Mongolia Growth Group Ltd. (YAK) 2023年年度報告「TSX-V」.pdf

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1、2023 Annual Report3Mongolia Growth Group Ltd|The year 2023 was rather bittersweet for everyone at MGG.On one hand,we finalized the sale of our Mongolian property assets,a goal that was necessitated by our subscale size.While foreshadowed for quite some time,I was still saddened to crystalize this tr

2、ansaction.Mongolia has been part of my life for over a decade,and I always believed that we could somehow turn things around if we simply waited long enough for Mongolias economic fortunes to recover.Unfortunately,this recovery has never arrived,and it became apparent that the time had come to extra

3、ct our remaining capital and engage it in more lucrative purposes,especially as our Mongolian operations have mostly operated at a loss for the past few years.At the same time,MGG had built a wonderful team that could accomplish anything,even under almost impossible circumstancesour most valuable as

4、sets,that never showed up on our balance sheet.Unfortunately,no one should toil away at a company that is slowly shrinking,and moving on is also for their own good,though I will miss them dearly.I will forever remember the loyalty and resourcefulness of our core team,many of whom have been with us s

5、ince 2011.We accomplished incredible things during our time together,and while that has not translated into financial rewards for you as shareholders,I dont think you realize how much we really accomplished.I also dont think you realize how difficult things frequently were in Mongolia,only to have o

6、ne of our employees find a creative way to save the day.Putting it differently,things could have turned out much worse for us as shareholders and were happy that we were able to ultimately extract value from our Mongolian assets.We segregate our business lines into three categories:Investment Proper

7、ties(discontinued),Subscription Business Products,and Corporate Division(which includes our investment portfolio).Given the complicated nature of the accounting for discontinued operations,Im going to break with normal practices and simply summarize that we sold our seven remaining property assets,i

8、ncluding our Mongolian headquarters for cash consideration of approximately$10,800,000.Four of these properties were sold via the sale of subsidiaries outlined in Note 5 of the financial statements.During the 4th quarter,we completed the wind-down of our operations,and expect that all Mongolia-relat

9、ed expenses are reflected in these year-end financial statements.Subsequent to the complete disposal of our Mongolian operations,we have four core assets remaining at MGG;Our Subscription Products Business.Our office property in Rincon,Puerto Rico.Our cash,net marketable securities,and digital asset

10、s.Canadian Tax assets related to the disposal of our Mongolian subsidiaries.I have on many occasions noted that there are tax and regulatory reasons why we cannot be a publicly traded business where the primary assets are marketable securities.Therefore,we MUST purchase over 25%of an operating busin

11、ess in the very near future.Unfortunately,we have not been able to identify any attractive opportunities and have started to lose confidence that we will be able to identify a sufficiently attractive opportunity.If we cannot find a suitable acquisition in the near future,we will likely choose to liq

12、uidate this Company,so as not to burden shareholders with the costs of a public company.In the meantime,we hope that future gains from our existing marketable securities portfolio can utilize our tax assets,maximizing the after-tax return to shareholders.Subscription Business Products:KEDM,our subsc

13、ription business,which tracks various Event-Driven strategies,continued to produce income for our company.During the year,we recognized$3,213,395(2022-$3,174,031)of revenue while taking in$2,792,680(2022-$3,685,715)of gross subscription receipts,representing a 24%decline in subscription receipts whe

14、n compared to the previous year.As noted previously,we believe that KEDM has reached a Harris KuppermanCEO and Chairman of the BoardLetter to Shareholders Dear Shareholders,4|Mongolia Growth Group Ltdmore mature state and that churn will likely remain above our ability to add new subscribers.Weve tr

15、ied a variety of methods to grow the subscriber base,but a weaker equity market,with reduced returns for investors,has led many subscribers to cancel their subscriptions.Meanwhile,weve struggled to replace these subscribers.That said,we believe that there is a core base of subscribers that will like

16、ly continue to renew their subscriptions as they value the data that we provide.As KEDM shrinks into this core base,we believe that overall churn will stabilize at a lower level that is offset by new subscriber additions and we expect that KEDM will remain a profitable business for us.As a reminder,

17、as of January 1st of 2023,my Registered In-vestment Advisor,Praetorian PR LLC,is now contracting with MGG to produce KEDM.To learn more about KEDM,go to www.KEDM.COM.Corporate Division:Our public securities portfolio produced a$4,050,104 unre-alized gain and a$518,828 realized gain during the year.I

18、 would like to caution you strongly that returns,as we have recently experienced,are highly unlikely to be repeated in fu-ture quarters.At year-end,our portfolio was concentrated in investments in oil futures and futures options,energy services companies,uranium equities,and a Florida landowner.Addi

19、-tionally,we own a small position in a cryptocurrency named Monero,that we added moderately to during the first quarter of 2023.We view these investments as highly liquid,inflation-protected,alternatives to holding cash,and we intend to liquidate various investments should we find additional busi-ne

20、sses to launch or acquire stakes in.ConclusionIn summary,the fiscal year 2023 was bittersweet.While we remain optimistic about Mongolias long-term future,it re-mains mired in an economic crisis.As a result,we decided to finally wind down operations and dispose of our remaining property assets.We wai

21、ted for over a decade for a recovery in Mongolias economy.One day that recovery will come,but unfortunately,as shareholders,we will not take part.Gen and I made many life-long friends in Mongolia and will cherish our memories of operating in such a remarkable country.We want to wish all our friends

22、and former employees the best in all of their endeavors.Our public equity investments continue to succeed beyond our wildest ambitions,and we are in the best financial posi-tion we have been in since we started this adventure.Gen and I very much want to continue this adventure.We have big plans and

23、even bigger ambitions for this company,as noted by our continued and aggressive insider purchases over the years.Unfortunately,various regulatory and tax authorities have put a roadblock in our way and despite speaking with multiple consultants and spending a veritable treasure chest of money on thi

24、s problem,we cannot find a way forward.We havent given up hope yet,but are also realists,hence we are making you aware of the likely return of a substantial portion of this companys capital.During the year,the company repurchased 600,200 shares un-der its Normal Course Issuer Bid.At year-end,our sha

25、re count was 26,980,699,or 24%fewer than during our peak share count in 2016.To date,the company has repurchased a total of 9,438,200 shares.Sincerely,Harris KuppermanCEO and Chairman of the Board5Mongolia Growth Group Ltd|MONGOLIA GROWTH GROUP LTD.Management Discussion&AnalysisDecember 31,2023The m

26、anagement of Mongolia Growth Group Ltd.(“MGG”or“the Corporation”)presents the Corporations management discussion and analysis for the year ended December 31,2023(the“MD&A”),compared with the year ended December 31,2022.As of January 1,2011,the Corporation adopted International Financial Reporting St

27、andards(“IFRS”).This MD&A provides an overall discussion,followed by analyses of the performance of the Corporations major reportable segments.The reporting and presentation currency in the consolidated financial statements and in this discussion and analysis is the Canadian dollar,unless otherwise

28、noted.This MD&A is dated April 25,2024,and incorporates all relevant information and considerations to that date.The following discussion and analysis should be read in conjunction with the audited consolidated financial statements of the Corporation for the year ended December 31,2023,and December

29、31,2022,together with all of the notes,risk factors,and information contained therein,available on SEDAR at .Forward Looking Statements This MD&A contains forward-looking statements relating to future events.In some cases,forward-looking statements can be identified by words such as“anticipate”,“con

30、tinue”,“estimate”,“expect”,“forecast”,“may”,“will”,“project”,“should”,“believe”,or similar expressions.These statements represent managements best projections but undue reliance should not be placed upon them as they are derived from numerous assumptions.These assumptions are subject to known and un

31、known risks and uncertainties,including the“Risks and Uncertainties”as discussed herein.Actual performance and financial results will differ from any projections of future performance or results expressed or implied by such forward looking statements and the difference may be material.Accordingly,re

32、aders are cautioned that events or circumstances could cause results to differ materially from those predicted.From time to time,the Corporations management may make estimates and have opinions that form the basis for the forward-looking statements.The Corporation assumes no obligation to update suc

33、h statements if circumstances,managements estimates,or opinions change.Forward looking statements are included within the Outlook,and Executive Strategy sections of this MD&A.6|Mongolia Growth Group LtdSection 1 OverviewFinancial and Operational OverviewThe fourth quarter saw a small decline in subs

34、cription revenue.Additionally,the Corporation recognized realized and unrealized gains from its investment portfolio.The Corporation has three core focuses of operation:Investment Properties(discontinued),Subscription Products,and Corporate.For several years now,Management has been of the opinion th

35、at its Mongolian property operations were not at a sufficient scale to be cash flow positive.As such,the Corporation has made the difficult decision to dispose of its Mongolian operations,now classified as discontinued operations.The Company has been looking at various investment opportunities outsi

36、de of Mongolia,in order to diversify its business and has adopted a Merchant Bank model.Since 2017,the Corporation has spent substantial time evaluating a number of businesses for acquisition but has not decided to move forward on any acquisition.However,the Corporation has incubated and launched a

37、Subscription Products business,which began to produce revenue during the third quarter of 2021.During the year ended December 31,2023,the Company directly sold three properties for net proceeds of$471,131,resulting in a net loss of$452,035 and sold four properties with a value of$9,095,765 via the s

38、ale of subsidiaries(note 5).During the year ended December 31,2022,the Company sold five properties for net proceeds of$919,621 resulting in a net loss of$146,544.Losses related to the sale of investment properties have been included in loss from discontinued operations(note 5 of the 2023 year-end f

39、inancial statements)for the years presented.During the year,the Corporation recognized revenue of$3,213,395(2022-$3,174,031)from its subscription data products business named KEDM.The Corporation continues to see significant subscriber churn and an overall slowdown in new subscriptions to KEDM as a

40、result of equity market weakness and reduced research budgets amongst investors.The corporation believes that this rate of churn may continue if equity markets remain difficult for investors.While the Corporation seeks out a business to build or acquire,the Corporation has invested its excess capita

41、l in publicly traded securities.During the year,the Corporations investment portfolio experienced$518,828 of realized gains and$4,050,104 of unrealized gains.As of the end of December,the Corporation has in excess of$50.6 million of cash and net marketable securities with negligible debt(when exclud

