XML 46 R23.htm IDEA: XBRL DOCUMENT
v3.3.1.900

FAIR VALUE ACCOUNTING | 12 Months Ended
--- | ---
Dec. 31, 2015
FAIR VALUE ACCOUNTING |
FAIR VALUE ACCOUNTING | NOTE 17 FAIR VALUE ACCOUNTING Assets and liabilities measured at fair value on a recurring basis The following tables set forth the fair value of the Company’s assets and liabilities measured at fair value on a recurring basis (at least annually) by level within the fair value hierarchy as at December 31, 201 5 and 201 4. As required by accounting guidance, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.
|  | Fair Value as at December 31, 2015 |
|  | Total |  | Level 1 |  | Level 2 |  | Level 3 |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Investments |  | $ | 1,032 |  | $ | 1,032 |  | $ | — |  | $ | — |
|  | $ | 1,032 |  | $ | 1,032 |  | $ | — |  | $ | — |
|  | Fair Value as at December 31 2014 |
|  | Total |  | Level 1 |  | Level 2 |  | Level 3 |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Investments |  | $ | 1,082 |  | $ | 1,082 |  | $ | — |  | $ | — |
|  | $ | 1,082 |  | $ | 1,082 |  | $ | — |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |
Portion of accounts payable and accrued liabilities recorded at fair value |  | $ | 355 |  | $ | 355 |  | $ | — |  | $ | — |
|  | $ | 355 |  | $ | 355 |  | $ | — |  | $ | — |
The Company's investments are marketable equity securities which are exchange traded and are valued using quoted market prices in active markets and as such are classified within Level 1 of the fair value hierarchy. The fair value of the investments is calculated as the quoted market price of the marketable equity security multiplied by the quantity of shares held by the Company. As at December 31, 2014, accounts payable included an accrual of $0.4 million on for the fair value approximately 319,640 shares of common stock, which were issued in payment during 2015, as discussed in Note 1 0, Shareholders’ Equity. The fair value of these accounts payable is assumed to approximate the fair value of the underlying shares with which they were settled. As the Company's stock is quoted on an active market, this liability is classified within Level 1 of the fair value hierarchy. The fair value of other financial assets and liabilities were assumed to approximate their carrying values due to their short-term nature and historically negligible credit losses. Assets and liabilities measured at fair value on a non‑recurring basis As discussed in Note 5, Mineral Property Interests and Asset Retirement Obligations, the Company recorded several impairment charges in the year ended December 31, 201 5. During the year ended December 31, 2015, the Company recorded impairment charges of $20.8 million for the Gold Bar project, $14.9 million for the Tonkin project and $1.4 million for the North Battle Mountain Complex. Fair value of these projects was estimated using an observed precedent transaction market value per acre and per ounce of gold equivalent mineralized material, which indicated a potential significant decrease in the market price of the projects, as of December 31, 2015. During the fourth quarter of 2015, the Company noted that the estimated market value per pound of copper equivalent mineralized material from comparable projects was below the carrying value per pound of copper equivalent minerali zed material of the Los Azules p roject, indicating a potential decrease on its market value, and therefore a requirement to test the Los Azules Project for recoverability. To assist in performing a recoverability test, the Company engaged a third-party valuation firm which determined that the carrying value of the property exceeded its estimated fair value, resulting in an impairment charge of $1 1.4 million, along with a resulting deferred income tax recovery of $1.3 million, recorded in the Statement of Operations and Comprehensive Loss for the year ended December 31, 2015. Further, during the fourth quarter of 2015 the Company also performed a fair value analysis on the El Gallo 2 assets, including mineral property interest, land, surface ownership and construction-in-progress. As a result of this analysis, the carrying value of the asset was found to exceed its fair value in the amount of $2.0 million. Therefore, an impairment charge of $2.0 million was recorded in the Statement of Operations and Comprehensive Loss, and allocated to construction-in-progress, based on the impairment results for the year ended December 31, 2015. During the fourth quarter of 2015, an impairment loss of $11.8 million was also recorded with respect to the Company’s investment in MSC. To estimate the fair value of the Company’s investment in MSC, the Company used a combined approach, which uses a discounted cash flow model for the operating mine and an observed precedent transaction market value per acre for the fair value of exploration properties. During the year ended December 31, 2014, a total of $353.7 million impairment charge was recorded, which included $228.3 million to the Los Azules project, $98.4 million to the Nevada properties, and $27.0 million to our Argentina properties. The impairment of Los Azules was triggered by a contemporaneous acquisition of a copper project located in Argentina, which we believed shared similarities with Los Azules, and the decline in the observed market value of comparable transactions observed in 2014. The impairment of the Nevada and Argentina properties, was primarily as a result of significant declines in the observed market value of comparable transactions noted as part of our year‑end annual impairment analysis, which indicated a decrease in the market value of our properties, as well as the strategic review of our exploration program, pursuant to which we have made the decision to focus primarily on core assets, namely our Los Azules, Gold Bar, Tonkin and North Battle Mountain properties. Further, these events resulted in a total deferred income tax recovery of $76.6 million. Further, during the year ended December 31, 2014 an impairment loss of $21.2 million was also recorded with respect to the Company’s investment in MSC. To estimate the fair value of the Company’s investment in MSC, the Company used a combined approach, which uses a discounted cash flow model for the operating mine and a market approach for the fair value of exploration properties. Further, a discount of 20% was applied to the observable market value per acre for the Argentina exploration properties to reflect the country risk associated with early-stage exploration lands located in Argentina at the date of assessment. The following table sets forth a summary of the quantitative and qualitative information related to the unobservable inputs used in the calculation of the Company’s non‑recurring Level 3 fair value measurements for the year ended December 31, 2015 and 2014.
