SELECT INFORMATION FROM THE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Additional information required by the Hong Kong Stock Exchange and not disclosed elsewhere in this announcement is as follows. All amounts are expressed in thousands of U.S. Dollars and shares in thousands, unless otherwise indicated.
1. BASIS OF PREPARATION
1.1 Corporate information and liquidity
The Company curtailed its mining activities at the Ovoot Tolgoi Mine during the three months ended June 30, 2012 to varying degrees to manage coal inventories and to maintain efficient working capital levels. As at June 30, 2012, mining activities had been fully curtailed. The Company's mining activities remained fully curtailed during the remainder of the year ended December 31, 2012.
The Company had cash and short term investments of $34,674 and working capital of $127,230 at December 31, 2012. These consolidated financial statements have been prepared on a going concern basis which assumes that the Company will continue operating for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations as they come due. The Company has in place a planning, budgeting and forecasting process to help determine the funds required to support the Company's normal operations on an ongoing basis and its expansionary plans. The Company expects to have sufficient liquidity and capital resources to meet its ongoing obligations and future contractual commitments for at least twelve months from the end of the December 31, 2012 reporting period. The Company expects its liquidity to remain sufficient based on existing capital resources and income from mining operations. Liquidity beyond the twelve month period is dependent on the success of the recommencement of operations and ongoing demand and prices in the coal market. On March 22, 2013, the Company recommenced mining activities at the Ovoot Tolgoi Mine. The Company continues to minimize uncommitted capital expenditures and exploration expenditures in order to preserve the Company's financial resources.
1.2 Statement of compliance
The Company's consolidated financial statements, including comparatives, have been prepared in accordance with and using accounting policies in full compliance with the International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board ("IASB") and Interpretations of the IFRS Interpretations Committee.
1.3 Basis of presentation
The consolidated financial statements have been prepared on a historical cost basis except for certain financial assets and financial liabilities which are measured at fair value. The Company's reporting currency and the functional currency of all of its operations is the U.S. Dollar as this is the principal currency of the economic environment in which the Company operates.
2. SEGMENTED INFORMATION
The Company's one reportable operating segment is its Mongolian Coal Division. The Company's Corporate Division does not earn revenues and therefore does not meet the definition of an operating segment.
The carrying amounts of the Company's assets, liabilities, reported income or loss and revenues analyzed by operating segment are as follows:
Mongolian Unallocated Consolidated Coal Division (i) Total -------------- -------------- --------------Segment assets As at December 31, 2012 $ 673,896 $ 55,471 $ 729,367 As at December 31, 2011 696,732 223,591 920,323Segment liabilities As at December 31, 2012 $ 11,315 $ 108,973 $ 120,288 As at December 31, 2011 51,256 152,887 204,143Segment income/(loss) For the year ended December 31, 2012 $ (90,509) $ (12,510) $ (103,019) For the year ended December 31, 2011 (14,043) 71,788 57,745Segment revenues For the year ended December 31, 2012 $ 53,116 $ - $ 53,116 For the year ended December 31, 2011 179,049 - 179,049Impairment charge on assets (ii), (iii) For the year ended December 31, 2012 $ 47,871 $ 19,184 $ 67,055 For the year ended December 31, 2011 20,893 - 20,893(i) The unallocated amount contains all amounts associated with the Corporate Division(ii) The impairment charge on assets for the year ended December 31, 2012 relates to trade and other receivables, investments, inventories and property, plant and equipment(iii) The impairment charge on assets for the year ended December 31, 2011 relates to trade and other receivables, inventories and property, plant and equipment