VENGA AEROSPACE SYSTEMS INC.

Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010
(Expressed in Canadian Dollars)

Managements Responsibility for Financial Reporting The accompanying consolidated financial statements of Venga Aerospace Systems Inc. were prepared by management in accordance with International Financial Reporting Standards (IFRS). Management acknowledges responsibility for the preparation and presentation of the consolidated financial statements, including responsibility for significant accounting judgments and estimates and the choice of accounting principles and methods that are appropriate to the Companys circumstances. The significant accounting policies of the Company are summarized in note 6 to the consolidated financial statements. Management has established a system of internal control over the financial reporting process, which is designed to provide reasonable assurance that relevant and reliable information is produced. The Board of Directors is responsible for reviewing and approving the consolidated financial statements, the accompanying Managements Discussion and Analysis and for ensuring that management fulfills its financial reporting responsibilities. An Audit Committee which is comprised of a majority of independent non-executive directors assists the Board of Directors in fulfilling this responsibility. The Audit Committee meets with management as well as with the independent auditor to review the internal controls over the financial reporting process, the consolidated financial statements and the auditors report. The Audit Committee reports its findings to the Board of Directors for its consideration in approving the consolidated financial statements for issuance to the shareholders. Management recognizes its responsibility for conducting the Companys affairs in compliance with established financial standards, and applicable laws and regulations, and for maintaining proper standards of conduct for its activities. Signed by: Hirsh Kwinter President Chief / Financial Officer Dr. Ezra Franken Director

April 29, 2012

INDEPENDENT AUDITORS' REPORT

To the Shareholders of Venga Aerospace Systems Inc. We have audited the accompanying consolidated financial statements of VENGA AEROSPACE SYSTEMS INC., which comprise the consolidated statements of financial position as at December 31, 2011, December 31, 2010 and January 1, 2010, consolidated statements of operations and comprehensive loss, consolidated statements of changes in equity, and consolidated statements of cash flow for the years ended December 31, 2011 and December 31, 2010, and a summary of significant accounting policies and other explanatory information. Managements Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors' Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entitys preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entitys internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of VENGA AEROSPACE SYSTEMS INC. as at December 31, 2011, December 31, 2010 and January 1, 2010, and its results of operations and its cash flows for the years ended December 31, 2011 and December 31, 2010 in

accordance with International Financial Reporting Standards.

Emphasis of Matter Without qualifying our opinion, we draw attention to Note 2 in the consolidated financial statements which indicates that none of the Companys ventures have begun commercial operations and thus recurring sources of revenue have not yet proven to be sufficient. The Company needs to obtain additional financing to enable it to continue its business. These conditions, along with other matters as set forth in Note 2 indicate the existence of a material uncertainty that may cast significant doubt about the Company's ability to continue as a going concern.

Rich Rotstein LLP

Chartered Accountants Licensed Public Accountants Toronto, Canada April 29, 2012

5 Venga Aerospace Systems Inc.

(Incorporated under the laws of the Province of Ontario)

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(Expressed in Canadian Dollars)

As at

December 31, 2011 December 31, 2010 January 1, 2010

$ $ $

ASSETS

(Note 6) (Note 6) Current Assets

Cash and cash equivalents 5,108 9,809 42,025

Prepaids and sundry receivables 65 717 10,102

5,173 10,526 52,127 Other Assets

Investment (Notes 3(b) and 10) 51,000 200,000 300,000

Investment in Global Mineral Investments, LLC (Notes 3 (a) and 12) 485,400 485,400 485,400

Total Assets 541,573 695,926 837,527

LIABILITIES AND SHAREHOLDERS EQUITY

Current Liabilities

Accounts payable and accrued charges 20,772 37,896 24,784

Due to Directors (Note 8) 39,000 0 0

Total Liabilities 59,772 37,896 24,784 Shareholders Equity

Capital Stock 17,268,966 17,268,966 17,268,966 Contributed Surplus 890,684 890,684 890,684 Deficit (17,677,849) (17,501,620) (17,346,907) Total Equity 481,801 658,030

812,743 Total Liabilities and Shareholders Equity 541,573 695,926 837,527 Going Concern (Note 2) The accompanying notes are an integral part of these consolidated financial statements Approved on behalf of the Board

Hirsh Kwinter (signed) Director Dr. Ezra Franken (signed) Director Hirsh Kwinter Dr. Ezra Franken

Venga Aerospace Systems Inc.

(Incorporated under the laws of the Province of Ontario)

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

9
for the Years Ended December 31, 2011 and 2010
(Expressed in Canadian Dollars) 2011 $ EXPENSES Office and general Professional fees 14,643 12,586 27,229 LOSS FROM OPERATIONS Impairment of long-term investments (Note 10) NET LOSS AND COMPREHENSIVE LOSS (27,229) (149,000) (176,229) 40,224 14,489 54,713 (54,713) (100,000) (154,713) 2010 $

Net loss per share basic and fully diluted Weighted average number of shares

(0.0007) 239,171,893

(0.0006) 239,171,893

The accompanying notes are an integral part of these consolidated financial statements

Venga Aerospace Systems Inc.

