Ashanti Sankofa Inc. — Management Reports 2021

Jun 26, 2021

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MANAGEMENT’S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED FEBRUARY 28, 2021

This Management’s Discussion & Analysis (“ MD&A ”) provides a detailed analysis of the business of Ashanti Sankofa Inc. (the “ Company ”) and should be read in conjunction with the Company’s audited consolidated financial statements for the year ended February 28, 2021 (the “Q4 Financial Statements”) and the notes thereto, which were prepared in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board and interpretations of the IFRS Interpretations Committee. The Company’s reporting currency is the Canadian dollar and all amounts in this MD&A are expressed in Canadian dollars.

This MD&A contains certain statements that may constitute “forward‐looking statements”. Forward‐looking statements include but are not limited to, statements regarding future anticipated business developments and the timing thereof, and business and financing plans. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward‐looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or which by their nature refer to future events. The Company cautions investors that any forward‐ looking statements by the Company are not guarantees of future performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, the Company’s ability to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies.

Additional information relating to the Company can be located on the SEDAR website at www.sedar.com.

This MD&A is current as at June 22, 2021.

OVERVIEW

The Company is an exploration stage company engaged in the acquisition and exploration of mineral properties. The Company is currently focusing its exploration activities on precious metals in West Africa through its wholly‐ owned subsidiaries AMI Africa Exploration Ltd. (“AMI Africa”) and Ashanti Sankofa Limited (“Ashanti”). The Company is a reporting issuer in British Columbia, Alberta and Quebec and trades on the TSX Venture Exchange under the trading symbol – ASI‐V.

YEAR ENDED FEBRUARY 28, 2021 HIGHLIGHTS

• From March to May 2020, 24,666,663 warrants expired without exercise.

• On August 28, 2020, Mr. Tony Pickett was appointed as a director of the Company.

• On December 9, 2020, the Company announce the Annual General Meeting to be held on Monday, December 28, 2020.

• On December 28, 2020, the Company at the Company’s AGM shareholders passed all resolutions put before them including: 1) to set number of directors to be elected at the meeting to at 3 (three); 2) Election of directors (Tony Pickett, Ronald Renne, and Edward Low); 3) to appoint Dale Matheson Carr‐Hilton LaBonte LLP, as auditor of the Company for ensuring year and authorizing the Directors to fix their remuneration; 4) to adopt and approve the Company’s amended fixed stock option plan.

• On February 23, 2021, the Company closed a private placement by issuing 7,500,000 unites at a price of $0.02 for gross proceeds of $150,000. Each unit consists of one common share of the Company and one transferable

ASHANTI SANKOFA INC. Management's Discussion & Analysis For the Year Ended February 28, 2021

common share purchase warrant exercisable to acquire an additional common share of the Company until February 23, 2021 at price of $0.05 per share.

• On April 7, 2021, the Company appointed Ryan Kim as a director of the Company.

• On May 5, 2021, Edward Low resigned as a director of the Company.

MINERAL PROPERTIES

Ghana - North Ashanti Gold Project

Ashanti Sankofa Limited (Ghana) holds or held a 100% interest (subject to a government 10% carried interest) in two Prospecting Licences (Beposo (33km[2] ) and Anuoro (65km[2] )), covering a combined area of approximately 98km[2] which together comprise the North Ashanti Gold Project.

The North Ashanti Gold Project is located in the Ashanti Region of Ghana, West Africa. Ghana is currently the world’s 8th largest gold producer and a number of mines are located along this Ashanti Shear.

The North Ashanti Gold Project is located approximately 220km northwest by road from the capital city Accra, and 40km southeast by road from the country’s second city, Kumasi. The Asante Akyem North District capital town of Konongo is located immediately north of the concession area. Konongo is also the regional gold mining centre with several small open pits and a historic underground mine. Newmont Mining Corporation’s (“ Newmont ”) Akyem Mine is located approximately 25km to the Northeast.

Structurally the North Ashanti Project covers a 14km segment of the Konongo‐Axim Shear System, or Ashanti Shear. This shear zone hosts a number of deposits and operating gold mines, including the Konongo mine, which adjoins the North Ashanti Project to the north, and the Obuasi mine located to the southwest. The shear continues towards the southwest adjacent to the western contact of the Ashanti Belt and also hosts the Bogosu mine and the Prestea mine.