|  | 2015
|  | Date of Fair Value |  |  |  |  |  | Range / |
|  | Measurement |  | Valuation Technique |  | Unobservable Input |  | Weighted Average |
|  |  |  |  |  | Discount Rate |  |  | 10 | %
|  |  |  | Discounted cash flow |  | Long Term Gold Price |  | $ | 1,245 | per ounce
Investment in MSC |  | December 31, 2015 |  | for operating mine |  | Long Term Silver Price |  | $ | 18 | per ounce
|  |  |  |  |  | Argentina Inflation Index |  |  | 21 | %
|  |  |  |  |  | United States Inflation Index |  |  | 2.4 | %
|  | 2014
|  | Date of Fair Value |  |  |  |  |  | Range / |
|  | Measurement |  | Valuation Technique |  | Unobservable Input |  | Weighted Average |
|  |  |  |  |  | Discount to reflect decline in |  |  |  |
|  |  |  | Market value per |  | observed market value of comparable |  |  | 35 | %
Los Azules Copper Project |  | December 31, 2014 |  | pound of copper |  | transactions from June 2014 (date of |  |  |  |
|  |  |  | equivalent mineralized |  | the last impairment test) to December |  |  |  |
|  |  |  | material |  | 31, 2014 |  |  |  |
|  |  |  |  |  | Discount Rate |  |  | 10 | %
|  |  |  | Discounted cash flow |  | Long Term Gold Price |  | $ | 1,300 | per ounce
|  |  |  | for operating mine |  | Long Term Silver Price |  | $ | 20.50 | per ounce
|  | December 31, 2014 |  |  |  | Argentina Inflation Index |  |  | 11.9 | %
Investment in MSC |  |  |  |  |  | United States Inflation Index |  |  | 2.1 | %
|  |  |  | Market value per acre |  | Discount to observed market value |  |  |  |
Investment in MSC |  | December 31, 2014 |  | for exploration |  | pre acre to reflect Argentina country |  |  | 20 | %
|  |  |  | properties |  | risk |  |  |  |
The following non financial assets and the company’s investment in MSC were measured at fair value on a non‑recurring basis as part of the Company’s impairment assessments during the year ended December 31, 201 5 and 201 4.
|  |  |  | 2015 |
|  | Date of Fair Value |  |  |  |  |  |  |  |  |  |  |  |  |  | Total |
|  | Measurement |  | Total |  | Level 1 |  | Level 2 |  | Level 3 |  | Impairment |
Mineral property interests |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Los Azules Copper Project |  | December 31, 2015 |  |  | 191,490 |  |  | — |  |  | — |  |  | 191,490 |  |  | 11,399 |
Tonkin Complex |  | December 31, 2015 |  |  | 4,833 |  |  | — |  |  | — |  |  | 4,833 |  |  | 14,939 |
Gold Bar Complex |  | December 31, 2015 |  |  | 30,730 |  |  | — |  |  | — |  |  | 30,730 |  |  | 20,847 |
North Battle Mountain Complex |  | December 31, 2015 |  |  | 785 |  |  | — |  |  | — |  |  | 785 |  |  | 1,443 |
Investment in MSC |  | December 31, 2015 |  |  | 167,107 |  |  | — |  |  | — |  |  | 167,107 |  |  | 11,777 |
|  |  |  | $ | 394,945 |  | $ | — |  | $ | — |  | $ | 394,945 |  | $ | 60,405 |
|  |  |  | 2014 |
|  | Date of Fair Value |  |  |  |  |  |  |  |  |  |  |  |  |  | Total |
|  | Measurement |  | Total |  | Level 1 |  | Level 2 |  | Level 3 |  | Impairment |
Mineral property interests |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Los Azules Copper Project |  | December 31, 2014 |  | $ | 202,889 |  | $ | — |  | $ | — |  | $ | 202,889 |  | $ | 228,301 |
Tonkin Complex |  | December 31, 2014 |  |  | 20,423 |  |  | — |  |  | — |  |  | 20,423 |  |  | 31,391 |
Gold Bar Complex |  | December 31, 2014 |  |  | 51,577 |  |  | — |  |  | — |  |  | 51,577 |  |  | 25,435 |
North Battle Mountain Complex |  | December 31, 2014 |  |  | 2,227 |  |  | — |  |  | — |  |  | 2,227 |  |  | 1,921 |
Investment in MSC |  | December 31, 2014 |  |  | 177,018 |  |  | — |  |  | — |  |  | 177,018 |  |  | 21,162 |
|  |  |  | $ | 454,134 |  | $ | — |  | $ | — |  | $ | 454,134 |  | $ | 308,210 |

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19207-110258 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 28 -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14064-108612 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=35750535&loc=d3e13537-108611 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 16 -URI http://asc.fasb.org/extlink&oid=35750535&loc=d3e13504-108611 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=35750535&loc=d3e13433-108611 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration