UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

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

For the quarterly period ended ~~July~~October 31, 2014

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

For the transition period from ________________ to _________________

Commission File Number 000-54700

GOLD AND GEMSTONE MINING INC.

(Exact name of registrant as specified in its charter)


Nevada	98-0642269
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

4020 N MacArthur Blvd Suite 122, Irving, Texas	75038
(Address of principal executive offices)	(Zip Code)

(972) 655-9870

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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. [X] YES [ ] 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). [X] YES [ ] NO

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]

Accelerated filer [ ]

Non-accelerated filer [ ]

(Do not check if a smaller reporting company)

Smaller reporting company [X]

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

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

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Shares Outstanding ~~543~~725,~~932~~555,~~501~~834 a/o ~~Aug~~Nov 116, 2014

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

GOLD AND GEMSTONE MINING, INC.
GOLD AND GEMSTONE MINING OF MEXICO, LIMITED LIABILITY COMPANY CAPITAL VARIABLE.
(AN EXPLORATION STAGE COMPANY)
BALANCE SHEETS (unaudited)
AS OF MAY 31, 2014 AND JULY 31, 2014
AS OF JUL 31, 2014 AND OCT 31, 2014
	Three months
	Three months ended October 31, 2014
	ended July 31,
	2014
ASSETS
Current assets
Cash and cash equivalents	722.73
Deferred financing costs	300,793.06
TOTAL ASSETS	301,515.79
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Liabilities
Current Liabilities
Bank overdraft	-
Accrued expenses	-
Accrued interest	-
Shareholder loans	-
Convertible notes payable, net of debt discount	-
Derivative liability	1,667.69
Note payable	-
Total Current Liabilities	1,667.69
Long-term Debt
Convertible notes payable	296,840.76
Total Liabilities	298,508.45
Stockholders’ Equity (Deficit)	3,821.97
50 Common stock, $76.44 par value, $3,821.97 shares authorized,
$3,821.97 shares issued and outstanding	-
Additional paid in capital	-
Deficit accumulated during the exploration stage	(814.63)
Total Stockholders’ Equity (Deficit)	3,007.34
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	301,515.79

~~Mexican Peso MX rate in dollars it is an average of the past days of the month june, july, august: $13.0823~~ASSETS

~~See~~Current ~~accompanying notes to financial statements.~~assets

Cash and cash equivalents

711.96

Deferred financing costs

296,312.15

TOTAL ASSETS

297,024.12

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

Liabilities

Current Liabilities

Bank overdraft

Accrued expenses

Accrued interest

Shareholder loans

Convertible notes payable, net of debt discount

Derivative liability

1,642.85

Note payable

Total Current Liabilities

1,642.85

Long-term Debt

Convertible notes payable

292,418.73

Total Liabilities

294,061.58

Stockholders’ Equity (Deficit)

3,765.03

50 Common stock, $76.44 par value, $3,821.97 shares authorized,

$3,821.97 shares issued and outstanding

Additional paid in capital

Deficit accumulated during the exploration stage

802.49

Total Stockholders’ Equity (Deficit)

2,962.54

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

297,024.12

The exchange rate in dollars it is an average of the past days of the month august, september, october: $13.2801

GOLD AND GEMSTONE MINING, INC.
GOLD AND GEMSTONE MINING OF MEXICO, LIMITED LIABILITY COMPANY CAPITAL VARIABLE.
(AN EXPLORATION STAGE COMPANY)
STATEMENTS OF OPERATIONS (unaudited)
FOR THE THREE MONTHS ENDED MAY 31, 2014 AND JULY 31, 2014.
FOR THE THREE MONTHS ENDED JUL 31, 2014 AND OCT 31, 2014.
	Three Months Ended
	July 31, 2014
	October 31, 2014
REVENUES	-
OPERATING EXPENSES
Incorporation costs	~~494~~486.2387
Professional fees	~~165~~163.8740
Consulting fees	-
Transfer agent expense	-
Compensation	-
General and administrative	~~154~~152.5323
TOTAL OPERATING EXPENSES	~~814~~802.6349
LOSS FROM OPERATIONS	~~(814~~802.~~63)~~49
OTHER INCOME (EXPENSE)
Interest expense	-
Amortization of debt discount	-
Change in value of derivative liability	-
TOTAL OTHER INCOME (EXPENSE)	-
LOSS BEFORE INCOME TAXES	~~(814~~802.~~63)~~49
PROVISION FOR INCOME TAXES	-
NET LOSS	~~(814~~802.~~63)~~49
NET LOSS PER SHARE: BASIC AND DILUTED	~~(814~~802.~~63)~~49
WEIGHTED AVERAGE SHARES OUTSTANDING: BASIC AND DILUTED	-

The exchange rate in dollars it is an average of the past days of the month ~~june~~august, ~~july~~september, ~~august~~october: $13.~~0823~~2801

See accompanying notes to financial statements.