(Incorporated under the laws of the Province of Ontario)

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

for the Years Ended December 31, 2011 and 2010

(Expressed in Canadian Dollars)

Share Capital # of Shares Balance January 1, 2010 Net loss and comprehensive loss for the year ended December 31, 2010 Balance December 31, 2010 Net loss and comprehensive loss for the year ended December 31, 2011 Balance December 31, 2011 239,171,893 17,268,966 $ 890,684 239,171,893 17,268,966 $ 890,684 239,171,893 Amount $ 17,268,966 $ Contributed Surplus 890,684 Deficit (17,346,907) $ Total 812,743

(154,713) (17,501,620)

(154,713) 658,030 (176,229)

(176,229) (17,677,849) 481,801

The accompanying notes are an integral part of these consolidated financial statements

Venga Aerospace Systems Inc.

11
(Incorporated under the laws of the Province of Ontario)

CONSOLIDATED STATEMENTS OF CASH FLOW for the Years Ended December 31, 2011 and 2010
(Expressed in Canadian Dollars) 2011 $ OPERATING ACTIVITIES Net Loss Adjustments not effecting cash: Impairment of long-term investments (Note 10) Changes in non-cash working capital items Prepaids and sundry receivables Accounts payable and accrued charges Cash Flow Used in Operating Activities FINANCING ACTIVITIES Loan from Directors Cash Flow From Financing Activities Net Decrease in Cash Cash and cash equivalents beginning of year Cash and cash equivalents end of year 39,000 39,000 (4,701) 9,809 5,108 0 0 (32,216) 42,025 9,809 652 (17,124) (43,701) 9,385 13,112 (32,216) 149,000 100,000 (176,229) (154,713) 2010 $

The accompanying notes are an integral part of these consolidated financial statements

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) ____________________________________________________________________________________

1. CORPORATE PROFILE Venga Aerospace Systems Inc. (the Company) was originally incorporated under the Business Corporations Act (Ontario) by certificates of amalgamation dated April 26, 1979, amalgamating Frodac Mines Ltd., Great Bear Silver Mines Limited and Silver Monarch Mines Limited to become Frodac Consolidated Energy Resources Ltd. On July 25, 1985, the Company changed its name to Global Aerospace Systems Inc. and on November 3, 1987, the Company further changed its name to Venga Aerospace Systems Inc. The registered head office is 2822 Danforth Avenue, Toronto, Ontario, M4C 1M1. In addition, these consolidated financial statements include the wholly owned subsidiary Venga Joint Venture Ltd., which is inactive. 2. GOING CONCERN These financial statements have been prepared in accordance with IFRS applicable accounting principles to a going concern which assumes that the Company will be able to realize its assets, including the ultimate realization of its long-term investments, and discharge its liabilities in the normal course of business. None of the Companys ventures have begun commercial operations thus recurring sources of revenue have not yet proven to be sufficient. The Company needs to obtain additional financing to enable it to continue its business. In the absence of additional financing, the Company may not have sufficient funds to meet its obligations. Management continues to monitor the cash needs and consider various alternatives to raise additional financing. These financial statements do not give effect to adjustments that would be necessary should the Company be unable to continue as a going concern. There is no assurance that this will be successful. 3. OPERATIONS (a) Mining and Resource Unit The Company initially acquired a 3% interest, together with an option to acquire up to an additional 15% interest, in Global Mineral Investments, LLC (GMI), a private U.S. corporation that proposed to lease and develop gold mining concessions in West Africa. On August 31, 2007, GMI was awarded four Class B Gold Mining Licences (the GMI Mining Licences) by the Ministry of Lands, Mines and Energy of the Republic of Liberia (the Ministry) for four, separate concessions (the GMI Concessions) located in the Sanquin Mining Zone in the Republic of Liberia. In consideration for business and management services that the Company rendered GMI, on September 6, 2007, the Companys ownership interest in GMI was increased from 3% to 4%. On October 10, 2008, the Company announced that it entered into a funding and operating agreement (the Funding Agreement) with GMI and a number of investors to raise, by way of a non-brokered private placement (the Offering or the Placement), the sum of $535,000.00 through the issue of 10,700,000 common shares at a price of $0.05 per share. The announced use of the proceeds from the Offering was to fund GMIs Proposed Dredging Operations (the "Proposed Dredging Operations") that GMI planned to carry out in those portions of the Upper Tartweh River system flowing through the GMI Concessions; to acquire an additional 16% equity interest in GMI (giving Venga a 20% total interest) and for general corporate purposes. The Company and GMI specifically agreed that the Funding Agreement did not create (whether directly or by implication) a partnership between the Company and GMI, nor did the Funding Agreement create, whether directly or indirectly, a joint venture between the parties. Under the terms of the Funding Agreement, the Company secured an immediate 20% investment interest in GMI with: GMI retaining full and complete operational control of all GMIs business operations including, but not limited to, the Proposed Dredging Operations and Venga being given management of the financial affairs of the Proposed Dredging Operations;

