**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

Washington, D.C. 20549

 

**FORM 10-Q**

(Mark One)

**x** **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 EXCHANGE ACT**

For the transition period from ___________ to _____________

*Commission file number 333-146407*

 

ORO VOLCANICO CORP.

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

 

|                                                           |   |                              |
|----------------------------------------------------------------|--------|-----------------------------------|
| Delaware                                                       |   | 98-0494816                        |
| (State or other jurisdiction of incorporation or organization) |   | (IRS Employer Identification No.) |

 

|                                                                                                        |
|-------------------------------------------------------------------------------------------------------------|
| 1 Place Ville Marie -Suite 2821

Montreal, Quebec H3B 4R4, Canada

(Address of principal executive offices) |

 

|                        |
|-----------------------------|
| (514) 286-1999              |
| (Issuer's telephone number) |

 

| Not Applicable                                                                      |
|-------------------------------------------------------------------------------------|
|                                                                                |
| (Former name, former address and former fiscal year,

if changed since last report) |

 

Check whether the registrant (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 the past 90 days.  Yesx  Noo

 

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 5,116,320 shares of Common Stock, as of June 17, 2008.  

 

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

 

          

| Large accelerated filer | o | Accelerated filer | o |
|-------------------------|---|-------------------|---|

 

| Non-accelerated filer | o | (Do not check if a smaller reporting company) |
|-----------------------|---|-----------------------------------------------|

Smaller reporting companyx

 

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934) (check one): Yesx   No  o

Transitional Small Business Disclosure Format (check one): Yeso   Nox 

 

 

 

 

 

 

 

 

 

 

2

 

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**PART I – FINANCIAL INFORMATION**

**Item 1. Financial Information**

 

 

**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

INTERIM FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2008 AND 2007

(UNAUDITED)

 

 

| **CONTENTS**                                            |
|---------------------------------------------------------|
| Interim Balance Sheets                                  |   | **1** |
| Interim Statements of Operations and Comprehensive Loss |   | **2** |
| Interim Statements of Stockholders' Deficit             |   | **3** |
| Interim Statements of Cash Flows                        |   | **4** |
| Notes to Interim Financial Statements                   |   | **5-17** |

 

 

 

 

 

 

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**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Interim Balance Sheets

As of March 31, 2008 and December 31, 2007

(Unaudited)

 

|                                                     |   | **March 31,** |         | December 31**,** |
|----------------------------------------------------------|--------|---------------|--------------|------------------|
|                                                     |   | **2,008**     |         | 2,007            |
|                                                     |   |          |         |             | (Audited) |
| **ASSETS**                                               |
| **Current Assets**                                       |   |          |         |             |   |   |
| Cash                                                     |   | **$**         | **5**        |             | $ | 37 |
| Prepaid expense                                          |   |          | **299**      |             |   | 773 |
|                                                     |   |          |         |             |   |   |
| **Total Current Assets**                                 |   |          | **304**      |             |   | 810 |
| **Mineral Rights**(note 6)                               |   |          | **23,588**   |             |   | 23,588 |
|                                                     |   |          |         |             |   |   |
| **Total Assets**                                         |   | **$**         | **23,892**   |             | $ | 24,398 |
|                                                     |   |          |         |             |   |   |
| **LIABILITIES**                                          |   |          |         |             |   |   |
| **Current Liabilities**                                  |   |          |         |             |   |   |
| Accrued liabilities                                      |   | **$**         | **17,836**   |             | $ | 23,659 |
| Loans from related parties (note 7)                      |   |          | **31,965**   |             |   | 22,761 |
|                                                     |   |          |         |             |   |   |
| **Total Liabilities**                                    |   |          | **49,801**   |             |   | 46,420 |
|                                                     |   |          |         |             |   |   |
| **Contingencies**(note 10)                               |   |          |         |             |   |   |
| **STOCKHOLDERS' DEFICIT**                                |
| **Capital Stock**(note 8)                                |   |          |         |             |   |   |
| Authorized                                               |   |          |         |             |   |   |
| 10,000,000 preferred shares, par value $0.0001 per share |   |          |         |             |   |
| 50,000,000 common shares, par value $0.0001 per share    |   |          |         |             |   |
|                                                     |   |          |         |             |   |   |
| Issued and outstanding                                   |   |          |         |             |   |   |
| 5,116,320 common shares                                  |   |          | **512**      |             |   | 512 |
| **Additional Paid-in Capital**                           |   |          | **59,214**   |             |   | 59,214 |
| **Accumulated Other Comprehensive Income**               |   |          | **5,678**    |             |   | 3,638 |
| **Deficit Accumulated During the Exploration Stage**     |   |          | **(91,313)** |             |   | (85,386) |
|                                                     |   |          |         |             |   |   |
| **Total Stockholders' Deficit**                          |   |          | **(25,909)** |             |   | (22,022) |
|                                                     |   |          |         |             |   |   |
| **Total Liabilities and Stockholders' Deficit**          |   | **$**         | **23,892**   |             | $ | 24,398 |

 

 

 

(The accompanied notes are an integral part of these unaudited interim financial statements.)

 

- 2 -

 

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**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Interim Statements of Operations and Comprehensive Loss

Three Months Ended March 31, 2008 and 2007, and the Period from Date of Inception (May 9, 2006) Through March 31, 2008

(Unaudited)