Anuoro License

AMI Africa was granted the 128.9km[2 ] Anuoro license on September 28, 2005. On December 14, 2009, AMI Africa received a 24‐month extension from the Minister of Mines on its Anuoro prospecting license. In March 2012, the Company shed half of the license in accordance with the Mining Act and on June 5, 2012, the Minerals Commission recommended a two‐year renewal of the retained 64.99km[2 ] license upon payment of the US$20,000 renewal fee. Newmont Ghana Gold Ltd. (“ Newmont Gold ”) paid this amount in accordance with the terms of the January 22, 2010 Newmont Gold/AMI Option Agreement. In‐order to comply with Ghana’s Mining Act 2006, AMI Africa incorporated a Ghanaian subsidiary Ashanti Sankofa Limited (formerly AMI Africa Ghana Exploration Ltd.) AMI Africa then assigned the Anuoro license to Ashanti Sankofa Limited. On May 9[th] , 2014, Ashanti Sankofa Limited received a letter from the Ministry of Lands and Natural Resources stating the Anuoro license had been renewed until May 9, 2016. The North Anuoro zone contains an at‐surface NI 43‐101 qualified gold resource of 97,686 ounces.

On April 6, 2016, Ashanti Sankofa Limited submitted documentation to the Minerals Commission requesting an extension of the Anuoro license. The Minerals Commission requested additional reports from Ashanti, which were submitted. Even though Ashanti has not yet received the extension under Section 35 (4) of the Minerals and Mining Act 2006, the prospecting license remains in force in respect of the land the subject of the application until the application is processed. The Company has submitted the application fees for the prospecting license and is waiting for the approval from Minister of Land and Resources.

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ASHANTI SANKOFA INC. Management's Discussion & Analysis For the Year Ended February 28, 2021

During May of 2018 Ashanti Sankofa enlisted the services of Sahara Natural Resources (“Sahara”) in Ghana to compile and re‐model the company’s extensive historical GIS, Geological and exploration data. This work was completed in June 2018.

On October 30, 2018, the Company received a letter from the Mineral Commission stating the Minister has approved the recommendation for grant of application. On June 27, 2019, the Ministry of Lands and Natural Resources sent a letter to the Company stating the Anuoro prospecting license had been renewed until June 27, 2022. As at February 29, 2020, management decided to write‐down the value of the property to $250,000 to reflect its estimated fair value. As at February 28, 2021, the Anuoro property’s carrying value was $250,000.

Beposo License

AMI Africa was granted the 33.35km[2 ] Beposo Concession on April 22, 2004. The Beposo license was a consolidation of three previous licenses (Ankasi, Adumasa & Pemenase) held since 1997. The Beposo license contains an at surface NI 43‐101 qualified gold resource of approximately 230,000 ounces in two main zones. AMI Africa has received several extensions of the Beposo license and has held EPA permits for exploration work on the Beposo license. In 2007, the Minerals Commission in conjunction with the EPA imposed a 5 to 10km non‐economic zone around Lake Botsumtwi, which encompasses the area of the Beposo gold resource. In response to the EPA's decision, a Writ of Summons was filed on May 13[th] 2011 in the High Court of Justice seeking compensation for the loss of the Beposo gold resource. In October 2014, AMI Africa was advised by its legal counsel that the High Court of Justice – Commercial Division had ruled against AMI Africa. AMI Africa, after consultation with its Ghanaian counsel, filed an appeal of this decision on a contingency fee basis with counsel. As a result of ongoing subsequent communication between Ashanti Sankofa Limited and the Minerals Commission, the Company advised its legal counsel to suspend its appeal in the hope of reaching an agreement to have the Beposo license reinstated by the government. The company has maintained regular contact, in person, with the Minerals Commission regarding the re‐instatement of the Beposo license and the opportunity to re‐enter the portion of the concession outside the non‐economic zone to carry out further exploratory operations. As at February 28, 2014, an impairment of $2,578,525 was taken with respect to the Beposo concession.

