Benem Ventures Inc. Files Audited Statement With SEDAR

Benem Ventures Inc. has filed its audited annual report with SEDAR; the auditors gave the financial statements an unqualified opinion. According to those statements [PDF file], cash and cash equivalents increased from $2,201 as of the end of fiscal year 2006, which ended June 30th, to $17,351 as of the end of fiscal year 2007, also ended June 30th. Short-term investments, on the other hand, shrunk from $325,000 as of June 30/07 to $150,000. Prepaid expenses decreased from $5,000 to $1,250 in the same time period, while accounts receivable hardly changed. As a result, current assets declined from $339,292 to $175,677. Because current liabilities increased from $12,836 to $15,015, working capital shrunk from $326,456 as of June 30/07 to $160,662 as of one year later. Book value shrunk from $326,456, or 8.48 cents/share, to $160,662, or 3.74 cents/share, in that same time period.

The statement of expenses shows a widening of Benem's annual loss from $124,692, or 3.24 cents/share, to $180,794, or 4.20 cents/share, from FY '06 to FY'07. $45,000 of the loss was accounted for by sponsorship fees in FY '07, which were nil in FY '06. Absent that item, the loss only increased slightly. Office expenses (comprising rent, administration and "office") went from $39,083 to $64,903; the two items comprising it, as well as consulting fees, were the only ones to increase significantly from FY '06 to FY '07. The two expense items that decreased significantly were travel and promotion expenses, which shrunk from $23,581 in FY '06 to $16,282 in FY '07, and filing & transfer agent fees, which shrunk from $18,652 to $8,321. The statement of cash flows pinpoints the decrease in short-term investments as the main source of cash for the year, although $15,000 worth of proceeds in share subscriptions were received during FY '07. Note 3(c) explains these receipts as resulting from the exercise of stock options, of which there are none left as shown by note 3(d). The only source of income, interest income, shrunk from $10,473 to $8,598 even though interest received (as cash) increased from $7,299 to $12,312. The only significant related-party transactions listed in note 4 of the financials is $35,746 in legal expenses, as compared with $38,427 in FY '06, and $5,300 in consulting fees to a director as compared with nil in FY '06. "Included in accounts payable is $6,500 (2006 - $4,000) for legal fees due to a firm that is associated with a former director of the Company," Andrew Walker. The last two notes explain that the company is currently between Qualifying Transactions.

The M D & A [PDF file] explains that the $45,000 sponsorship fee was paid to Integral Wealth Securities Limited because the TSX Venture refused to grant an exemption to the sponsorship requirement for the previous Qualifying Transaction, which fell through at the end of August of this year. Benem is currently trying to acquire some mineral claims owned by Velocity Resources Canada Ltd. in exchange for $75,000 and 12 million Benem shares, plus a commitment to raise $2 million in a subsequent private placement. Benem shares have been halted ever since the now-ended earlier Qualifying Transaction was about to be announced. BNM.H last traded on August 14th, 2006; it closed at 42 cents/share on that day.