Quebec Nickel Corp. — Audit Report / Information 2025

Jul 28, 2025

Quebec Nickel Corp.

Financial Statements
(Stated in Canadian Dollars)
For the Years Ended March 31, 2025 and 2024

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bakertilly

Baker Tilly WM LLP
900 – 400 Burrard Street
Vancouver, British Columbia
Canada V6C 3B7
T: +1 604.684.6212
F: +1 604.688.3497
vancouver@bakertilly.ca
www.bakertilly.ca

INDEPENDENT AUDITOR'S REPORT

To the Shareholders of Quebec Nickel Corp.:

Opinion

We have audited the financial statements of Quebec Nickel Corp. (the "Company"), which comprise the statements of financial position as at March 31, 2025 and 2024, and the statements of income (loss) and comprehensive income (loss), statements of changes in shareholders' equity and statements of cash flows for the years then ended, and notes to the financial statements, including material accounting policy information.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at March 31, 2025 and 2024, and its financial performance and its cash flows for the years then ended in accordance with IFRS Accounting Standards.

Basis for Opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material Uncertainty Related to Going Concern

We draw attention to Note 1 in the financial statements, which describes the events and conditions indicating that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended March 31, 2025. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

In addition to the matter described in the Material Uncertainty Related to Going Concern section of our auditor's report, we have determined the matter described below to be the key audit matters to be communicated in our report.

Baker Tilly WM LLP is a member of Baker Tilly Canada Cooperative, which is a member of the global network of Baker Tilly International Limited. All members of Baker Tilly Canada Cooperative and Baker Tilly International Limited are separate and independent legal entities.

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Key audit matter	How our audit addressed the key audit matter
Assessment of the existence of impairment indicators for exploration and evaluation assets
Refer to note 5	Our approach to addressing the matter involved the following procedures, among others:
As at March 31, 2025, the carrying amount of the Company's exploration and evaluation assets was $1.
At each reporting period, management assesses exploration and evaluation assets to determine whether there are any indicators of impairment. If any such indicators exist, the asset's recoverable amount is estimated. An impairment loss is recognized if the carrying amount of an asset exceeds its estimated recoverable amount.
Management assesses exploration and evaluation assets for impairment based on, at minimum, the presence of any of the following indicators:
(i) the period for which the Company has the right to explore in the specific area has expired during the year or will expire in the near future, and is not expected to be renewed;
(ii) substantive expenditure on further exploration for, and evaluation of, mineral resources in the specific area is neither budgeted nor planned;
(iii) the Company has decided to discontinue exploration for and evaluation of mineral resources in the specific area; and/or
(iv) for areas of likely development, available data indicates that the carrying amount exceeds the recoverable amount.
Impairment indicators were identified by management as at March 31, 2025. The carrying amount exceeded the recoverable amount of the assets and for the year ended March 31, 2025, an impairment of $13,971,572 was recognized.
We considered this a key audit matter due to the significance of the amount of the impairment for the exploration and evaluation assets.	Evaluating the judgments made by management in determining impairment indicators, which included the following:
• Evaluated management's intent for budgeting or planning further substantive expenditures on exploration and evaluation assets.
• Obtained, for a sample of claims by reference to government registries, evidence to support (i) the right to explore the area and (ii) claim expiration dates.
• Based on evidence obtained in other areas of the audit, considered whether other facts and circumstances suggest that the carrying amount may exceed the recoverable amount.

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Other Information

Management is responsible for the other information. The other information comprises the information included in the Management's Discussion & Analysis filed with the relevant Canadian securities commissions.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit and remain alert for indications that the other information appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact in this auditor's report. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with IFRS Accounting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.

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• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditor's report is Aycha Aziz.

Baker Tilly WM LLP

CHARTERED PROFESSIONAL ACCOUNTANTS

Vancouver, B.C.

