non-productive.  Even if we are able to find mineral reserves on our properties, our production capability is subject to further risks including:

- Costs of bringing the property into production including exploration work, preparation of production feasibility studies, and construction of production facilities, all of which we have not budgeted for;

- Availability and costs of financing;

- Ongoing costs of production; and

- Environmental compliance regulations and restraints.

The marketability of any minerals acquired or discovered may be affected by numerous factors which are beyond our control and which cannot be accurately predicted, such as market fluctuations, the lack of milling facilities and processing equipment near our mineral properties, and such other factors as government regulations, including regulations relating to allowable production, importing and exporting of minerals, and environmental protection.

Given the above noted risks, the chances of finding reserves on our mineral properties are remote and funds expended on exploration will likely be lost.

Even if we discover proven reserves of precious metals on our mineral properties, we may not be able to successfully commence commercial production.

Our mineral properties do not contain any known bodies of ore.  If our exploration programs are successful in discovering proven reserves on our mineral properties, we will require additional funds in order to place the mineral properties into commercial production.  The expenditures to be made by us in the exploration of mineral properties in all probability will be lost as it is an extremely remote possibility that the mineral claims will contain proven reserves.  If our exploration programs are successful in discovering proven reserves, we will require additional funds in order to place the mineral properties into commercial production.  The funds required for commercial mineral production can range from several millions to hundreds of millions.  We currently do not have sufficient funds to place our mineral claims into commercial production.  Obtaining additional financing would be subject to a number of factors, including the market price for gold and the costs of exploring for or mining these materials.  These factors may make the timing, amount, terms or conditions of additional financing unavailable to us.  Because we will need additional financing to fund our exploration activities there is substantial doubt about our ability to continue as a going concern.  At this time, there is a risk that we will not be able to obtain such financing as and when needed.

We face significant competition in the mineral exploration industry.

We compete with other mining and exploration companies possessing greater financial resources and technical facilities than we do in connection with the acquisition of mineral exploration claims and leases on precious metal prospects and in connection with the recruitment and retention of qualified personnel.  There is significant competition for precious metals and, as a result, we may be unable to acquire an interest in attractive mineral exploration properties on terms we consider acceptable on a continuing basis.

There is no assurance that we will be able to comply with our obligations under the Earn-In Agreement.

In order comply with our obligations under the Earn-In Agreement we are required to make a series of cash payments and meet the annual claim maintenance fees.  In order to meet these payments we will need to obtain substantial financing.  If we are unable to meet these payments, we will lose our options to acquire these properties.

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Because our sole director and executive officer does not have formal training specific to the technicalities of mineral exploration, there is a higher risk that our business will fail.

Howard Thomson, our sole director and executive officer, does not have any formal training as a geologist or in the technical aspects of managing a mineral exploration company.  Mr. Thomson’s lack of expertise could cause irreparable harm to our operations, earnings, and ultimate financial success could suffer irreparable harm due to management's lack of experience in this industry.

Because the prices of metals fluctuate, if the price of metals for which we are exploring decreases below a specified level, it may no longer be profitable to explore for those metals and we will cease operations.

Prices of metals are determined by such factors as expectations for inflation, the strength of the United States dollar, global and regional supply and demand, and political and economic conditions and production costs in metals producing regions of the world.  The aggregate effect of these factors on metal prices is impossible for us to predict.  In addition, the prices of precious metals are sometimes subject to rapid short-term and/or prolonged changes because of speculative activities.  The current demand for and supply of these metals affect the metal prices, but not necessarily in the same manner as current supply and demand affect the prices of other commodities.  The supply of these metals primarily consists of new production from mining.  If the prices of the metals are, for a substantial period, below our foreseeable cost of production, we could cease operations and investors could lose their entire investment.

The quotation price of our common stock may be volatile, with the result that an investor may not be able to sell any shares acquired at a price equal to or greater than the price paid by the investor.

