UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

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

For the quarterly period ended April 30, 2013

[ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

For the transition period from ______ to _______

Commission File Number 000-54840

SOURCE GOLD CORP.

(Name of small business issuer in its charter)

1155 Camino Del Mar #162

Del Mar, CA 92014

(Address of principal executive offices)

(949) 436-9382

 (Registrant’s telephone number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [  ] No [X]

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.

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

As of May 15, 2013, there were 80,370,066 shares of the registrant’s $0.001 par value common stock issued and outstanding.

Explanatory Note

This Amendment No. 1 to the Quarterly Report on Form 10-Q/A (the “Amendment”) amends the Quarterly Report on Form 10-Q of Source Gold Corp. (the “Company”) for the quarter ended April 30, 2013 (the “Original Filing”), that was originally filed with the U.S. Securities and Exchange Commission on June 19, 2013. The Amendment is being filed for the purpose of restating the unaudited financial statements that begin on page 3 of this 10-Q/A as well as the financial numbers used in the MD&A section that begin on page 14. The revisions are the result of an audit partner and manager review of the financials filed in our Original Filing. The Amendment encloses exhibit 10.7, Promissory Note by and between the Company and Direct Capital Group, dated December 18, 2012, which was inadvertently not attached to the Original Filing. This Amendment to the Form 10-Q for the period ended April 30, 2013, also contains currently dated certifications as Exhibits 31.01, 32.01 and 32.02

For ease of reference, this Form 10-Q/A amends and restates the Original Filing in its entirety. Revisions to the Original Filing have been made to the following sections:

·                  Part I, Item 1 — Financial Statements

·                  Part I, Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations

·

Part II, Item 6 – Exhibits

Except as described above, the Amendment does not modify or update the disclosures presented in, or exhibits to, the Original Filing in any way, and speaks as of the date of the Original Filing and does not reflect events occurring subsequent to the original filing date.

SOURCE GOLD CORP.*

TABLE OF CONTENTS

Special Note Regarding Forward-Looking Statements

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Source Gold Corp. (the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

*Please note that throughout this Quarterly Report, and unless otherwise noted, the words "we,"”SRGL,” "our," "us," the "Company," refers to Source Gold Corp.

PART I - FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

SOURCE GOLD CORP.

(A Development Stage Company)

Condensed Consolidated Financial Statements

(Expressed in US dollars)

April 30, 2013 (unaudited)

Financial Statement Index

Consolidated Balance Sheets (2013 unaudited)

                                    4

Consolidated Statements of Operations and Comprehensive Loss (unaudited)                            5                                       

Consolidated Statement of Cash Flows (unaudited)                                                                      9

Notes to the Consolidated Financial Statements (unaudited)

      10

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

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

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

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 30, 2013

(Unaudited)

Note 1

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles for financial information and with the instructions to Form 10-Q of Regulation S-K. They do not include all information and footnotes required by United States generally accepted accounting principles for complete financial statements.  However, except as disclosed herein, there has been no material change in the information disclosed in the notes to the financial statements for the year ended July 31, 2012 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission. These condensed consolidated financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of management, all adjustments considered necessary for a fair presentation, consisting solely of normal and recurring adjustments have been made. Operating results for the nine months ended April 30, 2013 are not necessarily indicative of the results that may be expected for the year ending July 31, 2013.

The condensed consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States and are presented in United States dollars.  

These consolidated financial statements include the accounts of the Company and its wholly owned subsidiary companies IRC Exploration Ltd., (‘IRC”) a company incorporated in Alberta, Canada on August 1, 2008; Northern Bonanza Inc, (‘NBI”) a company incorporated in Ontario, Canada on June 30, 2010; Source Bonanza LLC, (“SB”) a Limited Liability Company incorporated in Nevada, USA on June 18, 2010; and Vulture Gold LLC (“Vulture”), a Nevada Limited Liability Company which was acquired on August 7, 2010.

All significant inter-company transactions and balances have been eliminated.

Note 2

Nature of Operations and Going Concern

The Company was incorporated in the state of Nevada, United States of America on June 4, 2008.  The Company is a development stage company and was formed for the purpose of acquiring exploration and development stage mineral properties.  The Company’s year-end is July 31. On August 31, 2009, the Company changed its name to Source Gold Corp. in order to reflect the current focus of the Corporation.

