UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q/A





Amendment
#1





T
            QUARTERLY REPORT UNDER
      SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For
the quarterly period ended March 31, 2008




o
            TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934







For
the transition period from ______ to ______




HuntMountain
Resources Ltd.


(Exact
name of registrant as specified in its charter)












Washington
              001-01428
              68-0612191(State
      or other jurisdiction of incorporation)
              (Commission
      File  Number)
              (IRS
      Employer Identification No.)





1611
      N. Molter Road, Ste. 201
                  Liberty
      Lake, Washington
                99019(Address
      of principal executive offices)
                (Zip
      Code)








Indicate
by check mark  whether the issuer (1) filed all reports required 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 at least the past 90
days.




Yes SNo  £




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.




See the
definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.




Large
      accelerated filer £
              Accelerated
      filer £Non-accelerated
      filer £(Do not
      check if a smaller reporting company)
              Smaller
      reporting Company S







Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).  Yes £  NoS




State
the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date 76,251,362 as of
December 10, 2008.












EXPLANATORY
NOTE





This
Amendment #1 on Form 10-Q/A amends and restates items identified below with
respect to the Form 10-Q filed by HuntMountain Resources Ltd. (the “Company”)
for the period ended March 31, 2008 with the Securities and Exchange Commission
(the “SEC”) on May 20, 2008 (the “Original Filing”). The purpose of this
amendment is to amend and restate the previously issued financial statements
included in the Original Filing for the reasons described in Note 10 to the
financial statements included in Item 1 (Financial Statements) included herein.
Other than as set forth below, the items of the Original Filing continue to
speak as of the date of the original filing date thereof, and the disclosure
relating to such items is not being updated.





We
would encourage any user of this filing to review our current filings for the
most accurate current information. This Amendment is being filed as a corrected
historical document.





This
Amendment amends and restates the information in Item 1 (Financial Statements)
and Item 2 (Management’s Discussion and Analysis) of the Original Filing. This
Amendment continues to describe conditions as of the date of the Original
Filing, and the disclosures contained herein have not been updated to reflect
events, results or developments that have occurred after the date of the
Original Filing, or to modify or update those disclosures affected by subsequent
events. Among other things, forward-looking statements made in the Original
Filing have not been revised to reflect events, results or developments that
have occurred or facts that have become known to us after the date of the
Original Filing, and such forward-looking statements should be read in their
historical context. This Amendment should be read in conjunction with the
Company’s filings made with the SEC subsequent to the Original Filing, including
any amendments to those filings.





Restatement
of previously issued financial statements to correct a material misstatement is
an indicator of a material weakness in internal control over financial
reporting.  A material weakness is a deficiency, or a combination of
deficiencies, in internal control over financial reporting, such that there is a
reasonable possibility that a material misstatement of the company’s annual or
interim financial statements will not be prevented or detected on a timely
basis.





The
Company did not have sufficient qualified personnel with an adequate
understanding of generally accepted accounting principles and experience in the
application of such principles to complex financing transactions, which led to a
material misstatement of the Company’s interim financial statements for the
quarters ended March 31, June 30, and September 30, 2007.  Management
has determined that this is a material weakness in internal control over
financial reporting as of March 31, June 30, and September 30, 2007, remedied by
the hiring of the Company’s Chief Financial Officer in November,
2007.


~2~


PART
I


FINANCIAL
INFORMATION





ITEM
1. FINANCIAL STATEMENTS





HuntMountain
      Resources Ltd. and Subsidiaries(An
      Exploration Stage Enterprise)Consolidated
      Balance Sheets







March 31,
                                                        
                                                        
                                                        December 31,2008
                                                        
                                                        
                                                        2007(unaudited)AssetsCURRENT
      ASSETS:Cash
      and cash equivalents:Cash
                                                        
                                                        $
                                                        336,191
                                                        
                                                        
                                                        $
                                                        273,020Short
      term cash investments - domestic
                                                        
                                                        
                                                        12,897
                                                        
                                                        
                                                        
                                                        12,909Short-term
      cash investments - Argentina
                                                        
                                                        
                                                        252,402
                                                        
                                                        
                                                        
                                                        367,375Total
      cash and cash equivalents
                                                        
                                                        
                                                        601,491
                                                        
                                                        
                                                        
                                                        653,304Employee
      receivable
                                                        
                                                        
                                                        2,407
                                                        
                                                        
                                                        
                                                        2,115Accounts
      receivable
                                                        
                                                        
                                                        1,181
                                                        
                                                        
                                                        
                                                        40,622Prepaid
      expenses
                                                        
                                                        
                                                        67,197
                                                        
                                                        
                                                        
                                                        72,612Accrued
      interest receivable
                                                        
                                                        
                                                        3,955
                                                        
                                                        
                                                        
                                                        1,969Total
      current assets
                                                        
                                                        
                                                        676,232
                                                        
                                                        
                                                        
                                                        770,621EQUIPMENT:Office
      equipment and vehicle
                                                        
                                                        
                                                        27,547
                                                        
                                                        
                                                        
                                                        11,216Less
      accumulated depreciation
                                                        
                                                        
                                                        9,328
                                                        
                                                        
                                                        
                                                        7,01418,220
                                                        
                                                        
                                                        
                                                        4,203OTHER
      ASSETS:Receivable
      - V.A. tax, Argentina
                                                        
                                                        
                                                        375,221
                                                        
                                                        
                                                        
                                                        190,719Land
      - La Josefina Estancia
                                                        
                                                        
                                                        710,000
                                                        
                                                        
                                                        
                                                        710,000Performance
      bond
                                                        
                                                        
                                                        189,834
                                                        
                                                        
                                                        
                                                        214,762Property
      deposits
                                                        
                                                        
                                                        271,500
                                                        
                                                        
                                                        
                                                        136,500Investments
                                                        
                                                        
                                                        7,331
                                                        
                                                        
                                                        
                                                        7,331Property
      purchase option
                                                        
                                                        
                                                        70,000
                                                        
                                                        
                                                        
                                                        70,0001,623,885
                                                        
                                                        
                                                        
                                                        1,329,312Total
      assets
                                                        
                                                        $
                                                        2,318,337
                                                        
                                                        
                                                        $
                                                        2,104,136Liabilities
      and Stockholders’ EquityCURRENT
      LIABILITIES:Trade
      accounts payable
                                                        
                                                        $
                                                        330,886
                                                        
                                                        
                                                        $
                                                        380,118Accrued
      wages and related taxes
                                                        
                                                        
                                                        132,612
                                                        
                                                        
                                                        
                                                        120,202Short
      term note payable
                                                        
                                                        
                                                        5,247,000
                                                        
                                                        
                                                        
                                                        3,747,000Debt
      discount:
                                                        
                                                        
                                                        (2,751,062
                                                        )
                                                        
                                                        
                                                        (2,664,606
                                                        )Net
      short term note payable
                                                        
                                                        
                                                        2,495,938
                                                        
                                                        
                                                        
                                                        1,082,394Accrued
      interest on note payable
                                                        
                                                        
                                                        293,253
                                                        
                                                        
                                                        
                                                        165,149Total
      current liabilities
                                                        
                                                        
                                                        3,252,689
                                                        
                                                        
                                                        
                                                        1,747,864STOCKHOLDERS’
      EQUITY:Preferred
      stock –
      10,000,000 shares, $0.001 par value, authorized;-0- shares issued and
      outstanding
                                                        
                                                        
                                                        -
                                                        
                                                        
                                                        