42、ing margin borrowings).The Corporation sees its public securities holdings as a source of capital to fund a future acquisition along with the working capital needs of the business.The Corporation may also be forced to take on additional borrowings or issue equity to finance a future acquisition.Mong

43、olian Property BusinessDuring the boom years at the beginning of the last decade,Management and employees had worked hard to build up the infrastructure needed to manage MGGs institutional property platform.This platform was unique in Mongolia and was one of the only platforms capable of managing as

44、sets through the full cycle of ownership from acquisition through disposition and included dedicated departments that managed maintenance,leasing,marketing,and tenant management.During 2023,the Corporation continued to have occupancy levels that were in excess of market conditions,and it credits its

45、 leasing and property management teams with this success.Unfortunately,as the Mongolian property business was never able to reach scale,the Corporation made the difficult decision to dispose of the business.Subscription Products The Corporation has built a financial data product known as KEDM,which

46、helps investors monitor various Event-Driven opportunities.The Corporation initiated a paywall on July 1,2021,in order to monetize this service.During the year,the Corporation recognized$3,213,395 of subscription revenue.At the end of the year,the Corporation has$1,126,439 of unearned revenue(2022-$

47、1,547,154)related to subscription fees that have been collected and not earned.As of December 31,2023,the Corporation had received$8,458,277 of total billings before fees since the initiation of the paywall.The Corporation intends to invest to improve the scope and quality of the data.Should KEDM co

48、ntinue to perform acceptably,the Corporation may look to launch or acquire additional subscription products.Furthermore,the Corporation is reviewing additional services that it can add to the core KEDM platform in order to increase revenues.For more information on KEDM,go to http:/www.KEDM.COM.Inves

49、tments The Corporation has invested a portion of its excess capital in marketable securities.As of December 31,2023,the Corporation held positions in multiple different publicly traded companies with the values of marketable securities owned of$46,439,938,securities sold short of$5,724,and$5,536,537

50、 due to broker.During the year,the Corporation recognized realized gains of$518,828(2022-gain of$8,792,881)from sales of public securities and experienced unrealized gains of$4,050,104(2022 gain of$1,031,997).7Mongolia Growth Group Ltd|At the end of the year,the portfolios holdings with a weighting

51、in excess of 5%of the brokerage accounts equity were:The Corporations public securities as of December 31,2023,are broken out in the following sectors:The Corporation believes that public securities are a liquid alternative to holding cash while seeking out additional businesses to launch or acquire

52、.The Corporation intends to sell its holdings to fund such future businesses.Management of the Corporation would like to strongly caution investors that there are tax and regulatory reasons that this portfolio should not be thought of as the future of the Corporation.Between July 2021 and March 31,2

53、023,the Corporation traded several securities in addition to holding several core positions.As a result,during this time,securities gains were treated as income and not capital gains under Canadian tax statutes.As of April 1,2023,the Corporation has no longer been purchasing and selling securities o

54、utside of its core portfolio and intends to treat future gains as capital gains for tax purposes.The Corporation cautions investors that the public securities portfolio is likely to be more volatile than the overall market or a money market account.Additionally,investing in public securities entails

55、 substantial risks,far beyond the risks of investing excess cash into a bank account.The Corporation does not expect the recent returns to be repeatable,sustainable,or indicative of future returns from the public securities portfolio.During the first quarter of 2022,the Corporation purchased various

56、 Russian securities.As at March 31,2022,the Company marked all of these securities to zero as sanctions prohibit the sale of Russian securities and the Company may never recover any value from these securities.The Corporation continues to hold these securities but has valued them at zero.As of Decem

57、ber 31,2023,the public securities portfolio had a net equity value of approximately$47,000,000 when compared to a net equity value of approximately$36,700,000 at December 31,2022.During the year,the Corporation transferred$11,178,622 from the sale of its Mongolian portfolio to its public securities

58、portfolio and withdrew$900,000 from the portfolio to fund working capital needs and the Corporations NCIB.As of March 31,2024,the public securities portfolio had a net equity value of approximately$48,600,000 after withdrawing$500,000 to fund its NCIB.Due from and due to brokersThe Company has margi

59、n facilities with its prime brokers.As at December 31,2023,and 2022,the Companys amounts due to brokers have no specific repayment terms,and they are governed by the margin terms set forth in the prime brokerage agreements.As at December 31,2023,the Company had net margin borrowings of$5,536,573(202

60、2$7,329,685).The fair value of the collateral-listed equity securities is calculated daily and compared to the Companys margin limits.The prime brokers can at any time demand full or partial repayment of the margin balances and any interest thereon or demand the delivery of additional assets as coll

61、ateral.MONGOLIA GROWTH GROUP LTD.,Q4 2023 MD&A 6 The Corporation intends to invest to improve the scope and quality of the data.Should KEDM continue to perform acceptably,the Corporation may look to launch or acquire additional subscription products.Furthermore,the Corporation is reviewing additiona

62、l services that it can add to the core KEDM platform in order to increase revenues.For more information on KEDM,go to http:/www.KEDM.COM.Investments The Corporation has invested a portion of its excess capital in marketable securities.As of December 31,2023,the Corporation held positions in multiple

63、 different publicly traded companies with the values of marketable securities owned of$46,439,938,securities sold short of$5,724,and$5,536,537 due to broker.During the year,the Corporation recognized realized gains of$518,828(2022-gain of$8,792,881)from sales of public securities and experienced unr

64、ealized gains of$4,050,104(2022 gain of$1,031,997).At the end of the year,the portfolios holdings with a weighting in excess of 5%of the brokerage accounts equity were:Top Holdings(Long and Short)Holdings Shares%Sprott Uranium Trust(U-U Canada)416,940 25.1%Valaris PLC(VAL USA)76,230 14.7%Yellowcake

65、PLC 545,650 12.1%St Joe Company(JOE USA)70,906 12.0%A-Mark Precious Metals,Inc.100,000 8.5%Crude Oil Futures Calls-7.7%Tidewater Inc 30,000 6.1%Other-12.6%The Corporations public securities as of December 31,2023,are broken out in the following sectors:The Corporation believes that public securities

66、 are a liquid alternative to holding cash while seeking out additional businesses to launch or acquire.The Corporation intends to sell its holdings to fund such future businesses.Management of the Corporation would like to strongly caution investors that there are tax and regulatory reasons that thi

67、s portfolio should not be thought of as the future of the Corporation.Between July 2021 and March 31,2023,the Corporation traded several securities in addition to holding several core positions.As a result,during this time,securities gains were treated as income and not capital gains under Canadian

68、tax statutes.As of April 1,2023,the Corporation has no longer been purchasing and selling securities outside of its core portfolio and intends to treat future gains as capital gains for tax purposes.The Corporation cautions investors that the public securities portfolio is likely to be more volatile

69、 than the overall market or a Long Portfolio Industry Sector%Uranium 44.3%Energy Services 21.6%Land 12.0%Capital Markets 8.5%Crude Oil Futures Calls 7.7%Media and Communications 3.7%Other long equities 1.1%Short Portfolio Industry Sector%Short Crude Oil Futures Calls -0.01%MONGOLIA GROWTH GROUP LTD.

70、,Q4 2023 MD&A 6 The Corporation intends to invest to improve the scope and quality of the data.Should KEDM continue to perform acceptably,the Corporation may look to launch or acquire additional subscription products.Furthermore,the Corporation is reviewing additional services that it can add to the

71、 core KEDM platform in order to increase revenues.For more information on KEDM,go to http:/www.KEDM.COM.Investments The Corporation has invested a portion of its excess capital in marketable securities.As of December 31,2023,the Corporation held positions in multiple different publicly traded compan

72、ies with the values of marketable securities owned of$46,439,938,securities sold short of$5,724,and$5,536,537 due to broker.During the year,the Corporation recognized realized gains of$518,828(2022-gain of$8,792,881)from sales of public securities and experienced unrealized gains of$4,050,104(2022 g

73、ain of$1,031,997).At the end of the year,the portfolios holdings with a weighting in excess of 5%of the brokerage accounts equity were:Top Holdings(Long and Short)Holdings Shares%Sprott Uranium Trust(U-U Canada)416,940 25.1%Valaris PLC(VAL USA)76,230 14.7%Yellowcake PLC 545,650 12.1%St Joe Company(J

74、OE USA)70,906 12.0%A-Mark Precious Metals,Inc.100,000 8.5%Crude Oil Futures Calls-7.7%Tidewater Inc 30,000 6.1%Other-12.6%The Corporations public securities as of December 31,2023,are broken out in the following sectors:The Corporation believes that public securities are a liquid alternative to hold

75、ing cash while seeking out additional businesses to launch or acquire.The Corporation intends to sell its holdings to fund such future businesses.Management of the Corporation would like to strongly caution investors that there are tax and regulatory reasons that this portfolio should not be thought

76、 of as the future of the Corporation.Between July 2021 and March 31,2023,the Corporation traded several securities in addition to holding several core positions.As a result,during this time,securities gains were treated as income and not capital gains under Canadian tax statutes.As of April 1,2023,t

77、he Corporation has no longer been purchasing and selling securities outside of its core portfolio and intends to treat future gains as capital gains for tax purposes.The Corporation cautions investors that the public securities portfolio is likely to be more volatile than the overall market or a Lon

78、g Portfolio Industry Sector%Uranium 44.3%Energy Services 21.6%Land 12.0%Capital Markets 8.5%Crude Oil Futures Calls 7.7%Media and Communications 3.7%Other long equities 1.1%Short Portfolio Industry Sector%Short Crude Oil Futures Calls -0.01%8|Mongolia Growth Group Ltd MONGOLIA GROWTH GROUP LTD.,Q4 2

79、023 MD&A 7 money market account.Additionally,investing in public securities entails substantial risks,far beyond the risks of investing excess cash into a bank account.The Corporation does not expect the recent returns to be repeatable,sustainable,or indicative of future returns from the public secu

80、rities portfolio.During the first quarter of 2022,the Corporation purchased various Russian securities.As at March 31,2022,the Company marked all of these securities to zero as sanctions prohibit the sale of Russian securities and the Company may never recover any value from these securities.The Cor

