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Gold/Mining/Energy : REX DIAMOND MINING TSE:RXD -- Ignore unavailable to you. Want to Upgrade?

To: Dave Duggan who wrote (1445)	5/23/1999 10:11:00 PM
From: virginijus poshkus	Read Replies (1) \| Respond to of 2522

Dave, i don't know about you. look, oil went down to $10 in dec.all of the oil companies had to write down their properties to $10 oil, now if oil goes back to $20, it did, they don't write up their properties, simple as that. gold went down the tube, gold properties were written off, now if gold goes back to $400,they don't write them back up, . do you understand this? forget fixed assets. we are talking about minerals here. the two little diamonds were from surface gravels, 3mm. they did not mean anything, the stock didnt go up on that. bigger game is awaiting, the small diamonds were telltale signs of the mother lode in our future, regarding serge , he doesn't have to file anything if a takeover occurs . believe me, when debeers wants us, they will pay, that is what serge is waiting for. watch the big picture, for get the trees, the forest is what the big boys look at. v

To: Dave Duggan who wrote (1445)	5/23/1999 10:35:00 PM
From: George J. Tromp	Respond to of 2522

Hello Dave: Maybe this might help in understanding the accounting methods from Rex website Revenue recognition and valuation of diamonds Diamonds ready for sale are valued at estimated net realizable value. Revenue from the production of diamonds is recognized when the diamonds have been separated from the broken ore, processed and are in a deliverable form. Revenue is subject to adjustment on the ultimate sale of the diamonds in inventory. No value is ascribed to diamonds in broken ore. Comments: Diamonds are not usually counted on the books until they have been separated from broken ore, processed in a deliverable form.Given the fact you havent been to Rexs mines, I doubt whether a reasonable conclusion can be inferred nor would I. I suspect that Rex Diamond could stockpile diamonds ( please see the greater than 30 carat stones referenced in the Q&A section, and since they have not been sorted, cleaned, or in a ready deliverable form would not be counted as inventory. It is very possible that Rex sold a bulk amount prior to the date of record of Dec 31, and was left with a nominal inventory from S.Africa. In reference to your question Rex or any company can write off leases, whenever they choose, however the Mineral claims are bought and paid for, as well if you had done some common sense research you might note that Serge Muller owns 7.5% royalty on Sierra Leone leases, that can be translated to about a 30% working interest by some standards. 7.5% Royalty on 18,000,000 potential carats valued conservatively (175US per carat) translates to 262mil dollars personal wealth. Diamonds Parts and supplies inventories Parts and supplies inventories are valued at cost on a first-in, first-out basis and written down when appropriate with regard to age, condition and utility. Mineral properties and fixed assets Mining property, plant and equipment are recorded at cost and include costs associated with the acquisition and further development of mining properties including interest paid on funds borrowed to finance mining assets until these assets come into production. These assets are depreciated on a unit of production basis recognizing both estimated proven and probable reserves. Equipment and vehicles are depreciated on a declining balance basis over five to ten years. Mine development costs incurred to maintain current production are included in operating costs. Mine development costs incurred to expand the capacity of the operating mine, to develop a new ore body or to develop mine areas substantially in advance of current production are capitalized until significant production commences. Exploration expenditures Costs relating to the acquisition, exploration and development of non-producing mining properties are capitalized until such time as either economically recoverable reserves are established, or the properties are sold or abandoned. The ultimate recovery of these costs depends on the discovery and development of economic ore reserves or the sale of the mineral rights. Reclamation and site restoration costs The Company provides currently for reclamation and site restoration costs where reasonably determinable, on a unit of production basis over the estimated economic life of the related mine. Translation of foreign currencies The US dollar is the Company's currency of measurement and the currency in which the financial statements are presented as it is the currency in which all of its revenues are derived. Monetary assets and liabilities of the Company and its subsidiaries denominated in foreign currencies are translated into US dollars at the exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are translated at the historical rates. Gains and losses on translation are reflected in net income for the period, except for unrealized foreign currency gains and losses on long-term monetary assets and liabilities which are deferred and amortized over the remaining lives of the related items on a straight line basis. I have to go now, will comment when I get some more time Regards George