July 28, 2025

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Quebec Nickel Corp.
Statements of Financial Position
(Stated in Canadian Dollars)

	Notes	March 31, 2025	March 31, 2024
ASSETS
Current assets
Cash and cash equivalents	10	$ 1,310,794	$ 1,430,149
Amounts receivable	4	11,021	109,079
Prepaid expenses		49,524	65,663
Total current assets		1,371,339	1,604,891
Exploration and evaluation assets	5	1	13,990,175
TOTAL ASSETS		$ 1,371,340	$ 15,595,066
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables	9	$ 51,344	$ 169,359
Total current liabilities		51,344	169,359
Deferred tax liability	6, 13	-	1,544,950
TOTAL LIABILITIES		51,344	1,714,309
Shareholders' equity
Common shares	7	15,331,406	15,444,778
Share-based payments reserve	8	2,051,300	1,997,700
Deficit		(16,062,710)	(3,561,721)
Total shareholders' equity		1,319,996	13,880,757
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		$ 1,371,340	$ 15,595,066
Nature and continuance of operations	1

Approved on behalf of the Board of Directors:

"David Patterson"
David Patterson, Director

"Hani Zabaneh"
Hani Zabaneh, Director

The accompanying notes are an integral part of these financial statements

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Quebec Nickel Corp.
Statements of Income (Loss) and Comprehensive Income (Loss)
(Stated in Canadian Dollars)

| | For the year-ended
March 31, | | |
| --- | --- | --- | --- |
| | Notes | 2025 | 2024 |
| Expenses | | | |
| General and administrative | | $ 133,937 | $ 296,286 |
| Management fees | 9 | 169,667 | 376,168 |
| Professional fees | | 70,061 | 105,773 |
| Promotion and marketing | | 10,119 | 149,193 |
| Share-based payments | 8, 9 | 33,600 | 135,200 |
| Transfer agent and filing fees | | 43,031 | 47,913 |
| Travel | | 2,353 | 17,407 |
| Loss before other items | | (462,768) | (1,127,940) |
| Other income (expenses) | | | |
| Flow-through share premium | 6 | - | 1,201,400 |
| Impairment of exploration and evaluation assets | 5 | (13,971,572) | - |
| Royalty payment | 5 | (10,000) | - |
| Interest income | | 47,911 | 139,368 |
| Income (loss) before income taxes | | (14,396,429) | 212,828 |
| Deferred tax recovery | 13 | 1,895,440 | 1,090,530 |
| Net income (loss) and comprehensive income (loss) for the year | | $ (12,500,989) | $ 1,303,358 |
| Weighted average number of common shares outstanding | | | |
| Basic | | 12,290,584 | 11,534,422 |
| Diluted | | 12,290,584 | 11,534,422 |
| Basic and diluted income (loss) per common share | | $ (1.02) | $ 0.11 |

The accompanying notes are an integral part of these financial statements

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Quebec Nickel Corp.
Statements of Changes in Shareholders' Equity
(Stated in Canadian Dollars)

	Common Shares		Share-based Payments Reserve	Deficit	Total
	Number	Amount
Balance at March 31, 2024	11,534,420	$15,444,778	$1,997,700	$(3,561,721)	$13,880,757
Proceeds from shares issued for cash	2,000,000	250,000	-	-	250,000
Adjustment to the fair value of warrants from private placement	-	(20,000)	20,000	-	-
Share issuance costs	-	(3,459)	-	-	(3,459)
Deferred tax on share issuance costs	-	(350,490)	-	-	(350,490)
Adjustment to prior year share issuance costs	-	10,577	-	-	10,577
Share-based payments	-	-	33,600	-	33,600
Net and comprehensive loss for the year	-	-	-	(12,500,989)	(12,500,989)
Balance at March 31, 2025	13,534,420	$15,331,406	$2,051,300	$(16,062,710)	$1,319,996
	Common Shares		Share-based Payments Reserve	Deficit	Total
---	---	---	---	---	---
	Number	Amount
Balance at March 31, 2023	11,534,420	$15,574,625	$1,862,500	$(4,865,079)	$12,572,046
Share issuance costs	-	(17,067)	-	-	(17,067)
Deferred tax on share issuance costs	-	(112,780)	-	-	(112,780)
Share-based payments	-	-	135,200	-	135,200
Net and comprehensive income for the year	-	-	-	1,303,358	1,303,358
Balance at March 31, 2024	11,534,420	$15,444,778	$1,997,700	$(3,561,721)	$13,880,757

