UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[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, 2011

[ ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period ______________to _____________

Commission File Number 333-135980

NILAM RESOURCES INC.

(Exact name of small Business Issuer as specified in its charter)


Nevada	98-0487414
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

Calle Alcanfores 761 - 1701

Miraflores, Lima 18, Peru

Issuer’s telephone number, including area code 1-917-294-4072

~~_______________~~____________________

(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 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 the 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 proceeding 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.

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 [X ]

State the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 50,375,595 Class “A” Common Shares at a par value of $0.001 of the issuer Capital Stock are issued and outstanding as of ~~July~~October 31, 2011. The total number of authorized shares is 345,000,000.

PART I - FINANCIAL INFORMATION

Safe Harbor Statement

This report on Form 10-Q contains certain forward-looking statements. All statements other than statements of historical fact are “forward-looking statements” for purposes of these provisions, including any projections of earnings, revenues, or other financial items; any statements of the plans, strategies, and objectives of management for future operation; any statements concerning proposed new products, services, or developments; any statements regarding future economic conditions or performance; statements of belief; and any statement of assumptions underlying any of the foregoing. Such forward-looking statements are subject to inherent risks and uncertainties, and actual results could differ materially from those anticipated by the forward-looking statements.

These forward-looking statements involve significant risks and uncertainties, including, but not limited to, the following: competition, promotional costs, and risk of declining revenues. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of a number of factors. These forward-looking statements are made as of the date of this filing, and we assume no obligation to update such forward-looking statements. The following discusses our financial condition and results of operations based upon our consolidated financial statements which have been prepared in conformity with accounting principles generally accepted in the United States. It should be read in conjunction with our financial statements and the notes thereto included elsewhere herein.

Item 1. Financial Statements

The unaudited interim consolidated financial statements of Nilam Resources, Inc. (the “Company”, “Nilam”, “we”, “our”, “us”) follow. All currency references in this report are in U.S. dollars unless otherwise noted.

The accompanying Condensed Consolidated Financial Statements of Nilam Resources, Inc. should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended April 30, 2011. Significant accounting policies disclosed therein have not changed except as noted below.

Nilam Resources

(A Development Stage Company)

Unaudited

(Express in U.S. Dollars)

~~July~~October 31, 2011

Unaudited Consolidated Balance Sheets	5
Unaudited Consolidated Statements of Operations	6
Unaudited Consolidated Statement of Stockholders Equity (Deficit)	7
Unaudited Consolidated Statements of Cash Flows	8
Unaudited Notes to the Consolidated Financial Statements	9 - 15

-2-

NILAM RESOURCES INC.

(AN EXPLORATION STAGE COMPANY)

INTERIM CONSOLIDATED FINANCIAL STATEMENTS

~~July 31, 2011~~(Unaudited)

~~(Stated~~October in31, ~~US Dollars)~~2011

3(Stated in US Dollars)

~~NILAM RESOURCES INC.~~-3-

~~(AN~~NILAM ~~EXPLORATION~~RESOURCES ~~STAGE COMPANY)~~INC.

~~CONTENTS~~(AN EXPLORATION STAGE COMPANY)

PAGE	5	INTERIM CONSOLIDATED BALANCE SHEETS AS OF JULY 31, 2011 AND APRIL 30, 2011.
PAGE	6	INTERIM CONSOLIDATED STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED JULY 31, 2011 AND 2010, AND FOR THE PERIOD FROM JULY 11, 2005 (INCEPTION) TO JULY 31, 2011.
PAGE	7	INTERIM CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY FOR THE PERIOD FROM JULY 11, 2005 (INCEPTION) TO JULY 31, 2011.
PAGE	8	INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED JULY 31, 2011 AND 2010, AND FOR THE PERIOD FROM JULY 11, 2005 (INCEPTION) TO JULY 31, 2011.
PAGES	9 - 15	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

CONTENTS


PAGE	5	INTERIM CONSOLIDATED BALANCE SHEETS AS OF OCTOBER 31, 2011 AND APRIL 30, 2011.

PAGE	6	INTERIM CONSOLIDATED STATEMENT OF OPERATIONS FOR THE THREE AND SIX MONTHS ENDED OCTOBER 31, 2011 AND 2010, AND FOR THE PERIOD FROM JULY 11, 2005 (INCEPTION) TO OCTOBER 31, 2011.

PAGE	7	INTERIM CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT FOR THE PERIOD FROM JULY 11, 2005 (INCEPTION) TO OCTOBER 31, 2011.

PAGE	8	INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED OCTOBER 31, 2011 AND 2010, AND FOR THE PERIOD FROM JULY 11, 2005 (INCEPTION) TO OCTOBER 31, 2011.

PAGES	9 - 15	NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

~~NILAM RESOURCES INC.~~-4-

NILAM RESOURCES INC. (AN EXPLORATION STAGE COMPANY) CONSOLIDATED BALANCE SHEET (STATED IN U.S. DOLLARS)

CONSOLIDATED BALANCE SHEET


		October 31, 2011		April 30, 2011 (Audited)
ASSETS

CURRENT ASSETS
Cash	$	2,728	$	1,502
Prepaid expenses and deposits (Note 4)		24,540		-
		27,268		1,502
Investments (Note 4)		1,440,000		-
Mineral property (Note 3)		115,000		100,000
TOTAL ASSETS	$	1,582,268	$	101,502

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	406,216	$	318,399
Due to related parties (Note 7)		16,158		16,158
Share subscription liability (Note 6)		21,272		-
Notes payable - related parties (Note 5)		10,338		10,338

TOTAL LIABILITIES		453,984		344,895

STOCKHOLDERS’ EQUITY
Preferred stock, $0.001 par value, 1,000,000 shares authorized, none issued and outstanding		-		-

Common stock, $0.001 par value, 345,000,000 shares authorized, 52,055,595 shares and 50,375,595 shares issued and outstanding, respectively (Note 6)		52,056		50,376

Additional paid in capital (Note 6)		3,650,617		3,616,535

Accumulated deficit during exploration stage		(2,480,389)		(3,910,304)
Accumulated other comprehensive income		(94,000)		-
Total stockholders’ deficit		1,128,284		(243,393)

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	1,582,268	$	101,502

~~(STATED~~Nature INof ~~U.S.~~Operations ~~DOLLARS~~(Note 1)

	July 31, 2011			April 30, 2011 (Audited)
ASSETS
CURRENT ASSETS
Cash	$	2,346		$	1,502
		2,346			1,502
Investments		522,000			-
Mineral property (Note 3)		115,000			100,000
TOTAL ASSETS	$	639,346		$	101,502
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	350,810		$	318,399
Subscriptions received in advance (Note 5)		7,776
Due to related parties (Note 6)		16,158			16,158
Notes payable – related parties (Note 4)		10,338			10,338
TOTAL LIABILITIES		385,082			344,895
STOCKHOLDERS’ EQUITY
Preferred stock, $0.001 par value, 1,000,000 shares authorized, none issued and outstanding		-			-
Common stock, $0.001 par value, 345,000,000 shares authorized, 52,055,595 shares and 50,375,595 shares issued and outstanding, respectively (Note 5)		52,056			50,376
Additional paid in capital (Note 5)		3,649,535			3,616,535
Accumulated deficit during exploration stage		(2,435,327	)		(3,910,304	)
Accumulated other comprehensive income		(1,012,000	)		-
Total stockholders’ deficit		254,264			(243,393	)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	639,346		$	101,502

Subsequent Events (Note 8)

~~Nature~~Approved ofon ~~Operations~~Behalf ~~(Note~~of 1)the Board:

~~Subsequent~~/s/ ~~Events~~Shahin ~~(Note~~Tabatabaei, 8)Director

~~Approved~~See onaccompanying ~~Behalf~~notes ofto ~~the~~financial ~~Board:~~statements.

~~/s/ Shahin Tabatabaei, Director~~-5-

~~See~~NILAM ~~accompanying~~RESOURCES ~~notes~~INC. to(AN ~~financial~~EXPLORATION ~~statements.~~ STAGE COMPANY) INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS

5(Unaudited)

~~NILAM~~(STATED ~~RESOURCES~~IN ~~INC~~U.S. DOLLARS)

(AN EXPLORATION STAGE COMPANY)


	For the Three Months Ended October 31, 2011	For the Three Months Ended October 31, 2010	For the Six Months Ended October 31, 2011	For the Six Months Ended October 31, 2010	For the Period From July 11, 2005 (Inception) to October 31, 2011
OPERATING EXPENSES
Accounting and auditing fees	$ 4,620	$ 2,617	$ 7,432	$ 5,567	$ 140,551
Consulting fees	34,527	30,000	82,717	60,000	621,717
Exploration costs and expenses	-	-	-	-	59,555
General and administrative	1,221	2,334	5,513	10,654	67,626
Insurance	-	-	-	-	27,000
Investor relation	-	-	-	-	55,393
Listing and filing fees	1,340	2,020	1,340	2,020	17,208
Legal fees	3,343	800	7,072	1,600	108,894
Management fees	-	-	-	-	330,000
Stock-based compensation	-	-	-	-	100,977
Travel	-	-	-	-	14,695
Wages	-	-	-	-	20,630
Impairment of mineral property	-	-			208,000
Total Operating Expenses	45,051	37,771	104,074	79,841	1,772,246
LOSS FROM OPERATIONS	(45,051)	(37,771)	(104,074)	(79,841)	(1,772,246)

OTHER INCOME (EXPENSE)

Foreign currency transaction gain	(11)	-	(11)	-	897
Interest income	-	-	-	-	8
Loss on settlement of debt	-	-	-	-	(2,243,048)
Gain on sale of mineral properties	-	-	1,534,000	-	1,534,000

Total Other (Expense)/Income	(11)	-	1,533,989	-	(708,143)

NET INCOME (LOSS)	(45,062)	(37,771)	1,429,915	(79,841)	(2,480,389)
Other Comprehensive Income - Unrealized gain on available for sale investments	918,000	-	(94,000)	-	(94,000)
COMPREHENSIVE INCOME (LOSS)	$ 872,938	$ (37,771)	$ 1,335,915	$ (79,841)	$ (2,574,389)

Basic and Diluted Income (loss) per Common Share	$ (0.01)	$ (0.00)	$ 0.03	$ (0.00)	$ (0.15)

Weighted average number of shares outstanding during the period - basic and diluted	53,015,148	37,160,779	51,868,850	37,160,779	16,894,145

~~CONSOLIDATED~~See ~~STATEMENTS~~accompanying OFnotes ~~OPERATIONS~~to financial statements.

~~(STATED IN U.S. DOLLARS)~~-6-

	For the Three Months Ended July 31, 2011			For the Three Months Ended July 31, 2010			For the Period From July 11, 2005 (Inception) to July 31, 2011
OPERATING EXPENSES
Accounting and auditing fees	$	2,810		$	2,950		$	135,929
Consulting fees (Note 6)		48,190			30,000			587,190
Exploration costs and expenses		-			-			59,555
General and administrative		4,294			8,320			66,407
Insurance		-			-			27,000
Investor relation		-			-			55,393
Listing and filing fees		-			-			15,868
Legal fees		3,729			800			105,551
Management fees		-			-			330,000
Stock-based compensation		-			-			100,977
Travel		-			-			14,695
Wages		-			-			20,630
Impairment of mineral property		-			-			8,000
Total Operating Expenses		59,023			42,070			1,527,195
INCOME FROM OPERATIONS		(59,023	)		(42,070	)		(1,527,195	)
OTHER INCOME (EXPENSE)
Foreign currency transaction gain		-			-			908
Interest income		-			-			8
Loss on settlement of debt		-			-			(2,243,048	)
Gain on sale of mineral properties		1,534,000			-			1,534,000
Total Other Income		1,534,000			-			(708,132	)
NET INCOME (LOSS)	$	1,474,977		$	(42,070	)	$	(2,235,327	)
Net unrealized gains (losses) on available for sale securities:		(1,012,000	)		-			(1,012,000	)
COMPREHENSIVE INCOME (LOSS)	$	462,977		$	(42,070	)	$	(3,247,327	)
Basic and Diluted Income per Common Share	$	0.03		$	(0.00	)	$	0.14
Weighted average number of shares outstanding during the period – basic and diluted		50,463,048			37,160,779			15,772,812

NILAM RESOURCES INC.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
FOR THE PERIOD FROM JULY 11, 2005 (INCEPTION) TO OCTOBER 31, 2011
(STATED IN U.S. DOLLARS)

See accompanying notes to financial statements.