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010

13
(Expressed in Canadian Dollars) ____________________________________________________________________________________ 3. OPERATIONS (a) Mining and Resource Unit (continued) Venga being given the entitlement to receive an annual financial management fee (which fee, nor any portion of same, have yet to be received by the company as of the date of these financial statements) calculated as being the greater of $120,000.00 or an amount equal to 1% of all monies received, disbursed or distributed by the Company as the financial manager of the Proposed Dredging Operations; Revenues derived from the recovery of all minerals other than gold, including diamonds, being for the benefit of all parties to the Funding Agreement so that such revenues will be included in the calculation of the distributable profits from the Proposed Dredging Operations that are payable to such parties pursuant to the terms of the Funding Agreement; Subject to the approval of the Ministry, the records of the Ministry with respect to the GMIs Concessions to be amended to reflect Vengas direct ownership of these concessions in a percentage that is equal to Vengas then equity ownership position in GMI; and Any additional mining concessions secured or negotiated by GMI or Venga in Liberia or West Africa to be acquired in the joint names of GMI and Venga reflecting the parties equal ownership of such additional concessions.

(b) 3D Graphics Unit In November of 2006, the Company entered into a joint venture agreement (the JV Agreement) with 3DP North America, Inc., of Kenner, Louisiana; United Business & Capital Services, LLC of Kenner, Louisiana; EKG, LLC of Lafayette, Louisiana and Armadillo Photo Supply, Inc. of Houston, Texas creating a new commercial entity, the 3DP North America Joint Venture (the New JV), to provide a range of advanced 3D products and print services for both commercial and consumer customers. The Company retains a 30% ownership interest in the New JV with 3DP North America, Inc., who acts as the managing venturer of the New JV, owning the remaining 70% of the venture. (c) Aerospace Unit The Company, in association with ARINC Incorporated (www.arinc.com), made an unsolicited proposal to the Canadian government to provide replacement jet aircraft for the Canadian Forces' Snowbirds aerial demonstration squadron. As a direct result of the continuing delays in the Canadian government's decision with respect to selecting a program to replace or upgrade the Snowbirds' aircraft, the Company is holding its Snowbirds' aircraft replacement proposal in abeyance pending receipt of a positive response from the Canadian government 4. BASIS OF PREPARATION (a) Statement of Compliance These consolidated financial statements are audited and have been prepared using accounting policies consistent with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and Interpretations of the International Financial Reporting Interpretations Committee (IFRIC). These are the Companys first IFRS annual consolidated financial statements. Previously, the Company prepared its annual consolidated financial statements in accordance with Canadian Generally Accepted Accounting Principles (Canadian GAAP).

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) ____________________________________________________________________________________ 4. BASIS OF PREPARATION (continued) (a) Statement of Compliance (continued) The consolidated financial statements of the Company for the years ended December 31, 2011 and 2010 have been prepared by management, reviewed by the Audit Committee and approved and authorized for issue by the Board of Directors on April 29, 2012. Shortly thereafter, the financial statements are made available to shareholders and others through filing on the System for Electronic Document Analysis and Retrieval (SEDAR). (b) Basis of Presentation
The financial statements have been prepared on the historical cost basis except for financial instruments, which are measured at fair value. These financial statements have been prepared using IFRS principles applicable to a going concern, which contemplate the realization of assets and settlement of liabilities in the normal course of business as they come due. All amounts are presented in Canadian dollars, unless otherwise indicated.

(c) Adoption of New and Revised Standards and Interpretations The IASB issued a number of new and revised International Accounting Standards, International Financial Reporting Standards, amendments and related interpretations which are effective for the Companys financial year beginning on or after January 1, 2011. For the purpose of preparing and presenting the Financial Statements for the relevant periods, the Company has consistently adopted all these new standards. At the date of authorization of these Consolidated Financial Statements, the IASB and IFRIC have issued the following new and revised Standards and Interpretations which are not yet effective for the relevant reporting periods. An amendment to IAS 1, Presentation of Financial Statements (IAS 1) was issued by the IASB in June 2011. The amendment requires separate presentation for items of other comprehensive income that would be reclassified to the statement of income in the future if certain conditions are met, from those that would never be reclassified to the statement of income. The effective date is July 1, 2012, and earlier adoption is permitted. IAS 12 Income Taxes Limited scope amendment (recovery of underlying assets) (effective for annual periods beginning on or after January 1, 2012). IAS 27, Separate Financial Statements (IAS 27) was re-issued by the IASB in May 2011, to only prescribe the accounting and disclosure requirements for investments in subsidiaries, joint ventures and associates when an entity prepares separate financial statements. The consolidation guidance will now be included in IFRS 10. The amendments to IAS 27 are effective for annual periods beginning on or after January 1, 2013. IAS 28, Investments in Associates and Joint Ventures (IAS 28) was re-issued by the IASB in May 2011. IAS 28 continues to prescribe the accounting for investments in associates but is now the only source of guidance describing the application of the equity method. The amended IAS 28 will be applied by all entities that have an ownership interest with joint control of, or significant influence over, an investee. The amendments to IAS 28 are effective for annual periods beginning on or after January 1, 2013. IAS 32, Financial Instruments: Presentation (IAS 32) was amended by the IASB in December 2011. The amendment clarifies that an entity has a legally enforceable right to offset financial assets and financial liabilities if that right is not contingent on a future event and it is enforceable both in the normal course of business and in the event of default, insolvency or bankruptcy of the entity and all counterparties. The amendments to IAS 32 are effective for annual periods beginning on or after January 1, 2014.