Effective September 10, 2009, the Company increased the number of authorized common shares of the Company from 90,000,000 to 180,000,000 shares and authorized preferred shares from 10,000,000 to 20,000,000 shares per director’s resolution dated August 31, 2009.  The Company also conducted a four to one forward stock split of the Company’s issued and outstanding common shares per director’s resolution. Following this stock split, the number of outstanding shares of the Company’s common stock increased from 11,100,000 shares to 44,400,000 shares. All share and per share information in these financial statements has been retroactively restated for all periods presented to give effect to this stock split.

During the year ended July 31, 2009, the Company acquired via its subsidiary company IRC Exploration Ltd. (“IRC”), a mineral claim located in British Columbia, Canada. During the year ended

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 30, 2013

(Unaudited)

Note 2

Natures of Operations and Going Concern - (Cont’d)

July 31, 2010, the mineral property option agreement for the claim in British Columbia was abandoned.

During the year ended July 31, 2010, the Company acquired two additional mineral properties located in Ontario, Canada. The Company also incorporated two new subsidiary companies, Northern Bonanza Inc. (“NBI”) to hold its mineral properties located in Ontario, Canada; and Source Bonanza LLC (“SB”), to hold its mineral properties located in the USA. The Company also transferred its Ontario mineral properties to NBI during the year ended July 31, 2010.

On August 7, 2010, the Company acquired a 100% interest in Vulture Gold LLC, (“Vulture”) a Nevada Limited Liability Company.  (Note 10)

On March 28, 2012, the Company entered into a property option agreement to acquire a 100% undivided right in three tenures comprising 2,785 acres in northern British Columbia, Canada. (Note 10)

The Company intends on exploring its mineral properties and has not yet determined the existence of economically recoverable reserves.  The recoverability of amounts incurred on its mineral properties is dependent upon the existence of economically recoverable reserves in the property, confirmation of the Company’s interest in the underlying mineral claims, the ability of the Company to obtain the necessary financing to complete their development, and the attainment and maintenance of future profitable production or disposition thereof.

These condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for its next fiscal year.  Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern.

The Company has yet to achieve profitable operations, has accumulated a deficit of $14,560,344 since inception, has working capital deficiency of $420,080, has no source of recurring revenues, and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Company’s ability to continue as a going concern.  The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing from shareholders or other sources to meet its obligations and repay its liabilities arising from normal business operations when they become due.

Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or related party advances, however there is no assurance of additional funding being available or on acceptable terms, if at all.

The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 30, 2013

(Unaudited)

Note 3

Newly Issued Accounting Pronouncements

The Company has reviewed issued accounting pronouncements and plans to adopt those that are applicable to it. The Company does not expect the adoption of any other pronouncements to have a material impact on its results of operations or financial position.

Note 4

Computer equipment

Note 5

Financial Instruments

Fair value is defined as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability.

The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk.

The fair value hierarchy for valuation inputs prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of three levels; the level is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

Level 1 – inputs are based upon unadjusted quoted prices for identical instruments traded in active markets.

Level 2– inputs are based upon significant observable inputs other than quoted prices included in Level 1, such as quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques.

The carrying value of the Company’s financial assets and liabilities which consist of cash, accounts payable, accrued liabilities, and derivative liabilities, in management’s opinion approximate their fair value due to the short maturity of such instruments. Derivative liabilities are valued using Level 3 inputs.

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 30, 2013

(Unaudited)

Note 6

Related Party Transactions

All related party transactions have been recorded at the exchange value which was the amount of consideration established and agreed to by the related parties.

As of April 30, 2013, due to related party includes $15,782 (July 31, 2012 - $3,429) owing to the former President.

During the three month period ended April 30, 2013, the Company incurred management fees of $45,000 (three month period ended April 30, 2012 - $18,000) owed to the Company’s former president and Syndication Capital.

During the nine month period ended April 30, 2013, the Company incurred management fees of $81,000 (nine month period ended April 30, 2012 - $54,000) owed to the Company’s former president and Syndication Capital.

On November 1, 2009, the Company entered into a Corporate Management Services Agreement with the President of the Company for management services.  Pursuant to the agreement the President would receive a signing bonus of $7,500 (paid November 1, 2009) and $5,000 per month beginning December 1, 2009 for services rendered plus reimbursement of the Company’s expenses.  The agreement may be terminated by either party upon 30 days written notice.