Our common shares are quoted on the OTCBB under the symbol "TVER”.  Companies quoted on the OTCBB have traditionally experienced extreme price and volume fluctuations.  In addition, our stock price may be adversely affected by factors that are unrelated or disproportionate to our operating performance.  Market fluctuations, as well as general economic, political and market conditions such as recessions, interest rates or international currency fluctuations may adversely affect the market price of our common stock.  As a result of this potential volatility and potential lack of a trading market, an investor may not be able to sell any of our common stock that they acquire at a price equal or greater than the price paid by the investor.

Because our stock is a penny stock, shareholders will be more limited in their ability to sell their stock.

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks.  Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the Nasdaq system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or quotation system.  Because our securities constitute “penny stocks” within the meaning of the rules, the rules apply to us and to our securities.  The rules may further affect the ability of owners of shares to sell our securities in any market that might develop for them.  As long as the trading price of our common stock is less than $5.00 per share, the common stock will be subject to Rule 15g-9 under the Exchange Act.  The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that:

1. contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading;

2. contains a description of the broker’s or dealer’s duties to the customer and of the rights and remedies available to the customer with respect to a violation to such duties or other requirements of securities laws;

3. contains a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread between the bid and ask price;

4. contains a toll-free telephone number for inquiries on disciplinary actions;

5. defines significant terms in the disclosure document or in the conduct of trading in penny stocks; and

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6. contains such other information and is in such form, including language, type, size and format, as the SEC shall require by rule or regulation.

The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with: (a) bid and offer quotations for the penny stock; (b) the compensation of the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and (d) a monthly account statements showing the market value of each penny stock held in the customer’s account.  In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitably statement.  These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our stock.

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

None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 5.  OTHER INFORMATION.

None.

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ITEM 6.  EXHIBITS.

Exhibit Number	Description of Exhibit
3.1	Articles of Incorporation.(1)
3.2	Certificate of Change to Authorized Capital effective December 19, 2005.(2)
3.3	Bylaws.(1)
10.1	2006 Stock Incentive Plan.(4)
10.2	Stock Option Agreement between the Company and Howard Thomson dated March 31, 2006.(4)
10.3	Management Consulting Agreement dated March 21, 2006 between the Company and Howard Thomson.(4)
10.4	Interim Agreement dated July 9, 2008 between the Company and Pyro Pharmaceuticals, Inc.(5)
10.5	Amendment Agreement dated September 26, 2008 to the Interim Agreement dated July 9, 2008 between the Company and Pyro Pharmaceuticals, Inc.(6)
10.6	Share Purchase Agreement dated April 29, 2009 among Terrace Ventures Inc., Marktech Acquisition Corp., Worldbid International Inc. and Geobiz Systems Inc.(7)
10.7	Amendment Agreement to Share Purchase Agreement dated August 12, 2009 among Terrace Ventures Inc., Marktech Acquisition Corp., Worldbid International Inc. and Geobiz Systems Inc.(8)
10.8	Earn-In Agreement (Golden Snow) dated April 26, 2011 between Pengram Corporation and Terrace Ventures Inc.(9)
10.9	Earn-In Extension Agreement (Golden Snow) dated June 29, 2011 between Pengram Corporation and Terrace Ventures Inc.(10)
14.1	Code of Ethics.(3)
31.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document.
101.SCH	XBRL Taxonomy Extension Schema.
101.CAL	XBRL Taxonomy Extension Calculation Linkbase.
101.DEF	XBRL Taxonomy Extension Definition Linkbase.
101.LAB	XBRL Taxonomy Extension Label Linkbase.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase.

Notes:

(1) Filed with the SEC as an exhibit to our Registration Statement on Form 10-SB originally filed on February 2, 2004.

(2) Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on December 27, 2005.

(3) Filed with the SEC as an exhibit to our Annual Report on Form 10-KSB filed on September 8, 2004.

(4) Filed with the SEC as an exhibit to our Quarterly Report on Form 10-QSB filed on March 22, 2006.

(5) Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on July 15, 2008.

(6) Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on October 2, 2008.

(7) Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on April 29, 2009.

(8) Filed with the SEC as an exhibit to our Annual Report on Form 10-K filed on August 13, 2009.

(9) Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on April 28, 2011.