 

|                                    |   |             |          |         |   |          |   | Period from |
|-----------------------------------------|--------|------------------|---------------|--------------|--------|---------------|--------|-------------|
|                                    |   |             |          |         |   |          |   | Date of     |
|                                    |   |             |          |         |   |          |   | Inception   |
|                                    |   | **Three Months** |          | Three Months |   | (May 9, 2006) |
|                                    |   | **Ended**        |          | Ended        |   | Through       |
|                                    |   | **March 31,**    |          | March 31,    |   | March 31,     |
|                                    |   | **2008**         |          | 2007         |   | 2008          |
| **Revenues**                            |   | **$**            | **-**         |         | $      | -             |   | $           | - |
|                                    |   |             |          |         |   |          |   |        |   |
| **Expenses**                            |   |             |          |         |   |          |   |        |   |
| Professional fees                       |   |             | **5,843**     |         |   | 8,025         |   |        | 89,781 |
| Bank charges                            |   |             | **84**        |         |   | 226           |   |        | 700 |
| Office and general                      |   |             | **-**         |         |   | -             |   |        | 500 |
| Taxes and dues                          |   |             | **-**         |         |   | 291           |   |        | 291 |
|                                    |   |             |          |         |   |          |   |        |   |
| **Total Expenses**                      |   |             | **5,927**     |         |   | 8,542         |   |        | 91,272 |
|                                    |   |             |          |         |   |          |   |        |   |
| **Loss from Operations**                |   |             | **(5,927)**   |         |   | (8,542)       |   |        | (91,272) |
| **Other**                               |   |             |          |         |   |          |   |        |   |
| Foreign exchange loss                   |   |             | **-**         |         |   | (213)         |   |        | (41) |
|                                    |   |             |          |         |   |          |   |        |   |
| **Loss Before Income Taxes**            |   |             | **(5,927)**   |         |   | (8,755)       |   |        | (91,313) |
| Provision for income taxes(note 9)      |   |             | **-**         |         |   | -             |   |        | - |
|                                    |   |             |          |         |   |          |   |        |   |
| **Net Loss**                            |   |             | **(5,927)**   |         |   | (8,755)       |   |        | (91,313) |
| Foreign currency translation adjustment |   |             | **2,040**     |         |   | -             |   |        | 5,678 |
|                                    |   |             |          |         |   |          |   |        |   |
| **Comprehensive Loss**                  |   | **$**            | **(3,887)**   |         | $      | (8,755)       |   | $           | (85,635) |
|                                    |   |             |          |         |   |          |   |        |   |
| **Basic and Diluted Loss per Share**    |   | **$**            | **0.00**      |         | $      | 0.00          |   |        |   |
|                                    |   |             |          |         |   |          |   |        |   |
| **Basic and Diluted Weighted Average**  |   |             |          |         |   |          |   |        |   |
| **Number of Shares Outstanding During** |   |             |          |         |   |          |   |        |   |
| **the period**                          |   |             | **5,116,320** |         |   | 5,116,320     |   |        |   |

 

 

(The accompanied notes are an integral part of these unaudited interim financial statements.)

 

- 3 -

 

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**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Interim Statements of Stockholders' Deficit

Three Months Ended March 31, 2008 and 2007, and the Period from Date of

Inception (May 9, 2006) Through March 31, 2008

(Unaudited)

 

 

|                             |          |          |        |   |        |   |              |       |            | **Deficit**     |           |            |              |         |   |   |
|----------------------------------|---------------|---------------|-------------|--------|-------------|--------|-------------------|------------|-----------------|-----------------|----------------|-----------------|-------------------|--------------|--------|--------|
|                             |          |          |        |   |        |   |              |       |            | **Accumulated** |           | **Accumulated** |              | **Total**    |
|                             |          |          |        |   |        |   | **Additional**    |       | **Other**       |            | **During the** |            | **Stockholders'** |
|                             | **Number of** |          | **Capital** |   | **Paid-in** |   | **Comprehensive** |       | **Exploration** |            | **(Deficit)**  |
|                             | **Shares**    |          | **Stock**   |   | **Capital** |   | **Income**        |       | **Stage**       |            | **Equity**     |
|                             |          |          |        |   |        |   |              |       |            |            |           |            |              |         |   |   |   |
| Balance, May 9, 2066             |          | -             |        | $      | -           |   | $                 | -          |            | $               | -              |            | $                 | -            |   | $      | - |
| Common shares issued for         |          |          |        |   |        |   |              |       |            |            |           |            |              |         |   |   |   |
| cash (note 8)                    |          | 5,016,320     |        |   | 502         |   |              | 59,214     |            |            | -              |            |              | -            |   |   | 59,716 |
| Common shares issued for mineral |          |          |        |   |        |   |              |       |            |            |           |            |              |         |   |   |   |
| rights (notes 6 and 8)           |          | 100,000       |        |   | 10          |   |              | -          |            |            | -              |            |              | -            |   |   | 10 |
| Net loss for the period          |          | -             |        |   | -           |   |              | -          |            |            | -              |            |              | (20,970)     |   |   | (20,970) |
|                             |          |          |        |   |        |   |              |       |            |            |           |            |              |         |   |   |   |
| Balance, December 31, 2006       |          | 5,116,320     |        |   | 512         |   |              | 59,214     |            |            | -              |            |              | (20,970)     |   |   | 38,756 |
| Foreign currency translation     |          |          |        |   |        |   |              |       |            |            |           |            |              |         |   |   |   |
| adjustment                       |          | -             |        |   | -           |   |              | -          |            |            | 3,638          |            |              | -            |   |   | 3,638 |
| Net loss for the year            |          | -             |        |   | -           |   |              | -          |            |            | -              |            |              | (64,416)     |   |   | (64,416) |
|                             |          |          |        |   |        |   |              |       |            |            |           |            |              |         |   |   |   |
| Balance, December 31, 2007       |          | 5,116,320     |        |   | 512         |   |              | 59,214     |            |            | 3,638          |            |              | (85,386)     |   |   | (22,022) |
| Foreign currency translation     |          |          |        |   |        |   |              |       |            |            |           |            |              |         |   |   |   |
| adjustment                       |          | -             |        |   | -           |   |              | -          |            |            | 2,040          |            |              |         |   |   | 2,040 |
| Net loss for the period          |          | -             |        |   | -           |   |              | -          |            |            | -              |            |              | (5,927)      |   |   | (5,927) |
|                             |          |          |        |   |        |   |              |       |            |            |           |            |              |         |   |   |   |
| **Balance, March 31, 2008**      |          | **5,116,320** |        | **$**  | **512**     |   | **$**             | **59,214** |            | **$**           | **5,678**      |            | **$**             | **(91,313)** |   | **$**  | **(25,909)** |

 

(The accompanied notes are an integral part of these unaudited interim financial statements.)