                                                        -Common
      stock – 300,000,000 shares, $0.001 par value, authorized; 33,428,285 and
      32,266,285 shares issued and outstanding, respectively
                                                        
                                                        
                                                        33,428
                                                        
                                                        
                                                        
                                                        32,491Additional
      paid-in capital
                                                        
                                                        
                                                        18,193,493
                                                        
                                                        
                                                        
                                                        12,081,316Retained
      earnings - prior to development stage
                                                        
                                                        
                                                        90,527
                                                        
                                                        
                                                        
                                                        90,527Deficit
      accumulated during the development stage
                                                        
                                                        
                                                        (19,166,381
                                                        )
                                                        
                                                        
                                                        (11,794,981
                                                        )Accumulated
      other comprehensive income (loss)
                                                        
                                                        
                                                        (85,419
                                                        )
                                                        
                                                        
                                                        (53,081
                                                        )Total
      stockholders’ equity
                                                        
                                                        
                                                        (934,352
                                                        )
                                                        
                                                        
                                                        356,272Total
      liabilities and stockholders’ equity
                                                        
                                                        $
                                                        2,318,337
                                                        
                                                        
                                                        $
                                                        2,104,136Signed
      on behalf of the Board of Directors:







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


~3~




HuntMountain
      Resources Ltd. and Subsidiaries(An
      Exploration Stage Enterprise)Consolidated
      Statements of Income







Three
      months ended March 31,
                                      
                                      
                                      From
      Inception of Development Stage July 1, 2005
    through2008
                                      
                                      
                                      2007
                                      
                                      
                                      March 31,
      2008(unaudited)
                                      
                                      
                                      (unaudited)
                                      
                                      
                                      (unaudited)INCOME:Dividend
      and interest income
                                      
                                      $
                                      2,035
                                      
                                      
                                      $
                                      265
                                      
                                      
                                      $
                                      74,317EXPENSES:Professional
      fees
                                      
                                      
                                      165,224
                                      
                                      
                                      
                                      36,446
                                      
                                      
                                      
                                      852,034Marketing
                                      
                                      
                                      6,499
                                      
                                      
                                      
                                      9,300
                                      
                                      
                                      
                                      183,210Exploration
      expenses
                                      
                                      
                                      828,413
                                      
                                      
                                      
                                      399,013
                                      
                                      
                                      
                                      2,944,815Travel
      expenses
                                      
                                      
                                      63,849
                                      
                                      
                                      
                                      17,617
                                      
                                      
                                      
                                      341,625Administrative
      and office expenses
                                      
                                      
                                      52,891
                                      
                                      
                                      
                                      17,643
                                      
                                      
                                      
                                      413,137Payroll
      expenses
                                      
                                      
                                      190,150
                                      
                                      
                                      
                                      124,763
                                      
                                      
                                      
                                      1,107,165Stock
      compensation expense
                                      
                                      
                                      52,500
                                      
                                      
                                      
                                      -
                                      
                                      
                                      
                                      251,100Comon
      stock and options issued for services
                                      
                                      
                                      -
                                      
                                      
                                      
                                      9,000
                                      
                                      
                                      
                                      353,250Interest
      expense and bank charges
                                      
                                      
                                      141,238
                                      
                                      
                                      
                                      14,140
                                      
                                      
                                      
                                      334,156Financing
      charge
                                      
                                      
                                      4,229,946
                                      
                                      
                                      
                                      39,176
                                      
                                      
                                      
                                      9,485,595Amortization
      of debt discount
                                      
                                      
                                      1,641,212
                                      
                                      
                                      
                                      259,670
                                      
                                      
                                      
                                      2,968,828Depreciation
      expense
                                      
                                      
                                      2,314
                                      
                                      
                                      
                                      935
                                      
                                      
                                      
                                      9,3277,374,236
                                      
                                      
                                      
                                      927,703
                                      
                                      
                                      
                                      19,244,242LOSS
      BEFORE OTHER INCOME
                                      
                                      
                                      (7,372,200
                                      )
                                      
                                      
                                      (927,438
                                      )
                                      
                                      
                                      (19,169,924
                                      )OTHER
      INCOME:Income
      from partnership interest
                                      
                                      
                                      800
                                      
                                      
                                      
                                      -
                                      
                                      
                                      
                                      3,543LOSS
      BEFORE INCOME TAXES:
                                      
                                      
                                      (7,371,400
                                      )
                                      
                                      
                                      (927,438
                                      )
                                      
                                      
                                      (19,166,381
                                      )Income
      taxes:
                                      
                                      
                                      -
                                      
                                      
                                      
                                      -
                                      
                                      
                                      
                                      -NET
      LOSS
                                      
                                      $
                                      (7,371,400
                                      )
                                      
                                      $
                                      (927,438
                                      )
                                      
                                      $
                                      (19,166,381
                                      )BASIC
      AND DILUTED LOSS PER SHARE, based on weighted-average shares
      outstanding
                                      
                                      
                                      33,358,219
                                      
                                      
                                      
                                      32,266,285WEIGHTED-AVERAGE
      COMMON SHARES OUTSTANDING, BASIC AND DILUTED
                                      
                                      $
                                      (0.22
                                      )
                                      
                                      $
                                      (0.03
                                      )




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


~4~




HuntMountain
      Resources Ltd. and Subsidiaries(An
      Exploration Stage Enterprise)Consolidated
      Statements of Cash Flows







Three
      months endedMarch
      31,
                          
                          
                          From
      Inception of Development Stage July 1, 2005
    through2008
                          
                          
                          2007
                          
                          
                          March 31,
      2008(unaudited)
                          
                          
                          (unaudited)
                          
                          
                          (unaudited)Increase
      (Decrease) in Cash and Cash EquivalentsCASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
                          
                          $
                          (7,371,400
                          )
                          
                          $
                          (927,438
                          )
                          
                          $
                          (19,166,381
                          )Adjustments
      to reconcile net loss to net cash used in operating
      activitiesDepreciation
                          
                          
                          2,314
                          
                          
                          
                          935
                          
                          
                          
                          9,327Stock
      option compensation expense
                          
                          
                          52,500
                          
                          
                          
                          -
                          
                          
                          
                          251,100Common
      stock and options issued for services
                          
                          
                          -
                          
                          
                          
                          9,000
                          
                          
                          
                          353,250Financing
      charge
                          
                          
                          4,229,946
                          
                          
                          
                          39,176
                          
                          
                          
                          9,485,595Amortization
      of debt discount
                          
                          
                          1,641,212
                          
                          
                          
                          259,670
                          
                          
                          
                          2,968,828Gain
      on sale of precious metal investments
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          (15,194
                          )Increase
      in long term receivable - V.A. tax
                          
                          
                          (184,502
                          )
                          
                          
                          -
                          
                          
                          
                          (375,221
                          )Increase
      in employee receivable
                          
                          
                          (293
                          )
                          
                          
                          -
                          
                          
                          
                          (2,407
                          )Increase
      in accounts receivable
                          
                          
                          39,441
                          
                          
                          
                          -
                          
                          
                          
                          (1,181
                          )(Increase)
      decrease in prepaid expenses
                          
                          
                          5,415
                          
                          
                          
                          4,595
                          
                          
                          
                          (67,197
                          )Increase
      in accounts payable
                          
                          
                          (49,232
                          )
                          
                          
                          -
                          
                          
                          
                          286,761Increase
      in accrued liabilities
                          
                          
                          12,410
                          
                          
                          