81、poration continues to hold these securities but has valued them at zero.As of December 31,2023,the public securities portfolio had a net equity value of approximately$47,000,000 when compared to a net equity value of approximately$36,700,000 at December 31,2022.During the year,the Corporation transf

82、erred$11,178,622 from the sale of its Mongolian portfolio to its public securities portfolio and withdrew$900,000 from the portfolio to fund working capital needs and the Corporations NCIB.As of March 31,2024,the public securities portfolio had a net equity value of approximately$48,600,000 after wi

83、thdrawing$500,000 to fund its NCIB.Due from and due to brokers The Company has margin facilities with its prime brokers.As at December 31,2023,and 2022,the Companys amounts due to brokers have no specific repayment terms,and they are governed by the margin terms set forth in the prime brokerage agre

84、ements.As at December 31,2023,the Company had net margin borrowings of$5,536,573(2022$7,329,685).The fair value of the collateral-listed equity securities is calculated daily and compared to the Companys margin limits.The prime brokers can at any time demand full or partial repayment of the margin b

85、alances and any interest thereon or demand the delivery of additional assets as collateral.Digital Assets In 2023,the Corporation opened a digital currency account at Kraken Custody and purchased Monero(XMR)cryptocurrency.The Corporation purchased 595 Monero coins during the year for$134,332(2022-50

86、5 coins purchased for$94,910).At the end of the year,the Corporation held 2,020 Monero coins worth$438,872.During the year,the Companys digital assets experienced an unrealized gain of$29,313 and a currency loss of$9,026.2023 Gross amounts due from brokers$Gross amounts due to brokers$Net amounts$Du

87、e from brokers 22,172(22,021)151 Due to brokers -(5,536,537)(5,536,537)2022 Gross amounts due from brokers$Gross amounts due to brokers$Net amounts$Due from brokers 14,203(14,203)-Due to brokers -(7,393,046)(7,393,046)Digital AssetsIn 2023,the Corporation opened a digital currency account at Kraken

88、Custody and purchased Monero(XMR)cryptocurrency.The Corporation purchased 595 Monero coins during the year for$134,332(2022-505 coins purchased for$94,910).At the end of the year,the Corporation held 2,020 Monero coins worth$438,872.During the year,the Companys digital assets experienced an unrealiz

89、ed gain of$29,313 and a currency loss of$9,026.9Mongolia Growth Group Ltd|Section 2 Results of OperationsSelected Annual Financial Information(CAD)MONGOLIA GROWTH GROUP LTD.,Q4 2023 MD&A 8 Section 2-Results of Operations Selected Annual Financial Information(CAD)*Excludes operations of Investment Pr

90、operties previously included in Continuing Operations.Year ended Year ended Year ended 31-December-2023 31-December-2022 31-December-2021 ($)($)($)Revenue and other income 3,317,294 3,174,031 944,411 Income Net income(loss)from continued operations attributable to equity holders of the Corporation 4

91、,811,183 7,440,371 15,549,306 Net income(loss)from discontinued operations attributable to equity holders of the Corporation(17,991,032)498,051(653,967)Total Comprehensive income/(loss)attributable to equity holders of the Corporation 3,810,636 6,403,237 15,491,985 Basic earnings per share(EPS)(in C

92、AD)Net income/(loss)(0.48)0.29 0.53 Net income(loss)from discontinued operations(0.66)0.02(0.02)Net income(loss)from continuing operations 0.18 0.27 0.55 Diluted EPS(in CAD)Net Income/(loss)(0.48)0.29 0.53 Balance Sheet Total assets 58,195,061 64,557,624 55,026,865 Total liabilities 9,034,941 18,434

93、,092 14,849,578 Total equity 49,160,120 46,123,532 40,177,287 Shares outstanding at year end 26,980,699 27,710,499 27,778,499 Book value per share 1.82 1.66 1.45 10|Mongolia Growth Group LtdContinuing OperationsContinuing Operations Rental Revenue During the year,the Companys continuing operations e

94、arned rental revenues of$103,899(2022-$nil)as the Company leased out a portion of its headquarters in Puerto Rico.Continuing Operations Revenue from SubscriptionsRevenue from subscriptions consists of fees earned through our data analytics subscriptions.For the year ending December 31,2023,revenues

95、from subscriptions were$3,213,395 compared to$3,174,031 in 2022.Continuing Operations Unearned RevenueSubscription revenue collected that has not been earned has been classified as unearned revenue and will be classified according to the Companys revenue policies described in note 3 of the 2023 cons

96、olidated financial statements.As of December 31,2023,the Company has unearned revenue of$1,126,439(December 31,2022-$1,547,154).Prior to January 1,2023,MGG had engaged an arms length company to compile and produce the KEDM report on an ongoing basis,while MGG acted as the distributor and marketer of

97、 the product.As a part of this engagement,MGG had agreed to pay certain direct and approved expenses related to producing KEDM in addition to 20%of quarterly earned revenues above a threshold.Beginning on January 1,2023,MGG has engaged Praetorian PR LLC(PPR),a Puerto Rican company owned by MGGs Chai

98、rman and CEO to produce KEDM.Under the terms of the agreement,MGG pays PPR a monthly fee of USD$50,000 along with 20%of any quarterly revenue in excess of USD$125,000.This transaction was necessitated by the need to consolidate all financial-related business activities conducted by the Corporations

99、Chairman and CEO under the review of his Chief Compliance Officer,following PPRs registration as a Registered Investment Advisor with the US Securities and Exchange Commission(SEC).MGG believes that the compensation paid to PPR will result in a negligible profit to PPR based upon a review of anticip

100、ated expenses going forward.Both parties reserve the right to adjust the terms of the agreement following a short notice period.For more information about KEDM,go to www.KEDM.com.Expenses related to the unearned revenue have generally not yet been incurred and are not reflected in the Companys finan

101、cial statements.MGG owns all intellectual property related to KEDM and PPR disclaims any ownership or rights to the intellectual property.Unrealized public securities investment gain/lossDuring the year,the Corporation had an unrealized public securities investment gain of$4,050,104 compared to an u

102、nrealized public securities investment gain of$1,031,997 in 2022.Realized public securities investment gain/lossDuring the year,the Corporation had realized investment gains of$518,828 compared to a realized investment gain of$8,792,881 in 2022.Realized foreign currency gain/lossDuring the year,the

103、continuing operations of the Corporation had a realized foreign currency loss of$17,683 compared to a realized foreign currency gain of$203,495 in 2022.Share RepurchaseDuring 2023,the Corporation repurchased 600,200 common shares under its Normal Course Issuer Bid(NCIB)at an average price of$1.29(20

104、22-302,600,$1.51 average).As at December 31,2023,the Corporation held 105,000 shares in Treasury to be cancelled during the first quarter of 2024(2022-234,600).Corporate and Subscription Salary ExpensesCorporate and subscription salary expenses include senior management and employee salaries.For the

105、 year ending December 31,2023,general and administrative expenses have decreased from$896,662 in 2022 to$697,635 in 2023.This decrease was primarily driven by a reallocation of salaries to Subscription product business expenses.Corporate and Subscription Other ExpensesCorporate and subscription othe

106、r expenses include listing fees,professional fees,technology,travel,investment research expenses,KEDM.COM development costs,and administrative costs.11Mongolia Growth Group Ltd|For the year ending December 31,2023,general and administrative expenses have increased from$959,328 in 2022 to$1,483,107 i

107、n 2023 for the Corporations Corporate division primarily due costs associated with the disposal of the Mongolian operations and an increase in salaries.The general and administrative expenses for the Subscription business increased from$1,063,037 to$1,545,522.This increase was primarily driven by an

108、 increase in production expenses and revenue sharing at KEDM.Unrealized Digital Assets Investment Gain/LossDuring the year,the Corporation had an unrealized digital assets investment gain of$29,313 and a currency loss of$9,026(2022$98,700 investment loss and a$21,153 currency gain).CurrencyThe Mongo

109、lian Tgrg has fluctuated significantly since the Corporations initial investment in the country.The currency depreciated from 1,250 MNT/CAD in February 2011 to 2,585MNT/CAD in December 2023.The fluctuation in the currency is reflected in the Corporations financial statements,most notably in the inve

110、stment property portfolio.Note 12 in the financial statements discloses the foreign exchange adjustment,which flows through the investment property classification during each period and ultimately through Other Comprehensive Income on the Income Statement.As at December 31,2023,the Corporation reali

111、zed a foreign currency loss of$16,964,749 on the reclassification of accumulated other comprehensive income due to the disposition of the Mongolian operations.Net Income from Continuing OperationsFor the year ended December 31,2023,the Corporation had a net gain from continuing operations of$4,811,1

112、83(Q4 2022-$7,440,371).Management cautions investors that the Corporation is primarily focused on increasing shareholder value on a per-share basis.This means that,operationally,Management is more concerned with long-term asset appreciation at the expense of short-term cash flow.Management expects t

113、his to be the case in the foreseeable future.12|Mongolia Growth Group LtdDiscontinued OperationsRental Revenue from Discontinued Operations Rental revenues from Mongolian subsidiaries decreased from$798,826 in 2022 to$519,415 in 2023.Management has decided to focus on the core operations of the Corp

114、oration,leading to the disposition of the Mongolian property business.Revenue from other Sources from Discontinued OperationsRevenue from other sources consists of late fees,fees earned for third-party leasing,and property management.For the year ending December 31,2023,revenues from other sources d

115、ecreased to$23,500 compared to$100,572 for 2022.Gain/Loss on Disposal of Investment Properties from Discontinued OperationsDuring the year ended December 31,2023,the Company directly sold three properties for net proceeds of$471,131,resulting in a net loss of$452,035 and sold four properties with a

116、value of$9,095,765 via the sale of subsidiaries(note 5).During the year ended December 31,2022,the Company sold five properties for net proceeds of$919,621 resulting in a net loss of$146,544.Losses related to the sale of investment properties have been included in loss from discontinued operations(n

117、ote 5)for the years presented.Fair Value Adjustment on Investment Properties from Discontinued Operations The estimate of fair value of investment properties is a critical accounting estimate to the Corporation.An external appraiser estimates the fair value of the majority of the Investment Properti

118、es annually,the remainder are appraised internally by Management.The fair value of investment properties is based on the nature,location and condition of the specific asset.The fair value of investment properties represents an estimate of the price that would be made in an arms length transaction be