(10) Filed with the SEC as an exhibit to our Annual Report on Form 10-K filed on August 15, 2011.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			TERRACE VENTURES INC.
Date:	December 20, 2011	By:	/s/ Howard Thomson
			HOWARD THOMSON
			Chief Executive Officer, Chief Financial Officer,
			President, Secretary and Treasurer
			(Principal Executive Officer & Principal Accounting Officer)

EX-31.1

CERTIFICATIONS

I, Howard Thomson, certify that;

(1) I have reviewed this Quarterly Report on Form 10-Q of Terrace Ventures Inc.;

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

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

(4) 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 Rule 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, 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 registrant’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 registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

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

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

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

Date:    December 20, 2011

	/s/ Howard Thomson
By:	HOWARD THOMSON
Title:	Chief Executive Officer and
	Chief Financial Officer

EX-32.1

CERTIFICATION OF

CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Howard Thomson, the Chief Executive Officer and Chief Financial Officer of Terrace Ventures Inc. (the “Company”), hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(i) the Quarterly Report on Form 10-Q of the Company, for the fiscal quarter ended October 31, 2011, and to which this certification is attached as Exhibit 32.1 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Howard Thomson
Name:	HOWARD THOMSON
Title:	Chief Executive Officer and
	Chief Financial Officer
Date:	December 20, 2011

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of the Company under the Securities Act of 1933 or the Securities Exchange Act of 1934 (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing.

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INVESTMENT IN MINERAL RIGHTS

6 Months Ended

Oct. 31, 2011

INVESTMENT IN MINERAL RIGHTS

NOTE 2 – INVESTMENT IN MINERAL RIGHTS

On April 26, 2011, we entered into an agreement with Pengram Corporation (“Pengram”) dated April 26, 2011, as amended on June 29, 2011, (the “Earn-In Agreement”).  Under the terms of the Earn-In Agreement, the Company will earn up to a 75% interest in Pengram’s agreement with Scoonover Exploration LLC and JR Exploration LLC (the “Underlying Agreement”) to acquire the Golden Snow Property, by paying to Pengram up to $175,000 and expending up to $1,750,000 in exploration work.  The Golden Snow project consists of 111 mineral claims located in the Eureka Mining District in Eureka County, Nevada.  As of July 31, 2011, $25,000 was invested in Pengram by way of promissory note.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Oct. 31, 2011

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General

Terrace Ventures Inc. was incorporated on February 20, 2001 in the state of Nevada.  The Company acquires and develops certain mineral rights in Canada.

Basis of Presentation

The Company reports revenue and expenses using the accrual method of accounting for financial and tax reporting purposes.

Use of Estimates

Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.

Exploration Stage Company

In accordance with FASB ASC 915, the Company has been in the exploration stage since its formation and has not yet realized any revenues from its planned operations.

Stock-Based Compensation

Stock-based compensation is accounted for using the Equity-Based Payments to Non-Employees Topic of the FASB ASC (FASB ASC Topic 718), which establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services.  It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of those equity instruments.  The Company determines the value of stock issued at the date of grant. It also determines at the date of grant, the value of stock at fair market value or the value of services rendered (based on contract or otherwise) whichever is more readily determinable.

Shares issued to employees are expensed upon issuance.

The Company uses the fair value method for equity instruments granted to employees and will use the Black Scholes model for measuring the fair value of options, if issued.  The stock based fair value compensation is determined as of the date of the grant or the date at which the performance of the services is completed (measurement date) and is recognized over the vesting periods.

No stock options have been issued by Terrace Ventures, Inc.

Mineral Property Acquisition and Exploration Costs

The Company expenses all costs related to the acquisition and exploration of mineral properties in which it has secured exploration rights prior to establishment of proven and probable reserves.  To date, the Company has not established the commercial feasibility of any exploration prospects; therefore, all costs are being expensed.

Depreciation, Amortization and Capitalization

The Company records depreciation and amortization when appropriate using both straight-line and declining balance methods over the estimated useful life of the assets (five to seven years).

Expenditures for maintenance and repairs are charged to expense as incurred.  Additions, major renewals and replacements that increase the property's useful life are capitalized.  Property sold or retired, together with the related accumulated depreciation, is removed from the appropriate accounts and the resultant gain or loss is included in net income.