                          13,340
                          
                          
                          
                          163,737Net
      cash used in operating activities
                          
                          
                          (1,622,190
                          )
                          
                          
                          (600,722
                          )
                          
                          
                          (6,108,984
                          )CASH
      FLOWS FROM INVESTING ACTIVITIES:Land
      purchases
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          (710,000
                          )Accrued
      interest income
                          
                          
                          (1,986
                          )
                          
                          
                          -
                          
                          
                          
                          (3,955
                          )Purchase
      of performance bond
                          
                          
                          -
                          
                          
                          
                          (251,613
                          )
                          
                          
                          (247,486
                          )Property
      deposits
                          
                          
                          (135,000
                          )
                          
                          
                          -
                          
                          
                          
                          (271,500
                          )Property
      purchase option
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          (70,000
                          )Sale
      of precious metal investments
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          28,913Acquisition
      of equipment
                          
                          
                          (16,331
                          )
                          
                          
                          -
                          
                          
                          
                          (27,547
                          )Net
      cash used in investing activities
                          
                          
                          (153,317
                          )
                          
                          
                          (251,613
                          )
                          
                          
                          (1,301,575
                          )CASH
      FLOWS FROM FINANCING ACTIVITIES:Proceeds
      from convertible note financing
                          
                          
                          1,500,000
                          
                          
                          
                          807,000
                          
                          
                          
                          5,247,000Increase
      in debt discount
                          
                          
                          (86,456
                          )
                          
                          
                          -
                          
                          
                          
                          (2,751,062
                          )Increase
      in accrued interest payable
                          
                          
                          128,104
                          
                          
                          
                          -
                          
                          
                          
                          293,253Proceeds
      from sales of common stock
                          
                          
                          189,456
                          
                          
                          
                          -
                          
                          
                          
                          4,136,932Net
      cash from financing activities
                          
                          
                          1,731,104
                          
                          
                          
                          807,000
                          
                          
                          
                          6,926,123Effect
      of currency translation on cash
                          
                          
                          (7,410
                          )
                          
                          
                          -
                          
                          
                          
                          (21,994
                          )NET
      INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                          
                          
                          (51,813
                          )
                          
                          
                          (45,335
                          )
                          
                          
                          (506,430
                          )CASH
      AND CASH EQUIVALENTS, BEGINNING OF YEAR/PERIOD
                          
                          
                          653,304
                          
                          
                          
                          297,191
                          
                          
                          
                          1,107,921CASH
      AND CASH EQUIVALENTS, END OF YEAR/PERIOD
                          
                          $
                          601,491
                          
                          
                          $
                          251,856
                          
                          
                          $
                          601,491Supplemental
      Disclosures of Cash Flow Information:Income
      taxes, paid net of refunds:
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          -Interest
      paid:
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          -







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


~5~




HUNTMOUNTAIN
RESOURCES, LTD.


CONDENSED
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS





Note
1: Basis of Presentation




HuntMountain
Resources Ltd. (“HMR” or “The Company”), a Washington corporation, was formed in
2005.  Metaline Mining and Leasing Company, a Washington corporation
since 1927, merged with and into the Company in August 2005.  The
Company’s business plan is to acquire, explore, and develop mineral exploration
properties in North and South America.  As of the end of 2007, the
Company had acquired interest in one exploration property in Nevada, seven
properties in the province of Santa Cruz in Argentina, and two properties in
Quebec.  In addition, the Company is in the process of finalizing an
agreement to acquire an exploration property near Chinipas, Chihuahua, Mexico.
The Company continues to actively evaluate additional properties in North and
South America.




The
unaudited financial statements have been prepared by management of HuntMountain
Resources Ltd., pursuant to the rules and regulations of the Securities and
Exchange Commission (the SEC).  Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with accounting principles generally accepted in the United States of America
have been omitted pursuant to such SEC rules and regulations.  These
financial statements should be read in conjunction with the financial statements
and notes thereto included in the Company’s Annual Report on Form 10-K for the
year ended December 31, 2007, which was filed with the SEC on April 14,
2008.  In the opinion of management of the Company, the foregoing
statements contain all adjustments necessary to present fairly the financial
position of the Company as of March 31, 2008, and its results of operations and
cash flows for the three month periods ended March 31, 2008 and March 31,
2007.  The interim results reflected in the foregoing financial
statements are not considered indicative of the results expected for the full
fiscal year.




The
accompanying consolidated financial statements include the accounts of the
Company, its wholly-owned Canadian subsidiary HuntMountain Resources LTD (HMR
LTD), HMR’s wholly owned Mexican subsidiary Cerro Cazador Mexico S.A. De C.V.
(CCM), HMR’s wholly-owned subsidiary HuntMountain Investments, LLC (HMI), and
Cerro Cazador S.A. (CCSA), an Argentine subsidiary 95% owned by HMR and 5% owned
by HMI.




HMR
LTD is incorporated in British Columbia and provincially registered in
Yukon.  HMR LTD was formed for the purpose of holding Canadian
exploration properties, should the Company acquire an interest in any such
properties.  CCM was incorporated to acquire a property package in
Chihuaua, Mexico. HMI was incorporated for the specific purpose of holding
shares in subsidiary companies.  CCSA was formed in Argentina for the
purpose of holding Argentine exploration properties and executing agreements in
Argentina.




Note
2: Summary of Significant Accounting Policies




This
summary of significant accounting policies is presented to assist in the
understanding of the financial statements. The financial statements and notes
are representations of the Company’s management, which is responsible for their
integrity and objectivity. These accounting policies conform to accounting
principles generally accepted in the United States of America and have been
consistently applied in the preparation of the financial
statements.




~6~




Accounting
Method




The
Company’s financial statements are prepared using the accrual basis of
accounting in accordance with accounting principles generally accepted in the
United States of America.




Accounts
Receivable




The
Company carries its accounts receivable at net realizable value. On a periodic
basis, the Company evaluates its accounts receivable and determines if an
allowance for doubtful accounts is necessary, based on a history of past
write-offs and collections and current credit conditions. At March 31, 2008, and
December 31, 2007, the Company’s accounts receivable balance includes an
allowance for doubtful accounts of $0.




Use
of Estimates




The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America 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 reporting period.  Actual results could differ from those
estimates.




Cash
and Cash Equivalents




Cash
and cash equivalents include short-term cash investments that have an initial
maturity of 90 days or less. In the normal course of business, 30% of all funds
wire transferred from the Company to CCSA are withheld by the Government of
Argentina. These withheld amounts are invested in money market instruments until
the Government of Argentina approves CCSA’s formal application for release.
Funds held in this fashion are included in short-term cash
investments.




Principles
of Consolidation




The
consolidated financial statements include the accounts of the Company and its
wholly and majority-owned subsidiaries after elimination of intercompany
accounts and transactions. The wholly and majority-owned subsidiaries of the
Company are named above in “Note 1 – Basis of Presentation”.




Marketable
Securities




The
Company accounts for marketable securities in accordance with the provisions of
Statement of Financial Accounting Standards No. 115, “Accounting for Certain
Investments in Debt and Equity Securities” (“SFAS No. 115”).  Under
SFAS No. 115, debt securities and equity securities that have readily
determinable fair values are to be classified in three
categories:




Held
to Maturity – the positive intent and ability to hold to
maturity.  Amounts are reported at amortized cost, adjusted for
amortization of premiums and accretion of discounts.




Trading
Securities – bought principally for purpose of selling them in the near
term.  Amounts are reported at fair value, with unrealized gains and
losses included in earnings.