On June 21, 2011, the Company amended the agreement by issuing a resolution to reflect a payment of $7,500 per month for services rendered.

On October 31, 2012, the President of the Company acquired 10,000,000 common shares of the Company in a private transaction.  As of October 31, 2012, the President holds a 16.4% interest in the common stock of the Company.

Note 7

Convertible Notes Payable

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 30, 2013

(Unaudited)

Note 7   

Convertible Notes Payable – (Cont’d)

Promissory Note #1

On February 1, 2012, the Company received funding pursuant to a convertible promissory note in the amount of $32,500 dated January 23, 2012.  The promissory note was unsecured, bore  interest at 8% per

annum, and matured on October 25, 2012.  During the three month period ended April 30, 2013 the Company accrued $nil (three months ended April 30, 2012 - $614) in interest expense. .

During the nine month period ended April 30, 2013, the Company accrued $nil (nine months ended April 30, 2012 - $614) in interest expense as the entire note was converted into common stock during the first quarter of 2013.

The note could be converted at the option of the holder into Common stock of the Company.  The conversion price was 51% of the market price, where market price was defined as “the average of the lowest three of the last ten closing trading prices on the OTCBB immediately prior to conversion date”.

During the three month period ended October 31, 2012, the Company issued an aggregate of 9,585,054 common shares with a fair value of $66,301 upon the conversion into common stock of this convertible note.

During the nine months ending April 30, 2013, the Company reclassified the derivative liability amount of $11,029 to additional paid in capital.

Promissory Note #2

On March 19, 2012, the Company received $30,000 cash from the issuance of a convertible promissory note in the amount of $30,000.  The promissory note is unsecured, interest free and repayable upon demand.

The note may be converted at the option of the holder into Common stock of the Company.  The fixed conversion price is $0.01 per share.  Accordingly the note may be converted into 3,000,000 common shares of the Company.

The Company determined that this Promissory note should be accounted for in accordance with FASB ASC 470-20 which addresses “Accounting for Convertible Securities with Beneficial Conversion Features".  The beneficial conversion feature is calculated at its intrinsic value (that is, the difference between the conversion price $0.01 and the fair value of the common stock into which the debt is convertible at the commitment date (per share being $0.08), multiplied by the number of shares into which the debt is convertible. The valuation of the beneficial conversion feature recorded cannot be greater than the face value of the note issued.

A portion of the proceeds from issuance of the convertible debt, equal to the intrinsic value, is allocated to additional paid-in capital.  Because the debt is due on demand and is convertible at the date of issuance, the valuation of the beneficial conversion feature is charged to interest expense at the date of issuance.

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 30, 2013

(Unaudited)

During the year ended July 31, 2012 interest expense relating to the beneficial conversion feature of this convertible note of $30,000 (2011 - $nil) was recorded in the financial statements, with a corresponding increase to additional paid in capital.

Note 7

Convertible Notes Payable – (Cont’d)

Promissory Note #3

On May 14, 2012, the Company received funding pursuant to a convertible promissory note in the amount of $52,500.   The promissory note is unsecured, bears interest at 8% per annum, and matured on February 18, 2013.  During the three month period ended April 30, 2013 the Company accrued $312 (three month period ended April 30, 2012 - $nil) in interest expense.  During the nine month period ended April 30, 2013 the Company accrued $3,065 (nine month period ended April 30, 2012 - $nil) in interest expense.

After 180 days from issuance, the note may be converted at the option of the holder into common stock of the Company.  The conversion price is 51% of the market price, where market price is defined as “the average of the lowest three of the last ten closing trading prices on the OTCBB immediately prior to conversion date”.

On November 11, 2012, the Company recorded an initial derivative liability of $69,992 being the fair value of the conversion feature which was determined using the Black-Scholes valuation method.

On November 26, 2012, the Company issued 1,558,442 common shares upon the conversion of the principal amount of $12,000.  The derivative liability amounting to $15,803 was reclassified to additional paid in capital.

On December 13, 2012, the Company issued 1,463,415 common shares upon the conversion of the principal amount of $6,000. The derivative liability amounting to $6,951 was reclassified to additional paid in capital.