GOLD AND GEMSTONE MINING, INC.
GOLD AND GEMSTONE MINING OF MEXICO, LIMITED LIABILITY COMPANY CAPITAL VARIABLE.
(AN EXPLORATION STAGE COMPANY)
STATEMENTS OF CASH FLOWS (unaudited)
FOR THE THREE MONTHS ENDED MAY 31, 2014 AND JULY 31, 2014.
FOR THE THREE MONTHS ENDED JUL 31, 2014 AND OCT 31, 2014.
	Three months
	ended July 31,
	ended October 31,
	2014
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period	~~(814~~802.~~63)~~49
Adjustments to reconcile net loss to net cash used in operating activities:	-
Amortization of debt discount	-
Change in value of derivative liability	-
Changes in assets and liabilities:	-
Increase in deferred financing costs	-
Increase in bank overdraft	-
Increase (decrease) in accrued expenses	-
Increase in accrued interest	-
Net Cash Used in Operating Activities	~~(814~~802.~~63)~~49
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from note payable	~~(296~~292,~~840~~418.~~76)~~73
Proceeds from convertible notes payable	-
Proceeds from shareholder loans	-
Repayment of shareholder loans	-
Proceeds from sale of common stock	-
Net Cash Provided by Financing Activities	~~(296~~292,~~840~~418.~~76)~~73
NET DECREASE IN CASH AND CASH EQUIVALENTS	-
Cash and cash equivalents, beginning of period	-
Cash and cash equivalents, end of period	~~722~~711.7396
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	-
Income taxes paid	-
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING INFORMATION:
Forgiveness of shareholder debt	-
Derivative liability recorded on initial valuation of convertible notes payable	(296,932.66)

~~The~~SUPPLEMENTAL ~~exchange~~NON-CASH ~~rate~~INVESTING inAND ~~dollars~~FINANCING ~~it is an average of the past days of the month june, july, august~~INFORMATION: ~~$13.0823~~

~~See~~ Forgiveness ~~accompanying~~of ~~notes~~shareholder ~~to financial statements.~~debt

Derivative liability recorded on initial valuation of convertible notes payable

292,509.26

The exchange rate in dollars it is an average of the past days of the month august, september, october: $13.2801

GOLD AND GEMSTONE MINING, INC.
GOLD AND GEMSTONE MINING OF MEXICO, LIMITED LIABILITY COMPANY CAPITAL VARIABLE.
(AN EXPLORATION STAGE COMPANY)
STATEMENT OF STOCKHOLDERS 'EQUITY
				Deficit accumulated
				during the
	Common stock		Additional paid in	exploration
	Shares	Amount	capital	stage	Total
Inception, June 25, 2014.	50	$3,821.97	$ -		$ 3,821.97
July 31, 2014.	50	$3,765.03	$ -		$ 3,765.03
Net loss for the period from June 25, 2014 (inception) to July 31, 2014.				(814.63)	(814.63)
Net loss for the period from July 31, 2014 to October 31, 2014.				802.49	802.49
Balance, July 31, 2014.	50	$3,821.97	$ -	$(814.63)	$ 3,007.34
Balance, October 31, 2014.	50	$ 3,765.03	$ -	$ 802.49	$ 2,962.54

The exchange rate in dollars it is an average of the past days of the month ~~june~~august, ~~july~~september, ~~august~~october: $13.~~0823~~2801

Dated: ~~October~~December 622, 2014

/s/ Ivan Mondragon Ivan Mondragon Mendez VPPresident ~~Operations and General Manager Officer and Director~~ Gold and GemStone Mining Inc. Legal representant Gold and Gemstone Mining of Mexico, Limited Liability Company Capital Variable. Subsidiary Company

See accompanying notes to financial statements.

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

FINANCIAL STATEMENTS (unaudited)

APRIL 30, 2014

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

BALANCE SHEETS (unaudited)

AS OF ~~JULY~~OCTOBER 31, 2014 AND JANUARY 31, 2013

		April 30, 2014		January 31, 2013
ASSETS
Current assets
Cash and cash equivalents	$	0	$	0
Deferred financing costs		1,020		0
TOTAL ASSETS	$	1,020	$	0
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Liabilities
Current Liabilities
Bank overdraft	$	4,313	$	20
Accrued expenses		70,876		71,276
Accrued interest		6,865		2,513
Shareholder loans		900		900
Convertible notes payable, net of debt discount		104,956		19,451
Derivative liability		143,850		14,437
Note payable		664		664
Total Current Liabilities		332,424		109,261
Long-term Debt
Convertible notes payable		23,092		23,092
Total Liabilities		355,516		132,353
Stockholders’ Equity (Deficit)
Common stock, $.0001 par value, 400,000,000 shares authorized, 489,750,000 shares issued and outstanding		230,154		150,750
Additional paid in capital		-		1,977
Deficit accumulated during the exploration stage		(585,670)		(285,080)
Total Stockholders’ Equity (Deficit)		(355,516)		(132,353)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	$	0	$	0

October 31,

2014

January 31,

2013

ASSETS

Current assets

Cash and cash equivalents

Deferred financing costs

1,020

TOTAL ASSETS

1,020

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

Liabilities

Current Liabilities

Bank overdraft

4,313

Accrued expenses

70,876

71,276

Accrued interest

6,865

2,513

Shareholder loans

900

Convertible notes payable, net of debt discount

104,956

19,451

Derivative liability

143,850

14,437

Note payable

664

Total Current Liabilities

332,424

109,261

Long-term Debt

Convertible notes payable

23,092

Total Liabilities

355,516

132,353

Stockholders’ Equity (Deficit)

Common stock, $.0001 par value, 400,000,000 shares authorized, 489,750,000 shares issued and outstanding

230,154

150,750

Additional paid in capital

1,977

Deficit accumulated during the exploration stage

(585,670)

(285,080)

Total Stockholders’ Equity (Deficit)

(355,516)

(132,353)

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

See accompanying notes to financial statements.