 

- 4 -

 

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**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Interim Statements of Cash Flows Statements

Three Months Ended March 31, 2008 and 2007, and the Period from Date of Inception (May 9, 2006) Through December 31, 2007

(Unaudited)

 

|                                                                                        |             |         |         |   |          |   | Period from |
|---------------------------------------------------------------------------------------------|------------------|--------------|--------------|--------|---------------|--------|-------------|
|                                                                                        |             |         |         |   |          |   | Date of     |
|                                                                                        |             |         |         |   |          |   | Inception   |
|                                                                                        | **Three Months** |         | Three Months |   | (May 9, 2006) |
|                                                                                        | **Ended**        |         | Ended        |   | Through       |
|                                                                                        | **March 31,**    |         | March 31,    |   | March 31,     |
|                                                                                        | **2008**         |         | 2007         |   | 2008          |
| **Cash Flows from Operating Activities**                                                    |             |         |         |   |          |   |        |   |
| Net loss                                                                                    | **$**            | **(5,927)**  |         | $      | (8,755)       |   | $           | (91,313) |
| Changes in working capital:                                                                 |             |         |         |   |          |   |        |   |
| Prepaid expense                                                                             |             | **455**      |         |   | (1,280)       |   |        | 455 |
| Accrued liabilities                                                                         |             | **(5,072)**  |         |   | (5,339)       |   |        | 18,587 |
|                                                                                        |             |         |         |   |          |   |        |   |
| **Net Cash Used in Operating Activities**                                                   |             | **(10,544)** |         |   | (15,374)      |   |        | (72,271) |
|                                                                                        |             |         |         |   |          |   |        |   |
| **Cash Flows from Investing Activities**                                                    |             |         |         |   |          |   |        |   |
| Acquisition of mineral rights                                                               |             | **-**        |         |   | (310)         |   |        | (20,710) |
|                                                                                        |             |         |         |   |          |   |        |   |
| **Net Cash Used in Investing Activities**                                                   |             | **-**        |         |   | (310)         |   |        | (20,710) |
|                                                                                        |             |         |         |   |          |   |        |   |
| **Cash Flows from Financing Activities**                                                    |             |         |         |   |          |   |        |   |
| Stock issuance for cash                                                                     |             | **-**        |         |   | -             |   |        | 59,716 |
| Loans from related parties                                                                  |             | **10,512**   |         |   | -             |   |        | 33,270 |
|                                                                                        |             |         |         |   |          |   |        |   |
| **Net Cash Provided by Financing Activities**                                               |             | **10,512**   |         |   | -             |   |        | 92,986 |
|                                                                                        |             |         |         |   |          |   |        |   |
| **Net (Decrease) Increase in Cash**                                                         |             | **(32)**     |         |   | (15,684)      |   |        | 5 |
| **Cash - Beginning of Period**                                                              |             | **37**       |         |   | 48,007        |   |        | - |
|                                                                                        |             |         |         |   |          |   |        |   |
| **Cash - End of Period**                                                                    | **$**            | **5**        |         | $      | 32,323        |   | $           | 5 |
|                                                                                        |             |         |         |   |          |   |        |   |
| **Supplementary Information**                                                               |             |         |         |   |          |   |        |   |
| Interest                                                                                    | **$**            | **-**        |         | $      | -             |   | $           | - |
|                                                                                        |             |         |         |   |          |   |        |   |
| Income taxes                                                                                | **$**            | **-**        |         | $      | -             |   | $           | - |
|                                                                                        |             |         |         |   |          |   |        |   |
| In December 2006, 100,000 common shares were issued for mineral rights at the value of $10. |

 

 

(The accompanied notes are an integral part of these unaudited interim financial statements.)

 

- 5 -

 

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**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **1.** | **Nature of Business and Exploration Activities** |
|--------|---------------------------------------------------|

Oro Volcanico Corp., ("the Company"), incorporated in the state of Delaware on May 9, 2006, is an exploration stage company operating in Canada. The Company's principal business is the acquisition and exploration of mining properties. On November 29, 2006, the Company entered into an agreement to acquire an 80% interest in sixteen mineral claims located in Dalet Township in                the northwestern part of the province of Quebec, Canada, from a company under common control. The interest was purchased for approximately $20,240 ($20,000 Canadian) plus issuance of 100,000 common shares by the Company valued at $10 as described in notes 6 and 8. The Company has not presently determined whether its mineral rights contain mineral reserves that are economically recoverable. The exploration and development of mineral deposits involves significant financial risks.                The success of the Company will be influenced by a number of factors, including exploration and extraction risks, regulatory issues, environmental regulations and other matters.

The exploration program will be oriented towards probing the conductive zones by ground geophysics followed by diamond drilling. The total budget for the exploration program is approximately $26,858. The result of the program will then be evaluated to plan the investigation by drilling.

| **2.** | **Going Concern** |
|--------|-------------------|

These unaudited interim financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has not generated revenues since inception and has not paid any dividends and is unlikely to pay dividends or generate earnings in the immediate or                foreseeable future. The continuation of the Company as a going concern is dependant upon the continued financial support from the shareholders, the ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations from its mineral rights. Management is planning to obtain equity financing to continue operations. Although the Company plans to pursue additional financing, there can be no assurance that the Company will                be able to secure financing when needed or obtain such terms satisfactory to the Company, if at all. As of March 31, 2008, the Company has an accumulated deficit during the exploration stage of $91,313. These and other factors raise substantial doubt regarding the Company's ability to continue as a going concern.