							Accumulated	Accumulated
	Preferred					Additional	Other	Deficit During
	Stock			Common Stock		Paid-In	Comprehensive	Exploration
	Shares	Amount		Shares	Amount	Capital	Income	Stage	Total

Common stock issued to
founders for cash ($0.01 per
share)	-		$ -	600,000	$ 600	$ 5,400	$ -	-	$ 6,000
Common stock issued for
cash ($0.10 per share)	-		-	550,000	550	54,450		-	55,000
Net loss for the period from
July 11, 2005 (inception) to
April 30, 2006	-		-	-	-	-		(10,193)	(10,193)

BALANCE, APRIL 30, 2006	-		-	1,150,000	1,150	59,850		(10,193)	50,807
In-kind contribution of stock to officer	-		-	-	-	30,000		-	30,000
Net loss for the year	-		-	-	-	-		(68,479)	(68,479)

BALANCE, APRIL 30, 2007	-		-	1,150,000	1,150	89,850		(78,672)	12,328
In-kind contribution of property	-		-	-	-	5,000		-	5,000
In-kind contribution of expenses	-		-	-	-	5,950		-	5,950
Stock-base compensation	-		-	-	-	100,977		-	100,977
Common stock issued for	-		-	10,779	11	269,426		-	269,437
cash ($25 per share)
Net loss for the year	-		-	-	-	-		(342,242)	(342,242)

BALANCE, APRIL 30, 2008	-		-	1,160,779	1,161	471,203		(420,914)	51,450
Common stock issued on
property acquisition	-		-	20,000,000	20,000	180,000		-	200,000
In-kind contribution of expenses	-		-	-	-	56,474		-	56,474
Net loss for the period	-		-	-	-	-		(483,077)	(483,077)

BALANCE, APRIL 30, 2009	-		-	21,160,779	$ 21,161	$ 707,677		(903,991)	(175,153)
In-kind contribution of expenses	-		-	-	-	7,217		-	7,217
Debt settlement	-		-	16,000,000	16,000	284,000		-	300,000
Loss on debt settlement	-		-			1,780,000		(1,620,000)	160,000
Issuance of convertible debentures	-		-			14,000		-	14,000
Net loss for the period	-		-	-	-	-		(753,625)	(753,625)
.
BALANCE, APRIL 30, 2010	-		-	37,160,779	$ 37,161	$ 2,792,894		(3,277,616)	(447,561)
In-kind contribution of expenses	-		-	-	-	4,324		-	4,324
Debt settlement	-		-	12,214,816	12,215	808,527		-	820,742
Issuance of convertible debentures	-		-			1,790		-	1,790
Common stock issued for cash ($0.01 per share)	-		-	1,000,000	1,000	9,000		-	10,000
Net loss for the period	-		-	-	-	-		(632,688)	(632,688)

BALANCE, APRIL 30, 2011	-		-	50,375,595	$ 50,376	$ 3,616,534		(3,910,304)	$ (243,393)
In-kind contribution of expenses	-		-	-	-	1,081		-	1,081
Common stock issued for cash ($0.02 per share)	-		-	1,680,000	1,680	31,920		-	33,600
Unrealized loss on available for sale investments	-		-	-	-	-	(1,012,000)	-	(1,012,000)
Net income for the period	-		-	-	-	-		1,474,977	1,474,977

BALANCE, JULY 31, 2011	-		-	52,055,595	52,056	3,649,535	(1,012,000)	(2,435,327)	254,265

In-kind contribution of expenses	-		-	-	-	1,081	-	-	1.081
Adjustment to unrealized gain on available for sale investments	-		-	-	-	-	918,000	-	918,000
Net income for the period	-		-	-	-	-	-	(45,062)	(45,062)

BALANCE, OCTOBER 31, 2011	-		-	52,055,595	$ 52,056	$ 3,650,617	$ (94,000)	$ (2,480,389)	$ 1,128,284

6See accompanying notes to financial statements.

~~NILAM RESOURCES INC.~~-7-

NILAM RESOURCES INC. (AN EXPLORATION STAGE COMPANY) INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

~~CONSOLIDATED~~(Unaudited)(STATED ~~STATEMENTS~~IN OFU.S. ~~STOCKHOLDERS’ EQUITY~~DOLLARS)

FOR THE PERIOD FROM JULY 11, 2005 (INCEPTION) TO JULY 31, 2011


		For the Six Months Ended October 31, 2011		For the Six Months Ended October 31, 2010		For the Period From July 11, 2005 (Inception) to October 31, 2011
CASH FLOWS USED IN OPERATING ACTIVITIES:
Net income (loss) for the period	$	1,429,915	$	(79,841)	$	(2,480,389)
Adjustments to reconcile net loss to net cash used in operating activities:
Gain on sale of mineral properties		(1,534,000)		-		(1,534,000)
Foreign exchange gain/loss		-		-		-
Impairment of mineral properties		-		-		205,000
In-kind contribution of expenses		2,162		2,162		76,037
In-kind contribution of shares		-		-		30,003
Accretion interest		-		7,790		15,816
Loss on debt settlement		-		-		2,243,048
Settlement of accounts payable		-		-		(14,803)
Stock-based compensation		-		-		100,977
Changes in operating assets and liabilities:
Accounts payable and accrued expenses		87,817		67,491		992,823
Due to related parties		-		-		26,158
Net Cash Used In Operating Activities		(14,106)		(2,398)		(339,356)

CASH FLOWS USED IN INVESTING ACTIVITIES:
Subscription for marketable securities (Note 4)		(24,540)		-		(24,540)
Purchase of mineral rights		(15,000)		-		(65,000)
Net Cash Used In Investing Activities		(39,540)		-		(89,540)

CASH FLOWS FROM FINANCING ACTIVITIES:
Share subscriptions		54,872		-		395,308
Notes payable - related parties		-		-		10,338
Proceeds from convertible debenture		-		2,436		25,978
Net Cash Provided By Financing Activities		54,872		2,436		431,624

NET INCREASE (DECREASE) IN CASH		1,226		38		2,728

CASH AT BEGINNING OF PERIOD		1,502		-		-

CASH AT END OF PERIOD	$	2,728	$	38	$	2,728
Supplemental disclosure of cash flow information (Note 10)
Interest paid		-		-		-
Taxes paid		-		-		-

~~(STATED~~See INaccompanying ~~U.S.~~notes ~~DOLLARS)~~to financial statements.

							Accumulated			Accumulated
					Additional		Other			Deficit During
	Common Stock				Paid-In		Comprehensive			Exploration
	Shares		Amount		Capital		Income			Stage			Total
Common stock issued to founders for cash ($0.01 per share)		600,000	$	600	$	5,400	$	-			-		$	6,000
Common stock issued for cash ($0.10 per share)		550,000		550		54,450		-			-			55,000
Net loss for the period from July 11, 2005 (inception) to April 30, 2006		-		-		-		-			(10,193	)		(10,193	)
BALANCE, APRIL 30, 2006		1,150,000		1,150		59,850		-			(10,193	)		50,807
In-kind contribution of stock to officer		-		-		30,000					-			30,000
Net loss for the year		-		-		-		-			(68,479	)		(68,479	)
BALANCE, APRIL 30, 2007		1,150,000		1,150		89,850		-			(78,672	)		12,328
In-kind contribution of property		-		-		5,000		-			-			5,000
In-kind contribution of expenses		-		-		5,950		-			-			5,950
Stock-base compensation		-		-		100,977		-			-			100,977
Common stock issued for cash ($25 per share)
Net loss for the year		-		-		-		-			(342,242	)		(342,242	)
BALANCE, APRIL 30, 2008		1,160,779		1,161		471,203		-			(420,914	)		51,450
Common stock issued on property acquisition		20,000,000		20,000		180,000		-			-			200,000
In-kind contribution of expenses		-		-		56,474		-			-			56,474
Net loss for the period		-		-		-		-			(483,077	)		(483,077	)
BALANCE, APRIL 30, 2009		21,160,779	$	21,161	$	707,677	$	-			(903,991	)	$	(175,153	)
In-kind contribution of expenses		-		-		7,217		-			-			7,217
Debt settlement		16,000,000		16,000		284,000		-			-			300,000
Loss on debt settlement						1,780,000		-			(1,620,000	)		160,000
Issuance of convertible debentures						14,000		-			-			14,000
Net loss for the period		-		-		-		-			(753,625	)		(753,625	)
BALANCE, APRIL 30, 2010		37,160,779	$	37,161	$	2,792,894	$	-			(3,277,616	)	$	(447,561	)
In-kind contribution of expenses		-		-		4,324		-			-			4,324
Debt settlement		12,214,816		12,215		808,527		-			-			820,742
Issuance of convertible debentures						1,790		-			-			1,790
Common stock issued for cash ($0.01 per share)		1,000,000		1,000		9,000		-			-			10,000
Net loss for the period		-		-		-		-			(632,688	)		(632,688	)
BALANCE, APRIL 30, 2011		50,375,595	$	50,376	$	3,616,534	$	-			(3,910,304	)	$	(243,394	)
In-kind contribution of expenses		-		-		1,081		-			-			1,081
Common stock issued for cash ($0.02 per share)		1,680,000		1,680		31,920		-			-			33,600
Unrealized loss on available for sale investments		-		-		-		(1,012,000	)		-			(1,012,000	)
Net income for the period		-		-		-		-			1,474,977			1,474,977
BALANCE, JULY 31, 2011		52,055,595	$	52,056	$	3,649,535	$	(1,012,000	)		(2,435,327	)	$	254,264

-8-

~~See~~NILAM ~~accompanying~~RESOURCES ~~notes~~INC. to(AN ~~financial~~EXPLORATION ~~statements.~~STAGE COMPANY) NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

7(Unaudited)

~~NILAM~~AS ~~RESOURCES~~OF ~~INC.~~OCTOBER 31, 2011

~~(AN~~NOTE ~~EXPLORATION~~1 ~~STAGE~~NATURE ~~COMPANY)~~OF OPERATIONS

~~CONSOLIDATED~~These ~~STATEMENTS~~consolidated OFfinancial ~~CASH~~statements ~~FLOWS~~inclusive of the accounts of the Nilam Resources Inc. and its Peruvian subsidiary Nilam Resources Peru SAC. Nilam Resources Inc. (an exploration stage company) (the “Company”) was incorporated under the laws of the State of Nevada on July 11, 2005. The Company is a natural resource exploration company with an objective of acquiring, exploring and if warranted and feasible, developing natural resource properties. On November 23, 2007, the Company incorporated Nilam Resources Peru SAC, in Peru, as a wholly-owned subsidiary. The purpose of the new subsidiary is to hold the Company’s Peruvian properties and to carry on such business in Peru as is necessary to maintain, explore and develop the Company’s properties. Nilam Resources Peru SAC. holds the Company’s rights in respect of the Llippa property. The continuation of the Company is in the exploration stage of its mineral property development and to date has not yet established any proven mineral reserves on its existing properties. The continued operations of the Company and the recoverability of the carrying value of its assets are ultimately dependent upon the ability of the Company to achieve profitable operations.

~~(STATED~~The INunaudited Ucondensed consolidated financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission.S The financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair statement of such information. ~~DOLLARS)~~All such adjustments are of a normal recurring nature. Certain information and footnote disclosures, including a description of significant accounting policies normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America, have been condensed or omitted pursuant to such rules and regulations. The year-end balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. These interim financial statements should be read in conjunction with the financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended April 30, 2011, which was filed with the United States Securities and Exchange Commission on October 21, 2011. The results of operations for the three months ended October 31, 2011 are not necessarily indicative of the results for any subsequent periods or the entire fiscal year ending April 30, 2012.

