---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
20549

FORM 10-QSB

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2007

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to ________

Commission File No. 000-30230

GENERAL METALS CORPORATION(Exact name of small business issuer as specified in its
charter)

|Delaware                                                             | 65-0488983                          
|-------------------------------------------------------------------- | ------------------------------------
|(State or other jurisdiction of incorporation or
      organization) | (I.R.S. Employer Identification No.)

1 E. Liberty St., Suite 6000, Reno, NV 89501(Address of principal executive offices)

(775) 686-6078(Issuer's telephone number,
including area code)

**N/A** (Former Name, Former Address if
Changed Since last Report)

Check whether the issuer (1) filed all reports to be filed by
  Section 13 or 15(d) of the Exchange Act during the past 
  12 months (or for such shorter period that the Registrant was required to file
  such reports), and (2) has been subject 
  to such filing requirements for the past 90 days.
  Yes [   ]   No [X]

[APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS]

Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act after
distribution of securities under a plan confirmed by a court. Yes [ 
 ]   No [   ].

[APPLICABLE ONLY TO CORPORATE ISSUERS]

State the number of shares outstanding of each of the issuer's
classes of common equity as of the latest practicable date:

As of December 5, 2007, there were 87,961,289 shares of
common stock, par value $0.001, outstanding.

Transitional Small Business Disclosure Format (Check One): Yes
[   ]   No [X]

Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act). Yes [   ] 
 No [ X ]

---

PART I - FINANCIAL INFORMATION

Item
1.               
Financial Statements.

It is the opinion of management that the interim financial
statements for the quarter ended October 31, 2007 include all adjustments
necessary in order to ensure that the interim financial statements are not
misleading.

MOORE & ASSOCIATES, CHARTERED

ACCOUNTANTS AND ADVISORSPCAOB REGISTERED

Report of Independent Registered Public Accounting
Firm

To the Board of Directors General Metals Corporation
(An Exploration Stage Company)



We have reviewed the accompanying balance sheet of General
Metals Corporation as of October 31, 2007, and the related statements of income,
retained earnings, and cash flows for the six months then ended, in accordance
with the standards of the Public Company Accounting Oversight Board (United
States). All information included in these financial statements is the
representation of the management of General Metals Corporation (A Exploration
Stage Company).

A review consists principally of inquiries of company personnel
and analytical procedures applied to financial data. It is substantially less in
scope than an audit in accordance with generally accepted auditing standards,
the objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material
modifications that should be made to the financial statements in order for them
to be in conformity with generally accepted accounting principles.

*/s/ Moore & Associates, Chartered*

Moore & Associates, Chartered Las Vegas, Nevada

  December 7, 2007

2675 S. JONES BLVD. SUITE 109, LAS VEGAS, NEVADA 89146 (702)
  253-7499 FAX: (702)253-7501

2

---

General Metals Corporation Successor to General Gold
Corporation(An Exploration Stage Company)

Unaudited Consolidated Balance Sheets

|                                                                     |   |             |   |   | April 30,  |  
|-------------------------------------------------------------------- | - | ----------- | - | - | ---------- | -
|                                                                     |   | October 31, |   |   | 2007       |  
|                                                                     |   | 2007        |   |   | (Audited)  |  
|ASSETS                                                               |  
|Current Assets                                                       |   |             |   |   |            |  
|Cash and Cash
      Equivalents                                      | $ | 261,361     |   | $ | 193,796    |  
|Accounts Receivable                                                  |   | -           |   |   | -          |  
|Prepaid Expenses                                                     |   | -           |   |   | 11,200     |  
|Total Current Assets                                                 |   | 261,361     |   |   | 204,996    |  
|Fixed Assets                                                         |   |             |   |   |            |  
|Mineral Property                                                     |   | 58,091      |   |   | 58,091     |  
|Property and
      Equipment, net                                    |   | 37,425      |   |   | 25,595     |  
|Total Fixed Assets                                                   |   | 95,516      |   |   | 83,686     |  
|Total Assets                                                         | $ | 356,877     |   | $ | 288,682    |  
|LIABILITIES AND STOCKHOLDERS'
      EQUITY                           |  
|Current Liabilities                                                  |   |             |   |   |            |  
|Accounts Payable                                                     | $ | 50,632      |   | $ | 4,680      |  
|Notes Payable -
      Related Party                                  |   | 10,184      |   |   | 63,184     |  
|Total Liabilities                                                    |   | 60,816      |   |   | 67,864     |  
|Stockholders' Equity                                                 |   |             |   |   |            |  
|Preferred Stock, authorized
      50,000,000 shares,                 |   |             |   |   |            |  
|par value
      $0.001, zero issued and outstanding                  |   | -           |   |   | -          |  
|Common Stock, authorized
      200,000,000 shares, par value $0.001, |   |             |   |   |            |  
|issued and
      outstanding on October 31, 2007 and April 30,2007   |   |             |   |   |            |  
|is 87,961,289 and 80,657,967
      respectively                      |   | 87,961      |   |   | 80,656     |  
|Additional
      Paid-in Capital                                     |   | 2,890,582   |   |   | 1,523,261  |  
|Subscriptions (Receivable)/Cash
      Receipts                       |   | (151,000    | ) |   | (41,300    | )
|Accumulated
      Deficit during Exploration Stage                   |   | (2,531,482  | ) |   | (1,341,799 | )
|Total Stockholders' Equity                                           |   | 296,061     |   |   | 220,818    |  
|Total Liabilities and Stockholders' Equity                           | $ | 356,877     |   | $ | 288,682    |  

The accompanying notes are an integral part of these statements

3

---

General Metals Corporation Successor to General Gold
Corporation (An Exploration Stage Company)

Unaudited Consolidated Statements of Operations

July 17, 1998(Inception)Six
        Months Ended October 31,
      
      
      Three
        Months Ended October 31,
      
      
      to October 31,2007
      
      
      2006
      
      
      2007
      
      
      2006
      
      
      2007Revenue
      $
      -
      
      $
      -
      
      $
      -
      
      $
      -
      
      $
      -Operating ExpensesDepreciation and Amortization
      
      3,536
      
      
      540
      
      
      1,768
      
      
      270
      
      
      7,989General and Administrative
      
      302,590
      
      
      209,108
      
      
      6,910
      
      
      100,246
      
      
      1,014,500Management and Consulting
      
      163,899
      
      
      82,910
      
      
      83,768
      
      
      41,809
      
      
      701,584Exploration and Development
      
      264,498
      
      
      36,575
      
      
      224,482
      
      
      17,425
      
      
      484,473Professional Fees
      
      40,458
      
      
      12,000
      
      
      35,458
      
      
      7,000
      
      
      151,686Total Expenses
      
      774,981
      
      
      341,133
      
      
      352,386
      
      
      166,750
      
      
      2,360,232(Loss) from Operations
      
      (774,981
      )
      
      (341,133
      )
      
      (352,386
      )
      
      (166,750
      )
      
      (2,360,232
      )Extraordinary Gain/(Loss)Gain on Sale of Fixed
        Assets
      
      -
      
      
      -
      
      
      -
      
      
      -
      
      
      243,452Loss on Outstanding Warrants
      
      (414,702
      )
      
      -
      
      
      (10,400
      )
      
      -
      
      
      (414,702
      )Net Income
      $
      (1,189,683
      )
      $
      (341,133
      )
      $
      (362,786
      )
      $
      (166,750
      )
      $
      (2,531,482
      )Basic (Loss) per Share
      $
      (0.01
      )
      $
      (0.01
      )
      $
      (0.00
      )
      $
      (0.00
      )Weighted AverageNumber of Shares
      
      84,808,159
      
      
      64,437,426
      
      
      84,808,159
      
      
      64,437,426Diluted (Loss) per Share
      $
      (0.01
      )
      $
      (0.00
      )
      $
      (0.00
      )
      $
      (0.00
      )Weighted AverageNumber of Shares
      
      87,135,662
      
      
      71,037,598
      
      
      87,135,662
      
      
      71,037,598


The accompanying notes are an integral part of these statements

4

---

General Metals Corporation Successor to General Gold
Corporation (An Exploration Stage Company)

Unaudited Statement of Stockholders' Equity

inception 17-Jul-1998 to 31-Oct-2007

|                                    |  |                    |  |   |         |  |   |               |   |   |              |  |  | (Deficit)   |   |   |         |  
|----------------------------------- |  | ------------------ |  | - | ------- |  | - | ------------- | - | - | ------------ |  |  | ----------- | - | - | ------- | -
|                                    |  |                    |  |   |         |  |   |               |   |   |              |  |  | Accumulated |   |   |         |  
|                                    |  |                    |  |   |         |  |   |               |   |   | Stock        |  |  | During      |   |   |         |  
|                                    |  | Common
      Stock |  |   | Paid in |  |   | Subscriptions |   |   | Exploration  |  |  | Total       |  
|                                    |  | Shares             |  |   | Amount  |  |   | Capital       |   |   | (Receivable) |  |  | Stage       |   |   | Equity  |  
|Balance, July 17, 1998 (Inception   |  | -                  |  | $ | -       |  | $ | -             |   | $ | -            |  |  | -           |   | $ | -       |  
|Common Stock Issued to Founders for |  |                    |  |   |         |  |   |               |   |   |              |  |  |             |   |   |         |  
|Organizational Costs                |  | 5,500,000          |  |   | 5,500   |  |   | (5,000        | ) |   |              |  |  |             |   |   | 500     |  
|Contributed Capital                 |  |                    |  |   |         |  |   | 87            |   |   |              |  |  |             |   |   | 87      |  
|Common Stock Issued for Acquisition |  |                    |  |   |         |  |   |               |   |   |              |  |  |             |   |   |         |  
|Of License                          |  | 22,000,000         |  |   | 22,000  |  |   | (20,000       | ) |   |              |  |  |             |   |   | 2,000   |  
|Net (Loss)                          |  |                    |  |   |         |  |   |               |   |   |              |  |  | (587        | ) |   | (587    | )
|Balance, April 30, 1999             |  | 27,500,000         |  |   | 27,500  |  |   | (24,913       | ) |   | -            |  |  | (587        | ) |   | 2,000   |  
|Net (Loss)                          |  |                    |  |   |         |  |   |               |   |   |              |  |  | (2,000      | ) |   | (2,000  | )
|Balance, April 30, 2000             |  | 27,500,000         |  |   | 27,500  |  |   | (24,913       | ) |   | -            |  |  | (2,587      | ) |   | -       |  
|Contributed Capital                 |  |                    |  |   |         |  |   | 9,000         |   |   |              |  |  |             |   |   | 9,000   |  
|Net (Loss)                          |  |                    |  |   |         |  |   |               |   |   |              |  |  | (14,977     | ) |   | (14,977 | )
|Balance, April 30, 2001             |  | 27,500,000         |  |   | 27,500  |  |   | (15,913       | ) |   | -            |  |  | (17,564     | ) |   | (5,977  | )
|Contributed Capital                 |  |                    |  |   |         |  |   | 9,000         |   |   |              |  |  |             |   |   | 9,000   |  
|Net (Loss)                          |  |                    |  |   |         |  |   |               |   |   |              |  |  | (16,657     | ) |   | (16,657 | )
|Balance, April 30, 2002             |  | 27,500,000         |  |   | 27,500  |  |   | (6,913        | ) |   | -            |  |  | (34,221     | ) |   | (13,634 | )
|Contributed Capital                 |  |                    |  |   |         |  |   | 9,000         |   |   |              |  |  |             |   |   | 9,000   |  
|Net (Loss)                          |  |                    |  |   |         |  |   |               |   |   |              |  |  | (21         | ) |   | (21     | )
|Balance, April 30, 2003             |  | 27,500,000         |  |   | 27,500  |  |   | 2,087         |   |   | -            |  |  | (34,242     | ) |   | (4,655  | )
|Contributed Capital                 |  |                    |  |   |         |  |   | 9,000         |   |   |              |  |  |             |   |   | 9,000   |  
|Net (Loss)                          |  |                    |  |   |         |  |   |               |   |   |              |  |  | (20,886     | ) |   | (20,886 | )
|Balance, April 30, 2004             |  | 27,500,000         |  |   | 27,500  |  |   | 11,087        |   |   | -            |  |  | (55,128     | ) |   | (16,541 | )

5

---

General Metals Corporation Successor to General Gold
Corporation (An Exploration Stage Company)

Unaudited Statement of Stockholders' Equity (contd)

inception 17-Jul-1998 to 31-Oct-2007

|Balance, April 30, 2004                |  | 27,500,000 |   |  | 27,500 |   |  | 11,087   |   |  | -        |   |  | (55,128  | ) |  | (16,541  | )
|-------------------------------------- |  | ---------- | - |  | ------ | - |  | -------- | - |  | -------- | - |  | -------- | - |  | -------- | -
|Common Stock Issued for Cash at        |  |            |   |  |        |   |  |          |   |  |          |   |  |          |   |  |          |  
|$0.125, net of $3,710
      Offering C |  | 3,854,400  |   |  | 3,854  |   |  | 430,436  |   |  | (127,500 | ) |  |          |   |  | 306,790  |  
|Contributed Capital                    |  |            |   |  |        |   |  | 9,000    |   |  |          |   |  |          |   |  | 9,000    |  
|Net (Loss)                             |  |            |   |  |        |   |  |          |   |  |          |   |  | (153,123 | ) |  | (153,123 | )
|Balance, April 30, 2005                |  | 31,354,400 |   |  | 31,354 |   |  | 450,523  |   |  | (127,500 | ) |  | (208,251 | ) |  | 146,126  |  
|Cash Received for Subscriptions        |  |            |   |  |        |   |  |          |   |  |          |   |  |          |   |  |          |  
|Receivable                             |  |            |   |  |        |   |  |          |   |  | 127,500  |   |  |          |   |  | 127,500  |  
|Common Stock Issued for Cash at $0.25  |  |            |   |  |        |   |  |          |   |  |          |   |  |          |   |  |          |  
|In Private Placement                   |  | 44,000     |   |  | 44     |   |  | 4,956    |   |  |          |   |  |          |   |  | 5,000    |  
|Common Stock Issued for Cash at $0.125 |  |            |   |  |        |   |  |          |   |  |          |   |  |          |   |  |          |  
|In Private Placement                   |  | 26,400     |   |  | 26     |   |  | 2,974    |   |  |          |   |  |          |   |  | 3,000    |  
|Common Stock Issued at $0.001 to       |  |            |   |  |        |   |  |          |   |  |          |   |  |          |   |  |          |  
|exercise lease agreement               |  | 5,500,000  |   |  | 5,500  |   |  | (500     | ) |  |          |   |  |          |   |  | 5,000    |  
|Common Stock Issued for Cash at $0.125 |  |            |   |  |        |   |  |          |   |  |          |   |  |          |   |  |          |  
|In Private Placement                   |  | 2,782,450  |   |  | 2,782  |   |  | 313,406  |   |  |          |   |  |          |   |  | 316,188  |  
|Common Stock Issued in Reorgan         |  | 8,436,541  |   |  | 8,437  |   |  | (579,732 | ) |  |          |   |  |          |   |  | (571,295 | )
|Common Stock Issued to Convert Debt at |  |            |   |  |        |   |  |          |   |  |          |   |  |          |   |  |          |  
|0.0185 as Agreed in
      February 2   |  | 22,034,546 |   |  | 22,035 |   |  | 348,546  |   |  |          |   |  |          |   |  | 370,581  |  
|Common Stock Issued as Incentive       |  | 550,000    |   |  | 550    |   |  | (50      | ) |  |          |   |  |          |   |  | 500      |  
|Common Stock Returned and Can          |  | (550,000   | ) |  | (550   | ) |  | 50       |   |  |          |   |  |          |   |  | (500     | )
|Common Stock Issued in Exercise of     |  |            |   |  |        |   |  |          |   |  |          |   |  |          |   |  |          |  
|Warrants at $0.25                      |  | 702,900    |   |  | 703    |   |  | 159,047  |   |  |          |   |  |          |   |  | 159,750  |  
|Net (Loss)                             |  |            |   |  |        |   |  |          |   |  |          |   |  | (418,616 | ) |  | (418,616 | )
|Balance, April 30, 2006                |  | 70,881,237 |   |  | 70,881 |   |  | 699,220  |   |  | -        |   |  | (626,867 | ) |  | 143,234  |  

6

---

General Metals Corporation Successor to General Gold
Corporation (An Exploration Stage Company)

Unaudited Statement of Stockholders' Equity (contd)

inception 17-Jul-1998 to 31-Oct-2007

|Balance, April 30, 2006                |  | 70,881,237 |  |  | 70,881 |  |  | 699,220   |  |  | -        |   |  | (626,867   | ) |  | 143,234  |  
|-------------------------------------- |  | ---------- |  |  | ------ |  |  | --------- |  |  | -------- | - |  | ---------- | - |  | -------- | -
|Deposit received on Private Placement  |  |            |  |  |        |  |  |           |  |  | 76,000   |   |  |            |   |  | 76,000   |  
|Common Stock Issued in Exercise of     |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|Warrants at $0.25                      |  | 110,000    |  |  | 110    |  |  | 24,890    |  |  |          |   |  |            |   |  | 25,000   |  
|Common Stock Issued for Cash at $0.125 |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|In Private Placement                   |  | 440,000    |  |  | 440    |  |  | 49,560    |  |  | (50,000  | ) |  |            |   |  | -        |  
|Common Stock Issued for Service at     |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|$0.125 per share                       |  | 158,400    |  |  | 158    |  |  | 17,842    |  |  |          |   |  |            |   |  | 18,000   |  
|Common Stock Issued for Purchase of    |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|fixed asset at $0.075                  |  | 220,000    |  |  | 220    |  |  | 14,780    |  |  |          |   |  |            |   |  | 15,000   |  
|Common Stock Issued for Cash a         |  | 164,495    |  |  | 164    |  |  | 11,052    |  |  |          |   |  |            |   |  | 11,216   |  
|Common Stock Issued for Services at    |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|$0.075 per share                       |  | 330,000    |  |  | 330    |  |  | 22,170    |  |  |          |   |  |            |   |  | 22,500   |  
|Common Stock Issued to Convert Debt    |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|$0.075 per share                       |  | 513,333    |  |  | 513    |  |  | 34,487    |  |  |          |   |  |            |   |  | 35,000   |  
|Common Stock Issued for Cash at $0.075 |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|In Private Placement                   |  | 3,770,063  |  |  | 3,770  |  |  | 253,280   |  |  | (163,800 | ) |  |            |   |  | 93,250   |  
|Common Stock Issued for Cash at $0.075 |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|For Exploration Rights                 |  | 1,100,000  |  |  | 1,100  |  |  | 73,900    |  |  |          |   |  |            |   |  | 75,000   |  
|Common Stock Issued for Cash at $0.075 |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|For Employee Incentive                 |  | 275,000    |  |  | 275    |  |  | 18,475    |  |  |          |   |  |            |   |  | 18,750   |  
|Common Stock Issued for Cash at $0.125 |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|In Private Placement                   |  | 2,332,000  |  |  | 2,332  |  |  | 262,668   |  |  |          |   |  |            |   |  | 265,000  |  
|Common Stock Issued for Cash at $0.125 |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|In Private Placement                   |  | 363,440    |  |  | 363    |  |  | 40,937    |  |  | (41,300  | ) |  |            |   |  | -        |  
|Cash Received for Subscriptions        |  |            |  |  |        |  |  |           |  |  |          |   |  |            |   |  |          |  
|Receivable                             |  |            |  |  |        |  |  |           |  |  | 137,800  |   |  |            |   |  | 137,800  |  
|Net (Loss)                             |  |            |  |  |        |  |  |           |  |  |          |   |  | (714,932   | ) |  | (714,932 | )
|Balance, April 30, 2007                |  | 80,657,967 |  |  | 80,656 |  |  | 1,523,261 |  |  | (41,300  | ) |  | (1,341,799 | ) |  | 220,818  |  

7

---

General Metals Corporation Successor to General Gold
Corporation (An Exploration Stage Company)

Unaudited Statement of Stockholders' Equity (contd)

inception 17-Jul-1998 to 31-Oct-2007

|Balance, April 30, 2007                |  | 80,657,967 |  |   | 80,656 |  |   | 1,523,261 |   |   | (41,300  | ) |   | (1,341,799 | ) |   | 220,818    |  
|-------------------------------------- |  | ---------- |  | - | ------ |  | - | --------- | - | - | -------- | - | - | ---------- | - | - | ---------- | -
|Common Stock issued to convert Debt at |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|$0.075 per share                       |  | 513,333    |  |   | 513    |  |   | 34,487    |   |   |          |   |   |            |   |   | 35,000     |  
|Common Stock Issued for Cash at $0.125 |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|In Private Placement                   |  | 667,040    |  |   | 667    |  |   | 75,133    |   |   |          |   |   |            |   |   | 75,800     |  
|Common Stock Issued in Exercise of     |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|Share Purchase Warrants
      at $0    |  | 2,343,219  |  |   | 2,344  |  |   | 157,421   |   |   |          |   |   |            |   |   | 159,765    |  
|Common Stock Issued in Exercise of     |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|Share Purchase Warrants
      at $0    |  | 654,500    |  |   | 655    |  |   | 118,345   |   |   |          |   |   |            |   |   | 119,000    |  
|Common Stock Issued in Exercise of     |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|Share Purchase Warrants
      at $0    |  | 44,000     |  |   | 44     |  |   | 4,956     |   |   |          |   |   |            |   |   | 5,000      |  
|Common Stock Issued for purchase of    |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|asset at $0.125                        |  | 132,000    |  |   | 132    |  |   | 14,868    |   |   |          |   |   |            |   |   | 15,000     |  
|Common Stock recorded to balance with  |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|Transfer Agent Records                 |  | 177,760    |  |   | 178    |  |   | (178      | ) |   |          |   |   |            |   |   | -          |  
|Common Stock Issued in Exercise of     |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|Share Purchase Warrants
      at $0    |  | 216,000    |  |   | 216    |  |   | 42,984    |   |   |          |   |   |            |   |   | 43,200     |  
|Common Stock Issued for Cash at $0.125 |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|In Private Placement                   |  | 52,470     |  |   | 53     |  |   | 6,506     |   |   |          |   |   |            |   |   | 6,559      |  
|Cash Received for Subscriptions        |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|Receivable                             |  |            |  |   |        |  |   |           |   |   | 50,300   |   |   |            |   |   | 50,300     |  
|Fair value of warrants issued          |  |            |  |   |        |  |   | 414,702   |   |   |          |   |   |            |   |   | 414,702    |  
|Common Stock Issued for Cash at $0.20  |  |            |  |   |        |  |   |           |   |   |          |   |   |            |   |   |            |  
|In Private Placement                   |  | 2,503,000  |  |   | 2,503  |  |   | 498,097   |   |   | (160,000 | ) |   |            |   |   | 340,600    |  
|Net (Loss)                             |  |            |  |   |        |  |   |           |   |   |          |   |   | (1,189,683 | ) |   | (1,189,683 | )
|Balance, October 31, 2007              |  | 87,961,289 |  | $ | 87,961 |  | $ | 2,890,582 |   | $ | (151,000 | ) | $ | (2,531,482 | ) | $ | 296,061    |  

On November 18, 2005 the Company had a 2 for 1 forward stock
splitthat has been retroactively applied to the above schedule.

On July 19, 2007 the Company had an 11 for 10 forward stock
split that has been retroactively applied to the above schedule.

The accompanying notes are an integral part of these statements

8

---

General Metals Corporation Successor to General Gold
Corporation(An Exploration Stage Company)

Unaudited Consolidated Statements of Cash Flows

|                                                      |   |                                    |   |   |                |   |   | July 17, 1998 |  
|----------------------------------------------------- | - | ---------------------------------- | - | - | -------------- | - | - | ------------- | -
|                                                      |   |                                    |   |   |                |   |   | (Inception)   |  
|                                                      |   | Six
      Months Ended October 31, |   |   | to October 31, |  
|                                                      |   | 2007                               |   |   | 2006           |   |   | 2007          |  
|Operating Activities                                  |   |                                    |   |   |                |   |   |               |  
|Net Loss                                              | $ | (1,189,683                         | ) | $ | (341,133       | ) | $ | (2,531,482    | )
|Adjustments to reconcile
      Net Loss               |   |                                    |   |   |                |   |   |               |  
|Loss on Outstanding Warrants                          |   | 414,702                            |   |   | -              |   |   | 414,702       |  
|Stock Issued
      for Service and Conversion of Debt |   | 35,000                             |   |   | 18,000         |   |   | 481,081       |  
|Stock Issued to Acquire Mineral
      Property Lease  |   | -                                  |   |   | -              |   |   | 7,000         |  
|Stock Issued
      to Acquire Exploration Rights      |   | -                                  |   |   | -              |   |   | 75,000        |  
|Stock Issued to Acquire Fixed
      Assets            |   | 15,000                             |   |   | -              |   |   | 30,000        |  
|Stock Issued
      in Acquisition and Reorganization  |   | -                                  |   |   | -              |   |   | (571,295      | )
|Contributed Capital                                   |   | -                                  |   |   |                |   |   | 45,087        |  
|Depreciation
      and Amortization                   |   | 3,536                              |   |   | 570            |   |   | 5,623         |  
|Changes in Operating Assets and Liabilities           |   |                                    |   |   |                |   |   |               |  
|(Increase)/Decrease
      in Accounts Receivable      |   | -                                  |   |   | -              |   |   | -             |  
|(Increase)/Decrease in Prepaid
      Expenses         |   | 11,200                             |   |   | -              |   |   | -             |  
|Increase/(Decrease)
      in Accounts Payable         |   | 45,952                             |   |   | 43,148         |   |   | 50,632        |  
|Increase/(Decrease) in Accrued
      Liabilities      |   | -                                  |   |   | (2,202         | ) |   | -             |  
|                                                      |   |                                    |   |   |                |   |   |               |  
|Net Cash Used by Operating Activities                 |   | (664,293                           | ) |   | (281,617       | ) |   | (1,993,652    | )
|                                                      |   |                                    |   |   |                |   |   |               |  
|Investment Activities                                 |   |                                    |   |   |                |   |   |               |  
|Acquisition of Mineral
      Property                 |   | -                                  |   |   | (3,091         | ) |   | (58,091       | )
|Purchase of Equipment                                 |   | (15,366                            | ) |   | (6,730         | ) |   | (43,048       | )
|                                                      |   |                                    |   |   |                |   |   |               |  
|Net Cash Used by Investment Activities                |   | (15,366                            | ) |   | (9,821         | ) |   | (101,139      | )
|Financing Activities                                  |   |                                    |   |   |                |   |   |               |  
|Loans / (Repayments) -Related Parties                 |   | (53,000                            | ) |   | 93,218         |   |   | 10,184        |  
|Proceeds from the Sale
      of Stock                 |   | 800,224                            |   |   | 101,000        |   |   | 2,345,968     |  
|Net Cash Provided by Financing Activities             |   | 747,224                            |   |   | 194,218        |   |   | 2,356,152     |  
|Net Increase / (Decrease) in Cash                     |   | 67,565                             |   |   | (97,220        | ) |   | 261,361       |  
|Cash, Beginning of Period                             |   | 193,796                            |   |   | 114,212        |   |   | -             |  
|Cash, End of Period                                   | $ | 261,361                            |   | $ | 16,992         |   | $ | 261,361       |  
|                                                      |   |                                    |   |   |                |   |   |               |  
|Supplemental Information:                             |   |                                    |   |   |                |   |   |               |  
|Interest Paid                                         | $ | 1,070                              |   | $ | -              |   | $ | 1,070         |  
|Income Taxes Paid                                     | $ | -                                  |   | $ | -              |   | $ | -             |  

The accompanying notes are an integral part of these statements

9

---

General Metals Corporation Successor to General Gold
Corporation(An Exploration Stage Company) Notes to Audited
Consolidated Financial Statements(October 31, 2007 and April 30, 2007)

NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESSNature of Business

General Metals Corporation (the Company) was organized in the
State of New Jersey on March 4, 1994 and reincorporated in the State of Delaware
on September 13, 1995 as Interactive Multimedia Network, Inc. On March 29, 2005
the Company changed its name to RECOV Energy Corp. and then on January 12, 2006
changed its name to General Metals Corporation. The Company was unsuccessful in
its business plan of developing and marketing consumer products and therefore
actively pursued a merger or acquisition candidate.