These unaudited interim financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

- 6 -

 

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**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **3.** | **Summary of Significant Accounting Policies** |
|--------|------------------------------------------------|

The accounting policies of the Company are in accordance with generally accepted accounting principles of the United States of America, and their basis of application is consistent with that of the previous year. Outlined below are those policies considered particularly significant:

|   | a) | Use of Estimates |
|--------|----|------------------|

Preparation of the unaudited financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and related notes to financial statements. These estimates are based on management's best knowledge of current events                and actions the Company may undertake in the future. Actual results may ultimately differ from estimates, although management does not believe such changes will materially affect the financial statements in any individual period.

|   | b) | Mineral Rights and Deferred Exploration Expenses |
|--------|----|--------------------------------------------------|

Costs related to the acquisition and exploration of mineral rights are recorded at cost and capitalized until the commencement of commercial production. If commercially profitable, mineral reserves are developed, capitalized costs of the related mineral rights are reclassified as mining assets and amortized according to the units of production method. If it is determined                that capitalized acquisition, exploration and development costs are not recoverable over the estimated economic life of the reserves, or if the project is abandoned, then such costs are written down to their net realizable value. The Company’s management reviews the carrying values of assets on a regular basis to determine whether any write-downs are necessary. The recoverability of amounts recorded for mineral rights and deferred exploration expenses depends on the                discovery of economically recoverable reserves, confirmation of the Company’s interest in the mining claims, the ability of the Company to obtain the necessary financing to complete the development, and future profitable production or proceeds from the disposition thereof.

|   | c) | Reporting Currency |
|--------|----|--------------------|

The U.S. dollar has been used as the unit of measurement in these financial statements.

|   | d) | Foreign Currency Translation |
|--------|----|------------------------------|

The functional currency of the Company's foreign entity is the local currency. The translation of foreign currencies into U.S. dollars is performed for balance sheet accounts using the exchange rates in effect at the balance sheet dates and for revenue and expense accounts using a weighted average exchange rate during the year. The gains or losses resulting from the                translation are included in Accumulated Other Comprehensive Income in the Statement of Stockholders’ (Deficit) Equity and are excluded from net loss.

 

- 7 -

 

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**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **3.** | **Summary of Significant Accounting Policies**(cont'd) |
|--------|--------------------------------------------------------|

|   | e) | Share-Based Payment |
|--------|----|---------------------|

The Company has adopted the disclosure requirements of Statements of Financial Accounting Standards ("SFAS") No. 123R, "Share-Based Payment" ("SFAS No. 123R") for stock options and similar equity instruments (collectively, "options") issued to employees. The Company applies the fair-value based method of accounting as prescribed by SFAS No. 123R. Under the fair value based                method, compensation cost is measured at the grant date based on the value of the award and is recognized over the service period, which is usually the vesting period. For stock options, the fair value is determined using an option-pricing model that takes into account the stock price at the grant date, the exercise price, the expected life of the option, the volatility of the underlying stock and the expected dividends on it, and the risk-free interest rate over the expected                life of the option. SFAS No. 123R also applies to transactions in which an entity issues its equity instruments to acquire goods or services from non-employees. Those transactions must be accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable.

Value of options granted has been estimated using the Black-Scholes option pricing model. The assumptions are evaluated annually and revised as necessary to reflect market conditions and additional experience.

|   | f) | Income Taxes |
|--------|----|--------------|

The Company accounts for income taxes pursuant to SFAS No. 109, "Accounting for Income Taxes" ("SFAS No. 109"). Deferred taxes are provided under the liability method whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between                the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

|   | g) | Comprehensive Income (Loss) |
|--------|----|-----------------------------|

The Company has adopted SFAS No. 130, "Reporting Comprehensive Income." ("SFAS No. 130"). SFAS No. 130 establishes standards for reporting and presentation of comprehensive income and its components in a full set of financial statements. Comprehensive income is presented in the statement of stockholder's (deficit) equity, and consists of net loss and unrealized gains                (losses) on available for sale marketable securities; foreign currency translation adjustments; changes in market value of future contracts that qualify as a hedge; and negative equity adjustments recognized in accordance with SFAS No. 87. SFAS No. 130 requires only additional disclosures in the financial statements and does not affect the Company's financial position or results of operations.

 

- 8 -

 

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**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **3.** | **Summary of Significant Accounting Policies**(cont'd) |
|--------|--------------------------------------------------------|

|   | h) | Impairment of Long-lived Assets |
|--------|----|---------------------------------|

The Company evaluates the recoverability of long-lived assets and the related estimated remaining lives when events or circumstances lead management to believe that the carrying value of an asset may not be recoverable. Recoverability is assessed based on the carrying amount of a long-lived asset compared to the sum of the future undiscounted cash flows expected to result                from the use and the eventual disposal of the asset. An impairment loss is recognized when the carrying amount is not recoverable (exceeds the total undiscounted cash flows expected from its use and disposition) and exceeds fair value. For the periods ended March 31, 2008 and December 31, 2007, no events or circumstances occurred for which an evaluation of the recoverability of long-lived assets was required.

|   | i) | Asset Retirement Obligations |
|--------|----|------------------------------|

For operating properties, costs associated with environmental remediation obligations are accrued in accordance with SFAS No. 143, ''Accounting for Asset Retirement Obligations'' (''SFAS No 143''). SFAS No. 143 requires the Company to record a liability for the present value of the estimated environmental remediation costs, and the related asset created with it, in the                period in which the liability is incurred. The liability will be accreted and the asset will be depreciated over the life of the related assets. Adjustments for changes resulting from the passage of time and changes to either the timing or amount of the original present value estimate underlying the obligation will be made.

For non-operating properties, costs associated with environmental remediation obligations are accrued when it is probable that such costs will be incurred and they can be reasonably estimated. Estimates for reclamation and other closure costs are prepared in accordance with SFAS No. 5 ''Accounting for Contingencies,'' or Statement of Position 96-1 ''Environmental                Remediation Liabilities.'' Accruals for estimated losses from environmental remediation obligations have historically been recognized no later than completion of the remedial feasibility study for each facility and are charged to provision for closed operations and environmental matters. Costs of future expenditures for environmental remediation are not discounted to their present value unless subject to a contractually obligated fixed payment schedule. Such costs are based on                management's current estimate of amounts to be incurred when the remediation work is performed, within current laws and regulations.