	For the Three Months Ended July 31, 2011			For the Three Months Ended July 31, 2010			For the Period From July 11, 2005 (Inception) to July 31, 2011
CASH FLOWS USED IN OPERATING ACTIVITIES:
Net income for the period	$	1,474,977		$	(42,070	)	$	(2,435,327	)
Adjustments to reconcile net loss to net cash used in operating activities:
Impairment of mineral properties		-			-			205,000
Gain on sale of mineral properties		(1,534,000	)		-			(1,534,000	)
In-kind contribution of expenses		1,081			1,081			74,956
In-kind contribution of shares		-			-			30,003
Accretion interest (Note 7)		-			7,074			15,790
Loss on debt settlement (Note 5)		-			-			2,243,048
Settlement of accounts payable		-			-			(14,803	)
Stock-based compensation		-			-			100,977
Changes in operating assets and liabilities:
Prepaid		-			-			-
Accounts receivable		-			-			-
Accounts payable and accrued expenses		32,410			32,054			937,416
Subscriptions received in advance		7,776						7,776
Due to related parties		-			-			26,158
Net Cash Provided/Used In Operating Activities		(17,756	)		(1,861	)		(343,006	)
CASH FLOWS USED IN INVESTING ACTIVITIES:
Purchase of mineral rights		(15,000	)		-			(65,000	)
Net Cash Used In Investing Activities		(15,000	)		-			(65,000	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common shares		33,600			-			374,036
Notes payable – related parties		-			-			10,338
Net increase of Convertible debenture		-			1,917			25,978
Net Cash Used By Financing Activities		33,600			-			410,352
NET INCREASE IN CASH		844			56			2,346
CASH AT BEGINNING OF PERIOD		1,502			-			-
CASH AT END OF PERIOD	$	2,346		$	56		$	2,346
Supplemental disclosure of cash flow information (Note 10)
Interest paid	$	-		$	-		$	-
Taxes paid	$	-		$	-		$	-

These financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. If the Company is unable to raise additional capital in the near future, due to the Company’s liquidity problems, management expects that the Company will need to liquidate assets, seek additional capital on less favorable terms and/or pursue other remedial measures. These financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

~~See accompanying notes to financial statements.~~-9-

8NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

~~NILAM~~(A) ~~RESOURCES~~Basis ~~INC.~~of Presentation

~~(AN~~The ~~EXPLORATION~~accompanying ~~STAGE~~financial ~~COMPANY)~~statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the Securities and Exchange Commission.

~~NOTES~~(B) TOBasis ~~CONSOLIDATED~~of ~~FINANCIAL STATEMENTS~~Consolidation

ASThe OFconsolidated ~~July~~financial 31statements include the accounts of the Company and its wholly owned subsidiary, ~~2011~~Nilam Resources Peru SAC. Intercompany accounts and transactions have been eliminated in consolidation.

~~NOTE~~(C) 1Use ~~NATURE~~of ~~OF OPERATIONS~~Estimates

~~These~~The ~~consolidated~~preparation of financial statements ~~inclusive~~in ofconformity ~~the~~with ~~accounts~~United ofStates ~~the~~generally ~~Nilam~~accepted ~~Resources~~accounting ~~Inc.~~principles ~~and~~requires ~~its~~management ~~Peruvian~~to ~~subsidiary~~make ~~Nilam~~estimates ~~Resources~~and ~~Peru~~assumptions ~~SAC.~~that ~~Nilam~~affect ~~Resources~~the ~~Inc.~~reported ~~(an~~amount ~~exploration~~of ~~stage~~assets ~~company)~~and ~~(the~~liabilities ~~“Company”)~~at ~~was incorporated under~~ the ~~laws~~date of the ~~State~~financial ofstatements ~~Nevada on July 11, 2005. The Company is a natural resource exploration company with an objective of acquiring, exploring~~ and ifrevenues ~~warranted~~ and ~~feasible,~~expenses ~~developing~~during ~~natural~~the ~~resource~~year ~~properties~~reported. On By ~~November~~their 23nature, ~~2007,~~these ~~the~~estimates ~~Company~~are ~~incorporated~~subject ~~Nilam~~to ~~Resources~~measurement ~~Peru~~uncertainty ~~SAC,~~and ~~in Peru, as a wholly-owned subsidiary. The purpose of~~ the ~~new~~effect ~~subsidiary~~on ~~is to hold~~ the ~~Company’s~~financial ~~Peruvian~~statements ~~properties~~of ~~and~~changes toin ~~carry on~~ such ~~business~~estimates in ~~Peru~~future asperiods iscould ~~necessary~~be tosignificant. ~~maintain,~~Significant ~~explore~~areas ~~and~~requiring ~~develop the Company~~management’s ~~properties. Nilam~~estimates ~~Resources~~and ~~Peru~~assumptions ~~SAC.~~are ~~holds~~determining the ~~Company’s~~fair ~~rights~~value ~~in respect~~ of ~~the~~transactions ~~Llippa~~involving ~~property. The~~common ~~continuation~~stock, ofvaluation ~~the~~and ~~Company~~impairment islosses inon ~~the exploration stage of its~~ mineral property ~~development~~acquisitions and tovaluation ~~date has not yet established any proven mineral reserves on its existing properties. The continued operations~~ of ~~the~~convertible ~~Company and the recoverability of the carrying value of its assets are ultimately dependent upon the ability of the Company to achieve profitable operations~~debentures.

~~These~~(D) ~~financial~~Cash ~~statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets~~ and ~~discharge~~Cash its liabilities in the normal course of business. Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. If the Company is unable to raise additional capital in the near future, due to the Company’s liquidity problems, management expects that the Company will need to liquidate assets, seek additional capital on less favorable terms and/or pursue other remedial measures. These financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.Equivalents

~~NOTE~~For 2purposes ~~SUMMARY~~of OFthe ~~SIGNIFICANT~~cash ~~ACCOUNTING~~flow ~~POLICIES~~statements, the Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents.

(AE) ~~Basis~~Mineral ~~of Presentation~~Properties

The ~~accompanying~~Company ~~financial~~is ~~statements~~primarily ~~have~~engaged ~~been~~in ~~prepared~~the inacquisition, ~~accordance~~exploration ~~with~~and ~~accounting~~development ~~principles~~of ~~generally~~mineral ~~accepted~~properties. inMineral property acquisition costs are initially capitalized when incurred. The Company assesses the ~~United~~carrying ~~States~~costs offor ~~America~~impairment under Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) 360-10, “Property Plant and Equipment”. The ASC requires mining companies to consider cash flows related to the ~~rules~~economic value of mining assets (including mineral properties and ~~regulations~~rights) ofbeyond ~~the~~those ~~Securities~~assets’ proven and ~~Exchange~~probable ~~Commission~~reserves, as well as anticipated market price fluctuations, when testing the mining assets for impairment in accordance with FASB ASC 360-10.

(BF) ~~Basis of Consolidation~~Investments

The ~~consolidated~~Company ~~financial~~classifies ~~statements~~Investment ~~include~~as available-for-sale in its Consolidated Balance Sheets. Securities held for indefinite periods of time, including any securities that may be sold to assist in the ~~accounts~~clearing of payment service obligations or in the ~~Company~~management ~~and~~of ~~its~~the ~~wholly~~investment ~~owned~~portfolio, ~~subsidiary~~are classified as available-for-sale securities. These securities are recorded at fair value, ~~Nilam~~with ~~Resources~~the ~~Peru~~net ~~SAC~~after-tax unrealized gain or loss recorded as a separate component of stockholder deficit. ~~Intercompany~~Realized ~~accounts~~gains and ~~transactions~~losses ~~have~~and ~~been~~other ~~eliminated~~than-temporary impairments are recorded in ~~consolidation~~the Consolidated Statements of Income (Loss).

~~(C) Use of Estimates~~-10-

~~The~~(G) ~~preparation~~Loss ofPer financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and revenues and expenses during the year reported. By their nature, these estimates are subject to measurement uncertainty and the effect on the financial statements of changes in such estimates in future periods could be significant. Significant areas requiring management’s estimates and assumptions are determining the fair value of transactions involving common stock, valuation and impairment losses on mineral property acquisitions and valuation of convertible debentures.Share

Basic and diluted net loss per common share is computed based upon the weighted average common shares outstanding as defined by FASB ASC 260, “Earnings Per Share.” Basic loss per share includes no dilution and it`s computed by dividing loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings (Dloss) ~~Cash~~of ~~and~~the ~~Cash~~Company. The ~~Equivalents~~common shares potentially issuable on conversion of outstanding warrants were not included in the calculation of weighted average number of shares outstanding because the effect would be anti-dilutive.

~~For~~(H) ~~purposes~~Income ~~of the cash flow statements, the Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents.~~Taxes

9The Company accounts for income taxes under FASB ASC 740, “Income Taxes”. Under FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

(EI) ~~Mineral~~Foreign ~~Properties~~Currency Translation

The ~~Company~~financial isstatements ~~primarily~~are ~~engaged~~presented in ~~the~~United ~~acquisition,~~States ~~exploration~~dollars. In ~~and~~accordance ~~development~~with ofFASB ~~mineral~~ASC ~~properties.~~830-30, ~~Mineral~~“Translation ~~property~~of ~~acquisition~~Financial ~~costs~~Statements”, ~~are~~foreign ~~initially~~denominated ~~capitalized~~monetary ~~when~~assets ~~incurred.~~and ~~The~~liabilities ~~Company~~are ~~assesses~~translated ~~the~~to ~~carrying~~their ~~costs~~United ~~for~~States ~~impairment~~dollar ~~under~~equivalents ~~Financial~~using ~~Accounting~~foreign ~~Standards~~exchange ~~Board~~rates ~~Accounting~~which ~~Standards~~prevailed ~~Codification~~at ~~(“FASB~~the ~~ASC”)~~balance ~~360-10,~~sheet ~~“Property~~date. Revenue ~~Plant~~ and ~~Equipment”.~~expenses ~~The~~are ~~ASC~~translated ~~requires~~at ~~mining~~average ~~companies~~rates toof ~~consider~~exchange ~~cash~~during ~~flows related to~~ the ~~economic~~year. Related ~~value~~translation ofadjustments ~~mining~~are ~~assets~~reported ~~(including~~as ~~mineral~~a ~~properties~~separate ~~and~~component ~~rights)~~of ~~beyond those assets~~stockholders’ ~~proven and probable reserves~~equity, aswhereas ~~well~~gains asor ~~anticipated~~losses ~~market~~resulting ~~price~~from ~~fluctuations,~~foreign ~~when~~currency ~~testing~~transactions ~~the~~are ~~mining~~included ~~assets for impairment~~ in ~~accordance~~results ~~with~~of ~~FASB ASC 360-10~~operations.

(FJ) ~~Investments~~Business Segments

The Company ~~classifies~~operates ~~Investment as available-for-sale~~ in ~~its~~one ~~Consolidated~~industry ~~Balance~~segment ~~Sheets.~~within ~~Securities~~two ~~held~~geographical ~~for indefinite periods of time~~areas, ~~including~~Canada ~~any~~and ~~securities that may be sold to assist in the clearing of payment service obligations or in the management of the investment portfolio, are classified as available-for-sale securities~~Peru. ~~These~~The ~~securities~~mineral ~~are~~property ~~recorded~~is atheld ~~fair~~solely ~~value, with the net after-tax unrealized gain or loss recorded as a separate component of stockholder deficit. Realized gains and losses and other than-temporary impairments are recorded~~ in the ~~Consolidated~~Peru ~~Statements of Income (Loss)~~segment.

(GK) ~~Loss~~Business ~~Per Share~~Combinations

~~Basic~~In ~~and~~December ~~diluted~~2007, ~~net loss per common share is computed based upon~~ the ~~weighted~~FASB ~~average~~issued ~~common shares outstanding as defined by~~ FASB ASC ~~260~~805 (revised 2007), “~~Earnings~~ ~~Per~~Business ~~Share.~~Combinations” ~~Basic~~(“ASC ~~loss~~805”). ~~per~~ASC ~~share~~805 ~~includes~~significantly nochanges ~~dilution and it`s computed by dividing loss attributable to common stockholders by~~ the ~~weighted~~accounting ~~average number of common shares outstanding~~ for ~~the~~business ~~period. Diluted~~combinations ~~earnings~~in ~~per~~a ~~share~~number ~~reflect the potential dilution~~ of ~~securities~~areas ~~that~~including ~~could share in~~ the ~~earnings~~treatment ~~(loss)~~ of ~~the~~contingent ~~Company. The~~consideration, ~~common~~pre-acquisition ~~shares~~contingencies, ~~potentially~~transaction ~~issuable~~costs, ~~on conversion of outstanding warrants were not included~~ in-process ~~the~~research ~~calculation~~and ofdevelopment, ~~weighted~~and ~~average~~restructuring ~~number of shares outstanding because the effect would be anti-dilutive~~costs.

~~(H)~~In ~~Income~~addition, ~~Taxes~~under ASC 805, changes in an acquired entity's deferred tax assets and uncertain tax positions after the measurement period will impact income tax expense. ASC 805 is effective for fiscal periods beginning after December 15, 2008. The Company has adopted ASC 805 on May 1, 2009. This standard did not have a material impact on the Company’s financial statements.

The Company accounts for income taxes under FASB ASC 740, “Income Taxes”. Under FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.-11-

(IL) ~~Foreign~~Derivative ~~Currency Translation~~Instruments

~~The~~In ~~financial~~March ~~statements~~2008, ~~are~~the ~~presented~~FASB inissued ~~United~~ASC ~~States~~815, ~~dollars. In~~“ ~~accordance~~Disclosures ~~with~~about ~~FASB~~Derivative ~~ASC~~Instruments ~~830-30,~~and ~~“Translation~~Hedging ofActivities” ~~Financial~~(“ASC ~~Statements~~815”,). ~~foreign~~ASC ~~denominated~~815 ~~monetary~~requires ~~assets~~qualitative disclosures about objectives and ~~liabilities~~strategies ~~are~~for ~~translated~~using toderivatives, ~~their~~quantitative ~~United~~disclosures ~~States~~about ~~dollar~~fair ~~equivalents~~value ~~using~~amounts ~~foreign~~of ~~exchange~~gains ~~rates~~and ~~which~~losses ~~prevailed~~on atderivative ~~the~~instruments, ~~balance~~and ~~sheet~~disclosures ~~date~~about credit-risk-related contingent features in derivative agreements. ~~Revenue~~ ~~and~~This ~~expenses~~statement ~~are~~is ~~translated~~effective atfor ~~average~~financial ~~rates~~statements ofissued ~~exchange~~for ~~during~~fiscal ~~the~~periods ~~year. Related~~beginning ~~translation~~after ~~adjustments~~November ~~are~~15, ~~reported~~2008. asThe aCompany ~~separate~~has ~~component~~adopted ofASC ~~stockholders’~~815 ~~equity~~on May 1, ~~whereas~~2009. ~~gains~~Adoption orof ~~losses~~this ~~resulting~~standard ~~from~~did ~~foreign~~not ~~currency~~have ~~transactions~~a ~~are~~material ~~included~~impact inon the Company’s financial position, results of operations, or cash flows.

(JM) ~~Business~~Concentration ~~Segments~~of Credit Risk

~~The~~Cash ~~Company~~includes ~~operates~~deposits at a Canadian financial institution in ~~one~~US ~~industry~~currency ~~segment~~which ~~within~~is ~~two~~not ~~geographical~~covered ~~areas,~~by ~~Canada~~either ~~and~~the ~~Peru~~US FDIC limits or the Canadian CDI limits. The ~~mineral~~Company ~~property~~has isplaced ~~held~~its ~~solely~~cash in ~~the~~a ~~Peru~~high ~~segment~~credit quality financial institution.

(KN) ~~Business~~Fair ~~Combinations~~Value of Financial Instruments

InFASB ~~December~~ASC ~~2007~~820, “Fair Value Measurements and Disclosures” requires an entity to maximize the ~~FASB~~use ~~issued~~of observable inputs and minimize the use of unobservable inputs when measuring fair value. FASB ASC ~~805~~820 ~~(revised~~establishes ~~2007)~~a fair value hierarchy based on the level of independent, ~~“Business~~objective ~~Combinations”(“ASC~~evidence ~~805”)~~surrounding the inputs used to measure fair value. ~~ASC~~A ~~805~~financial ~~significantly~~instrument’s ~~changes~~categorization within the ~~accounting~~fair ~~for~~value ~~business~~hierarchy ~~combinations~~is inbased aupon ~~number~~the lowest level of ~~areas~~input ~~including~~that is significant to the ~~treatment~~fair ofvalue ~~contingent~~measurement. ~~consideration,~~FASB ~~pre-acquisition~~ASC ~~contingencies,~~820 ~~transaction~~prioritizes ~~costs,~~the ~~in-process~~inputs ~~research~~into ~~and~~three ~~development,~~levels ~~and~~that ~~restructuring~~may ~~costs.~~be used to measure fair value:


Level 1	Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2	Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3	Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

InThe ~~addition,~~Company’s ~~under~~financial ~~ASC~~instruments ~~805~~consist principally of cash, ~~changes~~accounts inpayable, anamounts ~~acquired~~due ~~entity's~~to ~~deferred~~related ~~tax~~parties, ~~assets~~notes payable, and ~~uncertain~~convertible ~~tax~~debenture. ~~positions~~Pursuant ~~after~~to ~~the~~FASB ~~measurement~~ASC ~~period~~820, ~~will~~the ~~impact~~fair ~~income~~value ~~tax~~of ~~expense.~~the ~~ASC~~Company’s ~~805~~cash equivalents is ~~effective~~determined ~~for~~based ~~fiscal~~on ~~periods~~“Level ~~beginning~~1” ~~after~~inputs, ~~December~~which ~~15,~~consist ~~2008~~of quoted prices in active markets for identical assets. The Company ~~has~~believes ~~adopted~~that ~~ASC~~the ~~805~~recorded onvalues ~~May~~of 1,all ~~2009.~~of ~~This~~its ~~standard~~other ~~did~~financial ~~not~~instruments ~~have~~approximate atheir ~~material~~current ~~impact~~fair onvalues ~~the~~because ~~Company’s~~of ~~financial~~their ~~statements~~nature and respective maturity dates or durations.

(LO) ~~Derivative~~Comprehensive ~~Instruments~~Income

~~In March 2008, the~~ FASB ~~issued~~ ASC ~~815~~220, “~~Disclosures~~Comprehensive ~~about Derivative Instruments and Hedging Activities~~Income”~~(“ASC~~ ~~815”).~~establishes ~~ASC~~standards ~~815~~for ~~requires~~the ~~qualitative~~reporting ~~disclosures about objectives~~ and ~~strategies~~display ~~for using derivatives, quantitative disclosures about fair value amounts~~ of ~~gains~~comprehensive ~~and~~income ~~losses on derivative instruments,~~ and ~~disclosures~~its ~~about~~components ~~credit-risk-related contingent features~~ in ~~derivative~~the ~~agreements. This statement is effective for~~ financial statements. During ~~issued~~the ~~for~~period ~~fiscal~~ended ~~periods~~October ~~beginning~~31, ~~after November 15~~2011, ~~2008.~~the ~~The~~ Company has ~~adopted~~other ~~ASC~~comprehensive ~~815~~income onrelated ~~May~~to 1,its ~~2009.~~investments ~~Adoption~~in ofmarketable ~~this~~securities ~~standard~~(Note ~~did not have a material impact on the Company’s financial position, results of operations, or cash flows~~4).

~~(M) Concentration of Credit Risk~~-12-

~~Cash~~NOTE ~~includes~~3 ~~deposits~~MINERAL at a Canadian financial institution in US currency which is not covered by either the US FDIC limits or the Canadian CDI limits. The Company has placed its cash in a high credit quality financial institution.PROPERTIES

~~(N)~~Llippa ~~Fair Value of Financial Instruments~~Property

~~FASB~~On ~~ASC~~December ~~820~~10, ~~“Fair~~2007, ~~Value Measurements and Disclosures” requires an entity to maximize~~ the ~~use~~Company, ofthrough ~~observable~~its ~~inputs~~wholly ~~and~~owned ~~minimize~~Peruvian ~~the~~subsidiary, ~~use~~entered ofinto ~~unobservable~~an ~~inputs~~agreement ~~when~~with ~~measuring~~MRC ~~fair~~1 ~~value.~~Exploraciones ~~FASB~~EIRL ~~ASC 820 establishes a fair value hierarchy based on the level~~ of ~~independent~~Peru, ~~objective~~to ~~evidence~~purchase ~~surrounding~~ the ~~inputs~~Llippa ~~used~~Project, toPeru, ~~measure~~for ~~fair value~~$100,000. ALlippa ~~financial instrument’s categorization within the fair value hierarchy~~ is ~~based~~a ~~upon~~mineral ~~the~~claim ~~lowest~~consisting ~~level~~ of ~~input~~two ~~that~~major ismining ~~significant~~concessions, to the ~~fair~~Prospera ~~value~~mine ~~measurement.~~and ~~FASB~~La ~~ASC~~Prospera ~~820 prioritizes the inputs into three levels that may be used to measure fair value:~~XXI.

~~Level~~Linderos ~~1 Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.~~Property

~~Level~~In 2the ~~Level~~period 2ended ~~applies~~October to31, ~~assets~~2011, orthe ~~liabilities~~Company ~~for~~entered ~~which~~into ~~there~~two ~~are~~agreements ~~inputs~~with ~~other~~Portage ~~than~~Resources ~~quoted~~Inc. ~~prices~~to ~~that~~sell ~~are~~all ~~observable~~rights, ~~for~~title ~~the~~and ~~asset~~interest orfor ~~liability~~the ~~such~~Linderos as4 ~~quoted~~and ~~prices~~5 ~~for~~mining ~~similar~~concessions, ~~assets~~located ~~or liabilities~~ in ~~active~~the ~~markets;~~Tabaconas ~~quoted~~District, ~~prices~~San ~~for~~Ignacio ~~identical~~Province, ~~assets~~Department orof ~~liabilities~~Cajamarca, inPeru. ~~markets~~The ~~with~~Company ~~insufficient~~had ~~volume~~previously orrecognized ~~infrequent~~an ~~transactions~~impairment ~~(less~~loss ~~active~~of ~~markets);~~$200,000 orrelated ~~model-derived~~to ~~valuations~~these inconcessions ~~which~~during ~~significant~~the ~~inputs~~year ~~are~~ended ~~observable~~April ~~or can be derived principally from~~30, ~~or corroborated by, observable market data~~2010.

~~Level~~Total 3consideration ~~Level~~for 3the ~~applies~~sale toof ~~assets~~the orLinderos ~~liabilities~~4 concessions is 10,000,000 common shares of Portage Resources Inc. and total consideration for ~~which~~the ~~there~~sale ~~are~~of ~~unobservable~~the ~~inputs~~Linderos 5 concessions is 8,000,000 common shares of Portage Resources Inc. Due to the ~~valuation~~impairment ~~methodology~~loss ~~that~~recognized ~~are~~in ~~significant~~2010, tothese concessions had a carrying value of $nil at the ~~measurement~~sale agreement dates. Consequently, the Company recognized a gain of $1,534,000 on the ~~fair~~sale of these concessions, based on the market value of the ~~assets~~shares orreceived ~~liabilities~~on the agreement dates.

The Company’s financial instruments consist principally of cash, accounts payable, amounts due to related parties, notes payable, and convertible debenture. Pursuant to FASB ASC 820, the fair value of the Company’s cash equivalents is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. The Company believes that the recorded values of all of its other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.Others

~~(O) Comprehensive~~On ~~Income~~July 22, 2011, the Company entered into an agreement to develop the Rocas mining concession in the province of Bolognesi, Department of Ancash, Peru for $10,000. The Company must make a minimum investment of $100,000 in the project within 24 months of the agreement and must share 45% of any resultant profits with the seller of the project. On September 26, 2011, the Company entered into an agreement with Portage Minerais Peru S.A. to sell 55% of its ownership of the project for seven million shares of Portage Resources Inc. The additional 45% of its ownership can be acquired by Portage Minerais Peru S.A. at any time for $0.675 per each ounce of silver on the total silver resource.

~~FASB~~On ~~ASC~~July ~~220~~22, ~~“Comprehensive~~2011, ~~Income”~~the ~~establishes~~Company ~~standards~~entered into an agreement to develop the Rocas I mining concession in the province of Bolognesi, Department of Ancash, Peru for $5,000. The Company must make a minimum investment of $50,000 in the ~~reporting~~project ~~and~~within ~~display~~24 months of ~~comprehensive~~the ~~income~~agreement and ~~its~~must ~~components~~share in45% of any resultant profits with the ~~financial~~seller ~~statements~~of the project. AsOn atSeptember ~~April~~ 30, 2011, nothe ~~element~~Company entered into an agreement with Portage Minerais Peru S.A. to sell 55% of ~~comprehensive~~its ~~income~~ownership orof ~~loss~~the ~~was~~project ~~noted~~for three and a half million shares of Portage Resources Inc. The additional 45% of its ownership can be acquired by Portage Minerais Peru S.A. at any time for $0.675 per each ounce of silver on the total silver resource.

~~(P)~~As ~~Recently~~the ~~Adopted~~Company ~~Accounting~~did ~~Pronouncements~~not receive the proceeds from Portage Resources Inc. and did not transfer title of the concessions prior to October 31, 2011, the Company has not yet recognized the sale of the Rocas projects.

In June 2009, the FASB issued SFAS No. 166, “Accounting for Transfers of Financial Assets—an amendment of FASB Statement” (“SFAS 166”). SFAS No. 166 is intended to establish standards of financial reporting for the transfer of assets and transferred assets to improve the relevance, representational faithfulness, and comparability. SFAS 166 was established to clarify derecognition of assets under FASB Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities. SFAS No. 166 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2009. The Company adopted this standard on May 1, 2010. The standard did not have a material impact on the Company’s financial statements.-13-

11NOTE 4 INVESTMENTS AND DEPOSITS

InThe ~~May~~Company’s ~~2008,~~investments ~~the~~consist ~~FASB~~of ~~issued ASC 470-20~~18, ~~“Debt with conversion and other options” (formerly FSP No. APB 14-1~~000,000 ~~“Accounting~~shares ~~for~~of ~~Convertible~~Portage ~~Debt~~Resources ~~Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)”)~~Inc. ~~ASC~~which ~~470-20~~were ~~applies~~acquired ~~to convertible debt instruments that, by their stated terms, may be settled~~ in ~~cash (or other assets) upon conversion, including partial cash settlement, unless~~ the ~~embedded~~sales ~~conversion option is required to be separately accounted for as a derivative under ASC 815. ASC 470-20 require that the liability and equity components~~ of ~~convertible debt instruments within~~ the ~~scope~~Linderos ofmining ~~ASC~~concessions 470-20 be separately accounted for in a manner that reflects the entity’s nonconvertible debt borrowing rate. This will require an allocation of the convertible debt proceeds between the liability component and the embedded conversion option (~~i.e.,~~Note ~~the equity component~~3). The ~~difference~~shares ~~between~~are ~~the~~carried ~~principal~~at ~~amount~~their ofmarket ~~the~~value ~~debt~~at ~~and~~October ~~the~~31, ~~amount~~2011, ofwith ~~the~~any ~~proceeds~~changes ~~allocated~~in tovalue ~~the~~being ~~liability~~recorded ~~component would be reported~~ as aother ~~debt~~comprehensive ~~discount and subsequently amortized to earnings over the instrument’s expected life using the effective interest method~~income. ASC 470-20 is effective for the Company’s fiscal year beginning May 1, 2010 and will be applied retrospectively to all periods presented. The Standard did not have a material impact on the Company’s financial statements.

InThe ~~July~~Company ~~2009,~~also ~~the~~paid ~~FASB issued ASC 105~~$24,540 ~~“Generally Accepted Accounting Principles” (formerly, SFAS No. 168, "FASB Accounting Standards Codification"),~~ as ~~the~~a ~~single~~share ~~source~~subscription ofdeposit ~~authoritative~~to ~~nongovernmental~~Portage ~~U.S.~~Resource ~~generally accepted accounting principles (GAAP)~~Inc. ~~ASC~~for ~~105~~a ~~was~~further ~~implemented on July 1~~245,500 ~~2009~~shares ~~and~~at ~~is effective for interim and annual periods ending after September 15, 2009~~$0.10 ~~This~~per ~~standard did not have a significant effect upon the financial statements~~share.

InNOTE ~~September~~5 ~~2009,~~NOTES ~~the~~PAYABLE ~~FASB issued ASC 820~~-10 ~~Measuring~~RELATED Liabilities at Fair Values (“ASC 820-10”). ASC 820-10 provides additional guidance on how companies should measure liabilities at fair value. Specifically, the fair value of a liability is not adjusted to reflect the impact of contractual restrictions that prevent its transfer. The Company does not expect adoption of this standard to have a material impact on its consolidated financial position, results of operations, and cash flows.PARTY

InOn ~~February~~August ~~2010~~28, ~~the FASB issued Accounting Standards Update (ASU) No. 2010-09~~2007, ~~“Subsequent Events (Topic 855): Amendments to Certain Recognition and Disclosure Requirements”. The amendments in~~ the ~~ASU~~Company ~~remove~~issued ~~the requirement for~~ a ~~Securities~~promissory ~~and~~note ~~Exchange Commission (SEC) filer to disclose a date through which subsequent events have been evaluated~~ in ~~both~~the ~~issued~~amount ~~and revised financial statements. Revised financial statements include financial statements revised as a result~~ of ~~either correction of an error or retrospective application of U.S. GAAP. The FASB also clarified that if the financial statements have been revised~~$10,000 ~~then an entity that is not an SEC filer should disclose both the date that the financial statements were issued or available~~ to bea ~~issued~~related ~~and the date the revised financial statements were issued or available to be issued~~party. This ~~The~~promissory ~~FASB~~note believes these amendments remove potential conflicts with the SEC's literature. All of the amendments in the ASU were effective upon issuance except for the use of the issued date for conduit debt obligors. That amendment is ~~effective for interim or annual periods ending after June 15~~unsecured, ~~2010.~~bears ~~The~~no ~~Company~~interest ~~does~~and ~~not~~is ~~expect~~due ~~the adoption of this guidance to have a material impact~~ on ~~the Financial Statements~~demand.

~~(Q)~~On ~~Recent~~November ~~Accounting~~6, ~~Pronouncements~~2007, a shareholder loaned the Company $338 to establish a bank account in Peru. There are no terms of repayment and the amount is non-interest bearing.

InNOTE ~~June~~6 2009, the FASB issued SFAS No. 167, “Amendments to FASB Interpretation No. 46(R)” (“SFAS No. 167”). SFAS No. 167 eliminates the exception to consolidate a qualifying special-purpose entity, changes the approach to determining the primary beneficiary of a variable interest entity and requires companies to more frequently re-assess whether they must consolidate variable interest entities. Under the new guidance, the primary beneficiary of a variable interest entity is identified qualitatively as the enterprise that has both (a) the power to direct the activities of a variable interest entity that most significantly impact the entitySTOCKHOLDERS’s economic performance, and (b) the obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity.DEFICIT

~~SFAS~~For ~~No.~~the ~~167~~six ~~becomes~~months ~~effective~~ended ~~for~~October 31, 2011, the Company’s ~~fiscal~~calculated ~~2011~~imputed ~~year-end~~interest ~~and~~of ~~interim~~$362 ~~reporting~~and ~~periods~~fair ~~thereafter.~~value ~~The~~of ~~Company~~a ~~does~~Director's ~~not~~fee ~~expect~~of ~~SFAS~~$1,800, ~~No.~~which ~~167~~are toall ~~have~~reflected aas ~~material~~an ~~impact~~in-kind oncontribution ~~its~~of ~~financial statements~~expenses.

InOn ~~December~~June ~~2010~~15, ~~the~~2011, ~~FASB updated guidance to clarify~~ the ~~acquisition~~company ~~date~~signed ~~that~~a ~~should~~subscription beagreement ~~used~~ for ~~reporting~~1,063,600 ~~the~~shares ~~pro~~at ~~forma~~$0.02 ~~financial~~for ~~information disclosures when comparative financial statements are presented~~cash. The ~~updated~~proceeds ~~guidance~~of isthis ~~effective~~agreement ~~for~~were ~~business~~received ~~combinations~~during ~~for which~~ the ~~acquisition~~period ~~date~~ended isOctober on31, or2011, ~~after~~but the ~~beginning~~shares ofhave ~~the~~not ~~first~~yet ~~annual~~been ~~reporting~~issued, ~~period~~resulting ~~beginning~~in ona orshare ~~after~~subscription ~~December~~liability ~~15,~~of ~~2010~~$21,272.

On July 12, 2011, the company issued 1,680,000 common shares at $0.02 per share for cash.

NOTE 37 ~~MINERAL~~RELATED ~~PROPERTIES~~PARTY TRANSACTIONS

~~Llippa~~On ~~Property~~August 28, 2007, the Company issued a promissory note in the amount of $10,000 to a related party. This promissory note is unsecured, bears no interest and is due on demand (Note 4). During fiscal 2008, the officer loaned the Company a further $338. This loan is also unsecured, bears no interest and is due on demand (Note 4).

OnAs ~~December~~of 10October 31, ~~2007~~2011, ~~the Company~~$16,158 ~~through~~was ~~its wholly~~ owed ~~Peruvian~~to ~~subsidiary,~~former ~~entered~~directors ~~into~~and anofficers ~~agreement with MRC 1 Exploraciones EIRL~~ of ~~Peru, to purchase~~ the ~~Llippa~~Company ~~Project, Peru,~~ for ~~$100,000. Llippa~~expenses ispaid aon ~~mineral~~behalf ~~claim consisting~~ of ~~two~~the ~~major~~Company ~~mining~~in ~~concessions,~~fiscal ~~the~~2009 ~~Prospera mine~~ and ~~La Prospera XXI~~2010.

~~Linderos~~As ~~Property~~of October 31, 2011, the Company accrued $60,000 (2011 - $60,000) of management fees to the officers of the Company.

OnNOTE ~~June~~8 ~~27,~~SUBSEQUENT 2011, the Company entered into an agreement to sell all rights, title and interest for the Linderos 4 mining concession to Portage Resources Inc. Total consideration for the sale is 10,000,000 common shares of Portage Resources Inc.EVENTS

On ~~July~~December 41, 2011, the ~~Company~~company ~~entered~~signed ~~into~~a ansubscription agreement ~~to sell all rights, title and interest~~ for ~~the Linderos 5 mining concession to Portage Resources Inc. Total consideration for the sale is 8~~1,~~000~~401,~~000~~900 ~~common~~ shares ofat ~~Portage~~$0.02 ~~Resources~~for ~~Inc~~cash.

~~Both~~On ofDecember ~~the concessions sold are located in the Tabaconas District~~1, ~~San Ignacio Province~~2011, ~~Department~~the ofcompany ~~Cajamarca,~~signed ~~Peru.~~a ~~During~~subscription ~~the~~agreement ~~year~~for ~~ended April 30~~1, ~~2010~~574,250 ~~the~~shares ~~Company~~at ~~recognized an impairment loss of~~ $~~200,000 related to the Linderos mining concessions~~0.02 ~~Consequently,~~for ~~these concessions had a carrying value of $nil at the sale agreement dates~~cash.

~~Others~~-14-

OnNOTE ~~July~~9 ~~22,~~COMPARATIVE 2011, the Company entered into an agreement with (Proyecto Rocas) to develop the project of exploration of possible reserves in LA concession in the province of Bolognesi, Department of Ancash, Peru for $10,000. The Company will share 55% of the utilities and products of LA concession.FIGURES

OnCertain ~~July~~of ~~22, 2011,~~ the ~~Company~~comparative ~~entered~~figures ~~into~~have anbeen ~~agreement~~classified ~~with~~to ~~(Proyecto~~conform ~~Rocas I)~~ to ~~develop~~ the ~~project~~presentation ofadopted ~~exploration of possible reserves~~ in ~~LA concession in~~ the ~~province~~current ~~of Bolognesi, Department of Ancash, Peru for $5,000~~period. ~~The Company will share 55% of the utilities and products of LA concession.~~

~~The~~NOTE ~~company~~10 ~~capitalized~~SUPPLEMENTAL ~~$15,000~~DISCLOSURE ~~towards~~OF ~~mineral~~CASH ~~cost~~FLOW INFORMATION

~~NOTE~~For ~~4 NOTES~~the ~~PAYABLE~~six –months ~~RELATED~~ended ~~PARTY~~October 31, 2011, the Company issued 1,680,000 common shares at $0.02 per share for cash. (Note 5)

On August 2810, ~~2007~~2011, the Company ~~issued~~entered into a ~~promissory~~subscription ~~note~~agreement into ~~the~~purchase ~~amount~~195,400 ofshares from Portage Resources Inc. at $0.10 per share. The Company has also advanced an additional $5,000 to aPortage ~~related~~Resource ~~party~~Inc. ~~This~~ ~~promissory~~as ~~note~~a isdeposit ~~unsecured,~~for ~~bears~~additional noshares ~~interest~~at ~~and~~$0.10 isper ~~due on demand~~share.

OnNOTE ~~November~~11 ~~6, 2007, a shareholder loaned the Company $338 to establish a bank account in Peru. There are no terms of repayment and the amount is non-interest bearing.~~CONTINGENCIES

OnThere ~~November~~were ~~20,~~no ~~2007,~~contingencies ~~the~~as ~~Company issued a promissory note in the amount of $60,000 to a related party for their interest in the Llippa property. The value of the transfer occurred~~ at ~~fair value. This promissory note is unsecured, bears no interest and is due on demand. On June 10, 2009, this promissory note was settled with 12,000,000 common shares of~~ the ~~Company~~report ~~(Note 5)~~date.

~~NOTE 5 STOCKHOLDERS’ DEFICIT~~-15-

OnItem ~~June~~2. ~~10,~~MANAGEMENT’S ~~2009,~~DISCUSSION ~~the~~AND ~~Company~~ANALYSIS ~~converted~~OR ~~$60,000~~PLAN ofOF ~~its debt into 12,000,000 common shares (Note 4 and 6).~~OPERATION

OnBusiness ~~February~~Overview 4,and ~~2010,~~Uncertainties the company converted $240,000 of its debt into 4,000,000 common shares. The common shares issued on settlement of the notes were assigned a value of $400,000, which was calculated based on the trading value of the Company’s stock on the date the settlement was approved by the Board of Directors. As a result of this settlement the Company recorded a loss of $160,000.

~~During~~Nilam ~~fiscal~~Resources, ~~2010~~Inc. was incorporated under the laws of Nevada on July 11, 2005. Our company is in the exploration stage with limited operations. As reflected in the accompanying financial statements, our Company ~~calculated~~had ~~imputed~~a ~~interest~~comprehensive income in the current period of $1872,~~217~~938. We ~~and~~had ~~fair~~a ~~value~~net loss from operations of a$45,062, ~~Director’s~~and ~~fee~~an unrealized gain from the sale of investments of $6918,000,. The ~~which~~company ~~are~~also ~~all~~had ~~reflected~~a asnegative ancash ~~in-kind~~flow ~~contribution~~from operations of ~~expenses~~$14,106 for the current period.

13We have not generated any revenues from operations, and further losses from operations are anticipated in the development of the business. This raises substantial doubt about the company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

OnManagement ~~November~~plans 1,to ~~2010,~~seek ~~the~~additional ~~company~~capital ~~converted~~funding ~~$120,000~~to ofimplement its ~~debt~~business ~~into~~plan ~~4,000,000~~through ~~common~~private ~~shares.~~placement ~~The~~and ~~common~~public ~~shares~~offerings ~~issued on the settlement were assigned a value~~ of ~~$200,000,~~common ~~which~~shares ~~was~~in ~~calculated~~its ~~based~~capital ~~on the trading value of the Company’s~~ stock. Additionally, onif ~~the~~necessary, ~~date~~ the ~~settlement~~officers ~~was~~or ~~approved~~directors bymay ~~the~~make ~~Board~~loans ofto ~~Directors.~~enable ~~As a result of this settlement,~~ the Company ~~has~~to ~~recorded~~meet aits ~~loss~~minimum ofcash ~~$80,000~~requirements.

OnManagement ~~November~~believes 2,that ~~2010,~~actions ~~the~~presently ~~company~~being ~~converted~~taken ~~$27,694~~to ofobtain ~~its~~additional ~~debt~~funding and ~~convertible~~implement ~~debentures~~its ~~and~~strategic ~~convertible~~plans ~~loans~~provide ~~into~~an ~~1,214,816~~opportunity ~~common~~for ~~shares (Note 7). The common shares issued on~~ the ~~settlement were assigned a value of $60,741, which was calculated based on the trading value of the~~ Company’s ~~stock~~to oncontinue ~~the~~as ~~date the settlement was approved by the Board of Directors. As~~ a ~~result~~going ~~of this settlement, the Company has recorded a loss of $33,047~~concern.

OnOur ~~January~~principal ~~24,~~office ~~2011,~~is ~~the~~located ~~company~~at ~~converted~~Calle ~~$210,000~~Alcanfores ~~management~~761 ~~fees~~- ~~owing~~1701, ~~to the officers of the Company into 7~~Miraflores,~~000,000~~ ~~common~~Lima ~~shares. The common shares issued on the settlement were assigned a value of $560~~18,~~000,~~ ~~which was calculated based on the trading value of the Company’s stock on the date the settlement was approved by the Board of Directors~~Peru. Our Asfiscal ayear ~~result~~ends ofApril ~~this settlement, the Company has recorded a loss of $350,000~~30th.

~~During~~Changes ~~fiscal 2011, the Company calculated imputed interest of $724 and fair value of a Director's fee of $3,600, which are all reflected as an~~ in~~-kind~~ ~~contribution~~Comprehensive ofNet ~~expenses.~~Gain

~~For~~The ~~the~~comprehensive ~~three~~net ~~months~~gain ~~ended~~in ~~July~~the period ending October 31, 2011 decreased by $602,039 from the ~~Company~~period ~~calculated~~ending ~~imputed~~July ~~interest~~31, of2011. The ~~$181~~comprehensive ~~and~~net ~~fair~~gain ~~value~~for ofthe aperiod ~~Director's~~ending ~~fee~~October of31, 2011 was $~~900~~ 872,938, ~~which~~and ~~are~~the ~~all~~comprehensive ~~reflected~~net asgain anfor ~~in-kind~~the ~~contribution~~period ofending ~~expenses~~July 31, 2011 was $ 1,474,977.

OnChanges ~~June 15, 2011, the company signed a subscription agreement for 1,063,600 shares at $0.02 for cash. As at July 31, 2011, $7,776 has been recorded as subscriptions received~~ in ~~advance.~~Net Loss

OnThe ~~July~~net 12loss from operations in the quarter ending October 31, 2011 decreased by $ 13,961 from the ~~company~~quarter ~~issued~~ending 1July 31,~~680,000~~ ~~common~~2011. The ~~shares~~net atloss for the period ending October 31, 2011 was $~~0.02~~45,062, ~~per~~and ~~share~~the net loss for ~~cash~~the period ending July 31, 2011 was $ 59, 023.

~~NOTE~~Unrealized 6Gain ~~RELATED~~from ~~PARTY~~Sale ~~TRANSACTIONS~~of Investment of Rocas Property I

OnThe ~~November~~company ~~20,~~had ~~2007,~~an ~~the~~unrealized ~~Company~~gain ~~issued~~from athe ~~promissory~~Sale ~~note~~of inInvestment ~~the~~property ~~amount~~ of $~~60,000~~ ~~to a related party. On June 10~~554,555 ~~2009,~~for ~~this~~the ~~promissory~~sale ~~note was settled with 12,000,000 common shares~~ of ~~the~~Rocas ~~Company~~I ~~(Notes 4 and 5)~~Property. The ~~common~~unrealized ~~shares~~gain ~~issued~~is onnot ~~settlement~~from of the ~~notes~~ordinary ~~were~~course ~~assigned~~of abusiness. On ~~value~~July of22, $12011,~~680,000,~~ ~~which~~the ~~was~~Company ~~calculated~~entered ~~based~~into onan ~~the~~agreement ~~trading~~to ~~value~~develop of the ~~Company’s~~Rocas ~~stock~~I onmining ~~the~~concession ~~date~~in the ~~settlement~~province ~~was~~of ~~approved~~Bolognesi, byDepartment ~~the~~of ~~Board~~Ancash, ofPeru ~~Directors~~for $10,000. On AsSeptember ~~this~~26, ~~transaction~~2011, ~~was~~the ~~with~~company asold ~~related~~its ~~party,~~interest ~~the~~in ~~loss~~Rocas onProperty ~~the~~I ~~extinguishment~~for of7 ~~debt~~million shares of $1Portage Resources,~~620,000~~ ~~has~~Inc. ~~been~~Valuded ~~recorded~~at ~~as a capital transaction~~$560,000.

OnAs ~~August 28, 2007,~~ the Company ~~issued~~did anot ~~promissory~~receive ~~note in~~ the ~~amount~~proceeds offrom ~~$10~~Portage Resources,~~000~~ ~~to a related party~~Inc. ~~This~~ ~~promissory~~And ~~note~~did isnot ~~unsecured,~~transfer ~~bears~~title noof ~~interest~~the ~~and~~concessions isprior ~~due~~to onOctober ~~demand~~31, ~~(Note 4). During fiscal 2008~~2001, the ~~officer loaned the~~ Company ahas ~~further~~not ~~$338.~~yet ~~This~~recognized ~~loan~~the issale ~~also~~of ~~unsecured,~~the ~~bears~~Rocas no1 ~~interest and is due on demand (Note 4)~~project.

~~As of July 31, 2011, $~~-16~~,158 was owed to former directors and officers of the Company for expenses paid on behalf of the Company in fiscal 2009 and 2010.~~-

AsUnrealized ofGain ~~July~~from ~~31,~~Sale ~~2011, the Company accrued $30,000 (2011 - $30,000)~~ of ~~management~~Investment ~~fees to the officers~~ of ~~the~~Rocas ~~Company.~~Property II

~~NOTE~~The 7company ~~CONVERTIBLE~~had ~~DEBENTURES~~an another unrealized gain from the Sale of Investment Property of $ 277,195 for the sale of Rocas II. On July 22, 2011, the Company entered into another agreement to develop the Rocas II mining concession in the province of Bolognesi, Department of Ancash, Peru for $5,000. On September 26, 2011, the company agreed to sell its interest in Rocas Property II for 3.5 million shares of Portage Resoruces, Inc. valued at $280,000.

OnAs ~~August 10, 2009,~~ the Company ~~issued~~did anot 5%receive ~~convertible~~the ~~debenture~~proceeds ~~with~~from aPortage ~~principal~~Resources ~~amount~~Inc. ~~of $10,187 which is due~~ and ~~payable~~did onnot ~~August~~transfer ~~10,~~title ~~2010.~~of ~~Interest is due at~~ the ~~maturity~~concessions ~~date~~prior ~~payable~~to atOctober ~~the~~31, ~~option~~2011, of the Company inhas ~~cash~~not oryet ~~shares.~~recognized ~~The principal and accrued interest on~~ the ~~debenture~~sale ~~may be converted at any time into shares~~ of the ~~Company’s~~Rocas ~~common stock at a price of $0~~II project.~~05 per share, at the option of the holder.~~

OnCritical ~~October~~Accounting 9,Policies ~~2009,~~- ~~the~~Mineral Company issued a 5% convertible debenture with a principal amount of $4,000 which is due on January 1, 2010. The Company has defaulted on the convertible debenture therefore it is due and payable on demand from the creditor. The debt carries a beneficial conversion feature which resulted in a debt discount of $4,000 which was recorded against the convertible debenture and offset in additional paid in capital during fiscal 2010.Interest

14Nilam Resources, Inc. is primarily engaged in the acquisition, exploration and development of mineral properties. Mineral property acquisition costs are initially capitalized when incurred using the guidance in EITF 04-02, “Whether Mineral Rights Are Tangible or Intangible Assets” The Company assesses the carrying costs for impairment under SFAS 144, “Accounting for Impairment or Disposal of Long Lived Assets”. The Emerging Issues Task Force issued EITF 04-3, Mining Assets: Impairment and Business Combinations requires mining companies to consider cash flows related to the economic value of mining assets (including mineral properties and rights) beyond those assets’ proven and probable reserves, as well as anticipated market price fluctuations, when testing the mining assets for impairment in accordance with SFAS 144.