Available
for Sale – not classified in one of the above categories.  Amounts are
reported at fair value, with unrealized gains and losses excluded from earnings
and reported separately as a component of stockholders’ equity.




At
this time, the Company holds securities classified as available for
sale.  See “Note 7 - Investments” for further
details.




~7~





Mineral
Development Costs




All
exploration expenditures are expensed as incurred. Significant property
acquisition payments for active exploration properties are capitalized. If no
economic ore body is discovered, previously capitalized costs are expensed in
the period the property is abandoned. Expenditures to develop new mines, to
define further mineralization in existing ore bodies, and to expand the capacity
of operating mines, are capitalized and amortized on a units-of-production basis
over proven and probable reserves.




Should
a property be abandoned, its capitalized costs are charged to operations. The
Company charges to the consolidated statement of operations the allocable
portion of capitalized costs attributable to properties sold. Capitalized costs
are allocated to properties sold based on the proportion of claims sold to the
claims remaining within the project area.




Long-lived
Assets




The
Company evaluates its long-lived assets for impairment annually, or when events
or changes in circumstances indicate that the related carrying amount may not be
recoverable.  If the sum of estimated future net cash flows on an
undiscounted basis is less than the carrying amount of the related asset
grouping, an asset impairment is considered to exist.  The related
impairment loss is measured by comparing estimated future net cash flows on a
discounted basis to the carrying amount of the asset.  Changes in
significant assumptions underlying future cash flow estimates may have a
material effect on the Company’s financial position and results of
operations.  To date no such impairments have been
identified.




Equipment
is stated at cost and is depreciated on the straight-line basis over an
estimated useful life of 3 years.




Earnings
Per Share




The
Company has adopted Statement of Financial Accounting Standards No. 128, which
provides for calculation of “basic” and “diluted” earnings per share. Basic
earnings per share includes no dilution and is computed by dividing net income
available to common shareholders by the weighted average common shares
outstanding for the period. Diluted earnings per share reflects the potential
dilution of securities that could share in the earnings of an entity similar to
fully diluted earnings per share. Although there were common stock equivalents
outstanding on March 31, 2008, they were not included in the calculation of
earnings per share because they would have been considered
anti-dilutive.




Basic
earnings per share are computed using the weighted average number of shares
outstanding during the years (33,358,219 in the first quarter of 2008 and
32,266,285 in the first quarter of 2007).




As of
March 31, 2008, the Company had outstanding options and warrants for a total of
3,648,000 additional shares which were considered
anti-dilutive.




Deferred
Income Tax




Deferred
income tax is provided for differences between the bases of assets and
liabilities for financial and income tax reporting.  A deferred tax
asset, subject to a valuation allowance, is recognized for estimated future tax
benefits of tax-basis operating losses being carried forward.




~8~




Fair
Value of Financial Instruments




Our
financial instruments as defined by Statement of Financial Accounting Standards
No. 107, “Disclosures about Fair Value of Financial Instruments,” include cash,
short term investments, a performance bond and accrued liabilities. All
instruments except the performance bond are accounted for on a historical cost
basis, which, due to the short maturity of these financial instruments,
approximates fair value at March 31, 2008 and December 31, 2007. The performance
bond was marked to market on March 31, 2008 and December 31,
2007.




Provision
for Taxes




Income
taxes are provided based upon the liability method of accounting pursuant to
Statement of Financial Accounting Standards No. 109, “Accounting for Income
Taxes” (hereinafter “SFAS No. 109”). Under this approach, deferred income taxes
are recorded to reflect the tax consequences in future years of differences
between the tax basis of assets and liabilities and their financial reporting
amounts at each year-end. A valuation allowance is recorded against the deferred
tax asset if management does not believe the Company has met the “more likely
than not” standard imposed by SFAS No. 109 to allow recognition of such an
asset.




Reclamation
and Remediation




Expenditures
for ongoing compliance with environmental regulations that relate to current
operations are expensed or capitalized as appropriate. Expenditures resulting
from the remediation of existing conditions caused by past operations that do
not contribute to future revenue generations are expensed. Liabilities are
recognized when environmental assessments indicate that remediation efforts are
probable and the costs can be reasonably estimated.




Estimates
of such liabilities are based upon currently available facts, existing
technology and presently enacted laws and regulations taking into consideration
the likely effects of inflation and other societal and economic factors, and
include estimates of associated legal costs. These amounts also reflect prior
experience in remediating contaminated sites, other companies’ clean-up
experience and data released by The Environmental Protection Agency or other
organizations. Such estimates are by their nature imprecise and can be expected
to be revised over time because of changes in government regulations,
operations, technology and inflation. Recoveries are evaluated separately from
the liability and, when recovery is assured, the Company records and reports an
asset separately from the associated liability.




Recent
Accounting Pronouncements




In
December 2007, the FASB issued Statement of Financial Accounting Standards No.
160 ("SFAS 160"), Noncontrolling interests in Consolidated Financial Statements,
which establishes accounting and reporting standards for the noncontrolling
interest in a subsidiary and for the deconsolidation of a subsidiary. SFAS 160
is effective for financial statements issued for fiscal years beginning on or
after December 15, 2008, and interim periods within those fiscal years.
Management has not determined yet the effect that adoption of SFAS 160 may have
on our results of operations or financial position.




In
December 2007, the FASB issued Statement of Financial Accounting Standards No.
141R ("SFAS 141R"), Business Combinations, which establishes principles and
requirements for how the acquirer recognizes and measures in its financial
statements the identifiable assets acquired, the liabilities assumed, and any
noncontrolling interest in the acquiree, goodwill acquired in the business
combination, or a gain from a bargain purchase. SFAS 141R is effective for
financial statements issued for which the acquisition date is on or after the
beginning of the first annual reporting period beginning on or after December
15, 2008. Management has not determined yet the effect that adoption of SFAS
141R may have on our results of operations or financial
position.




~9~





Effective
November 1, 2007, the Company adopted the Financial Accounting Standards Board
(“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes—an
interpretation of FASB Statement No. 109 (“FIN 48”). FIN 48 clarifies the
accounting for uncertainty in income taxes recognized in an enterprise’s
financial statements in accordance with FASB Statement No. 109, Accounting for
Income Taxes. FIN 48 prescribes a recognition threshold and measurement
attribute for the financial statement recognition and measurement of a tax
position taken or expected to be taken in a tax return. Additionally, FIN 48
provides guidance on derecognition, classification, interest and penalties,
accounting in interim periods, disclosure, and transition. The adoption of FIN
48 did not have a material impact on the Company’s financial position, results
of operation or liquidity.




In
February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
Financial Assets and Financial Liabilities”, which permits entities to choose to
measure many financial assets and financial liabilities at fair
value.  Unrealized gains on items for which the fair value option has
been elected are to be reported in earnings.  SFAS 159 will become
effective as of the beginning of the first fiscal year that begins after
November 15, 2007.  As such, the Company adopted SFAS 159 effective
January 1, 2008.  However, the Company has not elected the fair value
option for any financial instruments, and adoption has not impacted the
Company’s financial statements.