On January 20, 2006 the Company entered into an agreement,
effective March 15, 2006, to acquire all of the issued and outstanding shares
and convertible securities of General Gold Corporation (General Gold), an
Exploration Stage Company (See Note 3 Acquisition of General Gold for
details). This transaction resulted in a change of control and is accounted for
as a reverse acquisition with General Metals Corporation as the surviving legal
entity and General Gold the historical accounting company. The Company will
operate General Gold as a wholly owned subsidiary.

Through the acquisition of General Gold the Company is now an
Exploration Stage Company, as defined by Statement of Financial Accounting
Standard (SFAS) No.7 Accounting and Reporting by Development Stage
Enterprises. General Gold entered into the mining exploration business by
executing an agreement dated November 14, 2004, to acquire substantially all of
the assets related to the Independence mining claims in Lander County, Nevada
(See Note 9 Mineral Properties for details). The Companys principal business
is the acquisition and exploration of mineral properties. The Company has not
presently determined whether its properties contain mineral reserves that are
economically recoverable.

Basis of Presentation

The accompanying consolidated financial statements have been
prepared in accordance with U.S. generally accepted accounting principles. The
Company operates on an April 30 fiscal year end.

For accounting purposes, the acquisition of General Gold has
been treated as a reverse acquisition. Accordingly, the consolidated financial
statements, statements of operations, statement of stockholders deficit and
statements of cash flows reflect the results of operations and cash flows of
General Gold for the period from its inception on July 17, 1998 to October 31,
2007 and consolidated with those of General Metals from acquisition on March 15,
2006 to October 31, 2007.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESPrinciples of Consolidation

The accompanying consolidated financial statements include the
  accounts of General Metals Corporation and its wholly owned subsidiary, General
  God Corporation. Collectively, they are referred herein as the Company. All
  inter-company balances and transactions have been eliminated on consolidation.

10

---

**General Metals Corporation Successor to General Gold
Corporation**(An Exploration Stage Company) **Notes to
Audited Consolidated Financial Statements**(October 31, 2007 and
April 30, 2007)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

Use of Estimates

The preparation of financial statements in conformity with U.S.
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the period.
Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash and short term
deposits with original maturities of three months or less when purchased. As of
October 31, 2007, cash and cash equivalents consists of cash and cash in trust.

Property and Equipment

Property and equipment consists of furniture and equipment and
is recorded atcost. Equipment acquired from theacquisition is
recorded at net book value. The furniture and equipment are being depreciated on
a straight-line basis over their estimated lives of five years.

Following is a summary of property and equipment October 31,
2007 and April 30, 2007:

31-Oct-2007
    
    
    30-Apr-2007Furniture and Equipment
    $
    6,348
    
    $
    6,348Vehicle Purchase
    
    36,700
    
    
    21,700Less: Accumulated
      Depreciation
    
    (5,623
    )
    
    (2,453
    )Property and Equipment, Net
    $
    37,425
    
    $
    25,595


Basic and Diluted Net Income (Loss) Per Share

The Company computes net income (loss) per share in accordance
  with Statement of Financial Accounting Standards (SFAS) No. 128,
  "Earnings per Share". SFAS No. 128 requires presentation of both basic
  and diluted earnings per share (EPS) on the face of the income statement. Basic
  EPS is computed by dividing net income (loss) available to common shareholders
  (numerator) by the weighted average number of shares outstanding (denominator)
  during the period. Diluted EPS gives effect to all dilutive potential common
  shares outstanding during the period using the treasury stock method and convertible
  preferred stock using the if-converted method. In computing Diluted EPS, the
  average stock price for the period is used in determining the number of shares
  assumed to be purchased from the exercise of stock options or warrants. Diluted
  EPS excludes all dilutive potential shares if their effect is anti dilutive.

11

---

**General Metals Corporation Successor to General Gold
Corporation**(An Exploration Stage Company) **Notes to
Audited Consolidated Financial Statements**(October 31, 2007 and
April 30, 2007)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (contd)

The numerators and denominators used in the computations of
basic and diluted EPS are presented in the following table:

October 31,
    
    
    October 31,2007
    
    
    2006Numerators for Basic and Diluted EPSNet income/(loss) to common
      shareholders
    
    ($1,189,683
    )
    
    ($341,133
    )Denominators for Basic
      EPSWeighted average of shares outstanding
    
    84,808,159
    
    
    64,437,426Basic Earnings/(Loss) Per Share
    
    ($0.01
    )
    
    ($0.00
    )Denominators for Diluted EPSWeighted average of shares
      outstanding
    
    87,135,662
    
    
    71,037,598Diluted Earnings/(Loss) Per
      Share
    
    ($0.01
    )
    
    ($0.00
    )


Financial Instruments

The Companys financial instruments consist of cash; cash in
trust, accounts payable and accrued liabilities and amounts due to related
parties. The Company is not exposed to significant interest, currency or credit
risks arising from these financial instruments. The fair value of cash, cash in
trust, accounts payable and accrued liabilities and amounts due to related
parties approximates their carrying values due to the immediate or short term
maturity of these financial instruments.

Mineral Property Costs

The Company is in the exploration stage and has not yet
realized any revenues from its planned operations. It is primarily engaged in
the acquisition and exploration of mining properties. Mineral property
acquisition costs are capitalized. Exploration and Development costs are
expensed as incurred. When it has been determined that a mineral property can be
economically developed as a result of establishing proven and probable reserves,
the costs incurred to develop such property, are capitalized. Such costs will be
amortized using the units-of-production method over the estimated life of the
probable reserve. If mineral properties are subsequently abandoned or impaired,
any capitalized costs will be charged to operations.

Long-Lived Assets

In accordance with SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets, the carrying value of
intangible assets and other long-lived assets is reviewed on a regular basis for
the existence of facts or circumstances that may suggest impairment. The Company
recognizes impairment when the sum of the expected undiscounted future cash
flows is less than the carrying amount of the asset. Impairment losses, if any,
are measured as the excess of the carrying amount of the asset over its
estimated fair value.

Income Taxes

Under SFAS No 109 "Accounting for Income Taxes"the Company
  is required to recognize deferred tax liabilities and assets using the liability
  method. Under this method, deferred tax liabilities and assets are determined
  based on the temporary differences between the financial statements carrying
  values and tax bases of assets and liabilities using enacted tax rates in effect
  in the years in which the differences are expected to reverse. Future income
  tax assets are recorded in the financial statements if realization is considered
  more likely than not.

12

---

**General Metals Corporation Successor to General Gold
Corporation**(An Exploration Stage Company) **Notes to
Audited Consolidated Financial Statements**(October 31, 2007 and
April 30, 2007)

NOTE 3. ACQUISITION OF GENERAL GOLD

On January 20, 2006 the Company entered into an agreement,
effective March 15, 2006, to acquire all of the issued and outstanding shares
and convertible securities of General Gold Corporation (General Gold), an
Exploration Stage Company. This transaction resulted in a change of control and
is accounted for as a reverse acquisition with General Metals Corporation as the
surviving legal entity and General Gold the historical accounting company. The
Company will operate General Gold as a wholly owned subsidiary.

At the effective date of the merger The Company had 7,669,521
shares issued and outstanding and issued 36,097,500 common shares and 3,048,750
one-year warrants to affect the merger. Below are the balance sheets and
adjustments giving affect to the acquisition on March 15, 2006:

|                                           |   | General    |   |   | General   |   |   |             |   |   | Adjusted  |  
|------------------------------------------ | - | ---------- | - | - | --------- | - | - | ----------- | - | - | --------- | -
|                                           |   | Metals     |   |   | Gold      |   |   |             |   |   | Balance   |  
|                                           |   | March 15,  |   |   | March 15, |   |   | Acquisition |   |   | March 15, |  
|                                           |   | 2006       |   |   | 2006      |   |   | Adjustments |   |   | 2006      |  
|ASSETS                                     |   |            |   |   |           |   |   |             |   |   |           |  
|Current Assets                             |   |            |   |   |           |   |   |             |   |   |           |  
|Cash and Cash Equivalents                  | $ | 8,582      |   | $ | 39,268    |   | $ | -           |   |   | 47,850    |  
|Accounts Receivable net                    |   | 10,000     |   |   | 11,790    |   |   | -           |   |   | 21,790    |  
|Prepaid Expense                            |   | -          |   |   | 12,500    |   |   | -           |   |   | 12,500    |  
|Loan to Related Party                      |   | -          |   |   | 30,000    |   |   | (30,000     | ) |   | -         |  
|Total Current Assets                       |   | 18,582     |   |   | 93,558    |   |   | (30,000     | ) |   | 82,140    |  
|                                           |   |            |   |   |           |   |   |             |   |   |           |  
|Fixed Assets                               |   |            |   |   |           |   |   |             |   |   |           |  
|Investment in Mining Property              |   |            |   |   | 55,000    |   |   |             |   |   | 55,000    |  
|Property, Plant and Equipment,
      net   |   | 3,256      |   |   | 2,808     |   |   |             |   |   | 6,064     |  
|Total Fixed Assets                         |   | 3,256      |   |   | 57,808    |   |   | -           |   |   | 61,064    |  
|                                           |   |            |   |   |           |   |   |             |   |   |           |  
|Total Assets                               | $ | 21,838     |   | $ | 151,366   |   | $ | (30,000     | ) | $ | 143,204   |  
|                                           |   |            |   |   |           |   |   |             |   |   |           |  
|LIABILITIES AND STOCKHOLDERS' EQUITY       |   |            |   |   |           |   |   |             |   |  
|Current Liabilities                        |   |            |   |   |           |   |   |             |   |   |           |  
|Accounts Payable and Accrued Liabilities   | $ | 226,563    |   | $ | 20,776    |   |   |             |   |   | 247,339   |  
|Notes and Loans Payable                    |   | 335,956    |   |   |           |   |   |             |   |   | 335,956   |  
|Tax Payables                               |   | 614        |   |   |           |   |   |             |   |   | 614       |  
|Loan From Related Party                    |   | 30,000     |   |   | 1,457     |   |   | (30,000     | ) |   | 1,457     |  
|Total Liabilities                          |   | 593,133    |   |   | 22,233    |   |   | (30,000     | ) |   | 585,366   |  
|                                           |   |            |   |   |           |   |   |             |   |   |           |  
|Stockholders' Equity                       |   |            |   |   |           |   |   |             |   |   |           |  
|Common Stock                               |   | 7,670      |   |   | 36,097    |   |   |             |   |   | 43,767    |  
|Paid in Capital                            |   | 3,427,057  |   |   | 774,967   |   |   | (4,006,022  | ) |   | 196,002   |  
|Accumulated Equity/(Deficit)               |   | (4,006,022 | ) |   | (681,931  | ) |   | 4,006,022   |   |   | (681,931  | )
|Total Stockholders' Equity                 |   | (571,295   | ) |   | 129,133   |   |   | -           |   |   | (442,162  | )
|                                           |   |            |   |   |           |   |   |             |   |   |           |  
|Total Liabilities and Stockholders' Equity | $ | 21,838     |   | $ | 151,366   |   | $ | (30,000     | ) | $ | 143,204   |  

13

---

**GeneralMetals Corporation Successor to General Gold
Corporation**(An Exploration Stage Company) **Notes to
Audited Consolidated Financial Statements**(October 31, 2007 and
April 30, 2007)

NOTE 4. GOING CONCERN

The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern, which contemplates
the realization of assets and the liquidation of liabilities in the normal
course of business. However, at October 31, 2007 the Company has an accumulated
loss of $2,531,482 during its exploration stage. This raises substantial doubt
about the Companys ability to continue as a going concern. The financial
statements do not include any adjustments that might result from this
uncertainty.

Managements Plan

Management continues to seek funding from its shareholders and
other qualified investors to pursue its exploration and development programs.
These funds may be raised through equity financing, debt financing, or other
sources, which may result in further dilution in the equity ownership of our
shares. There is still no assurance that the Company will be able to maintain
operations at a level sufficient for an investor to obtain a return on his
investment. Further, the Company may continue to be unprofitable. The Company
needs to raise additional funds in the immediate future in order to proceed with
its exploration program.

On August 28, 2006 the Company initially retained a specialist
international equity capital firm whose primary business is arranging financings
for junior and other mining companies. They have arranged over $500 million for
junior mining companies over the last several years. The agreement calls for an
equity financing of shares and warrants in the amount of up to $2,000,000. In
February 2007, the balance of retainer was paid and the Company information was
distributed to the specialists clients for review.

During December, January, February and October the Company
successfully completed a series of Private Placements discussed in the
Stockholders Equity Note 7 below.

NOTE 5. GAIN ON FORGIVENESS OF DEBT AND DEBT CONVERSIONForgiveness of Debt

The Company acquired General Gold on March 15, 2006. Prior the
acquisition the Company had arranged to reduce or eliminate certain accounts
payable however, the transactions were not completed until after the acquisition
and prior to the April 30, 2006 report date. Shareholder loans in the amount of
$91,174 and accrued attorney fees in the amount of $110,784 were forgiven. The
Company determined that $24,606 in stale payables with no collection activity
for over six years could be legally written-off. Should any of these creditors
take action to collect the company will reassume responsibility. Following is a
list of Accounts payable that have been written-off and a gain on forgiveness of
debt has been recorded:

Accounts Payable:Shareholder Loans
    $
    91,175Attorney Fees  Related Party
    
    110,784Stale Payables
    
    24,606Total Debt Forgiven
    $
    226,565


Debt Conversion

The Company converted $370,581 shareholder loans to 20,031,405
  pre-split common shares during the year ended April 30, 2006. Agreements were
  reached to convert the debt in February 2005 at a rate of $0.0185 per share
  as disclosed in the 10KSB/A-2 for March 31, 2005 filed with the SEC on October
  4. 2005. Although the debt conversion was agreed to in February 2005 the actual
  transactions were not recorded until after the acquisition of General Gold and
  prior to the April 30, 2006 report date.

14

---

**General Metals Corporation Successor to General Gold
Corporation**(An Exploration Stage Company) **Notes to
Audited Consolidated Financial Statements**(October 31, 2007 and
April 30, 2007)

The Company converted $35,000 accrued liabilities and
shareholder loans to 466,666 pre-split common shares on January 31, 2007.

The Company converted $35,000 accrued liabilities to 466,666
pre-split common shares on May 18, 2007.

NOTE 6. RELATED PARTY TRANSACTIONS

The President and CEO has provided financing to the company in
the form of demand notes with no fixed or determinable repayment dates. The
amounts are recorded as current liabilities with the balance as of October 31,
2007 and April 30, 2007 of $10,184 and $63,184 respectively.

NOTE 7. STOCKHOLDERS' EQUITYPreferred Stock

The Company is authorized to issue 50,000,000 preferred shares
with a par value of $0.001 per share. As of October 31, 2007 no preferred stock
is issued and outstanding

Common Stock

The Company is authorized to issue 200,000,000 common shares
with a par value of $0.001 per share.

Because of the reverse acquisition of General Gold the
Statement of Stockholders equity has been revised to reflect General Golds
historical accounting General Metals is consolidated as if acquired by General
Gold.

On July 19, 2007 the Company executed an 11:10 forward stock
split. This forward split has been retroactively applied to the Statement of
Shareholders Equity. The following notes have been adjusted to retroactively
reflect the post-split shares issued however the price per share reported is the
original price.

On March 15, 2006, the Company had 7,669,521 common shares
issued and outstanding. On that date it issued 36,097,500 common shares in a one
for one share exchange with the shareholders of General Gold. As of the close of
March 15, 2006 the Company had 48,143,791 post-split common shares issued and
outstanding.

Between March 15 and April 30, 2006 the Company issued an
additional 22,034,546 post-split common shares to convert $370,581 of debt at
the pre-split rate of $0.0185 per share.

The Company issued 550,000 post-split common shares valued at
$500 as an executive hiring incentive.

The Company received and cancelled 550,000 post-split common
shares valued at $500 from a prior executive.

On April 28, 2006 the Company issued 702,900 post-split common
shares at the pre-split price of $0.25 per share through the exercising of
warrants.

The Company received $76,000 advanced payment on a private
placement.

On August 17, 2006 the Company issued 110,000 post split common
shares at the pre-split price of $0.25 per share through the exercise of
directors warrants.

On October 15, 2006 the Company issued 440,000 common shares
  in a private placement for $50,000 at pre-split price of $0.125 per share and
  158,400 common shares for services valued at $18,000 or pre-split price of $0.125
  per share.

15

---

**General Metals Corporation Successor to General Gold
Corporation**(An Exploration Stage Company) **Notes to
Audited Consolidated Financial Statements**(October 31, 2007 and
April 30, 2007) )

NOTE 7. STOCKHOLDERS' EQUITY (contd)Common Stock
(contd)

On January 31, 2007 the Company agreed to issue 385,310
post-split common shares at pre-split price of $0.075 per share and an equal
number of warrants exercisable by February 20, 2008 at $0.075 per share. Of the
shares to be issued 220,460 were used to purchase a vehicle valued at $15,000
and 164,850 shares were issued for $11,216 cash.

On January 31, 2007 the Company agreed to issue 330,000
post-split common shares at the pre-split price of $0.075 per share for services
valued at $22,500.

On January 31, 2007 the Company agreed to issue and aggregate
of 4,293,396 post-split common shares at $0.075 per share in a private placement
with an equal number of warrants exercisable on March 7, 2008 at $0.075 per
share. Of the aggregate shares, 513,333 post-split shares were issued to satisfy
$35,000 debt and 3,770,063 post-split shares were issued for $93,250 cash
$26,000 prepaid subscriptions and subscription receivable of $163,800.

On March 15, 2007, the Company issued 1,100,000 post-split
common shares at the pre-split price of $0.075 per share or $75,000 along with
1,000,000 two year warrants exercisable at $0.26 per share to acquire 100%
interest in Mikite Gold Resources ("Mikite"), a Ghanaian corporation with
exclusive exploration rights to the 150 square kilometer Nyinahin mining
concession near Bibiani, Ghana.

On March 30, 2007, the Company issued 275,000 post-split common
shares at pre-split price of $0.075 per share or $18,750 along with 250,000 one
year warrants exercisable at $0.075 per share as an incentive to join the
company as CFO.

On April 23, 2007 the Company issued 2,332,000 post-split
common shares at pre-split price of $0.125 per share for $265,000 cash and
1,060,000 twelve month warrants exercisable at $0.125.

On April 30, 2007 the Company issued 363,440 post-split common
shares at pre-split price of $0.125 per share for $41,300 cash and 165,200
twelve month warrants exercisable at $0.125.

On May 18, 2007 the Company issued 513,333 post-split common
shares to convert $35,000 debt.

Between May 18 and May 31, 2007 the Company issued 667,040
post-split common shares in a private placement at the pre-split price of $0.125
for a total of $75,800.

Between May 18 and May 25, 2007 the Company issued 2,343,219
post-split common shares from exercise of warrants at the pre-split price of
$0.75 per share or $159,765.

Between May 18 and May 22, 2007 the Company issued 654,500
post-split common shares from exercise of warrants at the pre-split price of
$0.20 per share or $119,000.

On May 22, 2007 the Company issued 44,000 post-split common
shares from exercise of warrants at the pre split-price of $0.125 per share or
$5,000.

On May 31, 2007 the Company issued 132,000 post-split common
shares for the purchase of an asset valued at $15,000 or $0.125 per share.

On July 19, 2007 the Company recorded the issue of 177,760
post-split common shares to balance with the shares issued per the transfer
agent.

On July 31, 2007 the Company issued 216,000 common shares from
  exercised of warrants at $0.20 per share or $43,200.

16

---

**General Metals Corporation Successor to General Gold
Corporation**(An Exploration Stage Company) **Notes to
Audited Consolidated Financial Statements**(October 31, 2007 and
April 30, 2007)

NOTE 7. STOCKHOLDERS' EQUITY (contd)Common Stock
(contd)

On July 31, 2007 the Company issued 52,470 common shares in a
private placement for $0.125 per share or $6,559.

On October 31, 2007 the Company completed a private placement
of 2,503,000 shares of common stock at $0.20 for $340,600 and $160,000 in
subscription receivable.

Warrants

The Company has the following warrants outstanding as of
October 31, 2007 and has recorded the cost associated with the issue of the
warrants using the Black-Sholes option pricing model with the following results:

DerivativeExpiration
    
    Exercise
    
    
    
    
    
    
    
    
    Value ofDate
    
    Price
    
    
    Shares
    
    
    
    
    
    Warrants3/30/2008
    
    $0.0750
    
    
    250,000
    
    
    
    
    $
    23,3554/23/2008
    
    $0.1250
    
    
    1,060,000
    
    
    
    
    
    60,1254/30/2008
    
    $0.1250
    
    
    165,200
    
    
    
    
    
    17,7055/31/2008
    
    $0.1250
    
    
    218,000
    
    
    
    
    
    32,0285/31/2008
    
    $0.2500
    
    
    815,000
    
    
    
    
    
    86,7668/31/2008
    
    $0.2500
    
    
    216,000
    
    
    
    
    
    10,4003/15/2009
    
    $0.2600
    
    
    1,000,000
    
    
    
    
    
    63,28210/31/2008
    
    $0.2500
    
    
    2,503,000
    
    
    
    
    
    121,041Total Derivative Cost of Warrants
    
    
    
    
    
    
    
    
    
    $
    414,702


NOTE 8. PROVISION FOR INCOME TAXES

The Company provides for income taxes under Statement of
Financial Accounting Standards No. 109, Accounting for Income Taxes. SFAS No.
109 requires the use of an asset and liability approach in accounting for income
taxes. Deferred tax assets and liabilities are recorded based on the differences
between the financial statement and tax bases of assets and liabilities and the
tax rates in effect when these differences are expected to reverse.

SFAS No. 109 requires the reduction of deferred tax assets by a
valuation allowance if, based on the weight of available evidence, it is more
likely than not that some or all of the deferred tax assets will not be
realized. In the Companys opinion, it is uncertain whether they will generate
sufficient taxable income in the future to fully utilize the net deferred tax
asset. Accordingly, a valuation allowance equal to the deferred tax asset has
been recorded. The total deferred tax asset is $469,630, which is calculated by
multiplying a 35% estimated tax rate by the items making up the deferred tax
account, the NOL of $1,341,799. The total valuation allowance is a comparable
$469,630.

The provision for income taxes is comprised of the net changes
in deferred taxes less the valuation account plus the current taxes payable as
shown in the chart below for the year ended April 30, 2007:

Deferred Tax Asset
    $
    469,630Less: Valuation Allowance
    
    (469,630
    )Net Deferred Tax Asset
    $
    0 17


---

**General Metals Corporation Successor to General Gold
Corporation**(An Exploration Stage Company) **Notes to
Audited Consolidated Financial Statements**(October 31, 2007 and
April 30, 2007)

NOTE 8. PROVISION FOR INCOME TAXES (contd)

The federal NOL is due to expire 20 years from the date of its
creation. The chart below shows the year of creation, the amount of each
estimated years NOL and the year of expiration if not utilized.

Year Created
    
    Amount
    
    
    Year to Expire1999
    $
    587
    
    
    20192000
    
    2,000
    
    
    20202001
    
    14,977
    
    
    20212002
    
    16,657
    
    
    20222003
    
    21
    
    
    20232004
    
    20,886
    
    
    20242005
    
    153,123
    
    
    20252006
    
    418,616
    
    
    20262007
    
    714,932
    
    
    2027Total NOL Carry forward
    $
    1,341,799


NOTE 9. MINERAL PROPERTY

On November 14, 2004, the Company entered into a letter of
intent with Independence Mines, LLC (Independence) and Gold Range, LLC
(Gold) with respect to the purchase of an option that Gold held to the
Independence mining claims in Lander County, Nevada and substantially all of the
assets that Gold uses to conduct the business of Independence. On April 29,
2005, the Company entered into an agreement (the Assignment Agreement), which
replaced the letter of intent whereby the Company purchased an assignment of
lease to the Independence mining claims from Gold. The purchase price included
$25,000 (paid) at the close of the Assignment Agreement, $25,000 (paid) when the
definitive agreement was entered into between Gold and the Lessor and a final
$25,000 (paid) within 30 days of the lease recordation date. On October 26,
2005, the Company issued 5,000,000 restricted shares of common stock to Gold.
Also, in addition to other underlying NSR requirements, the Company must pay a
1% net smelter royalty fee to Gold. The original payment of $25,000 was
expensed, however, the remaining $50,000 payment and $5,000 for 5,000,000 shares
of restricted stock issued have been capitalized as mineral property acquisition
costs.

NOTE 10. THE EFFECT OF RECENTLY ISSUED ACCOUNTING STANDARDS

Below is a listing of the most recent Statement of Financial
Accounting Standards (SFAS) SFAS 155-157 and their effect on the Company.

Statement No. 155 Accounting for Certain Hybrid
  Financial Instruments

In February 2006, the FASB issued SFAS No. 155, Accounting
  for Certain Hybrid Financial Instruments, which amends SFAS No. 133, Accounting
  for Derivatives Instruments and Hedging Activities and SFAS No. 140, Accounting
  for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities.
  SFAS No. 155 amends SFAS No. 133 to narrow the scope exception for interest-only
  and principal-only strips on debt instruments to include only such strips representing
  rights to receive a specified portion of the contractual interest or principle
  cash flows. SFAS No. 155 also amends SFAS No. 140 to allow qualifying special-purpose
  entities to hold a passive derivative financial instrument pertaining to beneficial
  interests that itself is a derivative instrument.

18

---

**General Metals Corporation Successor to General Gold
Corporation**(An Exploration Stage Company) **Notes to
Audited Consolidated Financial Statements**(October 31, 2007 and
April 30, 2007)

NOTE 10. THE EFFECT OF RECENTLY ISSUED ACCOUNTING STANDARDS
(contd)

Statement No. 156 Accounting for Servicing of
  Financial Assets

In March 2006, the FASB issued SFAS No. 156, Accounting for
Servicing of Financial Assets, which provides an approach to simplify
efforts to obtain hedge-like (offset) accounting. This Statement amends FASB
Statement No. 140, Accounting for Transfers and Servicing of Financial Assets
and Extinguishments of Liabilities, with respect to the accounting for
separately recognized servicing assets and servicing liabilities. The Statement
(1) requires an entity to recognize a servicing asset or servicing liability
each time it undertakes an obligation to service a financial asset by entering
into a servicing contract in certain situations; (2) requires that a separately
recognized servicing asset or servicing liability be initially measured at fair
value, if practicable; (3) permits an entity to choose either the amortization
method or the fair value method for subsequent measurement for each class of
separately recognized servicing assets or servicing liabilities; (4) permits at
initial adoption a one-time reclassification of available-for-sale securities to
trading securities by an entity with recognized servicing rights, provided the
securities reclassified offset the entity's exposure to changes in the fair
value of the servicing assets or liabilities; and (5) requires separate
presentation of servicing assets and servicing liabilities subsequently measured
at fair value in the balance sheet and additional disclosures for all separately
recognized servicing assets and servicing liabilities. SFAS No. 156 is effective
for all separately recognized servicing assets and liabilities as of the
beginning of an entity's fiscal year that begins after September 15, 2006, with
earlier adoption permitted in certain circumstances. The Statement also
describes the manner in which it should be initially applied.

Statement No. 157  Fair Value Measurements

In September 2006, the FASB issued SFAS No. 157, Fair Value
Measurements, to clarify how to measure fair value and to expand disclosures
about fair value measurements. The expanded disclosures include the extent to
which companies measure assets and liabilities at fair value, the information
used to measure fair value, and the effect of fair value on earnings and is
applicable whenever other standards require (or permit) assets and liabilities
to be measured at fair value. SFAS 157 is effective for financial statements
issued for fiscal years beginning after November 15, 2007 and interim periods
within those fiscal years.

The adoption of these new Statements is not expected to have
  a material effect on the Companys current financial position, results
  or operations, or cash flows.

19

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Item
2.               
Management's Discussion and Analysis or Plan of Operation.

The following discussion and analysis of our financial
condition and results of operations should be read in conjunction with the
financial statements and accompanying notes and the other financial information
appearing elsewhere in this report. The statements contained in this section
include projections of future results and "forward-looking statements" as that
term is defined in the Exchange Act. All statements that are included in this
report, other than statements of historical fact, are forward-looking
statements. Although we believe that the expectations reflected in these
forward-looking statements are reasonable, we can give no assurance that such
expectations will prove to have been correct. Important factors that could cause
actual results to differ materially from the expectations are disclosed in this
report, including, without limitation, general business conditions.