119、tween knowledgeable,willing parties.The Corporation operated in the emerging real estate market of Mongolia,which given its current economic and industry conditions,has an increased inherent risk given the lack of reliable and comparable market information.For the year ended December 31,2023,the Cor

120、poration recorded a valuation loss of$nil(2022$622,186 gain).Expenses from Discontinued Operations Expenses from discontinued operations consist of salaries,repairs and maintenance,bad debts,utilities,salaries,as well as land and property taxes.For the year ending December 31,2023,expenses from disc

121、ontinued operations were increased to$1,509,247 compared to$1,088,147 during 2022.Expenses from the Corporations former property subsidiary increased significantly during the year due to severance payments to its Mongolian employees and other costs related to the sale of the investment property port

122、folio.Foreign Currency Loss from the Sale of Discontinued Operations During December 2023,Mongolia(Barbados)Corp,disposed of its interests in both Big Sky Capital LLC and MGG Properties LLC.As a result of the sale,the Company realized a foreign currency loss of$16,964,749 on the reclassification of

123、accumulated other comprehensive income due to the disposition of the Mongolian operations.Net Income from Discontinued Operations For the year ended December 31,2023,the net loss from discontinued operations was$17,991,032(2022-net income of$498,051).This loss came from a foreign currency loss of$16

124、,964,749 on the reclassification of accumulated other comprehensive income due to the disposition of the Mongolian operations.Net Income For the year ended December 31,2023,the Corporation had a net loss of$13,179,849(2022-$7,938,422 net income).The bulk of this loss came from realized capital loss

125、on the disposal of Mongolian subsidiaries.Management cautions investors that the Corporation is primarily focused on increasing shareholder value on a per-share basis.This means that,operationally,Management is more concerned with long-term asset appreciation at the expense of short-term cash flow.M

126、anagement expects this to be the case for the foreseeable future.13Mongolia Growth Group Ltd|Section 3-Financial ConditionCash FlowMongolia Growth Groups primary sources of capital are cash generated from equity issuance,investing,financing,and asset sales.Management expects to meet all of the Corpo

127、rations obligations through current cash and cash equivalents along with cash flows from asset sales.The following table provides an overview of the Corporations cash flows from operating,financing,and investing activities for the year ended December 31,2023 and 2022.MONGOLIA GROWTH GROUP LTD.,Q4 20

128、23 MD&A 12 Section 3-Financial Condition Cash Flow Mongolia Growth Groups primary sources of capital are cash generated from equity issuance,investing,financing,and asset sales.Management expects to meet all of the Corporations obligations through current cash and cash equivalents along with cash fl

129、ows from asset sales.The following table provides an overview of the Corporations cash flows from operating,financing,and investing activities for the year ended December 31,2023 and 2022.Cash Flow Continuing Operations 31-December-2023 31-December-2022$Net change in cash related to:Operating(2,893,

130、966)(1,436,299)Investing 2,078,761 401,740 Financing(814,048)(456,992)Net change in cash during the period excluding FX(1,629,253)(1,491,551)Overall,the Corporation had cash outflows of$1,629,253 from continuing operations excluding FX during the year of 2023 primarily due to significant cash outflo

131、ws from operating activities,offset by inflows from investing activities.The changes in components of cash flows for the period ended December 31,2023,compared to the period ended December 31,2022,were the result of the following factors:Operating Operating cash outflows increased during Q4 2023 com

132、pared to cash outflows during Q4 2022 due to an increase in non-cash working capital balances compared to the prior year.Investing Investing cash inflows occurred primarily from a net sale of marketable securities.Financing Financing cash outflows occurred as the Company repurchased 600,200 shares d

133、uring the year while the Company repurchased 302,600 shares during 2022.Cash Flow from Discontinuing Operations 31-December-2023 31-December-2022$Net change in cash related to:Operating(1,388,755)309,467 Investing 10,599,135 919,621 Net change in cash during the period excluding FX 9,210,380 1,229,0

134、88 To date,the Corporation has been able to meet all of its capital and other cash requirements from its internal sources of cash.As at December 31,2023,the Corporation had$9,735,224(2022-$2,051,245)in cash and cash equivalents.Management considers its marketable securities holdings to be fairly liq

135、uid and can be sold should the Corporation need to increase its cash position.Total Assets As of December 31,2023,the Corporation had$56,682,081(2022-$51,617,254)in Current Assets of which$9,735,224 were held in cash and cash equivalents(2022-$2,051,245)and$46,439,938 were held in marketable securit

136、ies(Q4 2022-$49,237,506),$438,872 were held in digital assets(Q4 2022-$284,253),and$67,896 were held in other assets(Q4 2022-$44,250).The increase in marketable securities is due to an increase in leverage year over year.Investment Properties are classified as Non-Current Assets and are carried at F

137、air Market Value.During the year,Investment Properties decreased to$nil(Q4 2022-$10,086,956)due to the disposal of the Mongolian business.Overall,the Corporation had cash outflows of$1,629,253 from continuing operations excluding FX during the year of 2023 primarily due to significant cash outflows

138、from operating activities,offset by inflows from investing activities.The changes in components of cash flows for the period ended December 31,2023,compared to the period ended December 31,2022,were the result of the following factors:Operating Operating cash outflows increased during Q4 2023 compar

139、ed to cash outflows during Q4 2022 due to an increase in non-cash working capital balances compared to the prior year.Investing Investing cash inflows occurred primarily from a net sale of marketable securities.Financing Financing cash outflows occurred as the Company repurchased 600,200 shares duri

140、ng the year while the Company repurchased 302,600 shares during 2022.To date,the Corporation has been able to meet all of its capital and other cash requirements from its internal sources of cash.As at December 31,2023,the Corporation had$9,735,224(2022-$2,051,245)in cash and cash equivalents.Manage

141、ment considers its marketable securities holdings to be fairly liquid and can be sold should the Corporation need to increase its cash position.Total AssetsAs of December 31,2023,the Corporation had$56,682,081(2022-$51,617,254)in Current Assets of which$9,735,224 were held in cash and cash equivalen

142、ts(2022-$2,051,245)and$46,439,938 were held in marketable securities(Q4 2022-$49,237,506),$438,872 were held in digital assets(Q4 2022-$284,253),and$67,896 were held in other assets(Q4 2022-$44,250).The increase in marketable securities is due to an increase in leverage year over year.Investment Pro

143、perties are classified as Non-Current Assets and are carried at Fair Market Value.During the year,Investment Properties decreased to$nil(Q4 2022-$10,086,956)due to the disposal of the Mongolian business.Property and Equipment,which primarily consists of properties that are measured at their cost bas

144、e,decreased from$2,804,232 as at December 31,2022,to$1,512,980 as at December 31,2023 as the Company sold its Mongolian headquarters.Total LiabilitiesAs of December 31,2023,the Corporation had current liabilities of$8,534,419(2022-$15,461,570)consisting primarily of marketable securities sold short

145、of$5,724(2022-$5,159,131),amounts due to broker of$5,536,537(2022-$7,393,046),payables of$415,386(2022-$659,402),unearned revenue of$1,126,439(Q4 2022-$1,547,154)and income tax liability of$1,430,333(Q4 2022-$642,837).As of December 31,2023,the Corporation had non-current liabilities of$500,522 on t

146、he balance(Q4 2022-$2,972,522).The decrease in deferred income taxes was due to the sale of the Mongolian properties.Management considers all other current cash commitments to be immaterial and operational in nature.MONGOLIA GROWTH GROUP LTD.,Q4 2023 MD&A 12 Section 3-Financial Condition Cash Flow M

147、ongolia Growth Groups primary sources of capital are cash generated from equity issuance,investing,financing,and asset sales.Management expects to meet all of the Corporations obligations through current cash and cash equivalents along with cash flows from asset sales.The following table provides an

148、 overview of the Corporations cash flows from operating,financing,and investing activities for the year ended December 31,2023 and 2022.Cash Flow Continuing Operations 31-December-2023 31-December-2022$Net change in cash related to:Operating(2,893,966)(1,436,299)Investing 2,078,761 401,740 Financing

149、(814,048)(456,992)Net change in cash during the period excluding FX(1,629,253)(1,491,551)Overall,the Corporation had cash outflows of$1,629,253 from continuing operations excluding FX during the year of 2023 primarily due to significant cash outflows from operating activities,offset by inflows from

150、investing activities.The changes in components of cash flows for the period ended December 31,2023,compared to the period ended December 31,2022,were the result of the following factors:Operating Operating cash outflows increased during Q4 2023 compared to cash outflows during Q4 2022 due to an incr

151、ease in non-cash working capital balances compared to the prior year.Investing Investing cash inflows occurred primarily from a net sale of marketable securities.Financing Financing cash outflows occurred as the Company repurchased 600,200 shares during the year while the Company repurchased 302,600

152、 shares during 2022.Cash Flow from Discontinuing Operations 31-December-2023 31-December-2022$Net change in cash related to:Operating(1,388,755)309,467 Investing 10,599,135 919,621 Net change in cash during the period excluding FX 9,210,380 1,229,088 14|Mongolia Growth Group LtdTotal EquityDuring th

153、e year,the Companys equity value increased to$49,160,120 as at December 31,2023,from$46,123,532 at December 31,2022.The equity of the Corporation consists of one class of common shares.MONGOLIA GROWTH GROUP LTD.,Q4 2021 MD&A 13 Property and Equipment,which primarily consists of properties that are m

154、easured at their cost base,decreased from$2,804,232 as at December 31,2022,to$1,512,980 as at December 31,2023 as the Company sold its Mongolian headquarters.Total Liabilities As of December 31,2023,the Corporation had current liabilities of$8,534,419(2022-$15,461,570)consisting primarily of marketa

155、ble securities sold short of$5,724(2022-$5,159,131),amounts due to broker of$5,536,537(2022-$7,393,046),payables of$415,386(2022-$659,402),unearned revenue of$1,126,439(Q4 2022-$1,547,154)and income tax liability of$1,430,333(Q4 2022-$642,837).As of December 31,2023,the Corporation had non-current l

156、iabilities of$500,522 on the balance(Q4 2022-$2,972,522).The decrease in deferred income taxes was due to the sale of the Mongolian properties.Management considers all other current cash commitments to be immaterial and operational in nature.Total Equity During the year,the Companys equity value inc

157、reased to$49,160,120 as at December 31,2023,from$46,123,532 at December 31,2022.The equity of the Corporation consists of one class of common shares.Outstanding 31-December-2023 31-December-2022 Common shares 26,980,699*27,710,499*Options to buy common shares-*As at December 31,2023,the Corporation

158、held 105,000 common shares in Treasury to be cancelled during the first quarter of 2024(2022-234,600).*As at April 25,2024,the Corporation had 26,094,399 shares outstanding,no shares held in treasury,and no options outstanding.Acquisitions and Dispositions During the year ended December 31,2023,the

159、Company directly sold three properties for net proceeds of$471,131,resulting in a net loss of$452,035 and sold four properties with a value of$9,095,765 via the sale of subsidiaries(note 5).During the year ended December 31,2022,the Company sold five properties for net proceeds of$919,621 resulting

160、in a net loss of$146,544.Losses related to the sale of investment properties have been included in loss from discontinued operations(note 5)for the years presented.Related Party Transactions Parties are generally considered to be related if the parties are under common control or if one party has th

161、e ability to control the other party or can exercise significant influence or joint control over the other party in making financial and operational decisions.In considering each possible related party relationship,attention is directed to the substance of the relationship,not merely the legal form.