15

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) ____________________________________________________________________________________ 4. BASIS OF PREPARATION (continued) (c) Adoption of New and Revised Standards and Interpretations (continued) IFRIC 20, Stripping Costs in the Production Phase of a Surface Mine (IFRIC 20) was issued by the IASB in October 2011. IFRIC 20 is effective for annual periods beginning on or after January 1, 2013. The standard requires stripping costs incurred during the production phase of a surface mine to be capitalized as part of an asset, if certain criteria are met, and depreciated on a units of production basis unless another method is more appropriate. IFRIC 7, Financial Instruments: Disclosure (IFRS 7) was amended by the IASB in December 2011. The amendment contains new disclosure requirements for financial assets and financial liabilities that are offset in the statement of financial position or subject to master netting arrangements or similar agreements. These new disclosure requirements will enable users of the financial statements to better compare financial statements prepared in accordance with IFRS. IFRS 7 is effective for annual periods beginning on or after January 1, 2013. IFRS 9, Financial Instruments (IFRS 9) was issued by the IASB in November 2009 and will replace IAS 39, Financial Instruments: Recognition and Measurement (IAS 39). IFRS 9 replaces the multiple rules in IAS 39 with a single approach to determine whether a financial asset is measured at amortized cost or fair value and a new mixed measurement model for debt instruments having only two categories: amortized cost and fair value. The approach in IFRS 9 is based on how an entity manages its financial instruments in the context of its business model and the contractual cash flow characteristics of the financial assets. This standard also requires a single impairment method to be used, replacing the multiple impairment methods in IAS 39. In December 2011, the IASB issued amendments to IFRS 9 that defer the mandatory effective date to annual periods beginning on or after January 1, 2015. The amendments also provide relief from the requirement to restate comparative financial statements for the effect of applying IFRS 9 which was originally limited to companies that chose to apply IFRS 9 prior to 2012. Alternatively, additional transition disclosures will be required to help investors understand the effect that the initial application of IFRS 9 has on the classification and measurement of financial instruments. IFRS 10, Consolidated Financial Statements (IFRS 10) was issued by the IASB in May 2011, and will replace SIC 12, Consolidation Special Purpose Entities and parts of IAS 27, Consolidated and Separate Financial Statements. Under the existing IFRS, consolidation is required when an entity has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. IFRS 10 establishes principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities. This standard (i) requires an entity that controls one or more other entities to present consolidated financial statements; (ii) defines the principle of control and establishes control as the basis for consolidation; (iii) sets out how to apply the principle of control to identify whether an investor controls an investee and therefore must consolidate the investee; and (iv) sets out the accounting requirements for the preparation of consolidated financial statements. IFRS 10 is effective for annual periods beginning on or after January 1, 2013. IFRS 11, Joint Arrangements (IFRS 11) was issued by the IASB in May 2011, and will supersede IAS 31, Interest in Joint Ventures and SIC 13, Jointly Controlled Entities Non-Monetary Contributions by Venturers by removing the option to account for joint ventures using proportionate consolidation and requiring equity accounting. Venturers will transition the accounting for joint ventures from the proportionate consolidation method to the equity method by aggregating the carrying values of the proportionately consolidated assets and liabilities into a single line item on their financial statements. In addition, IFRS 11 will require joint arrangements to be classified as either joint operations or joint ventures. The structure of the joint arrangement will no longer be the most significant factor when classifying the joint arrangement as either a joint operation or a joint venture. IFRS 11 is effective for annual periods beginning on or after January 1, 2013.