OnPursuant ~~February~~to 3,SFAS ~~2010, the Company issued a 10% convertible debenture with a principal amount of $10,000 which is due and payable on August 1, 2010~~No. ~~The principal and accrued interest on the debenture may be converted at any time~~144, at the ~~option~~recoverability of the ~~holder,~~acquisition ~~into~~costs ~~shares~~associated ofwith the ~~Company’s~~purchase ~~common~~of ~~stock~~mineral atrights apresumes ~~price~~to ~~that~~be ~~with~~insupportable ~~50%~~prior ~~discount~~ to ~~the~~determining ~~market on~~ the ~~day~~existence of ~~conversion called by the holder. The debt carries~~ a ~~beneficial~~commercially ~~conversion~~minable ~~feature~~deposit ~~which resulted in a debt discount of $10,000 which was recorded against the convertible debenture~~ and ~~offset~~have into ~~additional~~be ~~paid in capital~~expensed. ~~This discount was amortized as interest expense over the life of the debt which resulted in amortization of approximately $6,000 during fiscal 2011.~~

OnOff-Balance ~~May~~Sheet 10, 2010, the Company issued a 5% convertible debenture with a principal amount of $1,790 which is due on October 1, 2010. The debt carries a beneficial conversion feature which resulted in a debt discount of $1,790 which was recorded against the convertible debenture and offset in additional paid in capital. This discount was amortized as interest expense over the life of the debt which resulted in amortization of approximately $1,790 during fiscal 2011.Arrangements

~~During~~We ~~fiscal~~have ~~2011,~~no ~~all~~significant ~~four~~off-balance ~~convertible~~sheet ~~debentures~~arrangements ~~were~~that ~~settled~~have ~~through~~or ~~the~~are ~~issuance~~reasonably oflikely ~~1,214,816~~to ~~common~~have ~~shares.~~a Ascurrent ~~all~~or ~~four~~future ~~debentures~~effect ~~were~~on ~~past~~our ~~due~~financial atcondition, ~~the~~changes ~~date~~in offinancial ~~settlement~~condition, ~~the~~revenues ~~common~~or ~~shares~~expenses, ~~issued~~results ~~on settlement~~ of ~~the notes were assigned a value of $60~~operations,~~741,~~ ~~which was calculated based on the trading value of the Company’s stock on the date the settlement was approved by the Board of Directors. This resulted in a loss of $33~~liquidity,~~047~~ oncapital ~~the~~expenditures ~~settlement~~or ofcapital ~~$27,694~~resources inthat ~~principal~~is ~~and~~material ~~accrued~~to ~~interest~~stockholders.

~~NOTE 8 SUBSEQUENT EVENTS~~Inflation

~~There~~The ~~were~~amounts nopresented ~~subsequent~~in ~~events~~the asfinancial atstatements do not provide for the ~~report~~effect ~~date~~of inflation on our operations or financial position. The net operating losses shown would be greater than reported if the effects of inflation were reflected either by charging operations with amounts that represent replacement costs or by using other inflation adjustments.

~~NOTE~~Item 93. ~~COMPARATIVE~~QUALITATIVE ~~FIGURES~~AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

~~Certain~~We ofare ~~the~~a ~~comparative~~smaller ~~figures~~reporting ~~have~~company ~~been~~as ~~classified~~defined toby ~~conform~~Rule to12b-2 of the ~~presentation~~Exchange ~~adopted~~Act inand ~~the~~are ~~current~~not ~~period~~required to provide information under this item.

~~NOTE~~Item 104. ~~SUPPLEMENTAL~~CONTROLS ~~DISCLOSURE~~and OFPROCEDURES ~~CASH~~OVER ~~FLOW~~FINANCIAL ~~INFORMATION~~REPORTING

~~During~~Conclusions ~~fiscal 2011, the Company settled $120,000~~ of ~~its~~Management ~~debt~~Regarding ~~through~~Effectiveness ~~issuance~~ of ~~4,000,000~~Disclosure ~~common~~Controls ~~shares~~and Procedures. ~~(Note 5)~~

~~During~~Our ~~fiscal~~management, ~~2011~~which includes our CEO, ~~the~~president ~~Company~~and ~~issued~~sole 1director,~~000,000~~ ~~common~~who ~~shares~~is atalso ~~$0.01~~the ~~per~~principal ~~share~~financial ~~for~~officer ~~cash.~~of ~~(Note~~the 5)Company, has further evaluated the effectiveness of our disclosure

~~During fiscal 2011, the Company converted $210,000 management fees owing to the officers of the Company into 7,000,000 common shares. (Note 6)~~-17-

~~During~~controls ~~fiscal~~and ~~2011,~~procedures pursuant to Exchange Act Rule 15d-15(e) as of the ~~Company~~end ~~converted~~of ~~$27~~the period covered by this report. Based on that evaluation,~~694~~ ofthe ~~its~~management ~~convertible~~has ~~debentures~~concluded ~~into~~that 1there was a material weakness affecting our internal control over financial reporting and,~~214,816~~ ~~common~~as ~~shares.~~a ~~(Note~~result 5)management concluded that our disclosure controls and procedures were not effective as of October 31, 2011.

~~During~~Management’s ~~fiscal~~Report ~~2011, the Company recorded accretion interest~~ on ~~beneficial~~Internal ~~conversion~~Control ~~features~~over ~~related~~Financial ~~to convertible debt of $7,790~~Reporting. ~~(Note 7)~~

~~For~~The ~~the~~Company’s ~~three~~management ~~months~~is ~~ended~~responsible ~~January~~for ~~31,~~establishing ~~2011,~~and maintaining adequate internal control over financial reporting for the company. The Company’s ~~issued 2,743,600~~internal ~~common~~control ~~shares~~over atfinancial $0reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the United States of America.02 ~~per~~Internal ~~share~~control over financial reporting includes maintaining records that in reasonable detail accurately and fairly reflect our transactions; providing reasonable assurance that transactions are recorded as necessary for ~~cash~~preparation of our financial statements; providing reasonable assurance that receipts and expenditures of company assets are made in accordance with management authorization; and providing reasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis. ~~(Note~~Because 5)of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected.

~~NOTE~~The 11management ~~CONTINGENCIES~~conducted an assessment of the effectiveness of the Company’s internal control over financial reporting as of Octorber 31, 2011 based on the criteria for effective internal control over financial reporting established in “Internal Control — Integrated Framework,” issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission. In its evaluation, Management evaluated whether the Company had sufficient “preventive controls” which are controls that have the objective of preventing the occurrence of errors or fraud that could result in a misstatement of the financial statements, and “detective controls” which have the objective of detecting errors or fraud that has already occurred that could result in a misstatement of the financial statements. In its evaluation, Management considered whether there were sufficient internal controls over financial reporting, in the context of the Company’s control environment, financial risk assessment, internal control activities, monitoring, and communication to determine whether sufficient controls are present and functioning effectively. Based upon this assessment, we determined that there was a material weakness affecting our internal control over financial reporting and, as a result of that weakness, our internal control over financial reporting was not effective as of October 31, 2011. The material weakness has been disclosed to, and reviewed with, our independent auditor.

~~There~~Management’s ~~were~~Remediation ~~no contingencies as at the report date.~~Initiatives

15The Company recognizes the importance of implementing and maintaining disclosure controls and procedures and internal controls over financial reporting and is working to implement an effective system of controls. Management is currently evaluating avenues for mitigating our internal controls weaknesses, but mitigating controls that are practical and cost effective based on the size, structure, and future existence of our organization. Since the Company has not engaged in any substantive operations since the loss of the right to purchase the Pativilca Mineral Property in Peru, or generated any significant revenues, the Company is limited in its options for remediation efforts. Management, within the confines of its budgetary resources, will engage its outside accounting firm to assist with an assessment of the Company’s internal controls over financial reporting on an on-going basis.

~~Item~~Because 2.of ~~MANAGEMENT’S~~the ~~DISCUSSION~~inherent ~~AND~~limitations ~~ANALYSIS~~in ORall ~~PLAN~~control OFsystems, ~~OPERATION~~no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. These inherent

~~Critical Accounting Policies~~ - ~~Mineral Interest~~18-

~~Nilam~~limitations ~~Resources,~~include ~~Inc.~~the isrealities ~~primarily~~that ~~engaged~~judgments in ~~the~~decision ~~acquisition,~~making ~~exploration~~can ~~and~~be ~~development~~faulty ofand ~~mineral~~that ~~properties.~~breakdowns ~~Mineral~~can ~~property~~occur ~~acquisition~~because ~~costs~~of ~~are~~simple ~~initially~~error ~~capitalized when incurred using the guidance in EITF 04-02, “Whether Mineral Rights Are Tangible~~ or ~~Intangible Assets”~~ mistake. The ~~Company~~design ~~assesses~~of ~~the~~any ~~carrying~~system ~~costs~~of ~~for~~controls ~~impairment~~is ~~under~~based ~~SFAS~~in ~~144,~~part ~~“Accounting~~on ~~for~~certain ~~Impairment~~assumptions orabout ~~Disposal~~the likelihood of ~~Long~~future ~~Lived Assets”. The Emerging Issues Task Force issued EITF 04-3~~events, ~~Mining Assets: Impairment~~ and ~~Business~~there ~~Combinations~~can ~~requires~~be ~~mining~~no ~~companies~~assurance tothat ~~consider~~any ~~cash~~design ~~flows~~will ~~related~~succeed toin ~~the~~achieving ~~economic~~its ~~value~~stated ofgoals ~~mining~~under ~~assets~~all ~~(including~~potential ~~mineral~~future ~~properties~~conditions. Projections ~~and~~of ~~rights)~~any ~~beyond~~evaluation ~~those~~of ~~assets’~~controls ~~proven~~effectiveness ~~and~~to ~~probable~~future ~~reserves,~~periods asare ~~well~~subject asto ~~anticipated market price fluctuations, when testing the mining assets for impairment in accordance with SFAS 144~~risks.

~~Pursuant~~This toannual ~~SFAS~~report ~~No.~~does ~~144,~~not ~~the~~include ~~recoverability~~an attestation report of the ~~acquisition~~Company’s ~~costs~~registered ~~associated~~public ~~with~~accounting ~~the~~firm ~~purchase~~regarding ofinternal ~~mineral~~control ~~rights~~over ~~presumes~~financial toreporting. beManagement’s ~~insupportable~~report ~~prior~~was not subject to ~~determining~~attestation by the ~~existence~~Company’s ofregistered apublic ~~commercially~~accounting ~~minable~~firm ~~deposit~~pursuant to temporary rules of the Securities and ~~have~~Exchange Commission that permit the company to beprovide ~~expensed~~only management’s report in this annual report.

~~Going~~Changes ~~Concern~~in ~~and~~internal ~~Uncertainties~~control over financial reporting

~~Nilam~~Except ~~Resources,~~as ~~Inc.~~noted ~~was incorporated under the laws of Nevada on July 11~~above, ~~2005. Our~~there ~~company~~have isbeen inno ~~the~~changes ~~exploration~~during ~~stage with limited operations. As reflected in~~ the ~~accompanying~~quarter ~~financial~~ended ~~statements,~~October ~~our Company had loss in the current period of $1~~31,~~474,977,~~ ~~and~~2011 ~~a negative cash flows from operations of $17,556. for the current period. We have not generated any revenues from operations, and further losses are anticipated~~ in the ~~development of the business. This raises substantial doubt about the company’s ability to continue as a going concern. The ability of the~~ Company ~~to continue as a going concern is dependent on the Company~~’s ~~ability~~internal tocontrols ~~raise~~over ~~additional capital and implement its business plan. The~~ financial ~~statements~~reporting ~~do not include any adjustments~~ that ~~might~~have bematerially ~~necessary~~affected, ifor ~~the~~are ~~Company~~reasonably islikely ~~unable~~ to ~~continue~~materially asaffect, ainternal ~~going~~controls ~~concern~~over financial reporting.

~~Management~~Inherent ~~plans~~Limitations toon ~~seek~~Effectiveness ~~additional capital funding to implement its business plan through private placement and public offerings~~ of ~~common shares in its capital stock. Additionally, if necessary, the officers or directors may make loans to enable the Company to meet its minimum cash requirements.~~Controls

~~Management~~The ~~believes~~Company’s management does not expect that ~~actions~~our ~~presently~~Disclosure ~~being~~Controls ~~taken~~or toour ~~obtain~~internal ~~additional~~control ~~funding~~over financial reporting will prevent or detect all error and ~~implement~~all ~~its~~fraud. A ~~strategic~~control ~~plans~~system, no matter how well designed and operated, can provide anonly ~~opportunity~~reasonable, ~~for~~not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to ~~continue~~future asperiods aare ~~going~~subject ~~concern~~to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

~~Our principal office is located at Calle Alcanfores 761 – 1701, Miraflores, Lima 18, Peru. Our fiscal year ends April 30th.~~-19-

~~Off-Balance~~PART ~~Sheet~~II OTHER ~~Arrangements~~INFORMATION

WeItem ~~have~~1. noLEGAL 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 is material to stockholders.PROCEEDINGS

~~Inflation~~As of October 31, 2011, the end of the quarterly period covered by this report, the Company was not subject to any legal proceedings.