Fair
Value Measurements




Effective
January 1, 2008, the Company adopted Financial Accounting Standards Board (FASB)
SFAS No. 157, Fair Value Measurements (SFAS 157). The provisions of SFAS 157 are
applicable to all of the Company’s assets and liabilities that are measured and
recorded at fair value. SFAS 157 establishes a new framework for measuring fair
value and expands related disclosures. SFAS 157 defines fair value as the price
that would be received for an asset or the exit price that would be paid to
transfer a liability in the principal or most advantageous market in an orderly
transaction between market participants. SFAS 157 establishes a fair value
hierarchy that gives the highest priority to observable inputs and the lowest
priority to unobservable inputs. The three levels of the fair value hierarchy
defined by SFAS 157 are described below.




Level
1: Quoted prices are available in active markets for identical assets or
liabilities. Active markets are those in which transactions for the asset or
liability occur with sufficient frequency and volume to provide pricing
information on an ongoing basis.




Level
2: Pricing inputs are other than quoted prices in active markets included in
Level 1, which are either directly or indirectly observable as of the reporting
date. Level 2 includes those financial instruments that are valued using models
or other valuation methodologies. These models are primarily industry-standard
models that consider various assumptions, including quoted forward prices for
commodities, time value, volatility factors, and current market and contractual
prices for the underlying instruments, as well as other relevant economic
measures. Substantially all of these assumptions are observable in the
marketplace throughout the full term of the instrument, can be derived from
observable data or are supported by observable levels at which transactions are
executed in the marketplace.




Level
3: Pricing inputs include significant inputs that are generally unobservable
from objective sources. These inputs may be used with internally developed
methodologies that result in management’s best estimate of fair value. Level 3
instruments include those that may be more structured or otherwise tailored to
the Company’s needs.




As
required by SFAS No. 157, financial assets and liabilities are classified in
their entirety based on the lowest level of input that is significant to the
fair value measurement.  The Company’s assessment of the significance
of a particular input to the fair value measurement requires judgment, and may
affect the valuation of fair value assets and liabilities and their placement
within the fair value hierarchy levels.




~10~


The
following table discloses by level within the fair value hierarchy the Company’s
assets and liabilities measured and reported on the Consolidated Balance Sheets
as of March 31, 2008, at fair value on a recurring basis:




Total
                                
                                
                                Level
      I
                                
                                
                                Level
      II
                                
                                
                                Level
      IIIAssets:Performance
      bond
                                
                                $
                                189,834
                                
                                
                                $
                                189,834
                                
                                
                                $
                                0
                                
                                
                                $
                                0Total:
                                
                                $
                                189,834
                                
                                
                                $
                                189,834
                                
                                
                                $
                                0
                                
                                
                                $
                                0







The
performance bond, required to secure the Company’s rights to explore the La
Josefina property, is a step-up coupon US dollar bond issued by the Government
of Argentina with a face value of $600,000. The bond was originally purchased
for $251,613 and had a value of $214,762 at December 31, 2007. As of the quarter
ended March 31, 2008, the value of the bond decreased $189,834.




Concentration
of Credit Risk




The
Company maintains its cash and cash equivalents in multiple financial
institutions.  Balances in the United States are insured by the
Federal Deposit Insurance Corporation (FDIC) up to $100,000 per
institution.  Balances on deposit may occasionally exceed FDIC insured
amounts. All of the Company’s cash in U.S. bank accounts was FDIC insured at
March 31, 2008. The Company also maintains cash in an Argentine bank. The
Argentine accounts, which had a U.S. dollar balance of $186,860 at March 31,
2008, are considered uninsured.




Beneficial
Conversion Feature of Convertible Notes




The
Company has determined that the Convertible Note (discussed in Note 3) contains
a beneficial conversion feature. Following the guidance provided by EITF 00-27
the Company allocated proceeds of convertible debt first to the warrants
issuable upon conversion of the note. The value of the warrants was recorded on
the balance sheet as debt discount and increases to shareholder’s equity. The
debt discounts are being amortized over the remaining life of the convertible
note. The value of warrants in excess of the actual debt advance amounts were
expensed as financing fees.




Once
the Company allocated proceeds of convertible note advances to the warrant
values, the embedded conversion feature of shares issuable on conversion of the
notes was recognized. All amounts relating to the share values were expensed as
financing fees.




Foreign
Currency Translation




Our
international operations use their local currency as their functional currency.
The financial statements of international subsidiaries are translated to their
U.S. dollar equivalents at end-of-period currency exchange rates for assets and
liabilities and at average currency exchange rates for revenues and expenses.
Translation adjustments for international subsidiaries whose local currency is
their functional currency are recorded as a component of accumulated other
comprehensive income (loss) within shareholders' equity. Transaction gains and
losses resulting from fluctuations in currency exchange rates on transactions
denominated in currencies other than the functional currency are recognized as
incurred in the accompanying Consolidated Statements of Income, except for
certain inter-company balances designated as long-term
investments.




~11~





Other
Comprehensive Income




The
Company has adopted SFAS 130, “Reporting of Comprehensive Income,” which
establishes guidelines for the reporting and display of comprehensive income
(loss) and its components in financial statements. Comprehensive income (loss)
includes foreign currency translation adjustments and accrued gain or loss on
the performance bond (discussed in Note 5).




Note
3: Convertible note




In
January 2007, HuntMountain Resources Ltd. obtained an unsecured loan commitment
for multiple advances up to $2,000,000 from Hunt Family Limited Partnership
(“HFLP”), an entity controlled by Tim Hunt, the Company’s Chairman and CEO, for
the specific purpose of providing working capital, surety, bonding and/or
indemnification purposes for HuntMountain Resources Ltd. and its
subsidiaries.




In August
2007, the Company obtained an amended, unsecured loan commitment for multiple
advances up to $5,000,000 from HFLP, effective August 1, 2007, to amend the
previous bridge financing note that was effective on January 31, 2007. The
simple interest rate on the new bridge financing note was eleven percent (11%)
per annum. The aggregate amount of unpaid advances and accrued and unpaid
interest under the amended note was convertible into equity securities of the
Company at the same price and terms as securities sold by the Company to
investors in its next equity financing.  The amended note amends and
restates, and does not evidence payment of, the unsecured loan for multiple
advances effective January 31, 2007.




In
October 2007, the Company obtained an amended and restated convertible unsecured
note for multiple advances up to $5,000,000 (“the October Note”) from HFLP to
provide working capital for the Company and its subsidiaries.  The
amended note was effective on October 23, 2007.  The amended and
restated convertible unsecured note was completed to replace the previous bridge
financing note that was effective August 1, 2007. The simple interest rate of
the October Note is eleven percent (11%) per annum. The aggregate amount of
unpaid advances and accrued and unpaid interest under the amended note is
convertible, in whole or in part, at the option of the holder into units of the
Company’s common stock. Each unit consists of one common share and one common
share purchase warrant at a conversion price of $0.25 per unit. The exercise
price of the warrants issued pursuant to such conversion is set at $0.40 to
acquire one new common share of the Company. The warrants to be issued pursuant
to the conversion of the October note are exercisable for a period of five years
from the conversion date.




In the
first quarter of 2008 the Company drew $1,103,000 from the October
Note.




In
November 2007 and December 2007, the Company issued 600,000 units pursuant to
the conversion of a portion of the October Note. In the first quarter of 2008
the Company issued 412,000 units pursuant to the conversion of a portion of the
October Note.




In
accordance with EITF 00-27, the Company recognized the beneficial conversion
feature associated with the notes convertibility into shares and warrants. The
total value of warrants was determined using the Black Scholes Option Price
Calculation. In employing this model, we used the actual three month T-Bill rate
on the advance dates for the risk-free rate. Similarly, the actual share price
on advance dates was used in the calculation. We assumed expected volatility of
82%, no dividends and a five year horizon in all Black Scholes Option Price
calculations. In the first quarter of 2008, the total value of warrants from
issuances of the October Note was $1,953,793 and the total value of shares was
$1,528,821.