162、Acquisitions and DispositionsDuring the year ended December 31,2023,the Company directly sold three properties for net proceeds of$471,131,resulting in a net loss of$452,035 and sold four properties with a value of$9,095,765 via the sale of subsidiaries(note 5).During the year ended December 31,2022

163、,the Company sold five properties for net proceeds of$919,621 resulting in a net loss of$146,544.Losses related to the sale of investment properties have been included in loss from discontinued operations(note 5)for the years presented.Related Party TransactionsParties are generally considered to be

164、 related if the parties are under common control or if one party has the ability to control the other party or can exercise significant influence or joint control over the other party in making financial and operational decisions.In considering each possible related party relationship,attention is d

165、irected to the substance of the relationship,not merely the legal form.Key management personnel of the Corporation include all directors,executive management,and persons related to directors and executive management.The summary of compensation for key management personnel is as follows:As at Decembe

166、r 31,2023,amounts due to related parties totaled approximately$240,061(Q4 2022-$16,446),comprised of fees owed to management and directors,were included in trade payables and accrued liabilities.Salaries to other related parties include the salary of an employee that is related to a director.*Beginn

167、ing on January 1,2023,MGG engaged Praetorian PR LLC(PPR),a Puerto Rican company owned by MGGs Chairman and CEO to produce KEDM.Under the terms of the agreement,MGG pays PPR a monthly fee of USD$50,000 along with 20%of any quarterly revenue in excess of USD$125,000.This transaction was necessitated b

168、y the need to consolidate all financial-related business activities conducted by the Corporations Chairman and CEO under the review of his Chief Compliance Officer,following PPRs registration as a Registered Investment Advisor with the US Securities and Exchange Commission(SEC).MGG believes that the

169、 compensation paid to PPR will result in a negligible profit to PPR based upon a review of anticipated expenses going forward.Both parties reserve the right to adjust the terms of the agreement following a short notice period.Additionally,PPR agrees to provide MGG with expense reports periodically t

170、o show the KEDM-related expenses that were incurred.For more information about KEDM,go to www.KEDM.com.Off-Balance Sheet Items As of December 31,2023,the Corporation had no off-balance sheet items.Events Subsequent to Year End Since January 1,2024,the Company has repurchased 781,300 of its shares at

171、 an average price of$1.51/share and cancelled 886,300 shares.As disclosed in the Corporations March 26,2024,press release,the Corporation announced that the TSX Venture Exchange(the“Exchange”)had accepted a Notice of Intention to renew its normal course issuer bid to purchase outstanding common shar

172、es of the Corporation on the open market in accordance with the policies of the TSX.Securities SoughtUp to 1,760,000 common shares,representing up to approximately 9.97%of the 17,648,649 common shares constituting the Issuers current Public Float(as defined in the Policies of the Exchange).MONGOLIA

173、GROWTH GROUP LTD.,Q4 2023 MD&A 14 Key management personnel of the Corporation include all directors,executive management,and persons related to directors and executive management.The summary of compensation for key management personnel is as follows:Related Party Transactions 2023$2022$Salaries and

174、other short-term benefits to officers 604,487 590,924 Salaries to other related parties 80,912 78,040 Director fees 60,000 60,000 KEDM production expense and revenue share paid to an entity controlled by the chairman*1,298,072-Total 2,043,471 728,964 As at December 31,2023,amounts due to related par

175、ties totaled approximately$240,061(Q4 2022-$16,446),comprised of fees owed to management and directors,were included in trade payables and accrued liabilities.Salaries to other related parties include the salary of an employee that is related to a director.*Beginning on January 1,2023,MGG engaged Pr

176、aetorian PR LLC(PPR),a Puerto Rican company owned by MGGs Chairman and CEO to produce KEDM.Under the terms of the agreement,MGG pays PPR a monthly fee of USD$50,000 along with 20%of any quarterly revenue in excess of USD$125,000.This transaction was necessitated by the need to consolidate all financ

177、ial-related business activities conducted by the Corporations Chairman and CEO under the review of his Chief Compliance Officer,following PPRs registration as a Registered Investment Advisor with the US Securities and Exchange Commission(SEC).MGG believes that the compensation paid to PPR will resul

178、t in a negligible profit to PPR based upon a review of anticipated expenses going forward.Both parties reserve the right to adjust the terms of the agreement following a short notice period.Additionally,PPR agrees to provide MGG with expense reports periodically to show the KEDM-related expenses tha

179、t were incurred.For more information about KEDM,go to www.KEDM.com.Off-Balance Sheet Items As of December 31,2023,the Corporation had no off-balance sheet items.Events Subsequent to Year End Since January 1,2024,the Company has repurchased 781,300 of its shares at an average price of$1.51/share and

180、cancelled 886,300 shares.As disclosed in the Corporations March 26,2024,press release,the Corporation announced that the TSX Venture Exchange(the“Exchange”)had accepted a Notice of Intention to renew its normal course issuer bid to purchase outstanding common shares of the Corporation on the open ma

181、rket in accordance with the policies of the TSX.Securities Sought Up to 1,760,000 common shares,representing up to approximately 9.97%of the 17,648,649 common shares constituting the Issuers current Public Float(as defined in the Policies of the Exchange).Duration The Issuer intends to commence purc

182、hasing its common shares under the Normal Course Issuer Bid three clear trading days following acceptance of the same by the TSX Venture Exchange(the“Exchange”).The Bid will commence on or about April 2,2024,and the Bid will end no later than April 1,2025.Method of Acquisition Purchases will be affe

183、cted through the facilities of the Exchange.Purchase and payment for the common shares of the Issuer will be made by the Issuer in accordance with Exchange requirements.Member and Broker The Normal Course Issuer Bid will be conducted by Research Capital Corporation of 199 Bay Street,Suite 4500,Toron

184、to ON M5L 1G2;Phone:(416)860-7655.15Mongolia Growth Group Ltd|DurationThe Issuer intends to commence purchasing its common shares under the Normal Course Issuer Bid three clear trading days following acceptance of the same by the TSX Venture Exchange(the“Exchange”).The Bid will commence on or about

185、April 2,2024,and the Bid will end no later than April 1,2025.Method of AcquisitionPurchases will be affected through the facilities of the Exchange.Purchase and payment for the common shares of the Issuer will be made by the Issuer in accordance with Exchange requirements.Member and BrokerThe Normal

186、 Course Issuer Bid will be conducted by Research Capital Corporation of 199 Bay Street,Suite 4500,Toronto ON M5L 1G2;Phone:(416)860-7655.Consideration OfferedPurchases of common shares under the Normal Course Issuer Bid will be conducted at applicable Market Prices in accordance with Exchange requir

187、ements.Completion of purchases under the bid will be subject to the Issuer having sufficient funds to acquire the common shares and continue to meet its working capital requirements throughout the course of the bid.The Issuer may in the normal course of its business operations,subject to market cond

188、itions,sell one or more of its investment properties to fund acquisitions throughout the course of the bid.Reasons for the Normal Course Issuer BidThe Issuer is undertaking the bid because,in the opinion of its board of directors,the market price of its common shares,from time to time,may not fully

189、reflect the underlying value of its operations and future growth prospects.The Issuer believes that in such circumstances,the purchase of the common shares of the Issuer may represent an appropriate and desirable use of the Issuers funds and further enhance market stability.Persons Acting Jointly or

190、 in Concert with the IssuerN/APrevious PurchasesThe Issuer has purchased 1,213,400 of its common shares at an average price of$1.40 within the past 12 months.Acceptance by Insiders,Affiliates and AssociatesTo the knowledge of the Issuer,no director,senior officer or other Insider of the Issuer or an

191、y associate or affiliate of the Issuer or any insider of the Issuer currently intends to sell common shares under the Normal Course Issuer Bid.However,such sales by persons through the facilities of the Exchange may occur if the personal circumstances of such persons change or any such person makes

192、a decision to sell shares as market circumstances may warrant.The benefits to any such person whose shares are purchased under the bid would be the same as the benefits available to all other holders of the Issuers common shares whose shares are purchased under the bid.Benefits from the Normal Cours

193、e Issuer BidN/AMaterial Changes in the Affairs of the Issuer CompanyThe Issuer currently has no plans or proposals for any Material Change in the affairs of the Issuer or to make any Material Changes in its business,corporate structure(debt or equity),management or personnel,or any other change whic

194、h might reasonably be expected to have a significant effect on the price or value of the securities.16|Mongolia Growth Group LtdSection 4-Quarterly InformationQuarterly ResultsThe following table is a summary of select quarterly information over the previous eight quarters:MONGOLIA GROWTH GROUP LTD.