7F-1

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF OPERATIONS (unaudited)

FOR THE THREE MONTHS ENDED ~~JULY~~OCTOBER 31, 2014 AND APRIL 30, 2013

	Three Months Ended	~~Three Months Ended~~
		April 30, 2014		April 30, 2013
	October 31, 2014		April 30, 2013
REVENUES	$	0	$	0
OPERATING EXPENSES
Incorporation costs		0		840
Professional fees		3,426		90,967
Consulting fees		1,200		57,000
Transfer agent expense		5,649		24,038
Compensation		144,230		7,700
General and administrative		9,082		27,294
TOTAL OPERATING EXPENSES		163,587		200,839
LOSS FROM OPERATIONS		(163,587)		(200,839)
OTHER INCOME (EXPENSE)
Interest expense		(2,422)		(3,784)
Amortization of debt discount		(5,730)		(10,855)
Change in value of derivative liability		(4,161)		(123,563)
TOTAL OTHER INCOME (EXPENSE)		(12,313)		(138,202)
LOSS BEFORE INCOME TAXES		(175,900)		(339,041)
PROVISION FOR INCOME TAXES
NET LOSS	$	(175,900)	$	(339,041)
NET LOSS PER SHARE: BASIC AND DILUTED	$	(0.00)	$	--
WEIGHTED AVERAGE SHARES OUTSTANDING: BASIC AND DILUTED		187,551,333		--

See accompanying notes to financial statements.

8F-2

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)

(unaudited)


							Deficit accumulated
							during the
	Common stock				Additional paid in		exploration
	Shares		Amount		capital		stage		Total
Inception, March 5, 2008	-	$	-	$	-	$	-	$	-
Net loss for the period from March 5, 2008 (inception) to January 31, 2009	-		-		-		(840)		(840)
Balance, January 31, 2009	-		-		-		(840)		(840)
Shares issued for cash	270,000,000		6,000		-		-		6,000
Net loss for the year ended January 31, 2010	-		-		-		(4,900)		(4,900)
Balance, January 31, 2010	270,000,000		6,000		-		(5,740)		260
Shares issued for cash	60,750,000		1,350		25,650		-		27,000
Net loss for the year ended January 31, 2011							(20,108)		(20,108)
Balance, January 31, 2011	330,750,000		7,350		25,650		(25,848)		7,152
Forgiveness of shareholder debt	-		-		3,840		-		3,840
Net loss for the year ended January 31, 2012	-		-		-		(28,301)		(28,301)
Balance, January 31, 2012	330,750,000		7,350		29,490		(54,149)		(17,309)
Cancellation and retirement of shares	(180,000,000)		(4,000)		4,000		-		0
Par value adjustment for 45:1 stock split	-		147,400		(33,490)		(113,910)		0
Forgiveness of shareholder debt	-		-		1,977		-		1,977
Net loss for the year ended January 31, 2013	-		-		-		(117,021)		(117,021)
Balance, January 31, 2013	150,750,000		150,750		1,977		(285,080)		(132,353)
Net loss for the period ended April 30, 2013	-		-		-		(167,871)		(167,871)
Balance, April 30, 2013	150,750,000	$	150,750	$	1,977	$	(452,951)	$	(300,224)

See accompanying notes to financial statements.

9F-3

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF CASH FLOWS (unaudited)

FOR THE THREE MONTHS ENDED ~~JULY~~APRIL 3130, 2013 AND 2012

						Period from
		Three months		Three months		March 5, 2008
		ended April 30,		ended April 30,		(Inception) to
		2013		2012		April 30, 2013
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period	$	(167,871)	$	(21,801)	$	(339,041)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discount		4,972		0		10,855
Change in value of derivative liability		129,413		0		123,563
Changes in assets and liabilities:
Increase in deferred financing costs		(6,750)		0		(6,750)
Increase in bank overdraft		3,771		0		3,791
Increase (decrease) in accrued expenses		(7,000)		8,004		64,276
Increase in accrued interest		965		0		3,478
Net Cash Used in Operating Activities		(42,500)		(13,797)		(139,828)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from note payable		0		0		664
Proceeds from convertible notes payable		42,500		0		99,447
Proceeds from shareholder loans		0		13,797		15,176
Repayment of shareholder loans		0		0		(8,459)
Proceeds from sale of common stock		0		0		33,000
Net Cash Provided by Financing Activities		42,500		13,797		139,828
NET DECREASE IN CASH AND CASH EQUIVALENTS		0		0		0
Cash and cash equivalents, beginning of period		0		0		0
Cash and cash equivalents, end of period	$	0	$	0	$	0
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	$	0	$	0	$	0
Income taxes paid	$	0	$	0	$	0
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING INFORMATION:
Forgiveness of shareholder debt	$	0	$	0	$	5,817
Derivative liability recorded on initial valuation of convertible notes payable	$	0	$	0	$	20,287

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING INFORMATION:

Forgiveness of shareholder debt

5,817

Derivative liability recorded on initial valuation of convertible notes payable

20,287

See accompanying notes to financial statements.

10F-4

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS (unaudited)

~~JULY~~OCTOBER 3130, 2014

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Description of Business

Gold and GemStone Mining Inc. (formerly Global GSM Solutions, Inc.) (“the Company”) was incorporated under the laws of the State of Nevada, U.S. on March 5, 2008.

On April 24, 2012, the Company amended its articles of incorporation to change the name of the Company to Gold and GemStone Mining Inc. The Company's principal business is the acquisition and exploration of mineral resources.

Exploration Stage Company

The Company is an Exploration Stage Company, as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification ("ASC") 915, Development Stage Entities.

Basis of Presentation

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

Accounting Basis

The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted a January 31 fiscal year end.

Cash and Cash Equivalents

The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. The Company had $01,050 ~~and~~Dec ~~$0 of cash as of April~~ 30, 2014.

Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, prepaid expenses, bank overdrafts, accrued expenses, accrued interest and shareholder loans. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

Income Taxes

Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

Use of Estimates

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

~~Revenue~~F-5 ~~Recognition~~

~~The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.~~12

Stock-Based Compensation

Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS (unaudited)

~~JULY~~APRIL 3130, 2014

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Revenue Recognition

The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.

Stock-Based Compensation

Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.

Basic Income (Loss) Per Share

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of April 30, 2013.

Comprehensive Income

The Company has established standards for reporting and display of comprehensive income, its components and accumulated balances. When applicable, the Company would disclose this information on its Statement of Stockholders’ Equity. Comprehensive income comprises equity except those resulting from investments by owners and distributions to owners. The Company has not had any significant transactions that are required to be reported in other comprehensive income.

Derivative financial instruments

FASB ASC subtopic 815-40, Derivatives and Hedging, Contracts in Entity’s own Equity (“ASC 815-40”) became effective for the Company on October 1, 2009. The Company has derivative liabilities resulting from the issuance of certain convertible debt, which were measured at fair value on a recurring basis using an option pricing model, consistent with level 3 inputs. See Note 5.

Recent Accounting Pronouncements

The Company does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flow.

NOTE 2 - GOING CONCERN

The financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has a working capital deficit, has not yet received revenues from sales of products or services, and has incurred losses since inception. Further losses are anticipated in the development of our business raising substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand and loans from directors and or private placement of common stock.

~~NOTE 3~~ F- ~~ACCRUED EXPENSES~~6

~~Accrued expenses consisted of the following at April 30, 2013 and January 31, 2013:~~13

		2013		2012
Audit fees	$	0	$	7,000
Accounting fees		2,100		2,100
Legal		8,691		8,691
Transfer agent		864		864
Consulting		50,000		50,000
Promotion		2,621		2,621
	$	64,276	$	71,276

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS (unaudited)

~~JULY~~APRIL 3130, 2014

NOTE 3 - ACCRUED EXPENSES

Accrued expenses consisted of the following at April 30, 2013 and January 31, 2013:


	2013		2012
Audit fees	$	0	$	7,000
Accounting fees		2,100		2,100
Legal		8,691		8,691
Transfer agent		864		864
Consulting		50,000		50,000
Promotion		2,621		2,621
	$	64,276	$	71,276

NOTE 4 - DUE TO RELATED PARTIES

An officer loaned $840 to the Company on March 5, 2008 and an additional $3,000 to the Company during the year ended January 31, 2011. The loans were due on demand, non-interest bearing and unsecured. The loans were forgiven during the year ended January 31, 2012 and recorded as contributed capital in accordance with ASC 470-50.

Additionally, during the year ended January 31, 2012, a shareholder and officer paid for expenses totaling $10,436. The amount is unsecured, non-interest bearing and due on demand. During the year ended April 30, 2013, $8,459 of this amount was repaid with the remaining $1,977 forgiven and recorded as contributed capital in accordance with ASC 470-50.

Also during the year ended January 31, 2013 a shareholder loaned the Company $900. The loan is unsecured, non-interest bearing and due on demand.

During July 1, 2014 a shareholder and officer loaned the company $8,000. The loan is unsecured, non-interest bearing and due on demand.

NOTE 5 - NOTES AND CONVERTIBLE NOTES PAYABLE

On February 22, 2012, the Company issued a convertible promissory note payable for $7,000. The note bears 10% interest, is secured by stock of the Company and is due in full on February 22, 2015. The loan and any accrued interest can be converted into shares of the Company’s common stock at any time at the market value on the date of conversion.

On May 30, 2012, the Company issued a convertible promissory note payable for $16,092. The note bears 10% interest, is secured by stock of the Company and is due in full on May 29, 2015. The loan and any accrued interest can be converted into shares of the Company’s common stock at any time at the market value on the date of conversion.

On July 17, 2012, the Company issued a convertible promissory note payable for $8,855. The note bears 8% interest, is secured by stock of the Company and is due in full on July 18, 2013. The loan and any accrued interest can be converted into shares of the Company’s common stock at any time at the average trading price of the Company’s stock for the 30 days preceding the conversion date. The Company valued the derivative liability associated with the beneficial conversion feature at $3,244 which was recorded as a discount on the debt and is being amortized over the life of the loan. Amortization of the debt discount of $811 was recorded during the period ended April 30, 2013. The Company used the following inputs to value the beneficial conversion feature; $0.04 stock price on the grant date; $0.06 exercise price; 1 year life; 178.525% volatility; and 0.18% risk-free interest rate.