Future closure, reclamation and environmental-related expenditures are difficult to estimate, in many circumstances, due to the early stage nature of investigations, and uncertainties associated with defining the nature and extent of environmental contamination and the application of laws and regulations by regulatory authorities and changes in reclamation or remediation                technology. Management periodically reviews accrued liabilities for such reclamation and remediation costs as evidence becomes available indicating that the Company's liabilities have potentially changed.

 

- 9 -

 

----

**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **3.** | **Summary of Significant Accounting Policies**(cont'd) |
|--------|--------------------------------------------------------|

|   | j) | Loss per Share |
|--------|----|----------------|

The Company adopted SFAS No.128, "Earnings per Share" which requires disclosure on the financial statements of basic and diluted loss per share. Basic loss per share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Diluted loss per share is computed by dividing net loss by the weighted average number of common                shares outstanding plus common stock equivalents (if dilutive) related to stock options and warrants for each period.

|   | k) | Recent Accounting Pronouncements |
|--------|----|----------------------------------|

In September 2006, the Financial Accounting Standards Board ("FASB") issued FASB Staff Position SFAS No. 157, "Fair Value Measurements" ("SFAS No. 157"), which defines fair value, establishes a framework for measuring fair value and expands the related disclosure requirements. SFAS No. 157 applies under other accounting pronouncements that require or permit fair value                measurements and does not require any new fair value measurements. SFAS No. 157 indicates, among other things, that a fair value measurement assumes that the transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. SFAS No. 157 defines fair value based upon an exit price model. In February 2008, the FASB issued FASB Staff                Positions (FSP) SFAS No. 157-1, "Application of FASB Statement No. 157 to FASB Statement No. 13 and Its Related Interpretive Accounting Pronouncements That Address Leasing Transactions," and FSP SFAS No. 157-2, "Effective Date of FASB Statement No. 157." FSP SFAS 157-1 removes leasing transactions from the scope of SFAS 157, while SFAS No. 157-2 defers the effective date of SFAS 157 to the fiscal year beginning after November 15, 2008 for nonfinancial assets and nonfinancial                liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis. It does not defer recognition and disclosure requirements for financial assets and financial liabilities, or for nonfinancial assets and nonfinancial liabilities that are remeasured at least annually. Effective January 1, 2008, the Company adopted SFAS 157, with the exception of the application of the statement to non-recurring nonfinancial assets and nonfinancial                liabilities. The adoption of SFAS 157 did not impact the Company's financial position or results of operations.

In September 2006, FASB issued Statement of Financial Accounting Standards ("SFAS") No. 158, “Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106, and 132(R)” ("SFAS No. 158") . The Company has adopted SFAS No. 158 except for the requirement to measure plan assets and benefit                obligations as of the date of the Company's fiscal year-end statement of financial position which is effective to fiscal years beginning after December 15, 2008. The Company is currently assessing the potential impact that the adoption of SFAS No. 158 could have on its financial statements.

 

- 10 -

 

----

**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **3.** | **Summary of Significant Accounting Policies**(cont'd) |
|--------|--------------------------------------------------------|

|   | k) | Recent Accounting Pronouncements (cont'd) |
|--------|----|-------------------------------------------|

In December 2007, FASB issued SFAS No. 141 (revised 2007), "Business Combinations" ("SFAS No. 141(R)"). This statement replaces SFAS No. 141, "Business Combinations" and requires an acquirer to recognize the assets acquired, the liabilities assumed, including those arising from contractual contingencies, any contingent consideration, and any noncontrolling interest in the                acquiree at the acquisition date, measured at their fair values as of that date, with limited exceptions specified in the statement. SFAS No. 141(R) also requires the acquirer in a business combination achieved in stages (sometimes referred to as a step acquisition) to recognize the identifiable assets and liabilities, as well as the noncontrolling interest in the acquiree, at the full amounts of their fair values (or other amounts determined in accordance with SFAS No. 141(R)).                In addition, SFAS No. 141(R)'s requirement to measure the noncontrolling interest in the acquiree at fair value will result in recognizing the goodwill attributable to the noncontrolling interest in addition to that attributable to the acquirer. SFAS No. 141(R) amends SFAS No. 109, "Accounting for Income Taxes", to require the acquirer to recognize changes in the amount of its deferred tax benefits that are recognizable because of a business combination either in income from                continuing operations in the period of the combination or directly in contributed capital, depending on the circumstances. It also amends SFAS 142, "Goodwill and Other Intangible Assets", to, among other things, provide guidance on the impairment testing of acquired research and development intangible assets and assets that the acquirer intends not to use. SFAS No. 141(R) applies prospectively to business combinations for which the acquisition date is on or after the beginning                of the first annual reporting period beginning on or after December 15, 2008. The Company is currently assessing the potential impact that the adoption of SFAS No. 141(R) could have on its financial statements.

In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements—amendment of Accounting Research Bulletin No. 51” (“SFAS 160”) SFAS 160 establishes accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. It also clarifies that                a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. SFAS 160 also changes the way the consolidated income statement is presented by requiring consolidated net income to be reported at amounts that include the amounts attributable to both the parent and the noncontrolling interest. It also requires disclosure, on the face of the consolidated statement of income,                of the amounts of consolidated net income attributable to the parent and to the noncontrolling interest. SFAS 160 requires that a parent recognize a gain or loss in net income when a subsidiary is deconsolidated and requires expanded disclosures in the consolidated financial statements that clearly identify and distinguish between the interests of the parent owners and the interests of the noncontrolling owners of a subsidiary. SFAS 160 is effective for fiscal periods, and                interim periods within those fiscal years, beginning on or after December 15, 2008. The Company is currently assessing the potential impact that the adoption of SFAS 160 could have on its financial statements.

