Ann: Jaurdi Gold Project July Production Update, page-36

Ok Pinks, you are starting to show some naivety mate. I don't want to give you a full accounting lesson here, but you seem to be lacking an understanding of some fundamentals.

Firstly, AISC is an estimate of apportioned costs. As is the cash cost. So just because gold is produced, it does not mean that the full profit amount according to either of those metrics will be reflected in the cash balance. Why? Because accounts payable is not tuned to the production. i.e. we don't turn to Joe's Reagents Supplies and say, Joe, I know you provided us with 2 tonne of Cyanide, but that was actually 3 months supply worth, so here is your cut of the proceeds from this months usage, we will give you some more next month, and the month after that.... Do you hear how silly this is? Do I need to go on? This is what your statement of cashflows is for, you can reconcile each quarter if you wish.

* Caveat - in reality an agreement like this could actually occur, it is known as consignment stock. But I have a very strong feeling you don't know what that is.


Secondly, how did they manage to spend x in 2 days? Despite your accounting error above, it is entirely feasible that $600k could be spent in 2 days through the purchase of non-current assets.