~~The~~Item ~~amounts presented in the financial statements do not provide for the effect of inflation on our operations or financial position~~1A. ~~The~~ ~~net~~RISK operating losses shown would be greater than reported if the effects of inflation were reflected either by charging operations with amounts that represent replacement costs or by using other inflation adjustments.FACTORS

~~Item~~Inherent ~~3. QUALITATIVE~~Risks ~~AND~~in ~~QUALITATIVE~~Our ~~DISCLOSURES~~Business ~~ABOUT~~and ~~MARKET~~the ~~RISK.~~Mining Industry

WeThe ~~are~~search for valuable minerals as a ~~smaller~~business ~~reporting~~involves ~~company~~substantial asrisks. The ~~defined~~likelihood byof ~~Rule~~our ~~12b-2~~success and success in the mining industry must be considered in light of the ~~Exchange~~substantial ~~Act~~risks, problems, expenses, difficulties, complications and delays encountered in connection with the exploration of the mineral properties that the Company plans to undertake. These potential problems include, but are not ~~required~~limited to, ~~provide~~the ~~information~~inherent ~~under~~speculative ~~this~~nature ~~item~~of exploration of mining properties, numerous hazards including pollution, cave-ins and other hazards against which we cannot, or may elect not to, insure, burdensome government regulations and other legal uncertainties, market fluctuations relating to the minerals and metals which we seek to exploit, other unanticipated problems relating to exploration, and additional costs and expenses that may exceed current estimates.

16Compliance with Government Regulation

~~Item~~The ~~4. CONTROLS~~Company will be required to comply with all regulations, rules and ~~PROCEDURES~~directives ~~OVER~~of ~~FINANCIAL~~governmental ~~REPORTING~~authorities and agencies applicable to the exploration of minerals in Peru.

~~Conclusions~~The ofCompany ~~Management~~will ~~Regarding~~have ~~Effectiveness~~to sustain the cost of ~~Disclosure~~reclamation ~~Controls~~and environmental mediation for all exploration and ~~Procedures~~development work undertaken. The amount of these costs is not known at this time as we do not know the extent of the exploration program that will be undertaken beyond completion of the currently planned work programs. Because there is presently no information on the size, tenor, or quality of any resource or reserves at this time, it is impossible to assess the impact of any capital expenditures on earnings or our competitive position in the event a potentially economic deposit is discovered.

~~Our~~If ~~management, which includes our CEO, president and sole director, who is also~~ the ~~principal~~Company ~~financial~~enters ~~officer~~into ~~of the Company~~production, ~~has further evaluated~~ the ~~effectiveness~~cost of ~~our~~complying ~~disclosure~~with ~~controls~~permit and ~~procedures~~regulatory ~~pursuant~~environment tolaws ~~Exchange~~will ~~Act~~be ~~Rule~~greater ~~15d-15(e)~~than asin of the ~~end~~exploration ofphases because the ~~period~~impact ~~covered by this report. Based~~ on ~~that evaluation,~~ the ~~management~~project ~~has~~area ~~concluded~~is ~~that~~greater. Permits ~~there was a material weakness affecting our internal control over financial reporting~~ and, asregulations awill ~~result~~be ~~management concluded that our disclosure controls and procedures were not effective as of July 31, 2011~~required.

~~Management’s~~- ~~Report~~Water discharge will have to meet water standards; - Dust generation may have to be minimal or otherwise re-mediated; - Dumping of material on ~~Internal~~the ~~Control~~surface ~~over~~may ~~Financial~~have ~~Reporting~~to be re-contoured and re-vegetated; - An assessment of all material to be left on the surface will need to be environmentally benign; - Ground water will have to be monitored for any potential contaminants; - The socio-economic impact of the project will have to be evaluated and if deemed negative, will have to be re-mediated; and - There will likely have to be an impact report of the work on the local fauna and flora.

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting for the company. The Company’s internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the United States of America. Internal control over financial reporting includes maintaining records that in reasonable detail accurately and fairly reflect our transactions; providing reasonable assurance that transactions are recorded as necessary for preparation of our financial statements; providing reasonable assurance that receipts and expenditures of company assets are made in accordance with management authorization; and providing reasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected.-20-

~~The~~Item management conducted an assessment of the effectiveness of the Company’s internal control over financial reporting as of July 31, 2011 based on the criteria for effective internal control over financial reporting established in “Internal Control — Integrated Framework,” issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission2. In ~~its~~UNREGISTERED ~~evaluation,~~SALES ~~Management~~OF ~~evaluated~~EQUITY ~~whether~~SECURITIES ~~the~~AND ~~Company~~USE ~~had~~OF sufficient “preventive controls” which are controls that have the objective of preventing the occurrence of errors or fraud that could result in a misstatement of the financial statements, and “detective controls” which have the objective of detecting errors or fraud that has already occurred that could result in a misstatement of the financial statements. In its evaluation, Management considered whether there were sufficient internal controls over financial reporting, in the context of the Company’s control environment, financial risk assessment, internal control activities, monitoring, and communication to determine whether sufficient controls are present and functioning effectively. Based upon this assessment, we determined that there was a material weakness affecting our internal control over financial reporting and, as a result of that weakness, our internal control over financial reporting was not effective as of July 31, 2011. The material weakness has been disclosed to, and reviewed with, our independent auditor.PROCEEDS

~~Management~~On August 10, 2009, the Company issued a 5% convertible debenture with a principal amount of $10,187 that is due and payable on August 10, 2010. The interest and principal is due at maturity at the option of the Company in either cash or shares. The convertible debenture may be converted into the Company’s ~~Remediation~~common ~~Initiatives~~stock at a price of $0.05 per share, at the option of the holder. As of October 31, 2011, the convertible debenture was not paid and not converted.

~~The~~On ~~Company~~October ~~recognizes~~9, 2009, the ~~importance~~Company ofissued ~~implementing~~a ~~and~~5% ~~maintaining~~convertible ~~disclosure~~debenture ~~controls~~with ~~and~~a ~~procedures~~principal ~~and~~amount ~~internal controls over financial reporting and is working to implement an effective system~~ of ~~controls. Management is currently evaluating avenues for mitigating our internal controls weaknesses~~$4,000 ~~but~~which ~~mitigating~~is ~~controls~~due ~~that are practical and cost effective based~~ on ~~the~~January ~~size~~1, ~~structure, and future existence of our organization~~2010. ~~Since~~ The ~~the~~ Company has ~~not~~defaulted ~~engaged~~on inthe ~~any~~convertible ~~substantive~~debenture ~~operations~~therefore ~~since~~it ~~the~~is ~~loss~~due ofand ~~the~~payable ~~right~~on todemand ~~purchase~~from the ~~Pativilca~~creditor. ~~Mineral~~The ~~Property~~debt incarries ~~Peru,~~a orbeneficial ~~generated~~conversion ~~any~~feature ~~significant~~which ~~revenues,~~resulted ~~the Company is limited~~ in ~~its~~a ~~options~~debt ~~for~~discount ~~remediation efforts. Management, within the confines~~ of ~~its budgetary resources~~$4,000 ~~will~~which ~~engage~~was ~~its~~recorded ~~outside~~against ~~accounting~~the ~~firm~~convertible todebenture ~~assist~~and ~~with~~offset anin ~~assessment~~additional ofpaid ~~the~~in ~~Company’s~~capital ~~internal~~during ~~controls~~fiscal ~~over financial reporting on an on-going basis~~2010.

~~Because~~Item of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected3. ~~These~~ ~~inherent~~DEFAULTS ~~limitations~~UPON ~~include~~SENIOR the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks.SECURITIES

~~This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting~~None. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management’s report in this annual report.

17Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

~~Changes in internal control over financial reporting~~None.

~~Except~~Item as5. ~~noted~~OTHER above, there have been no changes during the quarter ended July 31, 2011 in the Company’s internal controls over financial reporting that have materially affected, or are reasonably likely to materially affect, internal controls over financial reporting.INFORMATION

~~Inherent~~As ~~Limitations~~of onOctober ~~Effectiveness~~31, of2011, ~~Controls~~all warrants were expired.

~~The~~Item ~~Company’s management does not expect that our Disclosure Controls or our internal control over financial reporting will prevent or detect all error and all fraud~~6. A ~~control~~EXHIBITS ~~system,~~AND noREPORT ~~matter~~ON ~~how~~FORM well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.8-K

1831.

~~PART~~Certification ~~II OTHER~~of ~~INFORMATION~~Mr. Shahin Tabatabaei, Chief Executive Officer and Acting Chief Financial officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

~~Item 1~~32. ~~LEGAL PROCEEDINGS~~

AsCertification of ~~July~~Chief ~~31,~~Executive ~~2011,~~Officer ~~the~~and ~~end~~Chief ofFinancial ~~the~~Officer ~~quarterly~~pursuant ~~period~~to ~~covered~~18 byU.S.C. ~~this~~section ~~report~~1350, ~~the~~as ~~Company~~adopted ~~was~~pursuant ~~not~~to ~~subject~~section to906 ~~any~~of ~~legal~~the ~~proceedings~~Sarbanes Oxley Act of 2002.

~~Item 1A. RISK FACTORS~~-21-

~~Inherent Risks in Our Business and the Mining Industry~~SIGNATURES

~~The~~In ~~search~~accordance for valuable minerals as a business involves substantial risks. The likelihood of our success and success in the mining industry must be considered in light of the substantial risks, problems, expenses, difficulties, complications and delays encountered in connection with the ~~exploration~~requirements of the ~~mineral~~Exchange ~~properties that the Company plans to undertake. These potential problems include~~Act, ~~but are not limited to,~~ the ~~inherent~~registrant ~~speculative~~caused ~~nature~~this ofreport ~~exploration of mining properties, numerous hazards including pollution, cave-ins and other hazards against which we cannot, or may elect not~~ to, ~~insure,~~be ~~burdensome~~signed ~~government~~on ~~regulations~~this ~~and~~behalf ~~other~~by ~~legal uncertainties, market fluctuations relating to~~ the ~~minerals and metals which we seek to exploit~~undersigned, ~~other~~thereunto ~~unanticipated~~duty ~~problems relating to exploration, and additional costs and expenses that may exceed current estimates~~authorized.

Compliance with Government Regulation


	Nilam Resources, Inc.

Dated December 19, 2011
	/s/ Shahin Tabatabaei
	Shahin Tabatabaei
	CEO and Acting CFO

~~The Company will be required to comply with all regulations, rules and directives of governmental authorities and agencies applicable to the exploration of minerals in Peru.~~-22-

The Company will have to sustain the cost of reclamation and environmental mediation for all exploration and development work undertaken. The amount of these costs is not known at this time as we do not know the extent of the exploration program that will be undertaken beyond completion of the currently planned work programs. Because there is presently no information on the size, tenor, or quality of any resource or reserves at this time, it is impossible to assess the impact of any capital expenditures on earnings or our competitive position in the event a potentially economic deposit is discovered.

If the Company enters into production, the cost of complying with permit and regulatory environment laws will be greater than in the exploration phases because the impact on the project area is greater. Permits and regulations will be required.

- Water discharge will have to meet water standards; - Dust generation may have to be minimal or otherwise re-mediated; - Dumping of material on the surface may have to be re-contoured and re-vegetated; - An assessment of all material to be left on the surface will need to be environmentally benign; - Ground water will have to be monitored for any potential contaminants; - The socio-economic impact of the project will have to be evaluated and if deemed negative, will have to be re-mediated; and - There will likely have to be an impact report of the work on the local fauna and flora.

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

On August 10, 2009, the Company issued a 5% convertible debenture with a principal amount of $10,187 that is due and payable on August 10, 2010. The interest and principal is due at maturity at the option of the Company in either cash or shares. The convertible debenture may be converted into the Company’s common stock at a price of $0.05 per share, at the option of the holder. As of July 31, 2011, the convertible debenture was not paid and not converted.

On October 9, 2009, the Company issued a 5% convertible debenture with a principal amount of $4,000 which is due on January 1, 2010. The Company has defaulted on the convertible debenture therefore it is due and payable on demand from the creditor. The debt carries a beneficial conversion feature which resulted in a debt discount of $4,000 which was recorded against the convertible debenture and offset in additional paid in capital during fiscal 2010.

Item 3. DEFAULTS UPON SENIOR SECURITIES

None.

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

None.

Item 5. OTHER INFORMATION

As of July 31, 2011, all warrants were expired.

Item 6. EXHIBITS AND REPORT ON FORM 8-K

1. Certification of Mr. Shahin Tabatabaei, Chief Executive Officer and Acting Chief Financial officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

2. Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes Oxley Act of 2002.

SIGNATURES

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

	Nilam Resources, Inc.
Dated October 11, 2011
	/s/ Shahin Tabatabaei
	Shahin Tabatabaei
	CEO and Acting CFO

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