OVERVIEW

We were organized in the State of New Jersey on March 4, 1995,
under the name Interactive Multimedia Network, Inc. We were reincorporated in
the State of Delaware on September 13, 1995. We changed our name to RECOV Energy
Corp. effective March 29, 2005. On or about January 12, 2006, we changed our
name to General Metals Corporation.

On January 20, 2006, we entered into a Share Purchase Agreement
with General Gold Corporation, a Nevada company incorporated on July 17, 1988,
and the former shareholders of General Gold set out in the Agreement. The
closing of the transactions contemplated in the Agreement and the acquisition by
our company of all of the issued and outstanding and convertible securities of
General Gold occurred on March 15, 2006. For financial statement purposes,
General Gold, the acquired entity, is regarded as the predecessor entity as of
March 15, 2006.

Our Current Business

We are a junior mineral resource exploration company engaged in
the business of mineral exploration.

On November 14, 2004, as amended December 31, 2004, we entered
into a letter of intent with Independence Mines, LLC and Gold Range, LLC with
respect to the purchase of substantially all of the assets Gold Range, LLC uses
to conduct the business of Independence Mines, LLC. We did not proceed with the
acquisition in this form, instead electing to directly acquire the lease on the
subject property.

On April 29, 2005, we entered into an agreement for an
assignment of a lease with Gold Range, LLC. The lease to be assigned was the
lease to be entered into between Gold Range, LLC and Independence Gold-Silver
Mines Inc., pursuant to which Independence Gold-Silver Mines Inc. would lease to
Gold Range, LLC certain unpatented mining claims located in the Battle Mountain
District, Lander County, State of Nevada, as more particularly described in the
lease, known also as the Independence Mine.

The purchase price payable by us to Gold Range, LLC in
consideration for the assignment of the lease was 5,000,000 of our restricted
common shares and a 1% net smelter return royalty payable to Gold Range, LLC in
addition to other underlying net smelter return requirements.

On March 15, 2007, we purchased a 100% interest in Mikite Gold
Resources, a Ghanaian corporation with exclusive exploration rights to the 150
square kilometer Nyinahin mining concession near Bibiani, Ghana. Consideration
paid was 1,000,000 restricted common shares with 1,000,000 share purchase
warrants attached, priced at $0.26 for a period of 2 years in satisfaction of
full and complete payment.

On August 17, 2007, we entered into the First Amendment to the
  Mining Lease with Independence Gold-Silver Mines, Inc. and added 4 additional
  mining claims and 2 additional easements. These claims cover the area where
  the existing cyanide decantation mill and operating facilities are currently
  sited and the area where the Pioneer haul road to and from the Sunshine pit
  crosses the Independence claims; specifically, Independence #1, #2, DC#83 and
  An Old Glory. Our annual lease payments increase by $5,000.00.

20

---

The Independence Mines Property

We currently control a 100% undivided leasehold interest in the
Wilson-Independence Gold  Silver Mine, situated in the Battle Mountain Mining
District, Lander County, Nevada. The property consists of 14 whole and
fractional mining claims encompassing 240 acres. Due diligence by our company
shows that all claims are valid and in good standing through and for the
assessment year ending August 31, 2008.

The Wilson-Independence project is wholly owned by General
Metals through a mining lease/option agreement with Independence Gold Silver
Mines of Seattle, Washington. Under the terms of the agreement General Metals
must expend a minimum of $625,000 towards exploration development and commercial
production of ores, minerals or materials prior to September 30, 2010 as per the
following schedule:

September 30, 2006
    $50,000September 30, 2007
    $75,000September 30, 2008
    $125,000September 30, 2009
    $175,000September 30, 2010
    $200,000


Any expenditure in excess of the minimum expenditure may be
applied to subsequent years. The term of the lease is for a period of 20 years
commencing October 1, 2005. There is a production royalty payable for the sale
of all gold, silver or platinum based upon the average daily price of gold on
the London Metal Exchange of 3% when the price of gold per ounce is less than
$375, 4% when the price of gold per ounce is between $375 and $475 and 5% when
the price of gold is over $475. There is also a production royalty of 3% payable
on the sale of all substances other than gold, silver and platinum.

We have the option to purchase the property for $3.0 million
within 10 years of the date the lease commenced provided all obligations have
been met. To date, we have expended approximately $485,000 on exploration which
fulfills the expenditure requirements through September 30, 2009. It is
anticipated that the current exploration program will fulfill the full
expenditure requirements of the agreement before year end (April 30, 2008)

Location and Access

All infrastructure necessary for the exploration, development
and operation of a mine is readily available. The property is accessed via
federal, state and county maintained all weather paved and gravel roads from the
nearby town of Battle Mountain. A well-trained work force is available in the
town of Battle Mountain, situated 30 miles north of the property along
Interstate highway 80. Adequate ground water is available for diversion for
future mining operations which enjoy special treatment as temporary or interim
uses under Nevada water laws. Electrical power has recently been extended to
within one mile of the project to service the Phoenix project, and the
transcontinental natural gas line passes within 1.5 miles of the property.

The property has been the sight of intermittent historic
exploration and mining activities since the late 1920s. Past mining operations
extracted 65,000 tons of high grade gold and silver ores from the property. The
bulk of this activity occurred during two periods, the first from high grade
ores shipped for direct smelting during the late 1940s and early 1950s, and a
second from 1975 to 1983 when a significant amount of underground development
took place, and a mill erected on the property. Production grades have
historically been high, with individual samples from stopes reported to contain
up to 19,000 ounces of silver, and 64 ounces of gold. During its peak period of
production in 1976 the mine shipped up to 1 ton of gold and silver bullion per
month.

The Independence Mines property consists of 14 whole and fractional
  unpatented lode mining claims, which cover approximately 240 acres.

21

---

Core and reverse circulation drilling to date indicate two
targets. These two targets are referred to as the Independence Deep (A Target),
and the Independence Surface (B Target). Historic mining operations have
generated in excess of 70,000 tons of waste dumps, mill tailings, and other
waste rock products on the property. Samples of this material contain gold and
silver values which suggest potential to recover gold and silver values.

The Wilson-Independence Property covers a mineralized zone on
strike with the World Class, Fortitude / Phoenix Gold Skarn Deposit. The
property has potential to develop a high grade underground resource in the
Antler Sequence, together with a smaller surface / near surface resource in the
overlying Pumpernickel Formation. Situated at the intersection of the Battle
Mountain-Eureka Gold Trend and the Northern Nevada Rift (Twin Creeks-McCoy
lineament), the Independence Project, like Fortitude and Cove Mcoy, is one of a
number of Gold Skarns which occur along the Battle Mountain  Eureka and
Northern Nevada Rift Zone mineral lineaments.

Mineralized outcrops are common on the property. Many have been
prospected by shallow prospect shafts, pits and trenches. In addition, over 100
Reverse Circulation and Core holes, and extensive shallow underground mine
workings in the Independence Mine indicate wide spread, near surface
mineralization which we feel represents a valid exploration target for potential
future surface, bulk mining operations.

Historic drilling and underground mine workings indicate wide
spread mineralization, both in surface - near surface, and deep targets. There
are presently no identified reserves or resources on the property. We intend to
conduct phased exploration programs to evaluate the mineral potential of this
property, with the objective of identifying and developing mineral resources and
reserves reportable under SEC Industry Guide 7.

Independence Deep Target

A large body of mineralized material is clearly indicated by
previous drilling in the Deep Target. It is likely that proper logging and
subsequent geologic modeling has potential to result in the identification of an
economic resource. All core, approximately 25,000 feet, is stored on site, and
re-logging was completed during the summer of 2006. As part of our Phase I
exploration program, we have spent approximately $300,000, including limited
additional drilling and sampling.

Mineralization identified in the deep target to date is
contained in the lower plate of the Golconda Thrust in rocks of the Battle
Mountain and Edna Formations of the Antler Sequence.

Independence Surface Target

The Surface Target consists of both historic mill tailings and
oxidized mineralization in the near surface. The tailings consists of roughly
70,000 tons with an additional 60,000 tons of oversize already mined stockpiled
material.

Promising surface and near surface mineralization has been
identified. The Surface Target contains an oxide target. This target is hosted
entirely in the Pumpernickel Formation. To date over 100 drill holes and roughly
eight (8) miles of underground workings have penetrated portions of this target,
all of which have encountered highly anomalous to high grade mineralization. The
principle limiting factor for surface resources is the lack of drilling
information. We anticipate that it is highly likely that additional drilling
will develop resources sufficient to increase the near surface resource
substantially.

Mill & Building On Site

A relatively intact 50 to 75 ton per day Counter Current 
  Decantation cyanide mill is situated on the property. The present condition
  of the jaw crusher, cone crusher and ball mill are being evaluated and could
  possibly be returned to serviceable condition. A complete set of new rubber
  liners for the ball mill are on site. The mill is housed in a metal clad building
  erected in 1987.

22

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Surrounding Land and Mineral Ownership

The Wilson-Independence claims are completely surrounded by
Newmont Minings holdings and are an island with legal access. Newmonts Phoenix
Project is adjacent to the Independence claims and is in operation as the
largest operating gold mine in the US. Newmont enjoys 8.5 million ounces of gold
and 660 million ounces of silver in reserves with substantial additional
mineralized material under exploration.

Plan of Operations

Situated in the Battle Mountain  Cortez gold belt, the
Wilson-Independence gold project represents an opportunity for a gold-sliver
operation with potential for near surface open pit and deeper high grade
underground production. Gold is indicated in three discrete drilled zones with
sufficient values and spacing to warrant additional exploration drilling. Based
on drill intercepts and drill hole spacing, we believe there is potential to
develop a near surface mineralized deposit with between 3Mt and 5 Mt of material
with a grade of 0.03 to 0.05 opt and a deeper deposit containing 5 to 6 Mt of
material with grades between 0.27 and 0.35 opt.

We believe that with compilation of the historic data and small
amount of additional field work, a mineralization model can be developed that
will enhance target vectors and enable rapid confirmation of gold
mineralization. Following data evaluation, we plan a series of staged drill
campaigns designed to:

|1) | Rapidly evaluate and delineate the near surface deposits
      with the intent to bring them to a proven and probable reserve/resource,
      reportable under Industry Guide 7 and to aid in the development of an
      early production stage.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                  
|2) | Identify structures interpreted as mineralized fluid
      conduits from lower the mineralized zone.                                                                                                                                             
|   |                                                                                                                                                                                                                                                  
|3) | Evaluate and delineate the deep high grade gold
      potential.                                                                                                                                                                                 

We will begin concurrent environmental baseline studies to
facilitate a rapid production track pending a successful conclusion of the drill
programs.

Managements plan for 2007 -2008, Drill Targets: Previous
exploration campaigns by Tech Exploration, Noranda Exploration, Northern Dynasty
Minerals and Great Basin resulted in an estimated 1.5 million ounces of gold
being identified in three separate drill targets with over 80 holes being
reported, all containing gold.

Surface/Shallow Target: 3 million tons @ .02 opt gold (60,000
oz)

A shallow bench of low grade mineralized material that goes
from surface to around 50' deep has been identified. There is no overburden and
mining is inexpensive. Our drilling will be infill to identify a mineable
resource to add to the proposed heap leach.

Independence Mine Target: 3- 5 million tons @ .05 opt gold (
250,000 oz)

The surface and near surface mineralization contains drill
intercepts to 40' @ 0.148 opt gold and several holes have been ended in
mineralized material containing in excess of 0.10 opt gold. The surface target
contains an oxide target potential in the range of 250,000-300,000 ounces of
gold (See Carrington Report). We plan to drill the Independence Mine area from
above to establish the feasibility of an open pit mining approach for the
remaining mineralized material. There are over 8 miles of underground workings
currently developed.

Independence Deep Target: 1.4 - 2 million ounces of gold @
3,000 feet deep

This target has immediate potential to develop 1.4 to 2 million
  ounces of contained gold, according to the 1997 Carrington Report, Northern
  Dynasty Minerals reported an estimated resource of 818,000 ounces of contained
  gold, with an average grade of 0.27 opt gold and Noranda Exploration, in an
  interoffice memo estimated 2 million ounces. Approximately 25,000 feet of drill
  core is on site and has been recently relogged.

23

---

Recent and Future Planned Exploration:

We have completed a small characterization drilling program on
the tailings. A total of 36 reverse circulation holes were drilled on a nominal
50 spacing, indicating approximately 61,000 tons of material with an average
grade of 0.026 opt gold and 0.52 opt silver remain in the tailings. Based on 30
samples collected from the old mill stockpile, potential exists for an estimated
31,600 tons of material grading 0.046 opt Au and 3.39 opt Ag remaining on the
property.

Target Description

The Independence Target is one of several identified target
areas on our Independence Property. This target represents a near surface, oxide
target, potentially amenable to low cost, surface bulk mining and heap leaching
technology. The target zone encompasses the old Independence mine workings and
surrounding ground. Target mineralization extends from the surface to at least
360 feet and is believed to range from 20 to more than 140 feet in true
thickness, over a strike length of at least 1,500 feet. Mineralization is hosted
in favorable, thick bedded to massive chert horizons of the Pumpernickle
Formation where suitable structural preparation has created favorable conditions
for mineralization. The target is indicated by 20 drill holes and extensive mine
workings.

Historic Exploration

Within this specific target area of the property, Union Pacific
Rail Road, Battle Mountain Gold, United Mining and Landsdowne Minerals conducted
exploratory drilling. Battle Mountain and Landsdowne conducted limited Reverse
Circulation drilling, while United Mining conducted air track drilling. Union
Pacific Rail Road drilled one diamond core hole beneath this target area with
very poor recovery and only limited assay data.

Union Pacific, Silver King Mines and Landsdowne Minerals
conducted underground exploration programs of consequence. These consisted
primarily of channel sampling, and limited long-hole drilling by Union Pacific
and Silver King Mines. This undergound exploration work is separate and apart
from development and production activities conducted by Apco Oil Minerals,
Silver King Mines Inc., and United Mining Corp. during the period 1974 through
1987.