	Year Ended	Year Ended
	February 28, 2021	February 29, 2020
	$	$
Opening Balance	250,000	728,644
Field and camp costs	1,240	3,475
Geologist fees	11,928	35,738
Labour costs	‐	15,167
Legal fees	‐	550
Travel	‐	869
Costs incurred during the year	13,168	55,800
Impairment of exploration and evaluation assets	(13,168)	(534,444)
Ending Balance	250,000	250,000

LIQUIDITY AND CAPITAL RESOURCES

As at February 28, 2021, the Company had current assets of $97,322 and current liabilities of $515,516 compared to current assets of $6,782 and current liabilities of $394,937 as at February 29, 2020. At February 28, 2021, there was a working capital deficiency of $418,194 compared to a working capital deficiency of $388,155 at February 29, 2020.

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ASHANTI SANKOFA INC. Management's Discussion & Analysis For the Year Ended February 28, 2021

Cash at February 28, 2021 was $85,638, compared to $1,287 at February 29, 2020.

The Company’s current cash resources are insufficient to meet its working capital and mineral property funding requirements for the next year. Therefore, management will continue to seek new sources of capital to maintain its operations and to further the development of its mineral properties. As a public company, the evaluation by the investment community and individual investors will determine the outcome of any financing in the public market.

7,500,000 common shares issued during the year ended February 28, 2021.

RESULTS OF OPERATION

SELECTED ANNUAL INFORMATION

	February 28,	February 29,	February 28,
	2021	2020	2019
	$	$	$
Income Statement
Net profit (loss)	(175,040)	(669,588)	(317,415)
Loss per share (basic and diluted)	(0.00)	(0.02)	(0.01)
Balance Sheet
Exploration and evaluation assets	250,000	250,000	728,644
Total assets	347,322	256,782	742,226
Total long‐term liabilities	-	-	-

Three Months Ended February 28, 2021

The Company incurred a net loss of $96,189 for the three months ended February 28, 2021 compared to a net loss of $584,990 for three months ended February 29, 2020.

The following is a breakdown of operating expenses for the 4[th] quarter in 2021, compared to 2020:

• Management fees of $12,000 (Q4 2020 ‐ $16,000). There are no significant changes when compared to 2020.

• Professional fees of $64,020 (Q4 2020 ‐ $22,750). The increase is due to the legal fee bill received in the 4[th] quarter of this fiscal related to the previous three year’s corporate activities, including AGM, financing and other matters.

• Foreign exchange gain of $4,131 (Q4 2020 ‐$6,547). The fluctuate foreign exchange is due to the depreciating US dollar during this fiscal year when compared to the last year.

• Impairment of exploration and evaluation asset of $13,168 (Q4 2020 ‐ $534,444). The Company wrote off mining expenditure $13,168 in the 4[th] quarter of this year.

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ASHANTI SANKOFA INC. Management's Discussion & Analysis For the Year Ended February 28, 2021

Year Months Ended February 28, 2021

The Company incurred a net loss of $175,040 for the year ended February 28, 2021 compared to a net loss of $669,589 for year ended February 29, 2020.

The following is a breakdown of operating expenses for the fiscal year 2021, compared to 2020:

• Management fees of $48,000 (2020 ‐ $52,000). There are no significant changes when compared to 2020.

• Professional fees of $103,955 (2020 ‐ $60,622). The increase is due to the legal fee bill received in the 4[th] quarter of this fiscal year related to the previous three year’s corporate activities, including AGM, financing and other matters.

• Foreign exchange gain of $9,538 (2020 ‐$7,101). The fluctuate foreign exchange is due to the depreciating US dollar during this fiscal year when compared to the last fiscal year.

• Impairment of exploration and evaluation asset of $13,168 (Q4 2020 ‐ $534,444). The Company wrote off mining expenditure $13,168 in the 4[th] quarter of this year.

SELECTED QUARTERLY INFORMATION

	February 28,	November 30,	August 31,	May 31,
	2021	2020	2020	2020
	$	$	$	$
Net profit (loss)	(96,189)	(28,106)	(18,477)	(32,268)
Basicprofit(loss) per share	(0.00)	(0.01)	0.00	0.00
Dilutedprofit(loss) per share	**N/A **	N/A	N/A	N/A
	February 29,	February 28,	August 31,	May 31,
	2020	2019	2019	2019
	$	$	$	$
Net profit (loss)	(584,990)	(25,459)	(30,541)	(28,599)
Basicprofit(loss) per share	0.01	0.00	0.00	0.00
Dilutedprofit(loss) per share	N/A	N/A	N/A	N/A

FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

		February 28,	February 29,
	Ref.	2021	2020
		$	$
Other financial assets	a	85,638	1,287
Other financial liabilities	b	462,435	382,677

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ASHANTI SANKOFA INC. Management's Discussion & Analysis For the Year Ended February 28, 2021

a. Comprises cash

• b. Comprises accounts payable and amounts due to related parties

The Company has determined the estimated fair values of its financial instruments based on appropriate valuation methodologies; however, considerable judgment is required to develop these estimates. The fair values of the Company’s financial instruments are not materially different from their carrying values.