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _____________________________________________________________________________________ _____ 4. BASIS OF PREPARATION (continued) (c) Adoption of New and Revised Standards and Interpretations (continued) IFRS 12, Disclosure of Interests in Other Entities (IFRS 12) was issued by the IASB in May 2011. IFRS 12 requires enhanced disclosure of information about involvement with consolidated and unconsolidated entities, including structured entities commonly referred to as special purpose vehicles or variable interest entities. IFRS 12 is effective for annual periods beginning on or after January 1, 2013. IFRS 13, Fair Value Measurement (IFRS 13) was issued by the IASB in May 2011. This standard clarifies the definition of fair value, required disclosures for fair value measurement, and sets out a single framework for measuring fair value. IFRS 13 provides guidance on fair value in a single standard, replacing the existing guidance on measuring and disclosing fair value which is dispersed among several standards. IFRS 13 is effective for annual periods beginning on or after January 1, 2013. The Company has not early adopted these standards, amendments and interpretations, however the Company is currently assessing what impact the application of these standards or amendments will have on the consolidated financial statements of the Company. These Standards and Interpretations will be first applied in the financial report of the Company that relates to the annual reporting period beginning on or after the effective date of each pronouncement. 5. FIRST TIME ADOPTION OF IFRS The Company has adopted IFRS on January 1, 2011 with a transition date of January 1, 2010. IFRS 1, First-time Adoption of International Financial Reporting Standards (IFRS 1), provides guidance for the initial adoption of IFRS. Under IFRS 1, the IFRS are applied retrospectively at the transition date with all adjustments to assets and liabilities as stated under Canadian GAAP taken to accumulated deficit unless certain mandatory exceptions and optional exemptions are applied. Mandatory exceptions The mandatory exceptions applicable to the Company include the following: Estimates In accordance with IFRS 1, hindsight was not used to create or revise estimates. The estimates previously made by the Company under Canadian GAAP were not revised for application of IFRS except where necessary to reflect any differences in accounting policies between Canadian GAAP and IFRS. Optional exemptions and elections In addition to the mandatory exceptions, a number of optional exemptions from full retrospective application
are available to the Company upon adoption of IFRS. exemptions on the Company is listed below: The impact or non impact of all these optional

17

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _____________________________________________________________________________________ _____ 5. FIRST TIME ADOPTION OF IFRS (continued)
The Company has applied the following exemptions:

Exemption Business Combinations exemption

Application of exemption The Company has applied the business combinations exemption in IFRS 1. It has not restated business combinations that took place prior to January 1, 2010 transition date. No adjustment was required.

The Company has not applied the following exemptions: Exemption Share-Based payment transaction exemption Reason for not applying the exemption The Company has elected not to apply the share-based payment exemption. No adjustment was required.

Optional exemptions and elections (continued)

The Company has applied the following mandatory exceptions from retrospective application:

Exception Estimates exception

Description of exception and application to the Company Estimates under IFRS at January 1, 2010 should be consistent with estimates made for the same date under previous GAAP, unless there is evidence that those estimates were in error. No adjustments for estimates have been made.

Reconciliation between IFRS and Canadian GAAP IFRS employs a conceptual framework that is similar to Canadian GAAP. The adoption of IFRS may result in significant changes to a company's reported financial position, results of operations, and cash flows. Presented below are the Company's determinations as to any reconciliations necessary or required to reconcile IFRS treatment the Company's assets, liabilities, equity, net loss and cash flows as such items may differ from those reported under Canadian GAAP: Reconciliation of the Statements of Financial Position

There were no reportable changes to the Statements of Financial Position on adoption of IFRS as at the transition date of January 1, 2010.

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _____________________________________________________________________________________ ___ 5. FIRST TIME ADOPTION OF IFRS (continued) Reconciliation between IFRS and Canadian GAAP (continued) Reconciliation of the Statements of Assets, Liabilities and Equity There were no reportable changes to the Statements of Assets, Liabilities and Equities for the year ended at December 31, 2011 or for the year ended at December 31, 2010 on adoption of IFRS. Reconciliation of Loss and Comprehensive Loss There were no reportable changes to the Statements of Loss and Comprehensive Loss for the year ended December 31, 2011 or for the year ended at December 31, 2010 on adoption of IFRS. Reconciliation of the Statements of Cash Flows There were no reportable changes to the Statements of Cash Flows for the year ended December 31, 2011 or for the year ended at December 31, 2010 on adoption of IFRS.

6. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES These consolidated financial statements follow the same accounting policies and methods of application as the Company's most recent annual financial statement. a) Basis of Presentation The Company has prepared these comparative financial statements on a consolidated basis which includes its wholly-owned subsidiary, Venga Joint Venture Ltd. (b) Principles of Consolidation The consolidated financial statements include the accounts of Venga Aerospace Systems Inc. ("the Company") and its subsidiary.

19

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _____________________________________________________________________________________ ___ 6. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (c) Use of Estimates The preparation of the consolidated financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenues and expenses as well as the disclosure of contingent assets and liabilities at the date of the financial statements. Judgements, estimates and underlying assumptions are reviewed on a continuous basis and are based on managements experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Actual outcomes could differ from those estimates. Significant areas of financial reporting the require managements estimates and judgements are as follows: Accrued liabilities The Company uses estimates to record the expenses that have been incurred but payments have not been made. Impairment of long- term investments The Company records impairment of long-term investments based on managements determination. Judgement is required to determine the extent of impairment. (Note 10) (d) Financial Instruments Financial assets Financial assets are classified into four categories: Fair value through profit or loss (FVTPL) Held to maturity (HTM) Loans and receivables; and Financial assets at fair value through profit or loss (FVTPL) A financial asset is classified at fair value through profit or loss if it is classified as held-for-trading or is designated as such upon initial recognition. Financial assets are designated as at FVTPL if the Company manages such investments and makes purchase and sale decisions based on their fair value in accordance with the Companys risk management strategy. Attributable transaction costs are recognized in profit or loss when incurred. FVTPL are measured at fair value, and changes are recognized in the statements of operations and comprehensive loss. Cash is categorized as FVTPL and is carried at fair value. Held to maturity (HTM) These assets are non-derivative financial assets with fixed or determinable payments and fixed maturities that