As shown on the accompanying map, Landsdowne Minerals reported
results of underground channel sampling in 1994 which indicated mineralized
zones exposed in the Independence mine ranging from 55 feet to more than 140
feet at grades from .031 opt Au to to 0.127 opt Au. The most significant of the
Landsdowne results reported was 143 feet of contigious channel samples with an
average grade of 0.127 opt Au and 2.54 opt Ag.

Corporate Exploration Strategy

We are presently conducting a staged, multi-phase, exploration
  drilling program to drill test the Independence Target and delineate the extent
  of mineralization in this target area of the property. The objective to sequentially
  test, define and delimit the near surface, oxide mineralization in this target
  which may be amenable to open pit mining and heap leaching, and rapidly evaluate
  the potential of this target area for near term production. Phase 1 of this
  program consists of 25 Reverse Circulation type holes ranging from 100 to 400
  feet in depth. Thus far, we have completed 18 of the planned 25 drill holes
  for Phase 1 in this area of the property.

24

---



25

---

During the quarter ended October 31, 2007, we began the phase 1
drilling program with results reported November 27, 2007 and December 6, 2007.
Through December 6, 2007, the initial 25 holes have been completed.

We have received final assay results for holes GM-1, 2, 3, 4,
5, 6, 7 and 12 drilled to test for gold-silver mineralization along the
projected southern extension of the Independence fault zone. Holes 1, 2, 3, 5
and 6 form a "fence" of drill holes along Section 1600 N. The holes drill tested
the projected extension of mineralization southerly beyond the Wilson
Independence Mine in an area of favorable geology. Hole GM-6 successfully tested
the down dip projection of mineralization intersected. As may be seen on the
attached cross-section, all holes encountered mineralization over drill
intercepts ranging from 30 to 55 feet. The drilling indicates mineralization
from the surface which remains open at depth and along strike to the North and
South. The 30 foot interval from 275 to 305 feet averaged 0.023 ounces of gold
equivalent per ton (opt Au equiv.). This intercept is approximately 100 feet
down dip from the drill intercepts for holes 2, 3 and 5. Hole GM-6 also
intersected 55 feet of mineralization from 190 to 245 feet that contained an
average of 0.012 opt Au equiv. over the interval. This mineralization may be an
extension of the new zone intersected in hole GM-12, roughly 50 feet north.

Holes 4 and 12 were drilled to test mineralization in the
Independence Shallow target on Section 1650 North, as shown below. These holes
were also drilled to permit testing of possible cross cutting structures for
mineralization. Holes GM-4 and 12 confirmed projected gold / silver
mineralization as anticipated, within the projected target zone. Hole GM-4
contained a 55 foot mineralized intercept from 220 to 275 feet with an average
grade of 0.023 ounce per ton gold equivalent (opt Au eqiv.). Contained within
this is a 25 foot intercept of higher grade mineralization from 220 to 245 feet
with an average grade of 0.035 opt Au equiv.

Drill hole GM-12, tested the down dip projection of
mineralization from GM-4, encountering 55 feet of mineralization which averaged
0.017 opt Au equiv., from 225 to 280 feet and included 25 feet from 265 to 280
feet which averaged 0.034 opt Au equiv. In addition, GM-12 intersected a gold
mineralized zone between 15 to 65 feet that averaged 0.018 opt gold over the 50
foot drill intercept. This mineralization is situated approximately 260 feet
west of previously identified mineralization and has a higher gold to silver
ratio than the main Independence Shallow Zone. The location of the intercept and
the change in gold/silver ratio suggests this intercept may represent a new
discovery of gold mineralization that is distinctly different from the
mineralization in the main Independence Shallow Zone.

Drill Hole GM-7, situated on Section 1500 North intersected 60
feet of mineralization grading 0.042 opt Au equiv. from 140 to 200 feet within
the target zone. Included within this intercept is 25 feet from 170 to 195 feet
with an average grade of 0.076 opt Au equiv.

The presence of coincident gold  silver  bismuth anomalies
together with classic epithermal path finder elements such as arsenic and
antimony along with the interpreted geometry of the mineralized zones, based on
current drilling, supports managements opinion that potential to develop an
open pit type mining operation exists in the Independence Shallow Target Zone.
All of the mineralization encountered on the property to date has been deeply
and thoroughly oxidized. Oxidized ores characteristically are amenable to low
cost recovery techniques such as heap leaching. The grade of mineralization
encountered in our companys drilling to date are comparable with the grades of
mineralization found in other operating open pit, heap leach mines in the State
of Nevada today.

The results to date additionally support managements opinion
that the near surface mineralization at the Wilson Independence property
represents the epithermal expression of a leakage halo associated with, gold
skarn style mineralization in the Independence Deep target.

These drilling results continue to expand mineralization at the
Independence Project and support the model of near surface, potentially bulk
mineable gold  silver mineralization in the vicinity of the historic Wilson
Independence Mine. Mineralization remains open to along strike to the north and
south, and to depth.

Sampling, Assaying and Quality Control

All holes were drilled in an easterly direction, at an angle
  of 45 degrees below horizontal. All drilling is Reverse Circulation (RC) type
  drilling, using an MPD 1000 track mounted drill, drilling a nominal 5.25 inch
  diameter hole. Cuttings are split using a riffle type splitter set to produce
  two duplicate splits. One sample is sent to Chemex

26

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Laboratorys Prep Lab in Elko, Nevada for sample preparation
and fire assay, the remaining pulp is sent to Chemexs Vancouver, BC facility
for geochemical analysis. Assaying procedure follows fire assay with atomic
absorption finish. The duplicate sample is stored on site for future reference
and or metallurgical purposes.

Quality control programs include the use of duplicates,
standards and internal and external check assaying. Certified sample standards
provided by the Nevada Bureau of Mines and Geology are submitted with the normal
sample stream sent to the laboratory. Ten percent of the samples will be sent to
a third party laboratory for external check assay.

The following table summarizes the information described above:

Drill Hole
      Mineralized Intercepts
      Gold EquivalentFrom
      To
      **Intercept**
      Gold oz/t
      Gold**g/ton**
      **Silver** **oz/t**
      **Silver** g/ton
      oz/t Au Equiv.
      g/t Au **Equiv.**GM-1
      50
      95
      45
      0.046
      1.431
      1.38
      42.92
      0.072
      2.236GM-2
      165
      195
      30
      1.012
      0.373
      1.37
      42.61
      0.038
      1.172GM-3
      155
      210
      55
      .015
      0.467
      1.03
      32.04
      0.034
      1.067GM-4
      220
      270
      55
      0.013
      0.404
      0.52
      17.72
      0.023
      0.706Including
      220
      245
      25
      0.020
      0.622
      0.77
      26.14
      0.034
      1.067GM-5
      150
      205
      55
      0.032
      0.995
      1.58
      49.27
      0.062
      1.919Including
      160
      175
      15
      0.070
      2.177
      2.89
      89.89
      0.124
      3.863GM-6
      190
      245
      55
      0.006
      0.192
      0.32
      10.88
      0.012
      0.377GM-6
      275
      305
      30
      0.017
      0.529
      0.31
      10.70
      0.023
      0.711Including
      275
      290
      15
      0.026
      0.809
      0.38
      13.17
      0.033
      1.033GM-7
      140
      200
      60
      0.015
      0.467
      1.46
      50.07
      0.042
      1.318Including
      170
      195
      25
      0.032
      0.995
      2.32
      79.62
      0.076
      2.350GM-12
      15
      65
      50
      0.018
      0.560
      0.00
      0.06
      0.018
      0.561Including
      35
      60
      25
      0.024
      0.746
      0.04
      1.24
      0.025
      0.770GM-12
      225
      280
      55
      0.008
      0.249
      0.50
      15.55
      0.017
      0.540Including
      265
      280
      15
      0.012
      0.373
      1.17
      36.39
      0.034
      1.056


Note: All notations of t and ton refer
  to a US short ton weighing 2000 pounds. All gold equivalent is calculated
  at a gold price of $800 (US) and a silver price of $15 per ounce, and does not
  consider variations which may exist in metallurgical recovery.

27

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28

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29

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30

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Evaluation of all available structural, geologic and drill data
  is underway and required to generate an accurate geologic model for mineralization
  in the three target areas. Work is progressing as follows:

|1. | Surface and underground geology be re-mapped in detail,
      the new data combined with the existing data to form a geologic model for
      targeting mineralization in the three areas.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                           
|2. | Review and sample select portions of the Noranda core in
      the upper parts of the drill holes within the Independence
  target.                                                       
|   |                                                                                                                                                                                           
|3. | Based on the results of the above, a two phase drill
      program to test the drill target model in the Independence and Wilson Deep
      targets.                                      

| | a) | Phase 1: A drill program of 30 to 50 RC drill holes of
      500 or less to establish continuity of the near surface Independence
      mineralization and 2 RC drill holes 1000 deep to test vertical location
      and continuity of mineralized structures. Target date: March
2008                           
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                     
| | b) | Phase 2: Twenty additional RC drill holes of 500 or less
      in the Independence target and five 3,000 ft. RC pre-collar/core finish
      drill holes in the Wilson Deep to confirm continuity of the gold
      mineralization and facilitate resource estimate for both deposits. Target
      date: June 2008

|4. | A shallow 5-10 hole RC drill program be conducted in the
      North target to test potential for continuity and higher grade gold
      values. Target date: March 2008.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Phase 1 Program and Budget (Shallow Target)

Our program is up to $2.0 million in order to carry out
phase-one of a three-phased drilling program on the Wilson-Independence project,
proposed initial drilling of the deep target as well as for working capital
purposes. The program is as follows:

|Data review                        | $ | 2,750   | 
|---------------------------------- | - | ------- | 
|Surface/subsurface surveying       |   | 5,500   | 
|Underground mapping and sampling   |   | 16,500  | 
|Surface mapping and sampling       |   | 11,000  | 
|Core sampling                      |   | 11,000  | 
|Permitting                         |   | 15,000  | 
|Site Construction                  |   | 65,000  | 
|Drilling (RC)                      |   | 212,500 | 
|Sample preparation and analysis    |   | 60,000  | 
|Supervision                        |   | 59,000  | 
|Supplies                           |   | 12,000  | 
|Field expenses                     |   | 42,000  | 
|Section and map preparation        |   | 24,250  | 
|Geologic interpretation & modeling |   | 22,000  | 
|Report                             |   | 11,000  | 

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|Independence Deep modeling & resource
      study         |   | 100,000   | 
|--------------------------------------------------------- | - | --------- | 
|Pre-construction baseline studies, preliminary permitting |   | 75,000    | 
|Reclamation                                               |   | 48,750    | 
|Miscellaneous/Contingency                                 |   | 556,000   | 
|Subtotal Wilson-Independence
      project phase 1        |   | 1,349,250 | 
|Proposed initial deep drilling (2 holes)                  |   | 350,000   | 
|Working capital                                           |   | 300,750   | 
|Total                                                     | $ | 2,000,000 | 

Cash Requirements

For the next 12 months we plan to continue to explore for base
and precious metals on our Independence Mines property in Nevada pursuant to the
budgets indicated above. We also plan to advance operational permitting for a
5-6 million ton cyanide heap leach operation to enable early processing of the
shallow and near surface mineralized material which contains both gold and
silver. The target estimated recoverable material is 235,000 ounces of gold and
2,500,000 ounces of silver from the shallow targets.

We will require additional funds to implement our exploration
and development programs. These funds may be raised through equity financing,
debt financing, or other sources, which may result in further dilution in the
equity ownership of our shares. There is still no assurance that we will be able
to maintain operations at a level sufficient for an investor to obtain a return
on his investment in our common stock. Further, we may continue to be
unprofitable. We need to raise additional funds in the immediate future in order
to proceed with our exploration program.

Liquidity and Capital Resources

At October 31, 2007, we had working capital of $200,545
compared to a working capital of $137,132 at April 30, 2007.

At October 31, 2007, our total current assets were $261,361,
consisting of cash and cash equivalents of $261,361, compared to total current
assets of $204,996 at April 30, 2007. In addition, $151,000 in cash will be
received from stock subscriptions recorded as issued stock during the quarter.

At October 31, 2007, our total current liabilities were
$60,816, compared to total current liabilities of $67,864 at April 30, 2007.
Current liabilities at April 30, 2007 included promissory notes to a related
party, accounts payable and accrued interest.

At October 31, 2007, we had cash on hand of $261,361 compared
to $193,796 at April 30 , 2007. An additional infusion of cash totaling $151,000
from stock sales already subscribed is anticipated during November 2007.

During the quarter ended October 31, 2007, we issued 52,470
shares in connection with the exercise of share purchase warrants for aggregate
proceeds of $6,558.75.

During the quarter ended October 31, 2007, we raised aggregate
  proceeds of $543,800 in connection with the closing of two private placements
  for which we issued an aggregate of 2,719,000 shares and 2,719,000 share purchase
  warrants. The warrants issued are exercisable at $0.25 per share.

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Three months ended October 31, 2007 compared to three months
ended October 31, 2006

As at October 31, 2007, we had $60,816 in current liabilities,
and our working capital was $200,545. General and administrative expenses for
the three month period ended October 31, 2007 were $6,910 compared to $100,246
for the three month period ended October 31, 2006. The decrease was due to an
accounting reclassification of expenses from this classification to professional
fees and management and consulting. Explanations on the six month figures are
below. Exploration and development expenses for the three month period ended
October 31, 2007 were $224,482 compared to $17,425 for the three month period
ended October 31, 2006. The increase was due to beginning the phase 1 drilling
program during the quarter. The program is schedule to continue into our fourth
quarter.

Our financial statements report a net loss of $362,786 for the
three month period ended October 31, 2007 compared to a net loss of $166,750 for
the three month period ended October 31, 2006. Our accumulated loss increased to
$2,531,482 from inception to October 31, 2007. Our losses increased in part as a
result of increase in expenses in all categories for the three month period
ended October 31, 2007. We realized an overall increase in all expense
categories during the three month period ended October 31, 2007 as we were
actively involved in the investigation and acquisition of resource properties,
as well as exploration and development of the Independence Project, as compared
to the three month period ended October 31, 2006.

