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Note 8 - Investment in Peak Gold, LLC | 12 Months Ended
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Jun. 30, 2018
Notes to Financial Statements |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | 8. Investment in Peak Gold, LLC The Company recorded its investment at the historical book value of the assets contributed to the Joint Venture Company which was approximately $1.4 million. As of June 30, 2018, Royal Gold has contributed approximately $31.7 million to the Joint Venture Company, and earned a cumulative interest of approximately 40.0%. Therefore, as of June 30, 2018, the Company holds a 60.0% interest in the Joint Venture Company. As of June 30, 2017, the Company held a 70.5% interest in the Joint Venture Company. The Royal Gold Initial Contribution did not entitle Royal Gold to a percentage interest in the Joint Venture Company. During fiscal year 2018 the Company contributed $2.6 million to the Joint Venture Company. The Company did not make any contributions during fiscal year 2017. The following table is a roll-forward of our investment in the Joint Venture Company from January 8, 2015 ( inception) to June 30, 2018:
|  | Investment |
|  | in Peak Gold, LLC |
Investment balance at June 30, 2014 |  | $ | — |
Investment in Peak Gold, LLC, at Inception January 8, 2015 |  |  | 1,433,886 |
Loss from equity investment in Peak Gold, LLC |  |  | (1,433,886 | )
Investment balance at June 30, 2015 |  | $ | — |
Investment in Peak Gold, LLC |  |  | — |
Loss from equity investment in Peak Gold, LLC |  |  | — |
Investment balance at June 30, 2016 |  | $ | — |
Investment in Peak Gold, LLC |  |  | — |
Loss from equity investment in Peak Gold, LLC |  |  | — |
Investment balance at June 30, 2017 |  | $ | — |
Investment in Peak Gold, LLC |  |  | 2,580,000 |
Loss from equity investment in Peak Gold, LLC |  |  | (2,580,000 | )
Investment balance at June 30, 2018 |  | $ | — |
The following table presents the condensed balance sheet for Peak Gold, LLC as of June 30, 2018 and 2017:
|  | June 30, 2018 |  |  | June 30, 2017 |
ASSETS |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 2,628,195 |  |  | $ | 58,955 |
Mineral properties |  |  | 1,433,886 |  |  |  | 1,433,886 |
TOTAL ASSETS |  | $ | 4,062,081 |  |  | $ | 1,492,841 |
LIABILITIES AND MEMBERS' (DEFICIT) EQUITY |  |  |  |  |  |  |  |
Accounts payable and other liabilities |  | $ | 2,403,257 |  |  | $ | 1,754,009 |
TOTAL LIABILITIES |  |  | 2,403,257 |  |  |  | 1,754,009 |
MEMBERS' (DEFICIT) EQUITY |  |  | 1,658,824 |  |  |  | (261,168 | )
TOTAL LIABILITIES AND MEMBERS' (DEFICIT) EQUITY |  | $ | 4,062,081 |  |  | $ | 1,492,841 |
The Company's share of the Joint Venture Company's results of operations for the year ended June 30, 2018 was a loss of $5.8 million. The Company's share in the results of operations for the year ended June 30, 2017 was a loss of $10.3 million. The Peak Gold, LLC loss does not include any provisions related to income taxes as Peak Gold, LLC is treated as a partnership for income tax purposes. As of June 30, 2018 and June 30, 2017, the Company's share of the Joint Venture Company's inception-to-date cumulative loss of $27.0 million and $21.2 million, respectively, exceeds the sum of the historical book value of our initial investment in Peak Gold, LLC, of $1.4 million and our subsequent contributions of $2.6 million. Therefore, the investment in Peak Gold, LLC had a balance of zero as of June 30, 2018. The investment also had a balance of zero at June 30, 2017. The Company is currently not obligated to make additional capital contributions to the Joint Venture Company and therefore only records losses up to the point of its cumulative investment which is $4.0 million. The portion of the cumulative loss that exceeds the Company's investment will be suspended and recognized against earnings, if any, from the Company's investment in the Joint Venture Company in future periods. The suspended losses for the period from inception to June 30, 2018 are $22.9 million. The following table presents the condensed results of operations for Peak Gold, LLC for the periods ended June 30, 2018 and 2017:
|  | Year Ended |  |  | Year Ended |  |  | Period from Inception January 8, 2015 to |
|  | June 30, 2018 |  |  | June 30, 2017 |  |  | June 30, 2018 |
EXPENSES: |  |  |  |  |  |  |  |  |  |  |  |
Exploration expense |  | $ | 7,652,107 |  |  | $ | 11,326,289 |  |  | $ | 28,510,255 |
General and administrative |  |  | 1,741,791 |  |  |  | 2,034,507 |  |  |  | 5,578,697 |
Total expenses |  |  | 9,393,898 |  |  |  | 13,360,796 |  |  |  | 34,088,952 |
NET LOSS |  | $ | 9,393,898 |  |  | $ | 13,360,796 |  |  | $ | 34,088,952 |

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -URI http://asc.fasb.org/topic&trid=2196965 + Details
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