Income Taxes

The Company accounts for its income taxes in accordance with FASB ASC 740, “Accounting for Income Taxes".  Under this statement, a liability method is used whereby deferred tax assets and liabilities are determined based on temporary differences between basis used for financial reporting and income tax reporting purposes.  Income taxes are provided based on tax rates in effect at the time such temporary differences are expected to reverse. A valuation allowance is provided for certain deferred tax assets if it is more likely than not, that the Company will not realize the tax assets through future operations.

Fair Value of Financial Instruments

FASB ASC 825, “Financial Instruments”, requires the Company to disclose, when reasonably attainable, the fair market values of its assets and liabilities which are deemed to be financial instruments.  The Company's financial instruments consist primarily of cash and certain investments.

Investments

Investments that are purchased in other companies are valued at cost less any impairment in the value that is other than temporary in nature.

Per Share Information

The Company follows FASB ASC 260 “Earnings Per Share” which establishes standards for the computation, presentation and disclosure requirements for basic and diluted earnings per share for entities with publicly-held common shares and potential common stock issuances. Basic earnings (loss) per share are computed by dividing net income by the weighted average number of common shares outstanding.  In computing diluted earnings per share, the weighted average number of shares outstanding is adjusted to reflect the effect of potentially dilutive securities, such as convertible notes, stock options, and warrants.  Common stock equivalent shares are excluded from the computation if their effect is antidilutive.

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BALANCE SHEET (USD $)	Oct. 31, 2011	Apr. 30, 2011
Current Assets:
Cash	$ 28,804	$ 2,459
Total Current Assets	28,804	2,459
Investment in Mineral Rights	25,000	25,000
TOTAL ASSETS	53,804	27,459
Current Liabilities:
Accounts Payable and Accrued Expenses	89,427	50,817
Loans Payable	6,000	6,000
Loans Payable - Related Parties	1,000	1,000
Stock Subscriptions Payable	75,000
Note Payable	25,000	25,000
Total Current Liabilities	196,427	82,817
Stockholders' Deficit:
Common Stock, $0.001 par value 400,000,000 shares authorized, 29,470,660 shares issued	29,471	29,471
Additional Paid in Capital	1,991,424	1,991,424
Deficit Accumulated During the Exploration Stage	(2,163,518)	(2,076,253)
Total Stockholders' Equity/(Deficit)	(142,623)	(55,358)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)	$ 53,804	$ 27,459

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STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) (Parenthetical) (USD $)	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2008	Apr. 30, 2006	Apr. 30, 2004	Apr. 30, 2003	Apr. 30, 2002	Apr. 30, 2001	Apr. 30, 2006 November 23, 2005	Apr. 30, 2006 February 3, 2006	Apr. 30, 2006 March 13, 2006	Apr. 30, 2006 March 31, 2006	Apr. 30, 2007 May 24, 2006	Apr. 30, 2007 June 5, 2006	Apr. 30, 2007 January 23, 2007	Apr. 30, 2009 October 10, 2008	Apr. 30, 2009 April 8, 2009
Common Stock Issued, per share	$ 0.01		$ 0.1		$ 0.1	$ 0.1	$ 0.01	$ 0.001	$ 1	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 0.30	$ 0.1	$ 0.1	$ 0.02
Issuance date	Mar. 24, 2011		Mar. 24, 2011		Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011	Mar. 24, 2011
Reverse Stock Split, ratio		0.02
Stock Split, ratio				4
Stock Split, date		Oct. 01, 2009		Dec. 19, 2005

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STATEMENTS OF CASH FLOWS (USD $)	6 Months Ended		128 Months Ended
	Oct. 31, 2011	Oct. 31, 2010	Oct. 31, 2011
Cash Flows from Operating Activities:
Net Loss	$ (87,265)	$ (41,285)	$ (2,163,518)
Adjustments to Reconcile Net Income to Net Cash Provided/(Used) by Operating Activities:
Unrealized Loss on Investment	0	0	1,028,980
(Increase)/Decrease in:
Notes Receivable	0	0	0
Loan Receivable	0	0	0
Increase(Decrease) in:
Accounts Payable	38,610	31,626	89,427
Loans Payable	0	0	6,000
Loans Payable - Related Parties	0	0	1,000
Stock Subscriptions Payable	75,000	8,480	75,000
Net Cash Provided/(Used) by Operating Activities	26,345	(1,179)	(963,111)
Cash Flows from Investing Activities:
Stock Investment	0	0	(1,028,980)
Net Cash Used by Investing Activities	0	0	(1,028,980)
Cash Flows from Financing Activities:
Loans from Shareholders	0	0	157,395
Payments on Loans	0	0	(157,395)
Proceeds Related to Issuance of Common Stock	0	0	2,020,895
Net Cash Provided by Financing Activities	0	0	2,020,895
Net Increase in Cash	26,345	(1,179)	28,804
Cash at Beginning of Period	2,459	1,169	0
Cash at End of Period	$ 28,804	$ (10)	$ 28,804

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BALANCE SHEET (Parenthetical) (USD $)	Oct. 31, 2011	Apr. 30, 2011
Common Stock, par value	$ 0.001	$ 0.001
Common Stock, shares authorized	400,000,000	400,000,000
Common Stock, shares issued	29,470,660	29,470,660

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REVERSE STOCK SPLIT

6 Months Ended

Oct. 31, 2011

REVERSE STOCK SPLIT

NOTE 10 – REVERSE STOCK SPLIT

On September 2, 2009, the Board of Directors approved a one-for-five reverse split of the Company’s common stock.  Upon the completion of the reverse stock split, which was effective on October 1, 2009, the Company’s authorized shares of common stock was decreased from 400,000,000 shares, par value $0.001 per share, to 80,000,000 shares, par value $0.001 per share.  Issued and outstanding common stock was reduced from 47,353,200 shares to approximately 9,470,660 shares.  Weighted Average Shares Outstanding and Net Loss per Share have been restated on the Statements of Operations and Accumulated Deficit for the effect of the reverse stock split.

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Document and Entity Information	6 Months Ended
	Oct. 31, 2011	Dec. 13, 2011
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Oct. 31, 2011
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	Q2
Trading Symbol	TVER
Entity Registrant Name	TERRACE VENTURES INC
Entity Central Index Key	0000821899
Current Fiscal Year End Date	--04-30
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		29,470,659

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STOCK ISSUANCES

6 Months Ended

Oct. 31, 2011

STOCK ISSUANCES

NOTE 11 – STOCK ISSUANCES

On June 8, 2010 our Board of Directors terminated the convertible notes offering approved on March 16, 2010 and approved two private placement offerings for up to an aggregate of 10,000,000 Units for proceeds of up to $100,000 as follows:

Foreign Private Placement

On June 8, 2010, our Board of Directors approved a private placement offering of up to 5,000,000 Units at a price of $0.01 US per unit, with each Unit consisting of one share of our common stock and one share purchase warrant (the Foreign Private Placement”).  Each share purchase warrant entitled the holder to purchase an additional share of common stock exercisable for a period of two years at a price of $0.01 US per share.  The private placement offering was made to persons who are not “U.S. Persons” as defined in Regulation S.  Subsequent to the offering, the corporation received subscriptions for an aggregate of 14,700,000 shares and payment in full of the subscription proceeds.  In order to allow for the oversubscriptions to the Foreign Offering, on March 24, 2011, the Corporation increased the number of Shares being issued under the Offering to 14,700,000 Shares.  Upon the issuance of the Shares, the Corporation terminated this Foreign Offering.

U.S. Private Placement

Also, on June 8, 2010, our Board of Directors approved a private placement offering of up to 5,000,000 Units at a price of $0.01 US per Unit, with each Unit consisting of one share of our common stock and one share purchase warrant (the “U.S. Private Placement”).  Each share purchase warrant entitled the holder to purchase an additional share of common stock exercisable for a period of two years at a price of $.01 US per share.  The private placement offering was made to persons who are “Accredited Investors” as defined in Regulation D. Subsequent to the offering, the corporation received subscriptions for an aggregate of 5,300,000 shares and payment in full of the subscription proceeds.  In order to allow for the oversubscriptions to the US Offering, on March 24, 2011, the Corporation increased the number of Shares being issued under the Offering to 5,300,000 Shares.  Upon the issuance of the Shares, the Corporation terminated this US Offering.