On January 22, 2013, the Company issued 2,903,226 common shares upon the conversion of the principal amount of $9,000. The derivative liability amounting to $12,172 was reclassified to additional paid in capital.

On February 25, 2013, the Company issued 3,090,909 common shares upon the conversion of the principal amount of $6,800. The derivative liability amounting to $6,661 was reclassified to additional paid in capital.

On March 25, 2013, the Company issued 3,466,667 common shares upon the conversion of the principal amount of $5,200. The derivative liability amounting to $13,544 was reclassified to additional paid in capital.

On April 3, 2013, the Company issued 3,470,588 common shares upon the conversion of the principal amount of $5,900. The derivative liability amounting to $11,741 was reclassified to additional paid in capital.

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 30, 2013

(Unaudited)

Note 7

Convertible Notes Payable – (Cont’d)

Promissory Note #3 (Cont’d)

On April 22, 2013, the Company issued 3,450,000 common shares upon the conversion of the principal amount of $6,900. The derivative liability amounting to $8,681 was reclassified to additional paid in capital.

As of April 30, 2013, the principal balance is $700 and the derivative liability balance is $887.

Promissory Note #4

On October 5, 2012, the Company received funding pursuant to a convertible promissory note in the amount of $42,500.    The promissory note is unsecured, bears interest at 8% per annum, and matures on July 10, 2013.  During the three month period ended April 30, 2013 the Company accrued $829 (three month period ended April 30, 2012 - $nil) in interest expense.  During the nine month period ended April 30, 2013 the Company accrued $1,099 (nine month period ended April 30, 2012 - $nil) in interest expense.

After 180 days from issuance, the note may be converted at the option of the holder into Common stock of the Company.  The conversion price is 51% of the market price, where market price is defined as “the average of the lowest three of the last ten closing trading prices on the OTCBB immediately prior to conversion date”.

On April 4, 2013, the Company recorded a derivative liability of $84,577 being the fair value of the conversion feature which was determined using the Black-Scholes valuation method.

On April 30, 2013, the Company recorded a debit to the derivative liability of $32,691 based on the change in fair value bringing the derivative liability balance to $51,886.

Promissory Note #5

On October 30, 2012, the Company received funding pursuant to a convertible promissory note in the amount of $12,000. The promissory note is unsecured, bears interest at 8% per annum, and maturedon April 30, 2013.  During the three month period ended April 30, 2013, the Company accrued $234 (three month period ended April 30, 2012 - $nil) in interest expense.  During the nine month period ended April 30, 2013, the Company accrued $476 (nine month period ended April 30, 2012 - $nil) in interest expense.

After 180 days from issuance, the note may be converted at the option of the holder into Common stock of the Company.  The conversion price is 51% of the market price, where market price is defined as “the average of the lowest three of the last ten closing trading prices on the OTCBB immediately prior to conversion date”.

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 3, 2013

(Unaudited)

Note 7

Convertible Notes Payable – (Cont’d)

Promissory Note #5 (Cont’d)

On April 29, 2013, the Company recorded a derivative liability of $14,650 being the fair value of the conversion feature which was determined using the Black-Scholes valuation method.

Promissory Note #6

On December 18, 2012, the Company converted a loan payable of $11,774  to a convertible promissory note.  The promissory note is unsecured, bears interest at 8% per annum, and matures on June 18, 2013.  During the three month period ended April 30, 2013, the Company accrued $230 (three month period ended April 30, 2012 - $nil) in interest expense.  During the nine month period ended April 30, 2013, the Company accrued $343 (nine month period ended April 30, 2012 - $nil) in interest expense.

After 180 days from issuance the note may be converted at the option of the holder into Common stock of the Company.  The conversion price is 51% of the market price, where market price is defined as “the average of the lowest three of the last ten closing trading prices on the OTCBB immediately prior to conversion date”.

Promissory Note #7

On February 12, 2013, the Company received funding pursuant to a convertible promissory note in the amount of $27,500.The promissory note is unsecured, bears interest at 8% per annum, and matures on August 13, 2013.  During the three month period ended April 30, 2013 the

Company accrued $464 (three month period ended April 30, 2012 - $nil) in interest expense.  During the nine month period ended April 30, 2013, the Company accrued $422 (nine month period ended April 30, 2012 - $nil) in interest expense.

After 180 days from issuance the note may be converted at the option of the holder into Common stock of the Company.  The conversion price is 51% of the market price, where market price is defined as “the average of the lowest three of the last ten closing trading prices on the OTCBB immediately prior to conversion date”.

Note 8

Derivative Liabilities

The Company issued financial instruments in the form of convertible notes with embedded conversion features.  The convertible notes payable have conversion rates which are indexed to the market value of the Company’s common stock price.

During the nine months ended April 30, 2013, the Company has a balance of derivative liabilities for embedded conversion features related to convertible notes payable of face value $94,922  (July 31, 2012 - $38,425).  During the nine month period ending April 30, 2013, $84,300 (July 31, 2012 - $nil) of convertible notes payable were converted into common stock of the Company.

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 30, 2013

(Unaudited)

Note 8       Derivative Liabilities – (Cont’d)

These derivative liabilities have been measured in accordance with fair value measurements, as defined by GAAP. The valuation assumptions are classified within Level 1 inputs and Level 2 inputs.

The following table represents the Company’s derivative liability activity for the embedded conversion features discussed above:

Note 9

Common Stock

The Company is authorized to issue 20,000,000 shares of it $0.001 par value preferred stock and 180,000,000 shares of its $0.001 par value common stock.

During the three month period ended April 30, 2013, the Company issued 13,478,164 common shares with a fair value of $24,800 upon the conversion of promissory notes into common stock.

Warrants and Options

As of April 30, 2013 and July 31, 2012 , there were no warrants or options outstanding to acquire any additional shares of the Company’s common stock.

Note 10

Mineral Properties

a)

On October 26, 2009, the Company entered into a property option agreement whereby the Company was granted an option to earn up to a 50% interest in 19 mineral claims (the “KRK West” claims) located in the Thunder Bay Mining Division of Ontario.  The option agreement is denominated in Canadian dollars.  

Consideration for the option was the issuance of 2,000,000 common shares of the Company, cash payments totaling $103,718 (CDN$110,000), and aggregate exploration expenditures of $969,268 (CDN$1,000,000) as follows:

 i)

Cash payments:

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April 3, 2013

(Unaudited)

Note 10

Mineral Properties – (Cont’d)

·

$46,640 (CDN$50,000) upon execution of the Option agreement (paid);

·

$57,078(CDN$60,000) on or before December 1, 2009 (paid)

ii)

Exploration expenditures of $484,768 (CDN$500,000) on or before December 31, 2010, and $969,268 (CDN$1,000,000) in aggregate on or before December 31, 2011.

In aggregate to July 31, 2011, the Company incurred exploration expenditures aggregating $155,946 (See below regarding status of the agreement)

iii)

The issuance of 2,000,000 common shares (none issued) to the shareholders of the optionor, as directed by the optionor.

Upon earning its 50% interest in the option, the Company was to enter into a joint venture agreement to develop and operate the property.

Pursuant to the agreement, if commercial production had been achieved and the Company sold or otherwise disposed of metals and minerals that had been produced and removed from the KRK West properties, the Company would pay Thunder Bay a 3% Net Smelter Return royalty.

In the event the Company sold or caused the sale of products other than to a smelter or refinery or otherwise caused the removal of products from the Property, the Company would pay a 2% Net Smelter Return Royalty. Alternatively, the Company could buy back the royalty right for $1,000,000 for each breccia pipe that reached commercial production.

The property option agreement was stated in Canadian dollars.  The US dollar equivalent was converted using the foreign exchange rate at July 31, 2010 for all future commitments.

During the year ended July 31, 2010, the Company learned that the optionor had allowed the underlying claims to lapse, and therefore the option agreement was null and void.

The Company, and a director of the Company (The Company subsequently purchased these claims from the director), purchased the claims from persons who re-staked the claims for an aggregate amount of $27,577.  Subsequent to acquisition, the claims were transferred to the Company’s wholly owned subsidiary, Northern Bonanza Inc.  Due to the lapse of the underlying claims, the Company impaired $131,295 of acquisition costs incurred as of July 31, 2010, comprising the initial $103,718 payment and the additional payment of $27,577.

