105
CONSOLIDATED FINANCIAL STATEMENTS
DRIVING GROWTH FROM WITHIN
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2014 AND 2013
(All amounts in US$‘000’s unless otherwise stated)
b) Capital Commitments
As at December 31, 2014, there are no capital commitments
c) Other Commitments
The Company has a contract to guarantee the power supply at its Caylloma Mine. Under the contract, the seller is
obligated to deliver a "maximum committed demand" (for the present term this stands at 3,500 kW) and the Company
is obligated to purchase subject to exemptions under provisions of "Force Majeure". The contract is automatically renewed
every two years for a period of 10 years and expiring in 2017. Renewal can be avoided without penalties by notification
10 months in advance of the renewal date.
Tariffs are established annually by the energy market regulator in accordance with applicable regulations in Peru. The
minimum committed demand is $19 per month and the average monthly charge for 2014 is $202.
Operating leases includes leases for office premises, computer and other equipment used in the normal course of
business. Refer to Note 16. d).
The expected payments due by period as at December 31, 2014 are as follows:
Expected payments due by period as at December 31, 2014
Less than
1 year
1–3 years
4–5 years
Total
Office premises – Canada
$
132 $
452 $
126 $
710
Office premises – Peru
396
580
–
976
Office premises – Mexico
15
–
–
15
Total office premises
$
543 $ 1,032 $
126 $ 1,701
Computer equipment – Peru
185
164
–
349
Computer equipment – Mexico
17
–
–
17
Total computer equipment
$
202 $
164 $
– $
366
Machinery – Mexico
–
79
–
79
Total machinery
$
– $
79 $
– $
79
Total operating leases
$
745 $ 1,275 $
126 $ 2,146
d) Tax Contingencies
The Company has been assessed taxes and related interest and penalties, in Peru by SUNAT, for tax years 2010, 2011,
and 2012, in the amounts of $1,161, $740, and $110, respectively, for a total of $2,011. The Company is currently
appealing the assessments and believes the appeals with be ruled in favor of the Company. Subsequent to December
31, 2014, the Company has provided as a guarantee by way of letter bond in the amount of $776.
e) Other Contingencies
The Company is subject to various investigations, claims, legal, labor and tax proceedings covering matters that arise in
the ordinary course of business activities. Each of these matters is subject to various uncertainties and it is possible
that some of these matters may be resolved unfavorably for the Company. Certain conditions may exist as of the date
the financial statements are issued that may result in a loss to the Company. In the opinion of management, none of
these matters are expected to have a material effect on the results of operations or financial conditions of the Company.
23. Contingencies and Capital Commitments (Continued)