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

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Quebec Nickel Corp.
Statements of Cash Flows
(Stated in Canadian Dollars)

| | For the year-ended
March 31, | |
| --- | --- | --- |
| | 2025 | 2024 |
| Operating activities | | |
| Net income (loss) for the year | $(12,500,989) | $1,303,358 |
| Item not involving cash: | | |
| Flow-through share premium | - | (1,201,400) |
| Impairment of exploration and evaluation assets | 13,971,572 | - |
| Share-based payments | 33,600 | 135,200 |
| Deferred tax expense | (1,895,440) | (1,090,530) |
| Changes in non-cash working capital items: | | |
| Amounts receivable | 98,058 | 893,258 |
| Prepaid expenses | 16,139 | (7,839) |
| Trade and other payables | (107,438) | (1,295,398) |
| Net cash used in operating activities | (384,498) | (1,263,351) |
| Investing activity | | |
| Exploration and evaluation assets, net | 18,602 | (2,610,633) |
| Net cash (used in) provided by investing activity | 18,602 | (2,610,633) |
| Financing activities | | |
| Share issuance costs | (3,459) | (17,067) |
| Proceeds from issuance of shares | 250,000 | - |
| Net cash (used in) provided by financing activities | 246,541 | (17,067) |
| Change in cash and cash equivalents during the year | (119,355) | (3,891,051) |
| Cash and cash equivalents, beginning of year | 1,430,149 | 5,321,200 |
| Cash and cash equivalents, end of the year | $1,310,794 | $1,430,149 |
| Cash and cash equivalents consists of: | | |
| Cash | $268,845 | 89,123 |
| Cash equivalents | 1,041,949 | 1,341,026 |
| | $1,310,794 | $1,430,149 |
| Supplemental Cash Flow Information | | |
| Income taxes received (paid) | $- | $- |
| Interest received (paid) | $53,110 | $128,091 |
| Non-cash Financing Activities | | |
| Fair value of warrants issued in private placement | $20,000 | $- |
| Share issuance costs | $10,577 | $- |

The accompanying notes are an integral part of these financial statements

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Quebec Nickel Corp.
Notes to the Financial Statements
March 31, 2025 and 2024
(Stated in Canadian Dollars)

1. NATURE AND CONTINUANCE OF OPERATIONS

Quebec Nickel Corp. (the "Company") was incorporated on September 18, 2020 pursuant to the Business Corporations Act (British Columbia). On June 21, 2021, a Prospectus filed by the Company was given final receipt by the British Columbia Securities Commission. On July 5, 2021, the Company's common shares began trading on the Canadian Securities Exchange ("CSE") under the symbol 'QNI'. The office and principal place of business of the Company is located at 1100 – 1111 Melville Street, Vancouver, BC, V6E 3V6.

These financial statements have been prepared using accounting policies in compliance with IFRS Accounting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") on the assumption that the Company will continue as a going concern and realize its assets and discharge its liabilities in the normal course of business rather than through a process of forced liquidation.

The Company's principal business activities include the acquisition and exploration of mineral property assets. As at March 31, 2025, the Company had not yet determined whether its mineral property asset contains ore reserves that are economically recoverable. The recoverability of amounts shown for exploration and evaluation assets is dependent upon the discovery of economically recoverable reserves, confirmation of the Company's interest in the underlying mineral claims, and the ability of the Company to obtain the necessary financing to complete the development of and the future profitable production from the property or realizing proceeds from its disposition. The outcome of these matters cannot be predicted at this time.