 

- 11 -

 

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**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **3.** | **Summary of Significant Accounting Policies**(cont'd) |
|--------|--------------------------------------------------------|

|   | k) | Recent Accounting Pronouncements (cont'd) |
|--------|----|-------------------------------------------|

In February 2008, FASB issued FASB Staff Position (“FSP”) on SFAS No. 140-3, “Accounting for Transfers of Financial Assets and Repurchase Financing Transactions” (“FSP SFAS 140-3”). The objective of this FSP is to provide guidance on accounting for a transfer of a financial asset and a repurchase financing. This FSP presumes that an                initial transfer of a financial asset and a repurchase financing are considered part of the same arrangement (linked transaction) under SFAS No. 140, “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities” ("SFAS 140"). However, if certain criteria are met, the initial transfer and repurchase financing shall not be evaluated as a linked transaction and shall be evaluated separately under SFAS No. 140. FSP SFAS 140-3 is                effective for financial statements issued for fiscal years beginning after November 15, 2008, and interim periods within these fiscal years. Earlier application is not permitted. The Company is currently reviewing the effect, if any; the proposed guidance will have on its financial statements.

In March, 2008, FASB issued SFAS No. 161, "Disclosures about Derivative Instruments and Hedging Activities—amendment of FASB Statement No. 133" ("SFAS No. 161"). SFAS No. 161 requires enhanced disclosures about an entity’s derivative and hedging activities and thereby improves the transparency of financial reporting. SFAS No. 161 is effective for financial                statements issued for fiscal years and interim periods beginning after November 15, 2008. Earlier application is encouraged. The Company is currently reviewing the effect, if any; the proposed guidance will have on its financial statements.

In April 2008, FASB issued FASB Staff Position SFAS No. 142-3, “Determination of the Useful Life of Intangible Assets” (“FSP SFAS No. 142-3”). FSP SFAS No. 142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognizable intangible asset under SFAS No. 142,                “Goodwill and Other Intangible Assets” (“SFAS No. 142”). The intent of FSP SFAS No. 142-3 is to improve the consistency between the useful life of a recognizable intangible asset under SFAS No. 142 and the period of expected cash flows used to measure the fair value of the asset under SFAS 141(R), “Business Combinations” and other U.S. generally accepted accounting principles. FSP SFAS No. 142-3 is effective for financial statements issued for                fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. Early adoption is prohibited. The Company does not anticipate that the adoption of FSP SFAS No. 142-3 will have an impact on its financial position or results of operations.

 

- 12 -

 

----

**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **3.** | **Summary of Significant Accounting Policies**(cont'd) |
|--------|--------------------------------------------------------|

|   | k) | Recent Accounting Pronouncements (cont'd) |
|--------|----|-------------------------------------------|

In May, 2008, FASB issued FSP Accounting Principles Board ("APB") 141-1 "Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)" ("APB 141-1"). APB 141-1 clarifies convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement) are not addressed by paragraph 12                of APB Opinion No. 14, Accounting for Convertible Debt and Debt Issued with Stock Purchase Warrants. Additionally, APB 141-1 specifies that issuers of such instruments should separately account for the liability and equity components in a manner that will reflect the entity’s nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. Effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim                periods within those fiscal years. Early adoption is not permitted. The Company is currently reviewing the effect, if any; the proposed guidance will have on its financial statements.

In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles" ("SFAS No. 162"). SFAS No. 162 defines the order in which accounting principles that are generally accepted should be followed. SFAS No. 162 is effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board (“PCAOB”)                amendments to AU Section 411, "The Meaning of Present Fairly in Conformity with Generally Accepted Accounting Principles". The Company does not expect the adoption of SFAS No. 162 to have a material impact on its financial statements.

In May, 2008, FASB issued SFAS No. 163, "Accounting for Financial Guarantee Insurance Contracts—an interpretation of FASB Statement No. 60" ("SFAS 163"). SFAS 163 requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial                obligation. SFAS 163 also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. SFAS 163 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. The Company does not expect the proposed guidance will have an impact on its financial statements.

 

- 13 -

 

----

**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **4.** | **Financial Instruments** |
|--------|---------------------------|

Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risk arising from the financial instruments. The fair value of the financial instruments approximates their carrying values, unless otherwise noted.

Currency Risk

The Company realizes a portion of its expenses in foreign currencies, consequently, some assets, liabilities, and expenses are exposed to foreign exchange fluctuations. The following assets, liabilities, and expenses originate in Canadian dollars and are subject to fluctuations:

|   | Current assets | $ | 23,593 |
|--------|----------------|---|--------|

|   | Current liabilities | $ | 39,998 |
|--------|---------------------|---|--------|

|   | Expenses | $ | 5,927 |
|--------|----------|---|-------|

| **5.** | **Fair Value Measurements** |
|--------|-----------------------------|

Effective January 1, 2008, the Company adopted SFAS 157, except as it applies to the nonfinancial assets and nonfinancial liabilities subject to FSP SFAS 157-2. SFAS 157 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such,                fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, SFAS 157 establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

|   | Level 1 | -   Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------|

|   | Level 2 | -   Include other inputs that are directly or indirectly observable in the marketplace. |
|--------|---------|--------------------------------------------------------------------------------------------------------|

|   | Level 3 | -   Unobservable inputs which are supported by little or no market activity. |
|--------|---------|---------------------------------------------------------------------------------------------|

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Cash (level 1), prepaid expense (level 2), accrued liabilities (level 2) and loans from related parties (level 2) are reflected in the balance sheet at carrying value, which approximates fair value due to the short-term nature of these instruments.

 

- 14 -

 

----

**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **6.** | **Mineral Rights** |
|--------|--------------------|

On November 29, 2006, the Company entered into an agreement to acquire an 80% interest in sixteen mineral claims located in Dalet Township in the northwestern part of the province of Quebec, Canada, from a company under common control. The interest in mineral rights includes the following:

 

|                                             |   | **March 31,** |       | December 31, |
|--------------------------------------------------|--------|---------------|------------|--------------|
|                                             |   | **2008**      |       | 2007         |
|                                             |   |          |       | (Audited)    |
| Original acquisition costs by issuance of common |   | **$**         | **20,240** |         | $ | 20,240 |
| shares per note 8                                |   |          | **3,348**  |         |   | 3,348 |
| Miscellaneous acquisition costs                  |   |          |       |         |   |   |
|                                             |   | **$**         | **23,588** |         | $ | 23,588 |

| **7.** | **Loans from Related Parties** |
|--------|--------------------------------|