F-7

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS (unaudited)

APRIL 30, 2014

NOTE 5 - NOTES AND CONVERTIBLE NOTES PAYABLE (continued)

On October 31, 2012, the Company issued a convertible promissory note payable for $25,000. The note bears 6% interest, is secured by stock of the Company and is due in full on October 31, 2013. The loan and any accrued interest can be converted into shares of the Company’s common stock at any time at the average trading price of the Company’s stock for the 30 days preceding the conversion date. The Company valued the derivative liability associated with the beneficial conversion feature at $17,043 which was recorded as a discount on the debt and is being amortized over the life of the loan. Amortization of the debt discount of $4,261 was recorded during the period ended April 30, 2013. The Company used the following inputs to value the beneficial conversion feature; $0.08 stock price on the grant date; $0.08 exercise price; 1 year life; 199.48% volatility; and 0.18% risk-free interest rate.

On January 25, 2013, the Company issued a promissory note payable for $664. The note bears 8% interest, is unsecured and due on January 26, 2014.

On February 22, 2013 the Company issued a promissory note payable for $ 42,500. The note bears interest at 8% is secured by stock of the Company and is due in full on November 26, 2013. Financing costs related to the note payable of $ 6,250 will be amortized over the life of the note.

Total interest expense on the notes and convertible notes payable was $2,513 during the year ended April 30, 2013.

In accordance with ASC subtopic 815-40, the beneficial conversion features of the convertible notes payable were revalued as of April 30, 2013 at $143,850 using the following inputs; $0.05 stock price on the grant date; $0.01 exercise price; 2-6 month life; 250.12% volatility; and 0.12% - 0.14% risk-free interest rate. The change in the value of the derivative liability of $129,413 has been recorded in other income.

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS (unaudited)

JULY 31, 2014

NOTE 6 - COMMON STOCK

The Company had 75,000,000 common shares authorized with a par value of $ 0.001 per share. On April 11, 2012, the Company filed an amendment to increase the authorized shares to 400,000,000 with a par value of $0.001 per share.

On January 19, 2010, the Company issued 270,000,000 shares of its common stock for total cash proceeds of $6,000.

On October 28, 2010, the Company issued 60,750,000 shares of its common stock for total cash proceeds of $27,000.

On April 11, 2012, the Company filed a certificate of change effecting a 45 to 1 forward stock split. All share and per share data in these financial statements and footnotes has been adjusted retrospectively to account for the stock split.

On May 4, 2012, a shareholder returned and cancelled 180,000,000 shares of common stock.

Shares Outstanding ~~are 543~~725,~~932~~555,~~501~~834 asa/o ofNov ~~August 11~~6, 2014.

F-8

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS (unaudited)

APRIL 30, 2014

NOTE 7 - COMMITMENTS

The Company neither owns nor leases any real or personal property. An officer has provided office services without charge. There is no obligation for the officer to continue this arrangement. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.

NOTE 8 - INCOME TAXES

As of April 30, 2013, the Company had net operating loss carry forwards of approximately $339,000 that may be available to reduce future years’ taxable income in varying amounts through 2033. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.

The provision for Federal income tax consists of the following for the three months ended April 30, 2013 and 2012:


	2013		2012
Federal income tax benefit attributable to:
Current operations	$	57,076	$	9,622
Less: valuation allowance		(57,076)		(9,622)
Net provision for Federal income taxes	$	0	$	0

The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows as of April 30, 2013 and January 31, 2013:


	April 30,		January 31,
	2013		2013
Deferred tax asset attributable to:
Net operating loss carryover	$	115,274	$	58,198
Less: valuation allowance		(115,274)		(58,198)
Net deferred tax asset	$	0	$	0

~~Due~~F-9 to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of approximately $339,000 for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur net operating loss carry forwards may be limited as to use in future years.

1416

GOLD AND GEMSTONE MINING INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS (unaudited)

~~JULY~~APRIL 3130, 2014

NOTE 8 - INCOME TAXES (CONTINUED)

Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of approximately $339,000 for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur net operating loss carry forwards may be limited as to use in future years.

NOTE 9 - SUBSEQUENT EVENTS

In accordance with ASC 855-10, the Company has analyzed its operations subsequent to ~~July~~October 31, 2014 to the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these financial statements other than the events described above.

15F-10

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

FORWARD LOOKING STATEMENTS

This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, which may cause our or our industry's 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 these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our unaudited financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

Unless otherwise specified in this quarterly report, all dollar amounts are expressed in United States dollars and all references to “common stock” refer to shares of our common stock.

As used in this quarterly report, the terms “we”, “us”, “our” and “our company” mean Gold and GemStone Mining Inc., unless otherwise indicated.

General Overview

We were incorporated in the State of Nevada as a for-profit company on March 5, 2008 under the name Global GSM Solutions Inc. We established a fiscal year end of January 31. We do not have revenues, have minimal assets and have incurred losses since inception. Our company was originally formed to develop, manufacture, and distribute our product and services to the gaming and vending industry that allows remote monitoring of amusement and vending devices. Our product was intended to improve security, productivity, and profitability of devices such as arcade games, toy dispensing machines, redemption games and vending machines. We were not able to raise sufficient capital to carry out our business plan and our management changed our focus to acquiring operating assets or businesses. On May 4, 2012 we entered into a collaboration agreement (the “JV Agreement”) and changed our business to that of mineral exploration.

Our common stock was initially approved for quotation on the OTC Bulletin Board under the symbol “GGSM” on December 27, 2010. On April 24, 2012, we filed a Certificate of Amendment with the Nevada Secretary of State to change our name from Global GSM Solutions Inc. to Gold and GemStone Mining Inc. and to increase our authorized capital from 75,000,000 to 400,000,000 shares of common stock, par value of $0.001. These amendments became effective on April 30, 2012 upon approval from the Financial Industry Regulatory Authority (“FINRA”). Also effective April 30, 2012, our issued and outstanding shares of common stock increased from 7,350,000 to 330,750,000 shares of common stock, par value of $0.001, pursuant to a 1 old for 45 new forward split of our issued and outstanding shares of common stock. On May 4, 2012 our company’s majority shareholders took a number of actions to reconfigure our capital structure. Our former directors and officers, Gennady Fedosov and Anna Ivashenko cancelled an aggregate of 180,000,000 shares of our common stock and transferred an additional 88,000,000 to incoming management. Subsequent to all cancellations and transfers, we had 150,750,000 shares issued and outstanding. Our CUSIP number is 380485102.

On November 1, 2013, Charmaine King has resigned as Director, President and CEO of our company it will remain responsible as Chief Financial officer of the company. On November 1, 2013, Rafael A Pinedo was appointed president, chief executive officer, director and secretary.

Other than as set out in this current report, we have not been involved in any bankruptcy, receivership or similar proceedings, nor have we been a party to any material reclassification, merger, consolidation or purchase or sale of a significant amount of assets not in the ordinary course of our business.

1618

Our Current Business

Gold and Gemstone Mining, Inc. is an exploration stage company that will engage in the acquisition, exploration, and development of Diamond and Gold properties around the world also to acquire a diverse portfolio of direct and indirect interests in exploration of Rare Earth minerals projects and assets.

Research and Development

During the year ended January 31, 2014 we did not spend any funds on research and development.

Employees

We are an exploration stage company and currently have no employees, other than our ~~two~~one ~~officers~~officer and ~~directors~~director who provide services on a consulting basis. In ~~addition of another consultants and contractors in Mexico.~~ All the other functions on the finance and engineering area are outsource through third parties.

Intellectual Property

We own all of the right to the websites, and the content therein, of www.ggsmining.com and www.chancerymining.com .

Governmental Regulations

Permits from a variety of regulatory authorities are required for many aspects of mine operation and reclamation. We cannot predict the extent to which these requirements will affect our company or our properties if we identify the existence of minerals in commercially exploitable quantities. In addition, future legislation and regulation could cause additional expense, capital expenditure, restrictions and delays in the exploration of our mining concessions.

Environmental Compliance

We are not aware of any material violations of environmental permits, licenses or approvals that have been issued with respect to our operations. We expect to comply with all applicable laws, rules and regulations relating to our business, and at this time, we do not anticipate incurring any material capital expenditures to comply with any environmental regulations or other requirements.

We were unable to fulfill our payment obligations in respect of the Joint Venture Agreements with TTM Global Enterprises Ltd. and Blue Orange Mining Limited and, consequently, the agreements were terminated as at February 26, 2013.

Effective January 25, 2013, we entered into an investment agreement with Deer Valley Management, LLC whereby Deer Valley Management will provide for a non-brokered financing arrangement of up to $5,000,000. The financing allows, but does not require us to issue and sell up to the number of shares of common stock having an aggregate purchase price of $5,000,000 to Deer Valley Management. Subject to the terms and conditions of the financing agreement and a registration rights agreement, we may, in our sole discretion, deliver a notice to Deer Valley Management which states the dollar amount which we intend to sell to Deer Valley Management on a certain date. The maximum amount that we shall be entitled to sell to Deer Valley Management shall be equal to 200% of the average daily volume (U.S. market only) of the common stock for the 10 trading days prior to the applicable notice date so long as such amount does not exceed 4.99% of the outstanding shares of our company. Deer Valley Management will purchase our common stock valued at a 22.5% discount from the weighted average price for the 3 lowest closing bid prices during 10 consecutive trading days or the previous closing bid price, whichever is less, prior to delivery and receipt of our capital request. The shares that we sell to Deer Valley Management must be registered stock, among other conditions of investment.

In connection with the investment agreement, we also entered into a registration rights agreement with Deer Valley Management dated January 25, 2013, whereby we agreed to file a Registration Statement on Form S-1 with the Securities and Exchange Commission within 21 days of the date of the registration rights agreement. As at the date of this annual report we have not complied with our obligation to file a registration statement on Form S-1 pursuant to the registration rights agreement and the investment agreement with Deer Valley Management and we are therefore in default of those Agreements.

Effective February 8, 2013, our company entered into a collaboration agreement with Tell Mining Group for the exploration and development of mineral properties in Africa. Tell Mining is an active owner and developer of gold mining concessions in Ghana. Each concession constitutes a separate mining project. The agreement contemplates the creation of a joint venture company in Ghana (the “Ghana JV Company”) for which our company and Tell Mining shall each hold 50% of the issued and outstanding ordinary shares of the Ghana JV Company. Our company is required to deposit $10,000 cash with Tell Mining prior to commencement of mining along with 15% of net profits once in production, paid quarterly per concession. The term of the agreement is 5 years. As at the date of this annual report no action has been taken in respect of the collaboration agreement with Tell Mining and we have not made any payment pursuant to the agreement.