the Companys management has the positive intention and ability to hold to maturity. These assets are measured at amortized costs using the effective interest method. If there is objective evidence that the asset is impaired, determined by reference to external credit ratings and other relevant indicators, the financial asset is measured at the present value of estimated future cash flows. Any changes to the carrying amount of the investment, including impairment losses, are recognized in the statements of operations and comprehensive loss.

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _____________________________________________________________________________________ ___ 6. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) d) Financial Instruments (continued) Loans and receivables Loans and receivables are financial assets with fixed or determinable payments that are not quoted on an active market. Such assets are initially recognized at fair value plus any direct attributable transaction costs. Subsequent to initial recognition, loans and receivables are measured at amortized cost using the effective interest method, less any impairment loss. The Company classified its financial assets which consisted of prepaids and sundry receivables as loans and receivables. Financial liabilities Financial liabilities are classified as Other financial liabilities. This category includes Accounts payable and accrued charges and Due to directors, all of which are recognized at amortized cost. Impairment of financial assets Financial assets are assessed for indicators of impairment at the end of each reporting period. Financial assets are impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial assets, the estimated future cash flows of the investments have been affected. For all financial assets, objective evidence of impairment could include: significant financial difficulty of the issuer or counterparty; or it becomes probable that the borrower will enter bankruptcy or financial re-organization. For certain categories of financial assets, such as receivables, assets that are assessed not to be impaired individually are subsequently assessed for impairment on a collective basis. The carrying amount of financial assets is reduced by the impairment loss directly for all financial assets except receivables, where the carrying amount is reduced through the use of an allowance account. Subsequent recoveries of receivables previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognized in the statement of comprehensive loss. If, in a subsequent year, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the the impairment was recognized, the previously recognized impairment loss is reversed through the statement of loss and comprehensive loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortized cost would have been had the impairment not been recognized. (e) Income Taxes The Company uses the asset and liability method of accounting for income taxes under which future tax assets and liabilities are recognized for differences between the financial statement carrying amounts of

21
existing assets and liabilities and their respective tax bases. Future tax assets and liabilities are measured using substantively enacted tax rates in effect in the year in which those temporary differences are expected to be recovered or settled. The effect on future tax assets and liabilities of a change in tax rates is recognized as part of the provision for income taxes in the year that includes the enactment date. A valuation allowance is recorded to the extent there is uncertainty regarding realization of future tax assets.

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _____________________________________________________________________________________ ___ 6. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (f) Translation of Foreign Currencies Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange prevailing at the year end, non-monetary assets and liabilities are translated at historical rates and revenue and expenses are translated at the rate of exchange in effect on the transaction dates. Exchange gains and losses arising on translation of monetary items are included in income in the year in which they occur. (g) Long-term Investments Long-term investments are recorded at cost. Long-term investments classified as held-to maturity financial instruments, are valued at amortized cost, with changes in valuation charged to operations. Long-term investments classified as available-for-sale financial instruments, are valued at fair market value, with changes in valuation charged to comprehensive income. Long-term investments in equity instruments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured are measured at cost Gains and losses are recognized when investments are sold. Income is recognized only to the extent dividends are received h) Impairment of Long-lived Assets Long-lived assets, including capital assets, are amortized over their useful lives. The Company reviews longlived assets for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. If the sum of the undiscounted cash flows expected to result from the use and eventual disposition of a group of assets is less than its carrying amount, it is considered impaired. An impairment loss is measured as the amount by which the carrying amount of the group of assets exceeds its fair value (i) Basic and Diluted Loss per Share The Canadian Institute of Chartered Accountants ("CICA") recommends the use of the treasury stock method in computing earnings/loss per share. Under this method, basic loss per share is computed by dividing earnings available to common shareholders by the weighted average number of common shares outstanding during the year. In computing the loss per share on a fully diluted basis, the treasury stock method assumes that proceeds received from in-the-money stock options are used to repurchase common shares at the prevailing market rate. The weighted average number of common shares outstanding during the year was 239,171,893 (2010 - 239,171,893). (j) Revenue Recognition Revenue is recognized to the extent that it is probable that future economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received or to be received.