195、,Q4 2023 MD&A 16 Section 5-Quarterly Information Quarterly Results The following table is a summary of select quarterly information over the previous eight quarters:Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Q2 2022 Q1 2022 Revenue 16,487 1,655,885 1,055,595 1,132,242 1,127,733 912,789 1,046,75

196、7 839,606 Net income(loss)(19,790,455)7,879,688(8,158)(1,260,924)4,219,923(344,086)(2,218,219)6,280,804 Income(loss)per common share(0.72)0.29 0.00(0.05)0.15(0.01)(0.08)0.23 Total Assets 58,195,061 65,780,580 50,341,034 55,499,653 64,557,624 58,523,283 62,823,647 67,714,593 Weighted Average Shares(N

197、o.)27,243,468 27,320,541 27,387,703 27,469,402 27,761,956 27,771,511 27,777,752 27,778,499 Ending Shares(No.)26,980,699 27,065,199 27,307,799 27,307,799 27,710,499 27,759,299 27,759,299 27,778,499*The chart above reflects both the continuing and discontinued operations of the Corporation 17Mongolia

198、Growth Group Ltd|Section 5 Critical Estimates Critical Accounting EstimatesThe preparation of financial statements following IFRS required Management to make assumptions about the future that affect the reported amounts of assets and liabilities.Estimates and judgments are continually evaluated base

199、d on historical experiences and other factors,including expectations of future events that are believed to be reasonable under the circumstances.In the future,actual experience may differ from these estimates and assumptions.The critical estimates made in the preparation of the consolidated financia

200、l statements include the following:Fair Value Adjustment on Investment Properties The estimate of fair value of investment properties is the most critical accounting estimate to the Company.An external appraiser estimates the fair value of the majority of Investment Properties annually,the remainder

201、 is appraised internally by Management.The fair value of investment properties is based on the nature,location and condition of the specific asset.The fair value of investment properties represents an estimate of the price that would be made in an arms length transaction between knowledgeable,willin

202、g parties.The Corporation operates in the emerging real estate market of Mongolia,which given its current economic and industry conditions,has an increased inherent risk given the lack of reliable and comparable market information.For the year ending December 31,2023,the Corporation recorded a fair

203、value adjustment of$nil(Q4 2022$622,186 gain).Deferred Tax AssetsDeferred tax assets are recognized to the extent that it is probable that deductible temporary differences will reverse in the foreseeable future and there will be sufficient future taxable profits against which the deductible temporar

204、y differences can be utilized.The Corporation reviews the carrying amount of deferred tax assets at the end of each reporting period which is reduced to the extent that it is no longer probable that deferred tax assets recognized will be recovered or increased to the extent that sufficient future ta

205、xable profit will be available to allow all or part of a previously unrecognized deferred tax asset to be recovered.Estimates of future taxable income are based on forecasted cash flows from operations,available tax planning opportunities,and expected timing of reversals of taxable temporary differe

206、nces.Valuation of Marketable SecuritiesThe Company recognizes marketable securities at fair value.Fair value is determined on the basis of market prices from independent sources,if available.If there is no market price,then the fair value is determined by using valuation models with inputs derived f

207、rom observable market data where possible but where observable data is not available,judgement is required to establish fair values.Significant judgments made in the preparation of these consolidated financial statements include the following areas:Judgement is required in determining whether an ass

208、et meets the criteria for classification as assets held for sale and or as discontinued operations in the consolidated financial statements.Criteria considered by management include the existence of and commitment to a plan to dispose of the assets,the expected selling price of the assets,the probab

209、ility of the sale being completed within an expected timeframe of one year,and the period of time any amounts have been classified within assets held for sale.Management reviews the criteria for assets held for sale each quarter and reclassifies such assets to or from this financial position categor

210、y as appropriate.On completion of the sale,Management exercises judgement as to whether the sale qualifies as a discontinued operation.18|Mongolia Growth Group LtdSection 6 Risk ManagementCredit RiskThe Corporations exposure to credit risk is managed through risk management policies and procedures w

211、ith emphasis on the quality of the investment portfolio.For the year,most of the Corporations credit risk consisted of institutional deposits.The majority of the funds invested are held in reputable Canadian and American.Liquidity RiskUnder certain market conditions,such as during volatile markets o

212、r when trading in a security or market is otherwise impaired,the liquidity of the Corporations portfolio positions may be reduced.In addition,the Corporation may from time to time hold large positions with respect to a specific type of financial instrument,which may reduce the Corporations liquidity

213、.During such times,the Corporation may be unable to dispose of certain financial instruments,including longer-term financial instruments,which would adversely affect its ability to rebalance its portfolio.In addition,such circumstances may force the Corporation to dispose of financial instruments at

214、 reduced prices,thereby adversely affecting its performance.If there are other market participants seeking to dispose of similar financial instruments at the same time,the Corporation may be unable to sell such financial instruments or prevent losses relating to such financial instruments.Furthermor

215、e,if the Corporation incurs substantial trading losses,the need for liquidity could rise sharply while its access to liquidity could be impaired.In addition,in conjunction with a market downturn,the Corporations counterparties could incur losses of their own,thereby weakening their financial conditi

216、on and increasing the Corporations exposure to their credit risk.The Corporation does not believe its current maturity profile lends itself to any material liquidity risk,taking into account the level of cash and cash equivalents,investments and marketable securities as at December 31,2023.As at Dec

217、ember 31,2023,the Corporation had working capital of$48,147,662(2022-$36,155,684)comprised of cash and cash equivalents,marketable securities owned,due from broker,digital assets,other assets,net of trade and accrued liabilities,unearned revenue,due to broker,marketable securities sold short,CEBA lo

218、an and income taxes payable.Management considers the funds on hand to be sufficient to meet its ongoing obligations.Market RiskMarket risk is the risk that the fair value of,or future cash flows from,the Corporations financial instruments will significantly fluctuate due to changes in market prices.

219、The value of the financial instruments can be affected by changes in interest rates,foreign exchange rates,and equity and commodity prices.The Corporation is exposed to market risk in trading its investments and unfavorable market conditions could result in dispositions of investments at less than f

220、avorable prices.Catastrophe riskThe Company obtained insurance on its Puerto Rican property with a value of$1,385,665 at December 31,2023.As the property is located on the ocean,it is at risk of significant hurricane damage or other natural disasters which could result in a significant impairment to

221、 its value.Cryptocurrencies Risk Cryptocurrencies are measured at fair value less cost to sell.Cryptocurrency prices are affected by various forces including global supply and demand,interest rates,exchange rates,inflation or deflation and political and economic conditions.Further,cryptocurrencies h

222、ave no underlying backing or contracts to enforce recovery of invested amounts.The profitability of the Corporation is related to the current and future market price of cryptocurrencies;in addition,the Corporation may not be able to liquidate its inventory of cryptocurrencies at its desired price if

223、 necessary.Investing in cryptocurrencies is speculative,prices are volatile,and market movements are difficult to predict.Supply and demand for such currencies change rapidly and are affected by a variety of factors,including regulation and general economic trends.Cryptocurrencies have a limited his

224、tory;their fair values have historically been volatile,and the value of cryptocurrencies held by the Corporation could decline rapidly.A decline in the market prices of cryptocurrencies could negatively impact the Corporations future operations.Historical performance of cryptocurrencies is not indic

225、ative of their future performance.Many cryptocurrency networks are online end-user-to-end-user networks that host a public transaction ledger(blockchain)and the source code that comprises the basis for the cryptographic and algorithmic protocols governing such networks.In many cryptocurrency transac

226、tions,the recipient or the buyer must provide its public key,which serves as an address for a digital wallet,to the seller.In the data packets distributed from cryptocurrency software programs to confirm transaction activity,each party to the transaction user must sign transactions with a data code

227、derived from entering the private key into a hashing algorithm,which signature serves as validation that the transaction has been authorized by the owner of the cryptocurrency.This process is vulnerable to hacking and malware and could lead to theft of the Corporations digital wallets and the loss o

228、f the Corporations cryptocurrency.19Mongolia Growth Group Ltd|Cryptocurrencies are loosely regulated and there is no central marketplace for exchange.Supply is determined by a computer code,not a central bank.Additionally,exchanges may suffer from operational issues,such as delayed execution,that co

229、uld have an adverse effect on the Corporation.The cryptocurrency exchanges on which the Corporation may trade on are relatively new and,in many cases,largely unregulated,and therefore may be more exposed to fraud and failure than regulated exchanges for other assets.Any financial,security,or operati

230、onal difficulties experienced by such exchanges may result in an inability of the Corporation to recover money or cryptocurrencies being held on the exchange.Further,the Corporation may be unable to recover cryptocurrencies awaiting transmission into or out of the exchange,all of which could adverse

231、ly affect an investment of the Corporation.Additionally,to the extent that the digital asset exchanges representing a substantial portion of the volume in digital asset trading are involved in fraud or experience security failures or other operational issues,such digital asset exchanges failures may

232、 result in loss or less favorable prices of cryptocurrencies,or may adversely affect the Corporation,its operations,and its investments.Furthermore,crypto exchanges comingle their clients assets in exchange wallets.When crypto-assets are commingled,transactions are not recorded on the applicable blo

233、ckchain ledger but are only recorded by the exchange.Therefore,there is a risk around the occurrence of transactions or the existence of period-end balances represented by exchanges.Loss of access riskThe loss of access to the private keys associated with the Corporations cryptocurrency holdings may

234、 be irreversible and could adversely affect an investment.Cryptocurrencies are controllable only by an individual that possess both the unique public key and private key or keys relating to the“digital wallet”in which the cryptocurrency is held.To the extent a private key is lost,destroyed,or otherw

235、ise compromised and no backup is accessible the Corporation may be unable to access the cryptocurrency.Irrevocability of transactionsCryptocurrency transactions are irrevocable and stolen or incorrectly transferred cryptocurrencies may be irretrievable.Once a transaction has been verified and record

236、ed in a block that is added to the blockchain,an incorrect transfer or theft generally will not be reversible,and the Corporation may not be capable of seeking compensation.Hard fork and air drop risksHard forks may occur for a variety of reasons including,but not limited to,disputes over proposed c

237、hanges to the protocol,significant security breach,or an unanticipated software flaw in the multiple versions of otherwise compatible software.In the event of a hard fork in a cryptocurrency held by the Corporation,it is expected that the Corporation would hold an equivalent amount of the old and ne

238、w cryptocurrency following the hard fork.Airdrops occur when the promoters of a new cryptocurrency send amounts of the new cryptocurrency to holders of another cryptocurrency that they will be able to claim a certain amount of the new cryptocurrency for free.The Corporation may not be able to realiz