      

|                                                   |   | **March 31,** |       | December 31, |
|--------------------------------------------------------|--------|---------------|------------|--------------|
|                                                   |   | **2008**      |       | 2007         |
|                                                   |   |          |       | (Audited)    |
| Les Services Financiers Francis Mailhot Inc. 100%      |   |          |       |         |   |   |
| owned by the chief executive officer and major         |   |          |       |         |   |   |
| shareholder of the Company                             |   | **$**         | **18,521** |         | $ | 8,602 |
| 6541950 Canada Inc. - 50% owned by the chief executive |   |          |       |         |   |   |
| officer and major shareholder, and 50% owned by a      |   |          |       |         |   |   |
| director and minority shareholder of the Company       |   |          | **10,521** |         |   | 10,930 |
| Francis Mailhot - chief executive officer and major    |   |          |       |         |   |   |
| shareholder                                            |   |          | **2,923**  |         |   | 3,229 |
|                                                   |   |          |       |         |   |   |
|                                                   |   | **$**         | **31,965** |         | $ | 22,761 |

 

The loan from Les Services Financiers Francis Mailhot Inc. is non-interest bearing, unsecured, and due on demand.

The loan from 6541950 Canada Inc. is non-interest bearing, unsecured, and due on demand.

The loan from Francis Mailhot is non-interest bearing, unsecured, and due on demand.

 

- 15 -

 

----

**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **8.** | **Capital Stock** |
|--------|-------------------|

During 2006, the Company issued 5,016,320 common shares for proceeds of $59,716.

In December 2006, 100,000 common shares valued at $10, were issued as part of the acquisition of mineral rights as described in note 6.

| **9.** | **Income Taxes** |
|--------|------------------|

The Company accounts for income taxes pursuant to SFAS No. 109. SFAS No. 109 prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates. The effects of future changes in tax laws or                rates are not anticipated.

Under SFAS No. 109 income taxes are recognized for the following: a) amount of tax payable for the current period, and b) deferred tax liabilities and assets for future tax consequences of events that have been recognized differently in the financial statements than for tax purposes.

The current provision for income taxes have been computed as follows:

 

|                                                    |   |   | **March 31,** |
|---------------------------------------------------------|--------|--------|---------------|
|                                                    |   |   | **2008**      |
| Expected income tax expense at the statutory rate - 31% |   |   |          |
| (December 31, 2007 - 31%)                               |   | **$**  | **1,837**     |
| Valuation allowance                                     |   |   | **(1,837)**   |
|                                                    |   |   |          |
| Current provision for income taxes                      |   | **$**  | **-**         |

 

The Company has tax losses available to be applied against future years' taxable income. Due to the losses incurred in the current period and expected future operating results, management determined that it is more likely than not that the deferred tax asset resulting from the tax losses available for carryforward and will not be realized through the reduction of future                income tax payments. Accordingly a 100% valuation allowance has been recorded for the current income taxes and the deferred income tax assets.

 

- 16 -

 

----

**ORO VOLCANICO CORP.**

**(AN EXPLORATION STAGE COMPANY)**

Notes to Interim Financial Statements

March 31, 2008 and 2007

(Unaudited)

 

| **9.** | **Income Taxes**(cont'd) |
|--------|--------------------------|

The Company has deferred income tax assets as follows:

      

|                                                    |   |   | **March 31,** |
|---------------------------------------------------------|--------|--------|---------------|
|                                                    |   |   | **2008**      |
| Expected income tax expense at the statutory rate - 31% |   |   |          |
| (December 31, 2007 - 31%)                               |   | **$**  | **1,837**     |
| Valuation allowance                                     |   |   | **(1,837)**   |
|                                                    |   |   |          |
| Current provision for income taxes                      |   | **$**  | **-**         |

 

As of March 31, 2008, the Company had $91,313 of Federal and state net operating loss carryforwards available to offset future taxable income. The Company has the following losses which expire in 20 years from the date the loss was incurred:

|   | 2026 | $ | 20,970 |
|--------|------|---|--------|

|   | 2027 | $ | 64,416 |
|--------|------|---|--------|

|   | 2028 | $ | 5,927 |
|--------|------|---|-------|

| **10.** | **Contingencies** |
|---------|-------------------|

The Company’s operations are governed by governmental laws and regulations regarding environmental protection. Environmental consequences are difficult to identify, in terms of level, impact or when they might occur. At the present time, and to the best knowledge of its management, the Company is in conformity with the laws and regulations in effect.

 

 

 

- 17 -

 

 

 

----

**ITEM 2 MANAGEEMENT’S DISCUSSION AND ANALYSIS OR PLAN**

**OF OPERATION**

 

Management’s Discussion and Analysis contains statements that are forward-looking. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially because of various factors.

 

**OVERVIEW**

 

**Plan of Operation**

 

Over the next twelve months, we intend to explore the Dalet Properties in order to determine if any mineral deposits in commercially viable quantities are present in such properties.

 

Exploration activities at the early exploration stage generally consist of conducting geological exploration work on the properties in order to discover the existence of any mineral deposits. Initially, we will focus on probing the conductive zones by ground geophysics, followed by diamond drilling. The existing data base is very good and the activities will be used to locate the drilling targets on                the ground. Induced polarization is the preferred method of detection for disseminated and massive metallic mineralization. It has the capability to detect lower grade zones and is not influenced by the physical environment of mineral occurrences. It is also less sensitive to variations in conductivity. If we discover any mineral deposits, we will also undertake additional exploration work in order to determine the economic and legal feasibility of mining any such mineral                deposits.