Six months ended October 31, 2007 compared to three months
ended October 31, 2006

As at October 31, 2007, we had $60,816 in current liabilities,
and our working capital was $200,545. General and administrative expenses for
the six month period ended October 31, 2007 were $302,590 compared to $209,108
for the six month period ended October 31, 2006. The increase was due to
additional activity of our company in investor and shareholder relations as well
as additional travel required for managing the exploration and development of
the Independence Project. Exploration and development expenses for the six month
period ended October 31, 2007 were $264,498 compared to $36,575 for the six
month period ended October 31, 2006. The increase was due to the exploration
drilling program undertaken on the Independence Project.

Our financial statements report a net loss of $1,189,683
including $414,702 of expenses related to the valuation of the issuance of
warrants, for the six month period ended October 31, 2007 compared to a net loss
of $341,133 for the six month period ended October 31, 2006. Our accumulated
loss increased to $2,531,482 from inception to October 31, 2007. Our losses
increased in part as a result of increase in expenses in all categories for the
six month period ended October 31, 2007. We realized an overall increase in all
expense categories during the six month period ended October 31, 2007 as we were
actively involved in the investigation and acquisition of resource properties,
as compared to the six month period ended October 31, 2005.

We have suffered recurring losses from operations. The
continuation of our company is dependent upon our company attaining and
maintaining profitable operations and raising additional capital. In this regard
we have raised additional capital through the equity offerings noted above. We
need to raise additional funds in the immediate future in order to proceed with
our exploration program.

The continuation of our business is dependent upon obtaining
further financing, a successful program of acquisition and exploration, and,
finally, achieving a profitable level of operations. The issuance of additional
equity securities by us could result in a significant dilution in the equity
interests of our current stockholders. Obtaining commercial loans, assuming
those loans would be available, will increase our liabilities and future cash
commitments.

There are no assurances that we will be able to obtain further
  funds required for our continued operations. As noted herein, we are pursuing
  various financing alternatives to meet our immediate and long-term financial
  requirements. There can be no assurance that additional financing will be available
  to us when needed or, if available, that it can be obtained on commercially
  reasonable terms. If we are not able to obtain the additional financing on a
  timely basis, we will be unable to conduct our operations as planned, and we
  will not be able to meet our other obligations as they become due. In such event,
  we will be forced to scale down or perhaps even cease our operations.

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Product Research and Development

Our business plan is focused on a strategy for maximizing the
long-term exploration and development of our Independence Mines property in
Nevada and more recently our proposed acquisition in Ghana. To date, execution
of our business plan has largely focused on acquiring prospective leases. We
intend to establish a going forward exploration and development plan.

Purchase of Significant Equipment

We do not intend to purchase any significant equipment
(excluding exploration activities) over the twelve months ending October 31,
2008. To the extent that equipment is required for our exploration program it
will be provided by third party contractors or leased.

Employees

Currently we have three employees that assist our directors,
officers and advisory board members. We do not expect any material changes in
the number of employees over the next 12 month period. We do and will continue
to outsource contract employment or independent contractors as needed. However,
if we are successful in our initial and any subsequent drilling programs we may
retain additional employees or independent contractors.

RISK FACTORS

Much of the information included in this quarterly report
includes or is based upon estimates, projections or other forward looking
statements. Such forward looking statements include any projections or
estimates made by us and our management in connection with our business
operations. While these forward-looking statements, and any assumptions upon
which they are based, are made in good faith and reflect our current judgment
regarding the direction of our business, actual results will almost always vary,
sometimes materially, from any estimates, predictions, projections, assumptions
or other future performance suggested herein.

Such estimates, projections or other forward looking
statements involve various risks and uncertainties as outline below. We caution
the reader that important factors in some cases have affected and, in the
future, could materially affect actual results and cause actual results to
differ materially from the results expressed in any such estimates, projections
or other forward looking statements.

Risks Related To Our Business:

Going Concern.

We do not expect positive cash flow from operations in the near
term. There is no assurance that actual cash requirements will not exceed our
estimates. In particular, additional capital may be required in the event that:

- drilling, exploration and completion
costs for our Independence mine project increase beyond our expectations; or

- we encounter greater costs associated
with general and administrative expenses or offering costs.

The occurrence of any of the aforementioned events could
adversely affect our ability to meet our business plans.

We will depend almost exclusively on outside capital to pay for
the continued exploration and development of our properties. Such outside
capital may include the sale of additional stock and/or commercial borrowing. We
can provide no assurances that any financing will be successfully completed.

Capital may not continue to be available if necessary to meet
  these continuing development costs or, if the capital is available, that it
  will be on terms acceptable to us. The issuance of additional equity securities
  by us would result in

34

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a significant dilution in the equity interests of our current
stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.

If we are unable to obtain financing in the amounts and on terms
  deemed acceptable to us, we may be unable to continue our business and as a
  result may be required to scale back or cease operations for our business, the
  result of which would be that our stockholders would lose some or all of their
  investment.

We have a limited operating history and if we are not
successful in continuing to grow our business, then we may have to scale back or
even cease our ongoing business operations.

We have no history of revenues from operations and have no
significant tangible assets. We have yet to generate positive earnings and there
can be no assurance that we will ever operate profitably. Our company has a
limited operating history and must be considered in the development stage. The
success of our company is significantly dependent on a successful acquisition,
drilling, completion and production program. Our companys operations will be
subject to all the risks inherent in the establishment of a developing
enterprise and the uncertainties arising from the absence of a significant
operating history. We may be unable to locate recoverable reserves or operate on
a profitable basis. We are in the development stage and potential investors
should be aware of the difficulties normally encountered by enterprises in the
development stage. If our business plan is not successful, and we are not able
to operate profitably, investors may lose some or all of their investment in our
company.

Because of the early stage of development and the nature of
our business, our securities are considered highly speculative.

Our securities must be considered highly speculative, generally
because of the nature of our business and the early stage of its development. We
are engaged in the business of exploring and, if warranted, developing
commercial reserves of gold and silver. Our properties are in the exploration
stage only and are without known reserves of gold and silver. Accordingly, we
have not generated any revenues nor have we realized a profit from our
operations to date and there is little likelihood that we will generate any
revenues or realize any profits in the short term. Any profitability in the
future from our business will be dependent upon locating and developing economic
reserves of gold, silver or other minerals, which itself is subject to numerous
risk factors as set forth herein. Since we have not generated any revenues, we
will have to raise additional monies through the sale of our equity securities
or debt in order to continue our business operations.

As our properties are in the exploration and development
stage there can be no assurance that we will establish commercial discoveries on
our properties.

Exploration for mineral reserves is subject to a number of risk
factors. Few properties that are explored are ultimately developed into
producing mines. Our properties are in the exploration and development stage
only and are without proven reserves. We may not establish commercial
discoveries on any of our properties.

Because of the unique difficulties and uncertainties
inherent in mineral exploration ventures, we face a high risk of business
failure.

Potential investors should be aware of the difficulties normally
  encountered by new mineral exploration companies and the high rate of failure
  of such enterprises. The likelihood of success must be considered in light of
  the problems, expenses, difficulties, complications and delays encountered in
  connection with the exploration of the mineral properties that we plan to undertake.
  These potential problems include, but are not limited to, unanticipated problems
  relating to exploration, and additional costs and expenses that may exceed current
  estimates. The expenditures to be made by us in the exploration of the mineral
  claim may not result in the discovery of mineral deposits. Problems such as
  unusual or unexpected formations and other conditions are involved in mineral
  exploration and often result in unsuccessful exploration efforts. If the results
  of our exploration programs do not reveal viable commercial mineralization,
  we may decide to abandon our claim and acquire new claims for new exploration.
  The acquisition of additional claims will be dependent upon us possessing capital
  resources at the time in order to purchase such claims. If no funding is available,
  we may be forced to abandon our operations.

35

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Because of the speculative nature of exploration of mineral
properties, there is no assurance that our exploration activities will result in
the discovery of new commercially exploitable quantities of minerals.

We plan to continue exploration on our Nevada mineral
properties. The search for valuable minerals as a business is extremely risky.
We can provide investors with no assurance that additional exploration on our
properties will establish that additional commercially exploitable reserves of
precious metals on our properties. Problems such as unusual or unexpected
geological formations or other variable conditions are involved in exploration
and often result in exploration efforts being unsuccessful. The additional
potential problems include, but are not limited to, unanticipated problems
relating to exploration and attendant additional costs and expenses that may
exceed current estimates. These risks may result in us being unable to establish
the presence of additional commercial quantities of ore on our mineral claims
with the result that our ability to fund future exploration activities may be
impeded.

Because we anticipate our operating expenses will increase
prior to our earning revenues, we may never achieve profitability.

Prior to completion of our exploration stage, we anticipate
that we will incur increased operating expenses without realizing any revenues.
We therefore expect to incur significant losses into the foreseeable future. We
recognize that if we are unable to generate significant revenues from the
exploration of our mineral claims, we will not be able to earn profits or
continue operations. There is no history upon which to base any assumption as to
the likelihood that we will prove successful, and we can provide no assurance
that we will generate any revenues or ever achieve profitability. If we are
unsuccessful in addressing these risks, our business will most likely fail.

Because of the inherent dangers involved in mineral
exploration, there is a risk that we may incur liability or damages as we
conduct our business.

The search for valuable minerals involves numerous hazards. As
a result, we may become subject to liability for such hazards, including
pollution, cave-ins and other hazards against which we cannot insure or against
which we may elect not to insure. At the present time we have no coverage to
insure against these hazards. The payment of such liabilities may have a
material adverse effect on our financial position.

If our exploration costs are higher than anticipated, then
our profitability will be adversely affected.

We are currently proceeding with exploration of our mineral
properties on the basis of estimated exploration costs. If our exploration costs
are greater than anticipated, then we will not be able to carry out all the
exploration of the properties that we intend to carry out. Factors that could
cause exploration costs to increase are: adverse weather conditions, difficult
terrain and shortages of qualified personnel.

As we face intense competition in the mining industry, we
will have to compete with our competitors for financing and for qualified
managerial and technical employees.

The mining industry is intensely competitive in all of its
phases. Competition includes large established mining companies with substantial
capabilities and with greater financial and technical resources than we have. As
a result of this competition, we may be unable to acquire additional attractive
mining claims or financing on terms we consider acceptable. We also compete with
other mining companies in the recruitment and retention of qualified managerial
and technical employees. If we are unable to successfully compete for financing
or for qualified employees, our exploration and development programs may be
slowed down or suspended.

As we undertake exploration of our mineral claim, we will be
subject to compliance with government regulation that may increase the
anticipated cost of our exploration program.

There are several governmental regulations that materially restrict
  mineral exploration. We will be subject to the laws of the State of Nevada as
  we carry out our exploration program. We may be required to obtain work permits,
  post bonds and perform remediation work for any physical disturbance to the
  land in order to comply with these laws. While our planned exploration program
  budgets for regulatory compliance, there is a risk that new regulations could
  increase our costs of doing business and prevent us from carrying out our exploration
  program.

36

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Any change to government regulation/administrative practices
may have a negative impact on our ability to operate and our profitability.

The laws, regulations, policies or current administrative
practices of any government body, organization or regulatory agency in the
United States or any other jurisdiction, may be changed, applied or interpreted
in a manner which will fundamentally alter the ability of our company to carry
on our business.

The actions, policies or regulations, or changes thereto, of
any government body or regulatory agency, or other special interest groups, may
have a detrimental effect on us. Any or all of these situations may have a
negative impact on our ability to operate and/or our profitably.

Our By-laws contain provisions indemnifying our officers and
  directors against all costs, charges and expenses incurred by them.

Our By-laws contain provisions with respect to the
indemnification of our officers and directors against all costs, charges and
expenses, including an amount paid to settle an action or satisfy a judgment,
actually and reasonably incurred by him, including an amount paid to settle an
action or satisfy a judgment in a civil, criminal or administrative action or
proceeding to which he is made a party by reason of his being or having been one
of our directors or officers.

Investors' interests in our company will be diluted and
investors may suffer dilution in their net book value per share if we issue
additional shares or raise funds through the sale of equity securities.

Our constating documents authorize the issuance of 200,000,000
shares of common stock with a par value of $0.001 and 50,000,000 preferred
shares with a par value of $0.001. In the event that we are required to issue
any additional shares or enter into private placements to raise financing
through the sale of equity securities, investors' interests in our company will
be diluted and investors may suffer dilution in their net book value per share
depending on the price at which such securities are sold. If we issue any such
additional shares, such issuances also will cause a reduction in the
proportionate ownership and voting power of all other shareholders. Further, any
such issuance may result in a change in our control.

Some of our directors and officers are residents of
countries other than the United States and investors may have difficulty
enforcing any judgments against such persons within the United States.

Some of our directors and officers are nationals and/or
residents of countries other than the United States, and all or a substantial
portion of such persons assets are located outside the United States. As a
result, it may be difficult for investors to enforce within the United States
any judgments obtained against our company or our officers or directors,
including judgments predicated upon the civil liability provisions of the
securities laws of the United States or any state thereof.

Risks Associated With Our Common Stock:

Our stock is a penny stock. Trading of our stock may be
restricted by the Securities and Exchange Commissions penny stock regulations
and the Financial Industry Regulatory Authoritys sales practice requirements,
which may limit a stockholder's ability to buy and sell our stock.

Our stock is a penny stock. The Securities and Exchange Commission
  has adopted Rule 15g-9 which generally defines "penny stock" to be any equity
  security that has a market price (as defined) less than $5.00 per share or an
  exercise price of less than $5.00 per share, subject to certain exceptions.
  Our securities are covered by the penny stock rules, which impose additional
  sales practice requirements on broker-dealers who sell to persons other than
  established customers and "accredited investors". The term "accredited investor"
  refers generally to institutions with assets in excess of $5,000,000 or individuals
  with a net worth in excess of $1,000,000 or annual income exceeding $200,000
  or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer,
  prior to a transaction in a penny stock not otherwise exempt from the rules,
  to deliver a standardized risk disclosure document in a form prepared by the
  Securities and Exchange Commission which provides information about penny stocks
  and the nature

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and level of risks in the penny stock market. The broker-dealer
  also must provide the customer with current bid and offer quotations for the
  penny stock, the compensation of the broker-dealer and its salesperson in the
  transaction and monthly account statements showing the market value of each
  penny stock held in the customer's account. The bid and offer quotations, and
  the broker-dealer and salesperson compensation information, must be given to
  the customer orally or in writing prior to effecting the transaction and must
  be given to the customer in writing before or with the customer's confirmation.
  In addition, the penny stock rules require that prior to a transaction in a
  penny stock not otherwise exempt from these rules, the broker-dealer must make
  a special written determination that the penny stock is a suitable investment
  for the purchaser and receive the purchaser's written agreement to the transaction.
  These disclosure requirements may have the effect of reducing the level of trading
  activity in the secondary market for the stock that is subject to these penny
  stock rules. Consequently, these penny stock rules may affect the ability of
  broker-dealers to trade our securities. We believe that the penny stock rules
  discourage investor interest in and limit the marketability of our common stock.