Effective February 22, 2013, our company entered into a Securities Purchase Agreement with Asher Enterprises, Inc. Under the terms of the Agreement our company issued an 8% convertible promissory note, in the principal amount of $42,500, which note matures on November 26, 2013 and may be converted into shares of our company’s common stock at any time after 180 days from February 22, 2013, subject to adjustments as further set out in the Note. The conversion price shall be at a variable conversion rate of 55% multiplied by the market price, being the average of the lowest two trading prices for our company’s common stock during the 90 trading day period ending on the last complete trading day prior to the conversion date, subject to adjustments as further set out in the note. Our company received the sum of $42,500 principal under the note on February 22, 2013. The note is issued to Asher pursuant to Rule 506 of Regulation D of the Securities Act of 1933 on the basis that they represented to our company that they were an “accredited investor” as such term is defined in Rule 501(a) of Regulation D.

Effective July 6 2014, announces that it has completed the acquisition of a 100% interest (subject to certain underlying royalties) in the Gringo Viejo Project, the project is a past-producing mine dating back to 1982. A Preliminary Economic Assessment ("PEA") estimated an Indicated resource of 3.8 million tonnes at a grade of 1.66g/t gold and 24 g/t silver as well as an Inferred resource of 1.8 million tonnes at a grade of 1.39g/t gold and 31.96g/t silver (Mineral resources that are not mineral reserves do not have demonstrated economic viability. The PEA includes Inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the preliminary economic assessment will be realized), located on the best gold zone of Mexico with companies like Sierra Metals Inc, Goldcorp Inc, Minera Frisco SA own by Grupo Carso in Mexico the potential is exponential at short and medium term. The Company plans to undertake a complete review of all previous work, update the resource, conduct additional baseline studies and diamond drilling, to further advance in to feasibility and pre-production exploration stage. Further, we are looking in to expand our capacity of material processing from approximately 1200 tonnes a month to up to three times within a year, depending on additional institutional financing.

Our Business

We shifted our business focus on gold exploration in Mexico.

Mining Concessions

We will anticipate commitments in other areas in North Mexico, particularly in the State of Sinaloa, ~~Sonora~~ and ~~Chihuahua~~Sonora.

We will enter into a joint venture with gold mining concessions in Mexico.

Results of Operations

Our financial statements have been prepared assuming that we will continue as a going concern and accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.

We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.

Three Month Period Ended April 30, 2013 Compared to the Three Month Period Ended April 30, 2012 and the Period from Inception (March 5, 2008) to April 30, 2013.


						Period from
		Three months		Three months		March 5, 2008
		ended		ended		(Inception) to
		April 30,		April 30,		April 30,
		2013		2012		2013
Revenue	$	Nil	$	Nil	$	Nil
Operating Expenses	$	32,520	$	21,801	$	200,839
Other Expenses	$	135,351	$	Nil	$	138,202
Net Income (Loss)	$	(167,871)	$	(21,801)	$	(339,041)

Our net loss for the three month period ended April 30, 2013 was $167,871 compared to a net loss of $21,801 for the three month period ended April 30, 2012. Our net loss was $339,041 during the period from inception (March 5, 2008) to April 30, 2013. During the three month period ended April 30, 2013, we did not generate any revenue.


						Period from
		Three months		Three months		March 5, 2008
		ended		ended		(Inception) to
		April 30,		April 30,		April 30,
		2013		2012		2013
Incorporation costs	$	Nil	$	Nil	$	840
Professional fees	$	15,191	$	11,847	$	90,967
Consulting fees	$	Nil	$	7,000	$	57,000
Transfer agent expense	$	Nil	$	2,954	$	24,038
General and administrative	$	9,629	$	Nil	$	27,294

Other Expenses:
Interest expense	$	966	$	Nil	$	3,784
Amortization of debt discount	$	4,972	$	Nil	$	10,855
Change in value of derivative liability	$	129,413	$	Nil	$	123,563

During the three month period ended April 30, 2013, we incurred operating expenses of $32,520 compared to $21,801 for the three month period ended April 30, 2012. We incurred $200,839 during the period from inception (March 5, 2008) to April 30, 2013. The increase in our operating expenses was primarily due to increased professional fees, compensation and general and administrative expenses.

Liquidity and Capital Resources

Working Capital


		As at		As at
		April 30,		January 31,
		2013		2013
Current Assets	$	6,750	$	Nil
Current Liabilities	$	306,974	$	109,261
Working Capital (Deficit)	$	(300,224)	$	(109,261)

Cash Flows


						Period from
		Three months		Three months		March 5, 2008
		Ended		Ended		(Inception) to
		April 30,		April 30,		April 30,
		2013		2012		2013
Net cash used in operating activities	$	(42,500)	$	(13,797)	$	(139,828)
Net cash used in investing activities	$	Nil	$	Nil	$	Nil
Net cash provided by financing activities	$	42,500	$	13,797	$	139,828
Increase (decrease) in cash	$	Nil	$	Nil	$	Nil

As at April 30, 2013, our current assets were $6,670 compared to $Nil in current assets as at January 31, 2013. As at April 30, 2013, our current liabilities were $306,974 compared to $109,261 current liabilities as at January 31, 2013. Current liabilities at April 30, 2013 were comprised of $3,791 in bank overdraft, $64,276 in accrued expenses, $3,478 in accrued interest, $900 in shareholder loans, $90,015 in convertible notes payable, $143,850 in derivative liability and $664 in notes payable.