On April 26, 2011 our Board of Directors approved two concurrent private placements as follows:

Foreign Private Placement

On April 26, 2011, our Board of Directors approved a private placement offering of up to 2,500,000 shares of our common stock at a price of $0.10 US per share to persons who are not “US Persons” as defined in Regulation S if the Securities Act of 1933.

U.S. Private Placement

Also, on April 26, 2011, our Board of Directors approved a private placement offering of up to 2,500,000 shares of our common stock at a price of $0.10 US per share.  The offering will be made in the United States to persons who are accredited investors as defined in Regulation D of the Securities Act of 1933.

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STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT (USD $)	3 Months Ended		6 Months Ended		128 Months Ended
	Oct. 31, 2011	Oct. 31, 2010	Oct. 31, 2011	Oct. 31, 2010	Oct. 31, 2011
Revenues	$ 0	$ 0	$ 0	$ 0	$ 0
Operating Expenses	(67,353)	(31,130)	(87,265)	(41,285)	(1,149,029)
Loss Before Other Income and Expenses	(67,353)	(31,130)	(87,265)	(41,285)	(1,149,029)
Other Income:
Interest Income	0	0	0	0	14,491
Other Expense:
Unrealized Loss On Investment	0	0	0	0	(1,028,980)
Loss Before Provision for Income Taxes	(67,353)	(31,130)	(87,265)	(41,285)	(2,163,518)
Provision for Income Taxes	0	0	0	0	0
Net Loss	(67,353)	(31,130)	(87,265)	(41,285)	(2,163,518)
Accumulated Deficit, Beginning of Period	(2,096,165)	(1,989,213)	(2,076,253)	(1,979,058)	0
Accumulated Deficit, End of Period	$ (2,163,518)	$ (2,020,343)	$ (2,163,518)	$ (2,020,343)	$ (2,163,518)
Net Loss per Share	$ 0.00	$ 0.00	$ 0.00	$ 0.00	$ (0.26)
Weighted Average Shares Outstanding	29,470,660	9,470,660	29,470,660	9,470,660	8,205,527

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NOTE PAYABLE

6 Months Ended

Oct. 31, 2011

NOTE PAYABLE

NOTE 5 – NOTE PAYABLE

Note payable consists of short term monies due to Pengram Corporation. The company has agreed to pay Pengram Corporation $25,000 by way of promissory note (see Note 2), bearing interest at a rate of 10% per annum, due on September 27, 2011.

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LOANS PAYABLE - RELATED PARTIES

6 Months Ended

Oct. 31, 2011

LOANS PAYABLE - RELATED PARTIES

NOTE 4 – LOANS PAYABLE – RELATED PARTIES

Loans payable related parties consist of various short term monies advanced by shareholders.  These loans are unsecured, bear no interest rate and no specified maturity date.

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SUPPLEMENTAL STATEMENT

6 Months Ended

Oct. 31, 2011

SUPPLEMENTAL STATEMENT

SUPPLEMENTAL STATEMENT

STATEMENTS OF OPERATING EXPENSES

(Unaudited)

	THREE MONTHS ENDED				SIX MONTHS ENDED
	OCTOBER 31,				OCTOBER 31,				INCEPTION to
	2011		2010		2011		2010		OCTOBER 31, 2011
Operating Expenses:
Accounting & Audit	$	11,690	$	16,460	$	16,530	$	16,460	$	173,200
Bad Debt Expense		-0-		-0-		-0-		-0-		214,892
Bank Charges		110		70		140		115		1,340
Cancelled Merger Costs		-0-		-0-		-0-		-0-		8,300
Consulting		-0-		-0-		-0-		-0-		119,650
Exploration and Development		-0-		-0-		-0-		-0-		24,266
Interest Expense		664		-0-		1,328		-0-		1,328
Legal		11,690		4,259		17,780		6,269		301,094
Office Administration		7,500		7,500		15,000		15,000		189,600
Office Expenses		-0-		-0-		-0-		-0-		4,271
Property Maintenance		29,572		-0-		29,572		-0-		29,572
Regulatory Expenses/Fees		5,527		2,241		5,715		2,241		42,552
Rent		375		375		750		750		27,075
Telephone		225		225		450		450		7,181
Travel & Entertainment		-0-		-0-		-0-		-0-		4,708
Total Operating Expenses	$	67,353	$	31,130	$	87,265	$	41,285	$	1,149,029

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RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

6 Months Ended

Oct. 31, 2011

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

NOTE 8 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

Recently issued accounting pronouncements will have no significant impact on the Company and its reporting methods.