The original optionor represents that control of the claims remains with the optionor and that the Company has no right to further explore the property.  The Company disagrees with this assertion and accordingly, ownership to the claims is in dispute.  On January 6, 2011, the Ministry of Northern Development, Mines and Forestry, Canada, was to adjudicate upon the ownership of the claims.  The hearing did not occur as the other party filed for a change of venue.  A determination regarding the change of venue has not yet been made and a date for rendering the decision has not yet been established.  

Mediation regarding the matter was deferred until late 2011 and prior to the hearing the optionor cancelled the mediation.

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April30, 2013

(Unaudited)

Note 10

Mineral Properties – (Cont’d)

In October 2011, the Company, as a result of the cancellation of the mediation hearing with William J. Wheeler regarding the Thunder Bay claims, decided the best course of action was to file suit.  

Accordingly, a suit was filed against Thunder Bay and Wheeler in Ontario Superior Court of Justice. In the suit we detail the breach of the agreement by Thunder Bay and Wheeler and request:

i.

An order transferring an application regarding mining claims pending before the Office of the Mining and Lands Commissioner to the  Ontario Superior Court of Justice to be consolidated with this action;

ii.

A declaration regarding our ownership and Thunder Bay and Wheeler’s ownership with respect to certain mining claims; and $1,200,000 in damages from Thunder Bay and Wheeler.

During the year ended July 31, 2010, the Company entered into a property purchase agreement, which was formalized on May 4, 2010, to acquire a 100% interest in 21 mining claims located in  Northern Ontario for $50,767 (Cdn$51,800).  During the year ended July 31, 2010, the Company incurred an additional $17,741 in staking costs in relation to these claims.  Subsequent to the acquisition the claims and exploration costs were transferred to NBI at cost.

During the year ended July 31, 2010, the Company made exploration advances to the operator amounting to $47,806.  As of July 31, 2010, the operator had incurred exploration expenses aggregating $20,118 resulting in net advances held being $26,968.  During the year ended July 31, 2011, the Company made further advances to the operator of $7,040.  

During the year ended July 31, 2011, the operator incurred exploration expenditures of $34,008 and the Company also incurred direct exploration expenditures of $47,335.

As of April 30, 2013, the operator held exploration advances amounting to $nil (July 31, 2012 - $nil). Due to lack of funding, the Company has no immediate plans to explore these properties to determine resources available and consequently the costs incurred of $68,599 for these mineral

properties were deemed to be fully impaired as of July 31, 2011.  Subsequent to the period end the Company abandoned the claims.

c)

On August 7, 2010, the Company acquired a 100% interest in Vulture Gold LLC, (“Vulture”) a Nevada Limited Liability Company. Vulture holds 27 mineral claims in Maricopa County, Arizona, known as the Vulture Mine. As consideration for the acquisition the Company issued 4,000,000 common shares with a fair value of $2,000,000.

This transaction has been recorded as an asset acquisition and the fair value paid has been allocated to the cost of acquisition of the mineral property.

During the nine month period ended April 30, 2013, the Company incurred exploration expenditures of $3,317.

Source Gold Corp.

(A Development Stage Company)

Notes to the Condensed Consolidated Financial Statements

April30, 2013

(Unaudited)

Note 10

Mineral Properties – (Cont’d)

Due to lack of funding, the Company has no immediate plans to explore these mines to determine resources available and consequently the costs  incurred for these mineral properties was  deemed to be fully impaired with a mineral property option impairment recorded in the amount of $2,203,611 during the fiscal year 2011.

d)

On March 28, 2012, the Company entered into a property option agreement whereby the Company was granted an option to earn a 100% interest in 3 mineral tenures located in Northern British Columbia.  The option agreement is denominated in US dollars.  

Consideration for the option was the issuance of 1,000,000 common shares of the Company on March 28, 2012 valued at $80,000 (issued), and a cash payment of $5,000 by April 2, 2012 (paid) and aggregate exploration expenditures of $25,000 by September 15, 2013.

As at April 30, 2013, no exploration expenditures have been incurred on the property.

Note 11

Commitments

The Company has an on-going agreement with a director of the Company to provide management services for $6,000 per month.  Either party may terminate the agreement with one month’s written notice.

Note 12

Subsequent events

On May 16, 2013, the holder of a convertible note converted $2,800 of principal and interest into 2,545,455 shares of its common stock at a price of $0.0011.