239、e the economic benefit of a hard fork or airdrop,either immediately or ever,for various reasons.For instance,the Corporation may not have any systems in place to monitor or participate in hard forks or airdrops.Economic Volatility and UncertaintyOver the past few years,economic volatility and uncert

240、ainty around the world has contributed to dramatically restricted access to capital and reduced capital markets activity for more speculative businesses.Management believes that the Corporation has sufficient resources to carry on its business and remain a going concern.Risks and UncertaintiesThe Co

241、rporation,as part of its operations,carries financial instruments consisting of cash and cash equivalents,investments and marketable securities,accounts receivable,and trade payables,and accrued liabilities.It is Managements opinion that the Corporation is not exposed to significant credit,interest,

242、or currency risks arising from these financial instruments except as otherwise disclosed in the notes to the Consolidated Financial Statements.Further information related to Mongolia Growth Group Ltd.and the risks and uncertainties of MGG is filed on the System for Electronic Document Analysis and R

243、etrieval(“SEDAR”)and can be reviewed at .Financial InstrumentsThe Corporations financial instruments consist of cash and cash equivalents,investments and marketable securities,accounts receivable,and trade and accrued payables.The Corporation is subject to interest risk as it earns interest income f

244、rom its cash deposits.It is Managements opinion that the Corporation is not exposed to significant credit risks arising from these financial instruments and that the fair value of these financial instruments approximates their carrying values.Changes in Investment StrategiesThe Corporation may alter

245、 its investment strategies and restrictions without prior approval by shareholders to adapt to changing circumstances.20|Mongolia Growth Group LtdPossible Negative Impact of RegulationTThe regulatory environment is evolving and changes to it may adversely affect the Corporation.To the extent that re

246、gulators adopt practices of regulatory oversight that create additional compliance,transaction,disclosure or other costs for the Corporation,returns of the Corporation may be negatively affected.In addition,the regulatory or tax environment for securities,derivatives and related instruments is evolv

247、ing and may be subject to modification by government or judicial action that may adversely affect the value of the investments held by the Corporation.The effect of any future regulatory or tax change on the Corporation is impossible to predict.PFIC RiskThe Corporation has not undertaken an analysis

248、 to determine if it is a Passive Foreign Income Company(PFIC)under United States tax statutes,nor does it intend to.US shareholders are advised to consult with tax professionals to determine the risks and potential penalties that could be applicable if the Corporation is determined to be a PFIC at a

249、 later date.Use of DerivativesThe Corporation may use derivative instruments.The use of derivatives in general presents additional risks to those applicable to trading only in the underlying assets.To the extent of the Corporations investment in derivatives,it may take a credit risk concerning parti

250、es with whom it trades and may also bear the risk of settlement default.When used for hedging purposes,an imperfect or variable degree of correlation between price movements of the derivative instrument and the underlying investment sought to be hedged may prevent the Corporation from achieving the

251、intended hedge effect or expose the Corporation to the risk of loss.In addition,derivative instruments may not be liquid at all times,so that in volatile markets the Corporation may not be able to close out a position without incurring a loss.No assurance can be given that short sales,hedging,levera

252、ge,and other techniques and strategies utilized by the Corporation to hedge its exposure will not result in material losses.Custody Risk and Broker or Dealer InsolvencyThe Corporation does not control the custodianship of all of its assets.The Corporations assets will be held in one or more accounts

253、 maintained for the Corporation by its broker or brokers.Such brokers are subject to various laws and regulations in various jurisdictions that are designed to protect their customers in the event of their insolvency.However,the practical effect of these laws and their application to the Corporation

254、s assets are subject to substantial limitations and uncertainties.Because of the large number of entities and jurisdictions involved and the range of possible factual scenarios involving the insolvency of a broker or any sub-custodians,agents,or affiliates,it is impossible to generalize about the ef

255、fect of their insolvency on the Corporation and its assets.Investors should assume that the insolvency of any of the brokers or such other service providers would result in the loss of all or a substantial portion of the Corporations assets held by or through such brokers and/or the delay in the pay

256、ment of withdrawal proceeds.The Corporations cryptocurrency is currently being held at Kraken Custody.There is a risk that the custodian loses the Corporations cryptocurrency.Refer to the cryptocurrency risk section for further cryptocurrency risks.Investment and Trading Risks in GeneralAll trades m

257、ade by the Corporation risk the loss of capital.The Corporation may utilize trading techniques or instruments,which can,in certain circumstances,maximize the adverse impact to which a clients account may be subject.No guarantee or representation is made that the Corporations investment program will

258、be successful,and investment results may vary substantially over time.Many unforeseeable events,including actions by various government agencies,and domestic and international economic and political developments may cause sharp market fluctuations which could adversely affect the Corporations portfo

259、lio and performance.General Economic and Market ConditionsThe success of the Corporations activities may be affected by general economic and market conditions,such as interest rates,availability of credit,inflation rates,economic uncertainty,changes in laws,and national and international political c

260、ircumstances.These factors may affect the level and volatility of securities prices and the liquidity of the Corporations investments.Unexpected volatility or illiquidity could impair the Corporations profitability or result in losses.IssuerSpecific ChangesThe value of an individual security or part

261、icular type of security can be more volatile than and can perform differently from the market as a whole.Portfolio TurnoverThe Corporation has not placed any limits on the rate of portfolio turnover and portfolio securities may be sold without regard to the time they have been held when,in the opini

262、on of the Corporation,investment considerations warrant such action.A high rate of portfolio turnover involves correspondingly greater expenses than a lower rate.21Mongolia Growth Group Ltd|Liquidity of Underlying InvestmentsSome of the securities in which the Corporation may invest may be thinly tr

263、aded.There are no restrictions on the investment of the Corporation in illiquid securities.It is possible that the Corporation may not be able to sell or repurchase significant portions of such positions without facing substantially adverse prices.If the Corporation is required to transact in such s

264、ecurities before its intended investment horizon,the performance of the Corporation could suffer.Highly Volatile Markets The prices of financial instruments in which the Corporations assets may be invested can be highly volatile and may be influenced by,among other things,specific corporate developm

265、ents,interest rates,changing supply and demand relationships,trade,fiscal,monetary and exchange control programs and policies of governments,and national and international political and economic events and policies.The Corporation is subject to the risk of the failure of any of the exchanges on whic

266、h the Corporations positions trade or of their clearinghouses.Emerging MarketsThe Corporation may invest in the securities of companies that operate in some emerging markets.Operating in emerging markets involves additional risks because companies in emerging markets may be less regulated and not su

267、bject to the same standards,reporting practices,and disclosure requirements that apply in more developed markets.In addition,some emerging markets and legal systems may not adequately protect investor rights.Small-to Medium-Capitalization CompaniesThe Corporation may invest a portion of its assets i

268、n the securities of companies with small-to medium-sized market capitalizations.While the Corporation believes these investments often provide significant potential for appreciation,those securities may involve higher risks in some respects than do investments in securities of larger companies.For e

269、xample,while smaller companies generally have the potential for rapid growth,they often involve higher risks because they may lack the management experience,financial resources,product diversification,and competitive strength of larger companies.In addition,in many instances,the frequency and volume

270、 of their trading may be substantially less than is typical of larger companies.As a result,the securities of smaller companies may be subject to wider price fluctuations.When making large sales,the Corporation may have to sell portfolio holdings at discounts from quoted prices or may have to make a

271、 series of small sales over an extended period of time due to the trading volume of smaller Corporation securities.Fixed Income SecuritiesThe Corporation may occasionally invest in bonds or other fixed-income securities of issuers,including,without limitation,bonds,notes,and debentures issued by cor

272、porations.Fixed-income securities pay fixed,variable,or floating rates of interest.The value of fixed-income securities in which the Corporation invests will change in response to fluctuations in interest rates.In addition,the value of certain fixed-income securities can fluctuate in response to per

273、ceptions of creditworthiness,political stability,or soundness of economic policies.Fixed income securities are subject to the risk of the issuers inability to meet principal and interest payments on its obligations(i.e.,credit risk)and are subject to price volatility due to such factors as interest

274、rate sensitivity,market perception of the creditworthiness of the issuer and general market liquidity(i.e.,market risk).If fixed-income investments are not held to maturity,the Corporation may suffer a loss at the time of the sale of such securities.Equity SecuritiesTo the extent that the Corporatio

275、n holds equity portfolio investments or short positions in equities,it will be influenced by stock market conditions in those jurisdictions where the securities held by the Corporation,are listed for trading and by changes in the circumstances of the issuers whose securities are held by the Corporat

276、ion.OptionsSelling call and put options is a highly specialized activity and entails greater than ordinary investment risk.The risk of loss when purchasing an option is limited to the amount of the purchase price of the option;however,investment in an option may be subject to greater fluctuation tha

277、n an investment in the underlying security.In the case of the sale of an uncovered option,there can be potential for an unlimited loss.To some extent,this risk may be hedged by the purchase or sale of the underlying security.ShortingSelling a security short(“shorting”)involves borrowing a security f

278、rom an existing holder and selling the security in the market with a promise to return it at a later date.Should the security increase in value during the shorting period,losses will incur to the Corporation.There is in theory no upper limit to how high the price of a security may go.Another risk in

279、volved in shorting is the loss of a borrow,a situation where the lender of the security requests its return.In cases like this,the Corporation,must either find securities to replace those borrowed or step into the market and repurchase the securities.Depending on the liquidity of the security shorte

280、d,if there are insufficient securities available at current market prices,the Corporation,may have to bid up the price of the security in order to cover the short position,resulting in losses to the Corporation.22|Mongolia Growth Group LtdTrading CostsThe Corporation may engage in a high rate of tra

281、ding activity resulting in correspondingly high costs being borne by the Corporation.Currency and Exchange Rate RisksThe Corporations assets will be denominated in multiple currencies.The Corporation will report its results in Canadian dollars.The Corporation expects to report allocations of profit

282、and loss for income tax purposes in Canadian dollars.Changes in currency exchange rates may affect the value of the Corporations portfolio and the unrealized appreciation or depreciation of investments.LeverageThe Corporation may use financial leverage by borrowing funds against the assets of the Co