Management of Industry and Financial Risk

The Company is engaged primarily in mineral exploration and manages related industry risk issues directly. The Company may be at risk for environmental issues and fluctuations in commodity pricing. Management is not aware of and does not anticipate any significant environmental remediation costs or liabilities in respect of its current operations.

The Company’s financial instruments are exposed to certain financial risks, which include the following:

Credit risk

Credit risk is the risk of loss due to the counterparty's inability to meet its obligations. The Company’s exposure to credit risk is on its cash and other receivables. Risk associated with cash is managed through the use of major banks which are high credit quality financial institutions as determined by rating agencies. Other receivables comprise sales tax refunds from the Canadian federal government.

Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulties in meeting obligations when they become due. The Company ensures that there is sufficient capital in order to meet short‐term operating requirements, after taking into account the Company’s holdings of cash. The Company’s cash are held in corporate bank accounts available on demand. Liquidity risk has been assessed as being high.

Market Risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and price risk.

Currency Risk

The Company is subject to normal market risks including fluctuations in foreign exchange rates and interest rate. While the Company manages its operations in order to minimize exposure to these risks, the Company has not entered into any derivatives or contracts to hedge or otherwise mitigate this exposure.

Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is not exposed to significant interest rate risk relating to its related party balances.

Price Risk

The Company is exposed to price risk with respect to equity prices. Price risk as it relates to the Company is defined as the potential adverse impact on the Company’s ability to raise financing due to movements in individual equity prices or general movements in the level of the stock market. The Company closely monitors individual equity movements and the stock market to determine the appropriate course of action to be taken by the Company.

Capital management

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ASHANTI SANKOFA INC. Management's Discussion & Analysis For the Year Ended February 28, 2021

The Company's policy is to maintain a strong capital base so as to maintain investor and creditor confidence and to sustain future development of the business. The capital structure of the Company consists of components of shareholders' equity. There were no changes in the Company's approach to capital management during the period. The Company is not subject to any externally imposed capital requirements.

	February 28,	February 29,
Accountspayable and accrued liabilities:	2021	2020
	$	$
Accounts payable	256,357	250,693
Accrued liabilities	53,081	12,259
	309,438	262,952

RELATED PARTY TRANSACTIONS

The Company’s related parties include its subsidiaries, significant shareholder, and key management personnel. Transactions with related parties for goods and services are made on normal commercial terms and are considered to be at arm’s length. The remuneration of the Company’s directors and other key management personnel during the period ended February 28, 2021 and February 29, 2020 are as follows:

	February 28, 2021	February 29, 2020
	$	$
Management fees (a)	48,000	52,000
Professional fees(b)	51,000	51,000

As at February 28, 2021, the Company was indebted to its related parties for the amounts as below:

	February 28, 2021	February 29, 2020
	$	$
Due to related parties (a)(b)	168,234	116,684
Due to shareholder (c)	37,844	15,300
	206,078	131,984

• (a) During the year ended February 28, 2021, the Company incurred $48,000 (February 29, 2020 ‐ $52,000) for management fees to the CEO and a director for services provided. As at February 28, 2021, $82,000 (2020 ‐ $56,000) remains unpaid.

• (b) During the year ended February 28, 2021, the Company incurred $36,000 (2020 ‐ $36,000) for professional fees to the CFO and former CFO for accounting services performed. The Company also incurred $15,000 (2020 – $15,000) of professional fees to the Corporate Secretary for the legal services performed. As at February 28, 2021, $86,234 (February 29, 2020 ‐ $60,684) remains unpaid to these two parties.

• (c) During the year ended February 28, 2021, the Company received $22,544 in advances from a shareholder. As at February 28, 2021, $37,844 (February 29, 2020 ‐ $15,300) remains unpaid to this shareholder. These amounts are unsecured, non‐interest bearing and have no fixed repayment terms. Subsequent to February 28, 2021 the balance was fully repaid.