~12~





In March
2008 the Company received a $500,000 advance from HFLP pursuant to the identical
terms of the October Note. At that time, HFLP management determined that it
would convert all balances of principal and interest of the October Note into
units as outlined above (see also Note 9: Subsequent events below). The $500,000
advance in March of 2008 was therefore considered to be part of the October
Note. The total value of warrants from this issuance was $1,360,000 and the
total value of shares was $1,140,000.




Following
the guidance provided by EITF 00-27 the Company allocated proceeds first to the
warrants issuable upon conversion of the note. The value of the warrants was
recorded on the balance sheet as debt discounts and increases to shareholder’s
equity. The debt discounts are being amortized over the remaining life of the
convertible note. The value of warrants in excess of the actual debt advance
amounts were expensed as financing fees.




Once the
Company allocated proceeds of convertible note advances to the warrant values,
the embedded conversion feature of shares issuable on conversion of the notes
was recognized. All amounts relating to the share values were expensed as
financing fees.




Note
4: Stock option plan




The
Company’s 2005 Stock Plan permits the granting of up to 3,000,000 non-qualified
stock options, incentive stock options, and restricted shares of common stock to
employees, directors, and consultants.  At March 31, 2008, there were
2,290,000 stock options granted to directors, employees, and consultants, of
which 1,955,000 are vested as of March 31, 2008.  The fair value of
each option is estimated on the vesting date using the Black-Scholes Option
Price Calculation.




There
were 150,000 options that vested during the quarter ended March 31, 2008;
therefore, the Company’s total stock option expense for the quarter was
$52,500.  Expenses for the remaining options will be recorded as they
vest in the remainder of 2008.




For
purposes of calculating the fair value of options, volatility for the two years
presented is based on the historical volatility of the Company’s common stock
over its public trading life.  The Company currently does not foresee
the payment of dividends in the near term.  The fair value for these
options was estimated at the date of grant using the Black-Scholes
option-pricing model with the following assumptions:




Three
      month periods endedMarch 31, 2008
                      
                      
                      March 31, 2007Weighted
      average risk free rate:
                      
                      2.09%
                      
                      
                      4.92%Weighted
      average volatility:
                      
                      82.8%
                      
                      
                      75%Expected
      dividend yield:
                      
                      0%
                      
                      
                      0%Weighted
      average life (years):
                      
                      5.0
                      
                      
                      2.0


~13~




The
following table summarizes the terms of the options outstanding at March 31,
2008:




Number
      of
                            Options
                          
                          
                          Weighted
      Average Exercise
                            Price
                          
                          
                          Weighted
      Average
                            Remaining
                            Contractual
      Life
                            (Years)
                          
                          
                          Number
      of
                            Exercisable
                            Options
      at
                            March
      31, 200890,000
                          
                          
                          $
                          0.20
                          
                          
                          
                          3.89
                          
                          
                          
                          90,000700,000
                          
                          
                          $
                          0.25
                          
                          
                          
                          3.31
                          
                          
                          
                          650,000100,000
                          
                          
                          $
                          0.30
                          
                          
                          
                          3.59
                          
                          
                          
                          100,00010,000
                          
                          
                          $
                          0.34
                          
                          
                          
                          2.33
                          
                          
                          
                          10,00010,000
                          
                          
                          $
                          0.37
                          
                          
                          
                          2.01
                          
                          
                          
                          10,000320,000
                          
                          
                          $
                          0.38
                          
                          
                          
                          4.74
                          
                          
                          
                          160,000150,000
                          
                          
                          $
                          0.40
                          
                          
                          
                          4.75
                          
                          
                          
                          100,000650,000
                          
                          
                          $
                          0.45
                          
                          
                          
                          4.28
                          
                          
                          
                          600,0005,000
                          
                          
                          $
                          0.55
                          
                          
                          
                          3.25
                          
                          
                          
                          5,00055,000
                          
                          
                          $
                          0.60
                          
                          
                          
                          4.74
                          
                          
                          
                          55,000200,000
                          
                          
                          $
                          0.63
                          
                          
                          
                          3.89
                          
                          
                          
                          175,000TOTALS
                          
                          
                          2,290,000
                          
                          
                          $
                          0.378
                          
                          
                          
                          3.99
                          
                          
                          
                          1,955,000







For
purposes of calculating the fair value of options, volatility for the two years
presented is based on the historical volatility of the Company’s common stock
over its public trading life.  The Company currently does not foresee
the payment of dividends in the near term.  The fair value for these
options was estimated at the date of grant using the Black-Scholes
option-pricing model with the following assumptions:




Note
5: Performance bond




During
the quarter ended March 31, 2007, Cerro Cazador S.A. was required to purchase a
performance bond as a condition of the exploration agreement on the La Josefina
property in Argentina.  The bond was originally purchased for
$251,613. As of the quarter ended March 31, 2008, the value of the bond
decreased to $189,834.  The decline in value is presented on our
balance sheet as Other Comprehensive Loss. The bond has a face value of
$600,000, or 10% of our required investment under the terms of the
agreement.




Note
6: Commitments




DUN
GLEN PROPERTY – PERSHING COUNTY, NEVADA




The
Company has a lease for the Dun Glen property with an option to purchase a 100%
interest in the claims.  Lease payments began in 2006 and are
considered advance royalty payments.  The term of the lease is 10
years, renewable at the Company’s option for an additional ten
years.  The Company paid $37,500 in advance royalty payments during
the quarter ended March 31, 2007, for this property.  Future annual
advance royalty payments begin at $45,000 per year in 2008 and escalate to
$72,500 per year at the end of the fifth year of the lease and for every year
beyond that, until the lease is terminated or the purchase option is exercised.
During the first quarter of 2008 the Company paid $45,000 in advance royalty
payments for the Dun Glen property. The Company has also agreed to keep the
claims in good standing until the lease is terminated or the purchase option is
exercised.




BAJO
POBRE PROPERTY – SANTA CRUZ PROVINCE, ARGENTINA




On March
27, 2007, the Company, through its Argentine subsidiary, CCSA, signed a
definitive lease purchase agreement with FK Minera S.A. to acquire a 100%
interest in the Bajo Pobré gold property located in Santa Cruz Province,
Argentina.  The Company may earn up to a 100% equity interest in the
Bajo Pobré property by making cash payments and exploration expenditures over a
five-year earn-in period.  The required expenditures and ownership
levels upon meeting those requirements are:




Year of the Agreement
                
                Payment to FK Minera S.A.
                
                
                Exploration Expenditure
      Requirement
                
                
                OwnershipFirst
      year
                
                $
                50,000
                
                
                $
                250,000
                
                
                
                0
                %Second
      year
                
                
                50,000
                
                
                
                250,000
                
                
                
                0
                %Third
      year
                
                
                75,000
                
                
                
                0
                
                
                
                51
                %Fourth
      year
                
                
                75,000
                
                
                
                0
                
                
                
                60
                %Fifth
      year
                
                
                75,000
                
                
                
                0
                
                
                
                100
                %  ~14~


After the
fifth year, the Company is obligated to pay FK Minera S.A. the greater of a 1%
net smelter royalty (“NSR”) on commercial production or $100,000 per
year.  The Company has the option to purchase the NSR for a lump-sum
payment of $1,000,000 less the sum of all royalty payments made to FK Minera
S.A. to that point.