In addition to the "penny stock" rules promulgated by the
Securities and Exchange Commission, the Financial Industry Regulatory Authority
has adopted rules that require that in recommending an investment to a customer,
a broker-dealer must have reasonable grounds for believing that the investment
is suitable for that customer. Prior to recommending speculative low priced
securities to their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customer's financial status,
tax status, investment objectives and other information. Under interpretations
of these rules, the Financial Industry Regulatory Authority believes that there
is a high probability that speculative low priced securities will not be
suitable for at least some customers. The Financial Industry Regulatory
Authority requirements make it more difficult for broker-dealers to recommend
that their customers buy our common stock, which may limit your ability to buy
and sell our stock.

Going Concern

We have suffered recurring losses from operations. The
continuation of our company as a going concern is dependent upon our company
attaining and maintaining profitable operations and raising additional capital.
The financial statements do not include any adjustment relating to the recovery
and classification of recorded asset amounts or the amount and classification of
liabilities that might be necessary should our company discontinue operations.

Due to the uncertainty of our ability to meet our current
operating expenses and the capital expenses noted above, in their report on the
annual financial statements for the year ended April 30, 2007, our independent
auditors included an explanatory paragraph regarding concerns about our ability
to continue as a going concern. Our financial statements contain additional note
disclosures describing the circumstances that lead to this disclosure by our
independent auditors.

The continuation of our business is dependent upon us raising
additional financial support. The issuance of additional equity securities by us
could result in a significant dilution in the equity interests of our current
stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.

There are no assurances that we will be able to obtain further
funds required for our continued operations. As noted herein, we are pursuing
various financing alternatives to meet our immediate and long-term financial
requirements. There can be no assurance that additional financing will be
available to us when needed or, if available, that it can be obtained on
commercially reasonable terms. If we are not able to obtain the additional
financing on a timely basis, we will be unable to conduct our operations as
planned, and we will not be able to meet our other obligations as they become
due. In such event, we will be forced to scale down or perhaps even cease our
operations.

Recently Issued Accounting Standards

Statement No. 155  Accounting for Certain Hybrid Financial
Instruments

In February 2006, the FASB issued SFAS No. 155, Accounting for
  Certain Hybrid Financial Instruments, which amends SFAS No. 133, Accounting
  for Derivatives Instruments and Hedging Activities and SFAS No. 140,

38

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Accounting for Transfers and Servicing of Financial Assets and
Extinguishment of Liabilities. SFAS No. 155 amends SFAS No. 133 to narrow the
scope exception for interest-only and principal-only strips on debt instruments
to include only such strips representing rights to receive a specified portion
of the contractual interest or principle cash flows. SFAS No. 155 also amends
SFAS No. 140 to allow qualifying special-purpose entities to hold a passive
derivative financial instrument pertaining to beneficial interests that itself
is a derivative instrument.

Statement No. 156  Accounting for Servicing of Financial
Assets

In March 2006, the FASB issued SFAS No. 156, Accounting for
Servicing of Financial Assets, which provides an approach to simplify efforts to
obtain hedge-like (offset) accounting. This Statement amends FASB Statement No.
140, Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities, with respect to the accounting for separately
recognized servicing assets and servicing liabilities. The Statement (1)
requires an entity to recognize a servicing asset or servicing liability each
time it undertakes an obligation to service a financial asset by entering into a
servicing contract in certain situations; (2) requires that a separately
recognized servicing asset or servicing liability be initially measured at fair
value, if practicable; (3) permits an entity to choose either the amortization
method or the fair value method for subsequent measurement for each class of
separately recognized servicing assets or servicing liabilities; (4) permits at
initial adoption a one-time reclassification of available-for-sale securities to
trading securities by an entity with recognized servicing rights, provided the
securities reclassified offset the entity's exposure to changes in the fair
value of the servicing assets or liabilities; and (5) requires separate
presentation of servicing assets and servicing liabilities subsequently measured
at fair value in the balance sheet and additional disclosures for all separately
recognized servicing assets and servicing liabilities. SFAS No. 156 is effective
for all separately recognized servicing assets and liabilities as of the
beginning of an entity's fiscal year that begins after September 15, 2006, with
earlier adoption permitted in certain circumstances. The Statement also
describes the manner in which it should be initially applied.

Statement No. 157  Fair Value Measurements

In September 2006, the FASB issued SFAS No. 157, Fair Value
Measurements, to clarify how to measure fair value and to expand disclosures
about fair value measurements. The expanded disclosures include the extent to
which companies measure assets and liabilities at fair value, the information
used to measure fair value, and the effect of fair value on earnings and is
applicable whenever other standards require (or permit) assets and liabilities
to be measured at fair value. SFAS 157 is effective for financial statements
issued for fiscal years beginning after November 15, 2007 and interim periods
within those fiscal years.

The adoption of these new Statements is not expected to have a
material effect on our companys current financial position, results or
operations, or cash flows.

Application of Critical Accounting Policies

Our audited financial statements and accompanying notes are
prepared in accordance with generally accepted accounting principles used in the
United States. Preparing financial statements requires management to make
estimates and assumptions that affect the reported amounts of assets,
liabilities, revenue, and expenses. These estimates and assumptions are affected
by management's application of accounting policies. We believe that
understanding the basis and nature of the estimates and assumptions involved
with the following aspects of our financial statements is critical to an
understanding of our financials.

Item
3.               
Controls and Procedures.

We maintain disclosure controls and procedures that are designed
  to ensure that information required to be disclosed in our reports filed under
  the Securities Exchange Act of 1934, as amended, is recorded, processed,
  summarized and reported within the time periods specified in the Securities
  and Exchange Commission's rules and forms, and that such information is accumulated
  and communicated to our management, including our principal executive officer
  (our president and chief executive officer) and our principal accounting and
  financial officer (our chief financial officer) to allow for timely decisions
  regarding required disclosure. In designing and evaluating our disclosure

39

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controls and procedures, our management recognizes that any
controls and procedures, no matter how well designed and operated, can provide
only reasonable assurance of achieving the desired control objectives, and our
management is required to apply its judgment in evaluating the cost-benefit
relationship of possible controls and procedures.

As of October 31, 2007, the end of the three month period year
covered by this report, we carried out an evaluation, under the supervision and
with the participation of our management, including our president and chief
executive officer and our chief financial officer, of the effectiveness of the
design and operation of our disclosure controls and procedures. Based on the
foregoing, our president and chief executive officer and our chief financial
officer concluded that our disclosure controls and procedures were effective as
of the end of the period covered by this quarterly report.

There have been no significant changes in our internal controls
over financial reporting that occurred during the quarter ended October 31, 2007
that have materially affected, or are reasonably likely to materially affect,
our internal controls over financial reporting.

PART II - OTHER INFORMATION

Item
1.               
Legal Proceedings

In a lawsuit commenced by SunTrust Bank, we have been added to
the action by defendants Hollywood Honda and Maroone Chevrolet wherein they have
sued by a cross claim our company, alleging that we are liable for the debts of
Autosmart USA Leasing, Inc., a former subsidiary of our company. Autosmart was
an automobile dealer broker that purchased cars from the above dealers to sell
to their customers as a broker. The total claimed in the action is approximately
$200,000.00. The basis of the alleged claim against our company is that it
operated Autosmart for an improper purpose and as the alter ego of the parent
who is allegedly then liable. The transactions that the claims are based upon
occurred in 2002, far before the commencement of our current business under our
current management in March of 2006. We feel that the action against our company
is completely without merit and intend to vigorously defend. The action was
commenced in 2002 in the 17th Judicial Circuit in Broward County, Florida.
However, we have only just become aware of the litigation, having recently been
added to the action as a third party defendant due to the cross claim.

Item
2.               
Unregistered Sales of Equity Securities and Use of Proceeds

On August 3, 2007, we issued 52,470 shares in connection with
the exercise of share purchase warrants for aggregate proceeds of $6,558.75.

We issued the securities to one non-U.S. person (as that term
is defined in Regulation S of the Securities Act of 1933) in an offshore
transaction relying on Regulation S and/or Section 4(2) of the Securities Act of
1933, as amended.

On August 3, 2007, we closed a private placement consisting of
216,000 units of our securities at a price of US$0.20 per unit for gross
proceeds of $43,200. Each unit consists of one common share in the capital of
our company and one common share purchase warrant, with each whole warrant
entitling the holder to purchase one share of our common stock at a price of
US$0.25 per share for a period of 12 months from closing.

We issued the securities to eight (8) U.S. persons (as that
term is defined in Regulation S of the Securities Act of 1933) relying upon Rule
506 of Regulation D of the Securities Act of 1933.

On October 31, 2007, we closed a private placement consisting
  of 2,503,000 units of our securities at a price of US$0.20 per unit for gross
  proceeds of $500,600. Each unit consists of one common share in the capital
  of our company and one common share purchase warrant, with each whole warrant
  entitling the holder to purchase one share of our common stock at a price of
  US$0.25 per share for a period of 12 months from the effective date of a registration
  statement pertaining to the warrant shares.

40

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We issued the securities to 20 accredited investors pursuant to
exemptions from registration as set out in Rule 506 of Regulation D and/or
Section 4(2) of the Securities Act of 1933, as amended.

Item
3.               
Defaults Upon Senior Securities

None.

Item
4.               
Submission of Matters to a Vote of Security Holders

None.

Item
5.               
Other Information

None.

Item
6.               
Exhibits.

Exhibits required by Item 601 of Regulation S-B

|(3)  | Articles of Incorporation and By-laws                                                                                                                                                                                                                                        
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                              
|3.1  | Certificate of Incorporation (incorporated by reference
      from our Registration Statement on Form 10- SB12G filed on August 24,
      1999)                                                                                                                              
|     |                                                                                                                                                                                                                                                                              
|3.2  | By-Laws (incorporated by reference from our Registration
      Statement on Form 10-SB12G filed on August 24, 1999)                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                              
|3.3  | Amendment to Certificate of Incorporation (incorporated
      by reference from our Annual Report on Form 10-KSB filed on August 15,
      2006)                                                                                                                             
|     |                                                                                                                                                                                                                                                                              
|(10) | Material Contracts                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                              
|10.1 | Letter of Intent between General Gold Corporation and
      Gold Range, LLC dated November 14, 2004 (incorporated by reference from
      our Annual Report on Form 10-KSB filed on August 15, 2006)                                                                         
|     |                                                                                                                                                                                                                                                                              
|10.2 | Amendment to Letter of Intent between General Gold
      Corporation and Gold Range, LLC dated December 31, 2004 (incorporated by
      reference from our Annual Report on Form 10-KSB filed on August 15, 2006).                                                           
|     |                                                                                                                                                                                                                                                                              
|10.3 | Assignment of Lease Agreement between General Gold
      Corporation and Gold Range Company, LLC dated April 29, 2005 (incorporated
      by reference from our Annual Report on Form 10-KSB filed on August 15,
      2006).                                                
|     |                                                                                                                                                                                                                                                                              
|10.4 | Assignment of Lease and Consent Agreement between
      Independence Gold-Silver Mines Inc., Gold Range Company, LLC and General
      Gold Corporation dated June 29, 2005 (incorporated by reference from our
      Annual Report on Form 10-KSB filed on August 15, 2006).
|     |                                                                                                                                                                                                                                                                              
|10.5 | Lease Agreement between Independence Gold-Silver Mines
      Inc. and Gold Range Company, LLC dated July 13, 2005 (incorporated by
      reference from our Annual Report on Form 10-KSB filed on August 15, 2006)                                                           
|     |                                                                                                                                                                                                                                                                              
|10.6 | Share Purchase Agreement dated January 20, 2006 among
      General Gold Corporation, Recov Energy Corp. and the selling shareholders
      of General Gold Corporation (incorporated by reference from our Annual
      Report on Form 10-KSB filed on August 15, 2006).    

41

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|10.7 | Share Purchase
        Agreement dated March 15, 2007 between our company and Sanibel Investments
        Ltd. (incorporated by reference from our Current Report on Form 8-K filed
        on March 22, 2007).
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                
|(14) | Code of Ethics                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                
|14.1 | Code of Ethics
        (incorporated by reference from our Annual Report on Form 10-KSB filed
        on August 15, 2006)                                                                                      
|     |                                                                                                                                                                                                                
|(21) | Subsidiaries                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                
|     | General Gold
        Corporation, a Nevada company                                                                                                                                                             
|     |                                                                                                                                                                                                                
|(31) | Section 302
        Certification                                                                                                                                                                              
|     |                                                                                                                                                                                                                
|31.1 | Section
        302 Certification of the Sarbanes-Oxley Act of 2002 (filed herewith).                                                                                                                          
|     |                                                                                                                                                                                                                
|31.2 | Section
        302 Certification of the Sarbanes-Oxley Act of 2002 (filed herewith).                                                                                                                          
|     |                                                                                                                                                                                                                
|(32) | Section 906
        Certification                                                                                                                                                                              
|     |                                                                                                                                                                                                                
|32.1 | Section
        906 Certification of the Sarbanes-Oxley Act of 2002 (filed herewith)                                                                                                                           
|     |                                                                                                                                                                                                                
|32.2 | Section
        906 Certification of the Sarbanes-Oxley Act of 2002 (filed herewith)                                                                                                                           

42

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SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

GENERAL METALS CORPORATION

By: /s/ Stephen ParentStephen
Parent, Chief Executive Officer and President (Principal Executive Officer)

Date:   December 11, 2007.



By: ./s/ Daniel
ForbushDaniel
Forbush, Chief Financial Officer (Principal Financial Officer and Principal
Accounting Officer)

Date:   December 11, 2007.

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