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PROVISION FOR INCOME TAXES

6 Months Ended

Oct. 31, 2011

PROVISION FOR INCOME TAXES

NOTE 6 - PROVISION FOR INCOME TAXES

The provision for income taxes for the periods ended October 31, 2011 and October 31, 2010 represents the minimum state income tax expense of the Company, which is not considered significant.

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Oct. 31, 2011

COMMITMENTS AND CONTINGENCIES

NOTE 7 - COMMITMENTS AND CONTINGENCIES

Pengram Corporation Agreement – Golden Snow Project

The Company is obligated to Pengram Corporation for up to $175,000 in direct payments and $1,750,000 in exploration expenses as follows:

(i) The first 25% interest in the Underlying Agreement upon the Company:

a.        Paying Pengram $25,000 by way of a promissory note, bearing interest at a rate of 10% per annum, due on September 27, 2011;

b.        Completing exploration expenditures on the Property totaling $250,000 by July 31, 2012.

(ii)          An additional 25% interest in the Underlying Agreement upon the Company:

a.        Paying Pengram $50,000 on or before May 31, 2013;

b.       Completing additional exploration expenditures on the Property totaling $500,000 by July 31, 2013:

(iii)                   An additional 25% interest in the Underlying Agreement upon the Company:

a.       Paying Pengram $100,000 on or before May 31, 2014;

b.       Completing additional exploration expenditures on the Property totaling $1,000,000 by July 31, 2014.

 

The Company is also obligated to pay all advance royalties, county and BLM claim fees and Nevada state taxes during the currency of the Earn-In Agreement.

Operating Leases

The Company currently rents administrative office space under a monthly renewable contract.

Litigation

The Company is not presently involved in any litigation.

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GOING CONCERN

6 Months Ended

Oct. 31, 2011

GOING CONCERN

NOTE 9 – GOING CONCERN

Future issuances of the Company’s equity or debt securities will be required in order for the Company to continue to finance its operations and continue as a going concern.  The Company’s present revenues are insufficient to meet operating expenses.

The consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has incurred cumulative net losses of $2,163,518 since its inception and requires capital for its contemplated operational and marketing activities to take place.  The Company's ability to raise additional capital through the future issuances of common stock is unknown.  The obtainment of additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations.  The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