Cash Flows from Operating Activities

We have not generated positive cash flows from operating activities. For the three month period ended April 30, 2013, net cash flows used in operating activities was $42,500 consisting of a net loss of $167,872, a decrease in prepaid expenses of $7,000 and an increase in accrued expenses of $965. Net cash flows used in operating activities was $139,828 for the period from March 5, 2008 (inception) to April 30, 2013.

Cash Flows from Investing Activities

For the three-month period ended ~~July~~October 31, 2014, we did not generate any cash flows from investing activities.

Cash Flows from Financing Activities

We have financed our operations primarily from either advancements or the issuance of equity and debt instruments. For the three month period ended April 30, 2013, net cash flows from financing activities was $42,500. For the period from inception (March 5, 2008) to April 30, 2013, net cash provided by financing activities was $139,828 received mainly from related party loans and convertible loans.

Plan of Operation and Funding

The below tables describe our planned operating budget for the 12 month period beginning August 2014. The timeframe and cost estimates described represent our management’s beliefs based on its experiences and understanding of the mining industry in Mexico, where the concessions are located. The time frames described for each task indicate the estimated time of completion from when the task is initiated. Importantly, the initiation of any task will be subject to the availability of required capital, which cannot be guaranteed, and to the seasonal limitations on exploration in Mexico.

PHASE 1
Nature of Work	Timeframe	Cost
Incorporation and Registration of the Company (complete)	1 month	$10,000
Registration at Ministry of Mines in Mexico (complete)	1 month	$5,000
Obtain Land from Landowners (complete)	1 month	$25,000
Obtain Land from Landowners	1 month	$25,000
Obtain Mining License Work Plan (in progress)	2 months	$25,000
Obtain Mining License Work Plan	2 months	$25,000
Exploration Equipment (in progress)	2 months	$200,000
Exploration Equipment	2 months	$200,000
Production of Equipment (in progress)	1 month	$85,000
Production of Equipment	1 month	$85,000
Offices and Salaries	6 months	$200,000
Transport, Logistics	6 months	$50,000
Contingency		$50,000
Total	6 Months	$650,000

We have little cash on hand, no financing arrangements and no lines of credit or other bank financing arrangements. There can be no assurance that we will be able to close any financing and if we do close any financings, there can be no assurance that they will be sufficient to meet our needs for the upcoming 12 months.

We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.

Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next twelve months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations. We will have to raise additional funds in the next twelve months in order to sustain and expand our operations. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of our common stock. We have and will continue to seek to obtain short-term loans from our directors, although no future arrangement for additional loans has been made. We do not have any agreements with our directors concerning these loans. We do not have any arrangements in place for any future equity financing.

Off-Balance Sheet Arrangements

We have no 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 is material to stockholders.

Going Concern

The independent auditors' report accompanying our January 31, 2013 financial statements contained an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The current financial statements have been prepared by management and have not been review by our auditors , in addition "assuming that we will continue as a going concern, which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.

Critical Accounting Policies

The preparation of financial statements in conformity with United States generally accepted accounting principles requires our management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Our management routinely makes judgments and estimates about the effects of matters that are inherently uncertain.

Exploration Stage Company

Our company is an Exploration Stage Company, as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification ("ASC") 915, Development Stage Entities .

Basis of Presentation

The financial statements of our company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.

Accounting Basis

Our company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). Our company has adopted a January 31 fiscal year end.

Cash and Cash Equivalents

Our company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. Our company had $0 and $0 of cash as of April 30, 2014 and April 31, 2013 respectively.

Fair Value of Financial Instruments

Our company’s financial instruments consist of cash and cash equivalents, prepaid expenses, bank overdrafts, accrued expenses, accrued interest and shareholder loans. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

Income Taxes

Use of Estimates

Revenue Recognition

Our company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.

Stock-Based Compensation

Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718. To date, our company has not adopted a stock option plan and has not granted any stock options.

Basic Income (Loss) Per Share

Basic income (loss) per share is calculated by dividing our company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing our company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of April 30, 2014.

Comprehensive Income

Our company has established standards for reporting and display of comprehensive income, its components and accumulated balances. When applicable, our company would disclose this information on its Statement of Stockholders’ Equity. Comprehensive income comprises equity except those resulting from investments by owners and distributions to owners. Our company has not had any significant transactions that are required to be reported in other comprehensive income.

Derivative Financial Instruments

FASB ASC subtopic 815-40, Derivatives and Hedging, Contracts in Entity’s own Equity (“ASC 815-40”) became effective for our company on October 1, 2009. Our company has derivative liabilities resulting from the issuance of certain convertible debt, which were measured at fair value on a recurring basis using an option pricing model, consistent with level 3 inputs.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As a “smaller reporting company”, we are not required to provide the information required by this Item.

Item 4. Controls and Procedures

Management’s Report on Disclosure Controls and Procedures

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

As of the end of our quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president and chief financial officer (our principal executive officer, principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president and chief financial officer (our principal executive officer, principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.

Changes in Internal Control over Financial Reporting

During the period covered by this report there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

2324

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

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 any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

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

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

None

2425

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	GOLD AND GEMSTONE MINING INC.
Date: October 6, 2014	/s/ Ivan Mondragon
Date: December 23, 2014	/s/Ivan Mondragon
	Ivan Mondragon
	Vice President and General Manager OperationsOfficer, and Director
	President and General Manager Operations
	Officer, and Director

2526

Filing Compare · Gold & Gemstone Mining Inc.