LA
JOSEFINA PROPERTY - SANTA CRUZ PROVINCE, ARGENTINA




During
the second quarter of 2007, the Company, through its Argentine subsidiary, Cerro
Cazador S.A., was selected as the winning bidder for the La Josefina gold
property in Santa Cruz Province, Argentina.  Through a public bidding
process carried out by Fomento Minero de Santa Cruz Sociedad del Estado
(Fomicruz S.E.), Cerro Cazador S.A. was awarded the right to explore and develop
mineral deposits on La Josefina.  A definitive Exploration Agreement
was executed by the parties in July 2007.  According to the terms of
the Exploration Agreement, the Company will be required to expend $6,000,000 on
the property over a four-year term, including $1,500,000 before July
2008.  The agreement also defines the possible terms for a joint
venture company to be set up between Cerro Cazador S.A. and Fomicruz S.E. in the
event that a positive feasibility study is completed on the La Josefina property
during the exploration period.




ABITIBI
PROPERTIES – QUEBEC, CANADA




During
2006, the Company entered into a definitive Option Agreement for the acquisition
of a 100% interest in two properties in the Abitibi region of
Quebec.  Pursuant to the terms of the Option Agreement, the Company
paid $70,000 ($35,000 for each of the two properties) in cash to the property
owner.  The Company has also agreed to explore these properties and
drill at least three exploration drill holes in each.  The payments
and drilling of exploration drill holes will earn the Company a 100% interest in
each of these properties and give the Company the option to acquire additional
properties from the same property owner at similar terms.  The Company
has also agreed to keep the claims in good standing until the agreement is
terminated.




FACILITY
LEASES:




The
Company has lease commitments on office space and storage space in Liberty Lake,
Washington. The total annual lease obligation for this facility is
$54,792.




~15~




Note
7: Investments




The
Company holds an interest in two units of Pondera Partners, Ltd., a producing
oil project located in Teton County, Montana. This investment was valued at cost
on the Company’s balance sheet at $7,331 on March 31, 2008.




Note
8: Property purchase option




On June
19, 2006, the Company entered into an agreement with Diagnos, Inc., (Diagnos)
obtaining an exclusive option to acquire a 100% interest in two prospective gold
properties located in the Abitibi region of Québec, Canada.  The
properties consist of 46 claims covering approximately 6,500 acres.




The
Company will acquire a 100% interest in the properties by paying Diagnos a sum
of $70,000 and by conducting an initial exploration program comprised of at
least three drill holes on each property.  During the year ended
December 31, 2006, the Company paid the $70,000 fee, which is shown as property
purchase option on the consolidated balance sheets.  Upon completion
of the initial drilling programs, the Company will have the option to select up
to an additional seven properties in which it may acquire a 100% interest by
paying Diagnos a sum of $40,000 and completing three-hole exploration drilling
programs for each property.  The option will expire if the initial two
properties are not drilled within 48 months from the effective date of the
agreement.




For each
economic discovery made on any of the acquired properties, the Company will pay
Diagnos a bonus of $500,000.  The Company will also grant Diagnos a 2%
Net Smelter Royalty (NSR) for economic discoveries made on the initial or
additional properties, but will retain the option to acquire 1% of the NSR upon
payment of $1 million to Diagnos within five (5) years of making the economic
discovery.  An economic discovery is defined in the agreement as being
the production of a positive feasibility study for a given project in compliance
with Canada’s National Instrument 43-101.




Note
9: Subsequent events




Subsequent
to March 31, 2008 HFLP converted $5,060,014 of principal and interest owing
pursuant to the October Note into 20,240,056 units consisting of one share and
one warrant per unit.




Subsequent
to March 31, 2008 the Company drew an additional $950,000 from the October
Note.




Note
10: Correction of an error





The
Company has corrected its accounting treatment for certain non-cash adjustments
primarily related to the calculation and recognition of debt discount, financing
charges and amortization of debt discount in accordance with EITF 00-27inconnection with the
debt incurred under the bridge financing. The corrections pertain only to the
three month period ended March 31, 2007.





The
Company had not recognized any accounting treatment relating to debt discount,
financing charges and debt discount amortization pursuant to EITF 00-27. This
resulted in the Company understating net loss and overstating net convertible
debt for the period ended March 31, 2007. The impact of the correction of the
accounting treatment relating to EITF 00-27 is set forth in the following
table:





As
      Originally Reported
                
                
                As
      Restated
                
                
                Impact
      of the error Increase (Decrease)Income
      Statement for the three month period ended March 31,
    2007Financing
      Charge
                
                $
                -
                
                
                $
                39,176
                
                
                $
                39,176Amortization
      of debt discount
                
                
                -
                
                
                
                259,670
                
                
                
                259,670Net
      loss
                
                
                (628,592
                )
                
                
                (927,438
                )
                
                
                (298,846
                )Basic
      and fully diluted loss per share
                
                $
                (0.02
                )
                
                $
                (0.03
                )
                
                $
                (0.01
                )Balance
      Sheet at March 31, 2007Short-term
      Note Payable - Related Party, net of debt discount
                
                $
                807,000
                
                
                $
                253,107
                
                
                $
                (553,893
                )Total
      current liabilities
                
                
                881,372
                
                
                
                327,479
                
                
                
                (553,893
                )Additional
      paid-in capital
                
                
                2,433,570
                
                
                
                3,286,308
                
                
                
                852,738Deficit
      Accumulated During the Development Stage
                
                
                (2,830,126
                )
                
                
                (3,128,972
                )
                
                
                (298,846
                )Total
      Stockholders’ Equity (Deficit)
                
                
                (279,535
                )
                
                
                274,358
                
                
                
                553,893


~16~




ITEM
2. MANAGEMENT’S DISCUSSION AND ANALYSIS





Forward
Looking Statements




This form
10-Q and other documents we file with the Securities and Exchange Commission
(“SEC”) contain forward-looking statements that are based on current
expectations, estimates, forecasts and projections about us, our future
performance, our business, our beliefs and our management’s
assumptions.  All statements other than statements of historical facts
are forward-looking statements, including any statements of the plans and
objectives of management for future operations, projections of revenue earnings
or other financial items, any statements regarding future economic conditions or
performance, and any statement of assumptions underlying any of the
foregoing.  Some of these forward-looking statements may be identified
by the use of words in the statements such as “anticipate,” “estimate,” “could,”
“would,” “expect,” “project,” “intend,” “plan,” “believe,” “seek,” “should,”
“may,” “assume,” “continue,” variations of such words and similar
expressions.  These statements are not guarantees of future
performance and involve certain risks, uncertainties, and assumptions that are
difficult to predict.  We caution you that our performance and results
could differ materially from what is expressed, implied, or forecast by our
forward-looking statements due to general financial, economic, regulatory and
political conditions affecting the economy and markets, as well as more specific
risks and uncertainties affecting the Company.  The Company operates
in a rapidly changing environment that involves a number of risks, some of which
are beyond the Company’s control.  Future operating results and the
Company’s stock price may be affected by a number of factors.  Factors
that could cause or contribute to such differences include, but are not limited
to, those discussed in the section entitled “ITEM 1. BUSINESS,” and all
subsections therein, including, without limitation, the subsection entitled,
“FACTORS THAT MAY AFFECT THE COMPANY,” and the section entitled “MARKET FOR
REGISTRANT’S COMMON STOCK AND RELATED STOCKHOLDER MATTERS,” all contained in our
Annual Report on Form 10-K for the year ended December 31,
2007.  Given these risks and uncertainties, any or all of these
forward-looking statements may prove to be incorrect.  Therefore, you
should not rely on any such forward-looking statements.  Furthermore,
we do not intend (and we are not obligated) to update publicly any
forward-looking statements.  You are advised, however, to consult any
further disclosures we make on related subjects in our reports to the Securities
and Exchange Commission.