On June 6, 2013, the holder of a convertible note converted $3,200 of principal and interest into 3,440,860 shares of its common stock at a price of $0.00093.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

FORWARD-LOOKING STATEMENTS

This Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements. You can identify forward-looking statements by the use of the words may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of those terms. These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to differ materially from any forward-looking statements. Although we believe that the exceptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

RESULTS OF OPERATIONS

Working Capital

Cash Flows

Nine Months Ended

Results for the Nine Months Ended April 30, 2013 Compared to the Nine Months Ended April 30, 2012

Operating Revenues

The Company’s revenues for the nine months ended April 30, 2013 and April 30, 2012 were $nil and $nil, respectively. We do not anticipate earning additional revenues until such time that we enter into commercial production of our claims.  We are presently in the exploration stage of our business and we can provide no assurance that we will discover commercially exploitable levels of mineral resources, or if such resources are discovered, that we will enter into commercial production.

Cost of Revenues

The Company’s cost of revenues for the nine months ended April 30, 2013 and April 30, 2012 were $nil and $nil, respectively.

General and Administrative Expenses

General and administrative expenses for the nine months ended April 30, 2013 and April 30, 2012 were $168,992 and $154,098, respectively.  General and administrative expenses consisted primarily of consulting fees, management fees, officer compensation, legal fees and accounting and audit fees.  The increase was primarily attributable to an increase in Management fees for normal operations.

Net Loss

Net loss for the nine months ended April 30, 2013 was $(349,974) compared with a net loss of $(201,047) for the nine months ended April 30, 2012.  The increased net loss is due to an increase in the accretion of convertible note discount and interest on convertible notes– Note 7.

Results for the Period from June 4, 2008 (inception of exploration stage) Through April 30, 2013

Operating Revenues

The Company’s revenues for the period from June 4, 2008 (inception of development stage) through April 30, 2013 were $nil.

Cost of Revenues

The Company’s cost of revenues for the period from June 4, 2008 (inception of development stage) through April 30, 2013 were $nil.

General and Administrative Expenses

General and administrative expenses for the period from June 4, 2008 (inception of development stage) through April 30, 2013 were $14,299,513.  General and administrative expenses consist primarily of consulting fees, officer compensation, management fees, legal fees, office expenses, and professional fees appropriate for being a public company.

Net Loss

Net loss for the period from June 4, 2008 (inception of exploration stage) through April 30, 2013 was $(14,560,344).

Liquidity and Capital Resources

As at April 30, 2013, the Company had a cash balance and total assets of $110 and $87,036, respectively, compared with $15,620 and $102,609 of cash and total assets, respectively, as at July 31, 2012. The decrease in cash was due to normal operating activities and the decrease in total assets was due to the use of cash for operations.

As at April 30, 2013, the Company had total liabilities of $421,005 compared with $291,133 as at July 31, 2012. The increase in total liabilities was attributed to the issuance of a note payable, derivative liabilities and an increase in accounts payable and accrued liabilities.

The overall working capital deficit increased from $275,373 at July 31, 2012 to $420,080 at April 30, 2013.

Cashflows from Operating Activities

During the nine months ended April 30, 2013, cash used in operating activities was $(122,194) compared to $(176,542) for the nine months ended April 30, 2012.  The decrease in the amounts of cash used for operating activities was primarily due to the noncash expenses relating to the discount and interest on convertible notes. .

Cashflows from Investing Activities

During the nine months ended April 30, 2013 cash used in investing activities was $nil compared to $nil for the Nine months ended April 30, 2012.

Cashflows from Financing Activities

During the nine months ended April 30, 2013, cash provided by financing activities was $106,838 compared to $140,897 for the nine months ended April 30, 2012.  The decrease in cash provided by financing activities is due to receiving proceeds from issuance of common stock for the nine months ended April 30, 2012.

Quarterly Developments

On May 9, 2013, Jon Fullenkamp, resigned as President, Chief Executive Officer, Chief Financial Officer, Secretary, Treasurer, Chairman of the Board and as a Director. His resignation is for personal reasons and is not in connection with any known disagreement with the Company on any matter. On May 9, 2013, the Board of Directors appointed Mr. DhugaldPinchin, as the Chairman of the Board of Directors, President, Secretary, and Treasurer, effective immediately.