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STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) (USD $)	Total	November 23, 2005	February 3, 2006	March 13, 2006	March 31, 2006	May 24, 2006	June 5, 2006	January 23, 2007	October 10, 2008	April 8, 2009	Common Stock	Common Stock November 23, 2005	Common Stock February 3, 2006	Common Stock March 13, 2006	Common Stock March 31, 2006	Common Stock May 24, 2006	Common Stock June 5, 2006	Common Stock January 23, 2007	Common Stock October 10, 2008	Common Stock April 8, 2009	Additional Paid in Capital	Additional Paid in Capital November 23, 2005	Additional Paid in Capital February 3, 2006	Additional Paid in Capital March 13, 2006	Additional Paid in Capital March 31, 2006	Additional Paid in Capital May 24, 2006	Additional Paid in Capital June 5, 2006	Additional Paid in Capital January 23, 2007	Additional Paid in Capital October 10, 2008	Additional Paid in Capital April 8, 2009	Deficit Accumulated During the Exploration Stage
Beginning Balance at Apr. 30, 2000	$ 0
Common Stock Issued (in shares)											4,000,000
Common Stock Issued	4,000										4,000
Net Loss	(1,410)																														(1,410)
Ending Balance at Apr. 30, 2001	2,590										4,000																				(1,410)
Ending Balance (in shares) at Apr. 30, 2001											4,000,000
Common Stock Issued (in shares)											2,500,000
Common Stock Issued	25,000										2,500										22,500
Net Loss	(19,196)																														(19,196)
Ending Balance at Apr. 30, 2002	8,394										6,500										22,500										(20,606)
Ending Balance (in shares) at Apr. 30, 2002											6,500,000
Common Stock Issued (in shares)											142,500
Common Stock Issued	14,250										143										14,107
Net Loss	(17,632)																														(17,632)
Ending Balance at Apr. 30, 2003	5,012										6,643										36,607										(38,238)
Ending Balance (in shares) at Apr. 30, 2003											6,642,500
Common Stock Issued (in shares)											400,000
Common Stock Issued	40,000										400										39,600
Net Loss	(58,708)																														(58,708)
Ending Balance at Apr. 30, 2004	(13,696)										7,043										76,207										(96,946)
Ending Balance (in shares) at Apr. 30, 2004											7,042,500
Net Loss	(37,532)																														(37,532)
Ending Balance at Apr. 30, 2005	(51,228)										7,043										76,207										(134,478)
Ending Balance (in shares) at Apr. 30, 2005											7,042,500
Common Stock Issued (in shares)												500,000	400,000	380,000	999,920
Common Stock Issued		500,000	100,000	95,000	249,980							500	400	380	1,000							499,500	99,600	94,620	248,980
Net Loss	(987,633)																														(987,633)
4-for-1 Stock Split, December 19, 2005 (in shares)											22,627,500
4-for-1 Stock Split, December 19, 2005											22,627										(22,627)
Ending Balance at Apr. 30, 2006	(93,881)										31,950										996,280										(1,122,111)
Ending Balance (in shares) at Apr. 30, 2006											31,949,920
Common Stock Issued (in shares)																220,080	335,000	1,678,200
Common Stock Issued						55,020	100,500	167,820								220	335	1,678								54,800	100,165	166,142
Net Loss	(301,060)																														(301,060)
Ending Balance at Apr. 30, 2007	(71,601)										34,183										1,317,387										(1,423,171)
Ending Balance (in shares) at Apr. 30, 2007											34,183,200
Common Stock Issued (in shares)											2,570,000
Common Stock Issued	257,325										2,570										254,755
Net Loss	(100,450)																														(100,450)
Ending Balance at Apr. 30, 2008	85,274										36,753										1,572,142										(1,523,621)
Ending Balance (in shares) at Apr. 30, 2008											36,753,200
Common Stock Issued (in shares)																			10,000,000	600,000
Common Stock Issued									200,000	12,000									10,000	600									190,000	11,400
Net Loss	(355,923)																														(355,923)
Ending Balance at Apr. 30, 2009	(58,649)										47,353										1,773,542										(1,879,544)
Ending Balance (in shares) at Apr. 30, 2009											47,353,200
1-for-5 Reverse Stock Split, October 1, 2009											(37,882)										37,882
1-for-5 Reverse Stock Split, October 1, 2009 (in shares)											(37,882,540)
Net Loss	(99,514)																														(99,514)
Ending Balance at Apr. 30, 2010	(158,163)										9,471										1,811,424										(1,979,058)
Ending Balance (in shares) at Apr. 30, 2010											9,470,660
Common Stock Issued (in shares)											20,000,000
Common Stock Issued	200,000										20,000										180,000
Net Loss	(97,195)																														(97,195)
Ending Balance at Apr. 30, 2011	(55,358)										29,471										1,991,424										(2,076,253)
Ending Balance (in shares) at Apr. 30, 2011											29,470,660
Net Loss	(87,265)																														(87,265)
Ending Balance at Oct. 31, 2011	$ (142,623)										$ 29,471										$ 1,991,424										$ (2,163,518)
Ending Balance (in shares) at Oct. 31, 2011											29,470,660

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LOANS PAYABLE

6 Months Ended

Oct. 31, 2011

LOANS PAYABLE

NOTE 3 – LOANS PAYABLE

Loans payable consist of short term monies advanced.  These loans are unsecured, bear no interest rate and no specified maturity date.