 

We have sufficient resources to pay for the operating expenses that we expect to incur in connection with our proposed exploration program over the next twelve months. As of December 31. 2007 we had approximately $5 in cash. We estimate that we will incur approximately $31,100 in expenses in carrying out our proposed exploration program over the next twelve months. With respect to Dalet I, such                expenses will amount to approximately $25,100 and will consist of the following: $6,800 for line cutting over the zone of airborne anomalies; $12,000.00 for geophysical survey – induced polarization; $1,800 in fees payable to consultants; $2,000 in travel expenses and lodging; and $2,500 for contingencies. With respect to Dalet II, such expenses will amount to approximately $6,000 and will consist of the following: $4,000 for location of the grid and flagging of the survey                stations; and $2,000 for travel and lodging. To the extent our cash resources are not adequate for the next twelve months of operations, our principal shareholder, Les Services Financiers Francis Mailhot Inc., has committed to arrange for a loan, advance or investment of up to $50,000 by itself or others to fund our operations. As of June 15, 2008, Mr. Mailhot and entities controlled by him had advanced the Company an aggregate of approximately $32,000 on an interest free basis.                We will require additional financing to develop the Dalet Properties.

 

If we discover any mineral deposits, we may need additional funds to undertake additional exploratory work to determine if the development of such mineral deposits is feasible. Because we do not expect to have any cash flow from operations, we will need to raise additional capital to pay for such expenses. We may have to borrow money from shareholders or issue debt or equity or enter into a strategic                arrangement with a third party. There can be no assurance that additional capital will be available to us. We currently have no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

 

**Going Concern Consideration**

 

Our independent auditors included an explanatory paragraph in their report on the accompanying financial statements regarding concerns about our ability to continue as a going concern. Our financial statements contain additional note disclosures describing the circumstances that lead to this disclosure by our independent auditors.

 

3

 

----

 

**Off-Balance Sheet Arrangements**

 

We have no off-balance sheet arrangements.

 

**INFLATION**

 

If we become operational, inflation can be expected to have an impact on our operating costs. A prolonged period of inflation could cause a general economic downturn and negatively impact our results.

 

**SEASONALITY**

 

If we become operational, we do not believe that our business will be seasonal to any material degree except that operations may be more difficult in extreme whether during winter months.

 

 

*Recent Accounting Pronouncements*

 

In June 2003, the Securities and Exchange Commission adopted final rules under Section 404 of the Sarbanes-Oxley Act of 2002. Commencing with our annual report for the year ended October 31, 2008, we will be required to include a report of management on our internal control over financial reporting. The internal control report must include a statement.

 

§

of management’s responsibility for establishing and maintaining adequate internal control over our financial reporting;

§

of management’s assessment of the effectiveness of our internal control over financial reporting as of year end;

§

of the framework used by management to evaluate the effectiveness of our internal control over financial reporting; and

§

that our independent accounting firm has issued an attestation report on management’s assessment of our internal control over financial reporting, which report is also required to be filed

 

*Critical Accounting Policies*

 

The preparation of financial statements and related notes requires us to make judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. An accounting policy is considered to be critical if it requires an accounting estimate to be made based on assumptions about                matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the financial statements.

 

*Off Balance Sheet Transactions*

 

We have not engaged in off-balance sheet arrangements described in Regulation S-K Section 303.

 

**ITEM 3. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISKS**

 

We do not own the type of market risk sensitive instruments described in Regulation S-K Section 305.

 

4

 

 

----

**ITEMS 4 AND 4T. CONTROLS AND PROCEDURES**

 

We maintain disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) that are designed to assure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and                communicated to management, including our Chief Executive Officer and Chief Financial Officer (one person, our President), as appropriate, to allow timely decisions regarding required disclosures.

 

As required by Exchange Act Rule 13a-15(b), as of the end of the period covered by this report, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of our disclosure controls and procedures. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our                disclosure controls and procedures were effective as of that date.

 

There was no change in our internal control over financial reporting during our most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

| .                     |                                                                                                                                                                                                 |   |
|-----------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| **PART II**           |
|                  |                                                                                                                                                                                                 |   |
| **OTHER INFORMATION** |
|                  |                                                                                                                                                                                                 |   |
| Item 1                | Legal Proceedings                                                                                                                                                                                    | None   |
| Item 1A               |                                                                                                                                                                                                 |   |
|                  | Risk Factors: Reference is made to our the section entitled “Risk Factors” in our Registration Statement on Form SB-2 number 333-146407 which was ordered effective on October 12, 2007. |   |
|                  |                                                                                                                                                                                                 |   |
| Item 2                | Unregistered Sale of Equity Securities and Use of Proceeds                                                                                                                                           |
|                  |                                                                                                                                                                                                 |   |
|                  | None                                                                                                                                                                                                 |   |
|                  |                                                                                                                                                                                                 |   |
| Item 3                | Defaults Upon Senior Securities                                                                                                                                                                      |
|                  |                                                                                                                                                                                                 |   |
|                  | None                                                                                                                                                                                                 |   |
|                  |                                                                                                                                                                                                 |   |
| Item 4                | Submission of Matters to a Vote of Shareholders                                                                                                                                                      |
|                  |                                                                                                                                                                                                 |   |
|                  | None                                                                                                                                                                                                 |   |
|                  |                                                                                                                                                                                                 |   |
| Item 5                | Other Information                                                                                                                                                                                    |
|                  |                                                                                                                                                                                                 |   |
|                  | None                                                                                                                                                                                                 |   |
|                  |                                                                                                                                                                                                 |   |
| Item 6                | Exhibits                                                                                                                                                                                             |
|                  |                                                                                                                                                                                                 |   |

 

5

 

----

 

 

 

|           |   |                                                                                                                                                                               |
|----------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Exhibit Number |   |  

Description                                                                                                                                                                |
| 31.1           |   | Section 302 Certification Of Chief Executive Officer and Chief Financial Officer                                                                                                   |
|           |   |                                                                                                                                                                               |
| 32.1           |   | Certification Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 Of The Sarbanes-Oxley Act Of 2002 – Chief Executive Officer and Chief Financial Officer |

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6

 

----

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

Oro Volcanico Corp.

(Registrant)

 

June 18, 2008

Montreal, Quebec

 

 

|   | By: /s/ Francis Mailhot |
|--------|-------------------------|

|   | Francis Mailhot, Chief Executive Officer |
|--------|------------------------------------------|

|   | (Principal Executive, Financial and Accounting Officer) |
|--------|---------------------------------------------------------|

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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