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ASHANTI SANKOFA INC. Management's Discussion & Analysis For the Year Ended February 28, 2021

OUTSTANDING SHARE DATA

As at February 28, 2021, the Company had 51,900,860 commons shares outstanding. As at the same date there were 14,500,000 warrants outstanding at an exercise price of $0.05 per share. The Company also had 2,675,000 stock options outstanding at an average price of $0.05.

As at the date of this report, the Company had 51,900,860 common shares outstanding. As at the date of this report, the following warrants were outstanding:

Number of Warrants	Exercise Price	Expiry Date
7,500,000	$0.05	February23,2023

As at the date of this reporting, the following options were outstanding:

Number of Options	Vested	Exercise Price	Expiry Date
1,150,000	1,150,000	$0.05	April 17, 2023
1,525,000	1,525,000	$0.05	October 30,2023

OFF-BALANCE SHEET ARRANGEMENTS

The Company has not entered into any significant off‐balance sheet arrangements or commitments.

CRITICAL ACCOUNTING ESTIMATES

The preparation of the condensed consolidated interim financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, and revenue and expenses.

The use of estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and further periods if the review affects both current and future periods. Accounts which require management to make material estimates and significant assumptions in determining amounts recorded include: impairment of exploration and evaluation assets, share‐based payments, and determination of functional currency.

i) Impairment

The Company assesses its exploration and evaluation assets annually to determine whether any indication of impairment exists. Where an indicator of impairment exists, an estimate of the recoverable amount is made, which is considered to be the higher of the fair value less costs to sell and value in use. These assessments may require the use of estimates and assumptions such as long‐term commodity prices, discount rates, future capital requirements, and exploration potential.

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ASHANTI SANKOFA INC. Management's Discussion & Analysis For the Year Ended February 28, 2021

ii) Share based payments

The Company follows accounting guidelines in determining the fair value of stock‐based compensation. The computed amount is not based on historical cost, but is derived based on subjective assumptions input into an option pricing model. The model requires that management make forecasts as to future events, including estimates of: the expected life of options; future volatility of the Company’s share price in the expected hold period (using historical volatility as a reference); and the appropriate risk‐free rate of interest. Stock‐based compensation incorporates an expected forfeiture rate. The resulting value calculated is not necessarily the value that the holder of the option could receive in an arm’s length transaction, given that there is no market for the options and they are not transferable. It is management’s view that the value derived is highly subjective and dependent entirely upon the input assumptions made.

iii) Functional and presentational currency

These consolidated financial statements are presented in Canadian dollars, which is Ashanti Sankofa Inc.’s functional currency. The Company’s wholly‐owned subsidiary AMI Africa Exploration Ltd.’s functional currency is also Canadian dollars with foreign transactions including those exploration and evaluation related converted to Canadian dollars using the spot rate on the day of occurrence. The Company’s wholly‐owned subsidiary Ashanti Sankofa Limited’s functional currency is the Ghanaian Cedi.

iv) Basis of measurement

These consolidated financial statements have been prepared on a historical cost basis and except for cash flow information, using the accrual basis of accounting.

ACCOUNTING POLICIES

Please refer to the audited financial statements for the year ended February 29, 2020 which was filed on SEDAR.

PROPOSED TRANSACTIONS

None.

FORWARD LOOKING INFORMATION

Forward‐looking statements relate to future events or future performance and reflect management's expectations or beliefs regarding future events and include, but are not limited to, statements with respect to the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, success of mining operations, environmental risks, permitting risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage. In certain cases, forward‐looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" or the negative of these terms or comparable terminology. By their very nature forward‐looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward‐looking statements. Such factors include, among others, risks related to actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of resources; possible variations in ore reserves, grade or recovery rates; accidents, labor disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; as well as those factors detailed from time to time in the

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ASHANTI SANKOFA INC. Management's Discussion & Analysis For the Year Ended February 28, 2021

Company's interim and annual financial statements which are filed and available for review on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward‐looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward‐looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward‐looking statements

ADDITIONAL INFORMATION

The information provided in this MD&A is not intended to be a comprehensive review of all matters concerning the Company. This MD&A should be read in conjunction with other disclosure documents provided by the Company, which can be accessed at http://www.sedar.com/. No securities commission or regulatory body has reviewed the accuracy or adequacy of the information presented herein.

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