DhugaldPinchin obtained his degree in Bachelors of Business Administration and began working in the resource sector in the late 1990's. Mr. Pinchin then spent 10 years working in the banking sector specializing in finance and lending. Mr. Pinchin then returned to the resource sector and is currently working as Vice President of Business Development focusing on resource properties in Mexico from early exploration to those with primary resource calculations.

Going Concern

We have not attained profitable operations and are dependent upon obtaining financing to pursue any extensive acquisitions and activities. For these reasons, our auditors stated in their report on our audited 2012 financial statements that they have substantial doubt that we will be able to continue as a going concern without further financing.

Future Financings

We will continue to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund our operations and other activities.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Critical Accounting Policies

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in

conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

Recently Issued Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act"). Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of April 30, 2013, due to the material weaknesses resulting from the Board of Directors not currently having any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K, and controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Please refer to our Annual Report on Form 10-K as filed with the SEC on November 7, 2012, for a complete discussion relating to the foregoing evaluation of Disclosures and Procedures.

Changes in Internal Control over Financial Reporting

Our management has also evaluated our internal control over financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of our last evaluation.

The Company is not required by current SEC rules to include, and does not include, an auditor's attestation report. The Company's registered public accounting firm has not attested to Management's reports on the Company's internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

On October 26, 2009, we entered into an agreement with Thunder Bay Minerals, Inc. (the “Agreement” and “Thunder Bay”, respectively) under which we were granted an option to acquire an undivided 50% interest in 19 mineral claims known as the KRK West Claim, located north of Thunder Bay, Ontario, Canada. During the year ended July 31, 2010, we learned that Thunder Bay had allowed the KRK West Claims to lapse, and therefore the option agreement was null and void. As discussed above, we were able to re-purchase 13 of the 19 KRK West Claims from persons who re-staked the claims for an aggregate amount of $27,578. We also incurred exploration expenditures of $555 in relation to these claims. Subsequent to acquisition of the claims they were transferred to our wholly owned subsidiary, Northern Bonanza, Inc.

Thunder Bay currently maintains that control of the KRK West Claims remains with it and that we have no right to further explore the property. We disagree with this assertion and accordingly ownership to the claims is in dispute.

On January 6, 2011 the Ministry of Northern Development, Mines and Forestry, Canada, was to adjudicate upon the ownership of the claims. The hearing did not occur as the other party filed for a change of venue and mediation regarding the matter was scheduled. Two days prior to the scheduled mediation, William J. Wheeler (“Wheeler”), the principal of Thunder Bay, cancelled the mediation.

As a result of the cancellation, we decided the best course of action was to file suit. Accordingly, we filed an action against Thunder Bay and Wheeler in Ontario Superior Court of Justice. In the suit we detail the breach of the Agreement by Thunder Bay and Wheeler and request:

·

An order transferring an application regarding mining claims to Ontario Superior Court to be consolidated with this action;

·

A declaration regarding our ownership and Thunder Bay and Wheeler’s ownership with respect to certain mining claims; and

·

$1,200,000 in damages from Thunder Bay and Wheeler.

The Company entered into a formal settlement agreement with a vendor to settle an amount due of Cdn$34,000 by monthly installments of Cdn$5,000 commencing May 15, 2011. As of October 31, 2011, Cdn$30,000 of the total amount due has been paid.

Other than the foregoing we know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which our director, officer or any affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

ITEM 1A. RISK FACTORS

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

1.Quarterly Issuances:

On February 25, 2013, the holder of a convertible note converted $6,800 of principal and interest into 3,090,909 shares of its common stock at a price of $0.0022.

On March 25, 2013, the holder of a convertible note converted a total of $5,200 of principal and interest into 3,466,667 shares of its common stock at a price of $0.0015.

On April 3, 2013, the holder of a convertible note converted $5,900 of principal and interest into 3,470,588 shares of its common stock at a price of $0.0017.

On April 22, 2013, the holder of a convertible note converted $6,900 of principal and interest into 3,450,000 shares of its common stock at a price of $0.0020.

2. Subsequent Issuances:

On May 16, 2013, the holder of a convertible note converted $2,800 of principal and interest into 2,545,455 shares of its common stock at a price of $0.0011.

On June 6, 2013, the holder of a convertible note converted $3,200 of principal and interest into 3,440,860 shares of its common stock at a price of $0.00093.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

*Pursuant to Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

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.

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the Company and in the capacities and on the dates indicated.