Revenue is earned from the provision of consulting services, licence fees and if and when the Company receives its share of profits from the Company's 3D graphics and mining and resources business units. The Company recognizes revenue from consulting services when performance of the consulting services are complete and recognizes revenue from the Company's 3D graphics and mining and resources business units when such profit distributions are received. Licence fees represent fees that the New JV is contractually required to pay the Company for use of the Company's CLIK 3D trade name.

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _______________________________________________________________________________________ __

7. CAPITAL STOCK Authorized: Issued: Unlimited common stock and special shares without par value December 31, 2011 239,171,893 $17,268,966 December 31, 2010 239,171,893 $17,268,966

As of December 31, 2011, the Company had not issued any warrants or options nor were there any outstanding warrants or options. 8. RELATED PARTY TRANSACTIONS Directors of the Company advanced the Company the sum of $39,000 as loans due and payable on demand which loans are non - interest bearing. These funds were to be used by the Company for its ongoing corporate and business operations. 9. CAPITAL MANAGEMENT The Companys objectives when managing capital are to safeguard its ability to continue as a going concern to pursue the development of its three business segments and to maintain a flexible capital structure which optimizes the cost of capital within a framework of acceptable risk. In the management of capital, the Company includes share capital, contributed surplus and deficit. The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust its capital structure, the Company may issue new shares, issue new debt, acquire or dispose of assets or adjust the amount of cash and cash equivalents. The Company is dependent on the capital markets and potential private investors as its sole source of operating capital and the Companys capital resources are largely determined by the strength of the junior public markets and by the status of the Companys projects in relation to these markets and its ability to compete for investor support of its projects. The Company is not subject to externally imposed capital requirements

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Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _______________________________________________________________________________________ __ . 10. INVESTMENT IN NEW JV 2011 $ Investment, beginning of year Less: Impairment loss Investment, end of year 200,000 149,000 51,000 100,000 200,000 300,000 2010 $

Pursuant to the terms of the JV Agreement, and in order to provide the New JV with working or operational capital, the Company advanced $600,000 USD to the New JV. The Company has no management rights or further funding requirements or obligations with respect to the New JV. The Companys participation in the New JV is limited to the Companys right to receive 30% of the New JVs net profits as and when such profits are distributed to the joint venturers in accordance with the terms and provisions of the New JV Agreement. As a consequence of both the continuing delays in the New JV becoming operational and the New JVs outstanding and unfulfilled obligation to pay the Company a licensing fee as required pursuant to the terms of the New JV Agreement, Management elected in 2008 to take write down its investment interest in the New JV for impairment to $300,000 and to take a further write down for impairment loss of $100,000 in 2010. With the New JV continuing to experience delays in becoming operational and following an appraisal by 3DP North America Inc. of the fair market value of JVs assets, management decided to record a further impairment loss of $149,000 of the Company's interest in the New JV in 2011. The Company is only liable to the extent of its investment and is indemnified from the other joint venturers for any excess losses and liabilities. Upon termination of the New JV, the Company is entitled to its capital account share in net assets of the New JV.

11. VENGA'S LICENCE FEE Pursuant to the terms of the New JV Agreement, the Company granted the New JV a licence (the "Venga

Licence") during the currency of the New JV Agreement to use, market, operate and commercially exploit the business trade name 'CLIK 3D'. In consideration of the Company's granting of the Venga Licence, the New JV agreed to pay Venga, the sum of fifty thousand ($50,000.00) dollars (the "Venga Licence Fee") each year or part year during the currency of the New JV Agreement. Notwithstanding the terms of the New JV Agreement, the New JV has failed to pay the Company the required Venga Licence Fee for the years 2006 through 2011. The Company has advised the New JV that the Company is not waiving any right to recover any portion of the accumulated, unpaid and outstanding amount for the Venga Licence Fee and that the Company is and continues to regard the accumulated, unpaid and outstanding amount for the Venga Licence Fee a valid, legal debt owed by the New JV to the Company. However, in accordance with the Companys significant accounting policies with respect to revenue recognition, revenue with respect to Vengas licence fee has not been recorded for the years ended December 31, 2011 or December 31, 2010.