283、rporation.Leverage increases both the possibilities for profit and the risk of loss for the Corporation.From time to time,the credit markets are subject to periods in which there is a severe contraction of both liquidity and available leverage.The combination of these two factors can result in lever

284、aged strategies being required to sell positions typically at highly disadvantageous prices in order to meet margin requirements,contributing to a general decline in a wide range of different securities.Illiquidity can be particularly damaging to leveraged strategies because of the essentially discr

285、etionary ability of dealers to raise margin requirements,requiring leveraged strategy to attempt to sell positions to comply with such requirements at a time when there are effectively no buyers in the market at all or at any but highly distressed prices.These market conditions have in the past resu

286、lted in major losses.Such conditions,although unpredictable,can be expected to recur.Future Acquisitions and Business DiversificationManagement is currently evaluating future acquisitions of businesses and operating assets that are not related to investments within Mongolia.There can be no certainty

287、 that the Corporation will acquire any business.Additionally,if the Corporation acquires part or all of a business outside of Mongolia,it may dilute managements focus on current operations within Mongolia.Additionally,shareholders who desire a Mongolia-focused investment vehicle may sell shares of t

288、he Corporation if they do not desire investments outside of Mongolia.There can be no certainty that the Corporation can raise adequate funding to finance an acquisition of a business outside of Mongolia or that diversification of the Corporations business is in the best interest of the Corporation.C

289、apital spent on researching businesses outside of Mongolia will increase operating expenses and operating losses as long as such due diligence is ongoing.Internal Controls over Financial ReportingChanges in securities laws no longer require the Chief Executive Officer and Chief Financial Officer of

290、junior reporting issuers to certify that they have designed internal control over financial reporting or caused it to be designed under their supervision,to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes

291、 in accordance with IFRS.Instead,an optional form of certification has been made available to junior reporting issuers and has been used by the Corporations certifying officers since December 31,2013,annual filings.The new certification reflects what the Corporation considers to be a more appropriat

292、e level of CEO and CFO certification given the size and nature of the Corporations operations.This certification requires the certifying officers to state that:they have reviewed the interim MD&A and consolidated financial statements;they have determined that there is no untrue statement of a materi

293、al fact,or any omission of material fact required to be stated which would make a statement or its omission misleading in light of the circumstances under which it was made within the interim MD&A and consolidated financial statements;based on their knowledge,the interim filings,together with the ot

294、her financial information included in the interim filings,fairly present in all material respects the financial condition,results of operations and cash flows of the Corporation as of the date and for the periods presented in the filings.Additional InformationAdditional information relating to Mongo

295、lia Growth Group Ltd.,including its interim financial statements,is available on SEDAR at .23Mongolia Growth Group Ltd|December 31,2023 Mongolia Growth Group Ltd.Consolidated Financial Statements(Expressed in Canadian dollars)24|Mongolia Growth Group Ltd Mongolia Growth Group Ltd.Consolidated Financ

296、ial Statements December 31,2022(Expressed in Canadian dollars)INDEPENDENT AUDITORS REPORT To the Shareholders of Mongolia Growth Group Ltd.Opinion We have audited the accompanying consolidated financial statements of Mongolia Growth Group Ltd.(the“Company”),which comprise the consolidated statements

297、 of financial position as at December 31,2023 and 2022,and the consolidated statements of operations and comprehensive income,changes in equity,and cash flows for the years then ended,and notes to the consolidated financial statements,including material accounting policy information.In our opinion,t

298、hese consolidated financial statements present fairly,in all material respects,the financial position of the Company as at December 31,2023 and 2022,and its financial performance and its cash flows for the years then ended in accordance with IFRS Accounting Standards as issued by the International A

299、ccounting Standards Board.Basis for Opinion We conducted our audit in accordance with Canadian generally accepted auditing standards.Our responsibilities under those standards are further described in the Auditors Responsibilities for the Audit of the Consolidated Financial Statements section of our

300、 report.We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada,and we have fulfilled our other ethical responsibilities in accordance with these requirements.We believe that the audit evidence we

301、 have obtained in our audit is sufficient and appropriate to provide a basis for our opinion.Key Audit Matters Key audit matters are those matters that,in our professional judgment,were of most significance in our audit of the consolidated financial statements of the current year.These matters were

302、addressed in the context of our audit of the consolidated financial statements as a whole,and in forming our opinion thereon,and we do not provide a separate opinion on these matters.Disposal of Mongolian Subsidiaries As described in Note 5 to the consolidated financial statements,the Company dispos

303、ed of its Mongolian wholly-owned subsidiaries;MGG Properties LLC,Big Sky Capital LLC,Carrollton LLC,Biggie Industries LLC,Zulu LLC,Crescent City LLC and Oceanus LLC for cash consideration of$10,320,149 and the assumption of the subsidiaries liabilities.As a result of these sales,there are requiremen

304、ts concerning the allocation of income and expenses to discontinued operations,and the presentation within the consolidated financial statements.The principal considerations for our determination that the disposal of the Mongolian Subsidiaries is a key audit matter are that there was judgment made b

305、y management when assessing whether these operations comprise a discontinued operation as defined by IFRS 5,and that the accounting requirements for loss of control of subsidiaries are non-routine and require significant management judgement.This in turn led to a high degree of auditor judgment,subj

306、ectivity,and effort in performing procedures to evaluate the presentation and accuracy of the results of the discontinued operation.25Mongolia Growth Group Ltd|To address this key audit matter,we performed the following procedures:Reviewed accounting policies for discontinued operations to ensure co

307、mpliance with IFRS.Obtained a detailed understanding of the processes to allocate income and expenses to be presented as discontinued operations.Evaluated the carrying value of the disposal group at the transaction date and agreed to supporting records.Reviewed share purchase agreements to gain an u

308、nderstanding of the key terms and conditions of the sale.Verified that the consideration received was consistent with supporting documentation.Recalculated loss on disposal and loss from discontinued operations.Assessed the presentation of the results as discontinued operations and disclosure in acc

309、ordance with IFRS 5.Other Information Management is responsible for the other information.The other information obtained at the date of this auditors report includes Managements Discussion and Analysis.Our opinion on the consolidated financial statements does not cover the other information and we d

310、o not express any form of assurance conclusion thereon.In connection with our audit of the consolidated financial statements,our responsibility is to read the other information and,in doing so,consider whether the other information is materially inconsistent with the consolidated financial statement

311、s or our knowledge obtained in the audit,or otherwise appears to be materially misstated.We obtained Managements Discussion and Analysis prior to the date of this auditors report.If,based on the work we have performed,we conclude that there is a material misstatement of this other information,we are

312、 required to report that fact.We have nothing to report in this regard.Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance

313、 with IFRS Accounting Standards,and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement,whether due to fraud or error.In preparing the consolidated financial statements,management is r

314、esponsible for assessing the Companys ability to continue as a going concern,disclosing,as applicable,matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations,or has no realistic alternative but

315、to do so.Those charged with governance are responsible for overseeing the Companys financial reporting process.Auditors Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a w

316、hole are free from material misstatement,whether due to fraud or error,and to issue an auditors report that includes our opinion.Reasonable assurance is a high level of assurance,but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will alw

317、ays detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if,individually or in the aggregate,they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.A

318、s part of an audit in accordance with Canadian generally accepted auditing standards,we exercise professional judgment and maintain professional skepticism throughout the audit.We also:Identify and assess the risks of material misstatement of the consolidated financial statements,whether due to frau

319、d or error,design and perform audit procedures responsive to those risks,and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error,as fraud may inv

320、olve collusion,forgery,intentional omissions,misrepresentations,or the override of internal control.26|Mongolia Growth Group Ltd Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances,but not for the purpose of

321、expressing an opinion on the effectiveness of the Companys internal control.Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.Conclude on the appropriateness of managements use of the going concern basis

322、 of accounting and,based on the audit evidence obtained,whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companys ability to continue as a going concern.If we conclude that a material uncertainty exists,we are required to draw attention in

323、our auditors report to the related disclosures in the consolidated financial statements or,if such disclosures are inadequate,to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditors report.However,future events or conditions may cause the Company

324、 to cease to continue as a going concern.Evaluate the overall presentation,structure and content of the consolidated financial statements,including the disclosures,and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presen

325、tation.Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements.We are responsible for the direction,supervision and performance of the group audit.We rema

326、in solely responsible for our audit opinion.We communicate with those charged with governance regarding,among other matters,the planned scope and timing of the audit and significant audit findings,including any significant deficiencies in internal control that we identify during our audit.We also pr

327、ovide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence,and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence,and where applicable,related safeguards.Fro

328、m the matters communicated with those charged with governance,we determine those matters that were of most significance in the audit of the consolidated financial statements of the current year ended and are therefore the key audit matters.We describe these matters in our auditors report unless law

329、or regulation precludes public disclosure about the matter or when,in extremely rare circumstances,we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communicat

330、ion.The engagement partner on the audit resulting in this independent auditors report is Daniel Nathan.Vancouver,Canada Chartered Professional Accountants April 25,2024 27Mongolia Growth Group Ltd|Mongolia Growth Group Ltd.Consolidated Statements of Financial Position As at December 31 (Expressed in

331、 Canadian dollars)20232022$Assets Current assets Cash and cash equivalents(note 6)9,735,2242,051,245Marketable securities owned(note 8)46,439,93849,237,506Due from broker(note 7)151-Digital assets(note 10)438,872284,253Other assets(note 11)67,89644,250 56,682,08151,617,254Non-current assets Investme

332、nt properties(note 12)-10,086,956Other assets-long term receivable(note 11)-49,182Property and equipment(note 13)1,512,9802,804,232 1,512,98012,940,370 Total assets 58,195,06164,557,624 Liabilities Current liabilities Trade payables and accrued liabilities(note 14)415,386659,402Unearned revenue(note

333、 9)1,126,4391,547,154Due to broker(note 7)5,536,5377,393,046Marketable securities sold short(note 8)5,7245,159,131CEBA Loan(note 7)20,00060,000Income taxes payable 1,430,333642,837 8,534,419 15,461,570 Non-current liabilities Deferred income tax liability(note 15)500,5222,972,522 Total liabilities 9,034,94118,434,092 Equity Share capital(note 16)49,773,08250,547,130Contributed surplus 6,849,9766,8