~17~




Overview




We are
engaged in the business of acquiring, exploring and developing mineral
properties, primarily those containing gold, silver and associated base metals.
Through our Latin American subsidiaries we hold mining claims in Santa Cruz
province, Argentina and the state of Chihuahua, Mexico. Additionally, we hold an
option to acquire a 100% interest in two properties in the province of Quebec,
Canada and a 10 year lease on a mining property in the state of
Nevada.




The
Company is currently evaluating other exploration and development properties in
North and South America.




Results
of Operations




Three
month period ended March 31, 2008 compared to March 31, 2007




We had no
revenues from operations during the recently completed quarter. Our only income
has been derived from interest and dividends on our cash and cash investments.
Interest and dividend income for the three-month period ended March 31, 2008
increased to $2,035 from $265 for the same period ended March 31, 2007. This
increase was due to the receipt of a dividend payment during the quarter ended
March 31, 2008. In the quarter ended March 31, 2007 the Company did not receive
a similar dividend payment.




We had
a net loss of $7,371,400 during the three-month period ended March 31,
2008.  This compares to a net loss of $927,438 during the three-month
period ended March 31, 2007. The increase in our net loss was due to increased
debt discount amortization and financing charges relating to the Company’s
convertible notes, significantly higher exploration expenditures, higher
professional fees, higher payroll expenses and higher interest expense
associated with the company’s convertible notes.




During
this most recently completed quarter, the Company primarily focused its
exploration expenditures in Argentina.




We
anticipate continuing net losses until such time as we sufficiently develop
properties for production or subsequent acquisition by another company. Our
ongoing expenses consist of exploration expenses on properties that we have
acquired; payroll; investor relations and marketing; travel, administrative and
office expenses; accounting, legal, and consulting expenses related to complying
with reporting requirements of the Securities Exchange Act of 1934; and expenses
incurred in the search for exploration properties that meet our acquisition
criteria.




Working
Capital, Cash and Cash Equivalents




The
Company’s working capital deficit for the three month period ending March 31,
2008 was $(2,576,457) compared to $(615,486) during that same period in 2007.
The ratio of current assets to current liabilities was 0.21 to 1 at March 31,
2008 compared to 0.30 to 1 at March 31, 2007. Working capital decreased during
the three month period ended March 31, 2008 compared to the same period in 2007
due to the Company’s increased exploration activity and the Company’s short-term
convertible debt financing incurred in 2007 and 2008.




~18~




Net cash
used in operating activities was $1,622,190 for the three month period in 2008
compared with $600,722 used in operating activities in the same period during
2007.  The increase is the result of the increased net loss from
operations.




During
the period ending March 31, 2008, investing activities used $153,317 compared
with $251,613 during that same period in 2007.  The decrease is
primarily due to our purchase of a performance bond relating to our La Josefina
project in the first quarter of 2007.




Cash flow
from financing activities was $1,731,104 during the three month period ended
March 31, 2008 compared to $807,000 during that same period in 2007. The
increase is primarily the result of the Company’s convertible debt
financing.




As a
result, cash and cash equivalents decreased by $51,813 during the three month
period ended March 31, 2008. This compares to a decrease in cash and cash
equivalents of $45,335 in the three month period ended March 31, 2007. The
Company has cash and cash equivalents of $601,491 as of March 31, 2008. It will
be necessary for the Company to raise additional capital to continue it business
activities in 2008.




It is
anticipated that expenditures will continue to increase as we move forward with
our exploration programs on our current properties and seek additional
opportunities with other properties.  We have sufficient resources,
including a convertible note due to Hunt Family Limited Partnership, an entity
controlled by the Company’s Chairman and CEO, to meet our financial obligations
until July 31, 2008. We anticipate that this note will be replaced with a
similar note from the same entity if the Company has not secured additional
financing arrangements before that time. The Company intends to pursue financing
opportunities in the Canadian capital markets before July 31, 2008.




Item
3. Controls and Procedures






Tim Hunt, the Company’s President and
CEO, and Bryn Harman, the Company’s Chief Financial Officer, have evaluated the
Company’s disclosure controls and procedures as of March 31, 2008. Based upon
this evaluation, the Chief Executive Officer and Chief Financial Officer
concluded that the Company’s disclosure controls and procedures were effective
as of March 31, 2008 to give reasonable assurance that the information required
to be disclosed in the reports that the Company files or submits under the
Securities Exchange Act of 1934, as amended, is recorded, processed, summarized
and reported within the time periods specified in the rules and forms of the
Securities and Exchange Commission, and that such information is also
accumulated and communicated to the Company’s management, including its Chief
Executive Officer and Chief Financial Officer, to allow timely decisions
regarding required disclosures.




During
the quarter ended March 31, 2008 there were no changes in the Company’s internal
controls or, to the knowledge of the management of the Company, any other
changes that materially affect, or are reasonably likely to materially affect,
the Company’s internal control over financial reporting.




~19~




PART
II — OTHER INFORMATION




ITEM
      1.
            LEGAL
      PROCEEDINGS




None




ITEM
      1A.
              RISK
      FACTORS






There are
no material changes from the risk factors previously disclosed in the Company’s
Annual Report on Form 10-K for the year ending December 31, 2007.




ITEM
      2
            UNREGISTERED
      SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS




During
the Quarter ended March 31, 2008 the Company issued 412,000 units of Common
Stock to partners of Hunt Family Limited Partnership. Each unit consisted of one
common share and one common stock purchase warrant, pursuant to the conversion
of a convertible note. The warrants issued have a $0.40 per share exercise price
and an expiration date of five years from the date of issuance. The private
placement was made pursuant to section 4(2) and Regulation D Rule 506 exemptions
from registration under the Act.




ITEM
      3.
            DEFAULTS
      UPON SENIOR SECURITIES




None




ITEM
      4.
            SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY
HOLDERS




Not
applicable




ITEM
      5.
            OTHER
      INFORMATION




None.






Item
6.  Exhibits




31.1--
            Certification
      required by Rule 13a-14(a) or Rule 15d-14(a). Tim
  Hunt




31.2--
            Certification
      required by Rule 13a-14(a) or Rule 15d-14(a). Bryn
  Harman




32.1--
            Certification
      required by Rule 13a-14(a) or Rule 15d-14(b) and section 906 of the
      Sarbanes-Oxley Act of 2002,  18 U.S.C. Section 1350, Tim
      Hunt




32.2--
            Certification
      required by Rule 13a-14(a) or Rule 15d-14(b) and section 906 of the
      Sarbanes-Oxley Act of 2002,  18 U.S.C. Section 1350, Bryn
      Harman




~20~




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.








HUNTMOUNTAIN
RESOURCES LTD.








/s/
      Tim HuntBY:
                
                
                
                DATE:  December
      10, 2008TIM
      HUNT, CHAIRMAN, PRESIDENT & CHIEF EXECUTIVE OFFICER





/s/
      Bryn HarmanBY:
              
              
              
              DATE:
      December 10, 2008BRYN
      HARMAN, CHIEF FINANCIAL OFFICER






~21~