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _______________________________________________________________________________________ __ 12. INVESTMENT IN GLOBAL MINERAL INVESTMENTS LLC Pursuant to the terms and provisions of the Funding Agreement, the Company, currently has a 20% (December 31, 2011 - 20%) interest. The Funding Agreement provides that the Company will participate in the profits generated through from the Companys management of the financial aspects of the Proposed Dredging Operation, for which the Company is entitled to receive a management fee in accordance with the terms of the Funding Agreement, the Company has no management rights or ongoing funding requirements with respect to GMI or the Proposed Dredging Operation. The Company and GMI have specifically agreed that no term, condition or provision in the Funding Agreement will act to, or be deemed to, create or establish in law, or otherwise, a form of partnership between GMI and the Company nor will the terms, conditions and provisions of the Funding Agreement create, or be deemed to create or establish, in law or otherwise, a joint venture between the Company and GMI with respect to the Proposed Dredging Operation or otherwise. As of the date of these consolidated financial statements the Company has yet to receive confirmation as to the results of GMI's dredge mining operations that were recommenced in February, 2011. On April 11, 2011, the Company announced that GMI had signed a funding and operational agreement (the "Operational Agreement") with Kiwi, Inc., a Liberian based mining company to fund and manage GMI's dredge mining and planned land based mining operations at GMI's Kumasi Hill 15 and Kumasi Hill 18 concessions ("GMI's Planned Land Based Operations") located in Sinoe County, Liberia. Pursuant to the terms of the Operational Agreement, Kiwi, Inc. agreed to commence full mining operations at GMI's two Kumasi Hill sites by October 1, 2011. While the Corporation has received confirmation from GMI that the original October 1, 2011 date for the commencement of mining operations at GMI's two Kumasi Hill sites has been extended, as of the date of these consolidated financial statements the Company has yet to receive confirmation as to when, or even if, such mining operations will begin. The Operational Agreement further provides that Kiwi, Inc. will have full operational management of GMI's dredge mining operations and Planned Land Based Operations, with all profit derived from such operations being divided equally between Kiwi, Inc. and GMI. In managements opinion the investment in GMI is not impaired at December 31, 2011. 13. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT Measurement and Fair value The Companys financial assets and liabilities are classified and measured as follows: Classification Measurement Fair Value 2011 Fair value 2010

25
$ Financial assets: Cash and cash equivalent Prepaids and sundry receivables Financial liabilities: Accounts payable and accrued charges Due to Directors Other financial liabilities Other financial 39,000 liabilities Amortized cost 0 Amortized cost 20,772 37,896 Held for trading Loans and receivables Fair value Amortized cost 5,108 65 9,809 717 $

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _______________________________________________________________________________________ __ 13. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (continued) Measurement and Fair value (continued) Fair value is the amount at which a financial instrument could be exchanged between willing parties, based on the current markets for instruments with the same risk, principal and remaining maturity. The fair values of the Companys financial instruments approximate their carrying values because of the short-term nature of these instruments. Financial instruments recorded at fair value at the balance sheet date are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 fair value measurements are those derived from inputs other than quoted prices included within level 1 that are not observable for the asset or liability, either directly(i.e. as prices) or indirectly (i.e. derived from prices); and Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data.

The fair value of cash is measured based on Level 1 inputs referred to in the three levels of the hierarchy noted above. The Company does not have any Level 2 or 3 fair value measurements. There have been no significant transfers between levels. Risk The Company has exposure to a credit risk; liquidity risk; foreign currency risk and interest risk from its use of financial instruments. The Company's cash is held in major Canadian banks and their subsidiaries. Management approves and monitors the risk management process. There has been no change in the Company's risk management process for the year ended December 31, 2011.

Credit Risk Credit risk represents the financial loss that the Company would experience if a counterparty to a financial instrument failed to meet its obligations to the Company. Cash consists of cash bank balances held in a major Canadian financial institution. As a result, there is no significant credit risk related to the Company's assets. The carrying amounts of this financial asset represent the maximum credit exposure. Liquidity Risk The Company ensures, including arranging a loan from a director, that there is sufficient capital in order to meet short-term business requirements after taking into account the Company's holdings of cash. The Company's cash is held in major Canadian banks and their subsidiaries. As of the year ended December 31, 2011, the Company had cash of $5,108 and thus the Company faces a liquidity risk. Foreign Currency Risk While the Company's functional currency is the Canadian dollar, the Company is subject to normal market risks including fluctuations in foreign exchange rates. The Company has not entered into any derivatives or contracts to hedge or otherwise mitigate this exposure. As at December 31, 2011, the Company held no financial instruments subject to foreign exchange rates.

Venga Aerospace Systems Inc.

Notes to the Consolidated Financial Statements for the Years Ended December 31, 2011 and 2010 (Expressed in Canadian Dollars) _______________________________________________________________________________________ __ 13. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (continued) Risk (continued) Interest Rate Risk Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The risk that the Company will realize a loss due to a change in interest rates is limited because the Company as at December 31, 2011, had no interest bearing financial assets or liabilities. 14. INCOME TAX Income tax recovery and future income tax assets The reconciliation of income taxes attributable to operations computed at the combined statutory income tax rate of 28.25% (2010 31%) to income tax recovery shows that income tax recovery of $49,785 (2010 $47,961) is entirely absorbed by a valuation allowance resulting in no provision for income tax recovery since there is uncertainty as to whether the Company can utilize losses for income tax purposes. Similarly future income tax assets which reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts for tax purposes are $0 (2010 $0). The Company has accumulated losses for income tax purposes totaling approximately $1,041,892 for which the tax benefits have not been recognized in the financial statements. These losses can be deducted from future years' taxable income and expire as follows: $

27
2014 2015 2026 2027 2028 2029 2030 345,277 244,780 219,473 82,446 60,824 34,359 54,713 1,041,892 15. COMMITMENTS AND CONTRACTUAL OBLIGATIONS The Company had no contractual or other obligations as at December 31, 2011.