The Company's business may be affected by changes in political and market conditions, such as interest rates, availability of credit, inflation rates, changes in laws, and national and international circumstances. Recent geopolitical events and potential economic global challenges such as the risk of the higher inflation and energy crises, may create further uncertainty and risk with respect to the prospects of the Company's business.

On January 8, 2024, the Company completed a consolidation of the authorized and issued common shares of the Company on the basis of a one (1) post-consolidated common share for each ten (10) pre-consolidation common shares.

All information relating to basic and diluted loss per share, issued and outstanding common shares, options and warrants, and per share amounts in these financial statements have been adjusted retrospectively to reflect the share consolidation.

As at March 31, 2025, the Company had not yet achieved profitable operations, had an accumulated deficit of $16,062,710 since inception, and expects to incur further losses in the development of its business. These events and conditions indicate a material uncertainty that may cast significant doubt on the Company's ability to continue as a going concern. The Company's continuation as a going concern is primarily dependent upon its ability to raise financing from equity markets or borrowings and upon successful results from its mineral property exploration activities. While the Company has been successful in securing financings in the past, there is no assurance that it will be able to do so in the future. Accordingly, these financial statements do not give effect to adjustments, if any, that would be necessary should the Company be unable to continue as a going concern. If the going concern assumption was not used, then the adjustments required to report the Company's assets and liabilities on a liquidation basis could be material to these financial statements.

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Quebec Nickel Corp. Notes to the Financial Statements March 31, 2025 and 2024 (Stated in Canadian Dollars)

2. BASIS OF PRESENTATION

a) Statement of compliance

The Company has prepared its financial statements in accordance with IFRS issued by the IASB and interpretations of the IFRS Interpretation Committee ("IFRIC").

b) Basis of presentation

These financial statements are presented in Canadian dollars and all values are rounded to the nearest dollar except where otherwise indicated. The financial statements have been prepared on an accrual basis, except for the statements of cash flows, and are based on historical costs.

c) Approval of the financial statements

The financial statements of the Company for the year ended March 31, 2025 were reviewed, approved and authorized for issue by the Board of Directors on July 28, 2025.

d) New standards, interpretations and amendments not yet adopted

The Company has not yet adopted certain new standards, amendments and interpretations to existing standards, which have been published but are only effective for accounting periods beginning on or after April 1, 2025 or later periods. The new and amended standards are not expected to have a material impact on the Company.

In April 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements. This standard aims to improve the consistency and clarity of financial statement presentation and disclosures by providing updated guidance on the structure and content of financial statements. Key changes include enhanced requirements for the presentation of financial performance, financial position, and cash flows, as well as additional disclosures to improve transparency and comparability. IFRS 18 is effective for annual reporting periods beginning on or after January 1, 2027.

In May 2024, the IASB issued amendments to IFRS 9 and IFRS 7 to clarify that a financial liability is derecognized on the "settlement date" and introduce an accounting policy choice to derecognize a financial liability settled using an electronic payment system before the settlement date. Other clarifications include guidance on the classification of financial assets with ESG linked features, non-recourse loans and contractually linked instruments. The amendments are effective for annual periods beginning on or after January 1, 2026. Early adoption is permitted, with an option to early adopt the amendments for contingent features only.

3. MATERIAL ACCOUNTING POLICIES

a) Cash and cash equivalents

Cash and cash equivalents in the statement of financial position are comprised of cash held at Canadian financial institutions, cash held in trust, and short-term deposits which are cashable without penalty, are readily convertible into a known amount of cash, and subject to an insignificant risk of change in fair value.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

3. MATERIAL ACCOUNTING POLICIES (continued):

b) Foreign currencies

The Company's functional currency is the Canadian dollar, which is the currency of the primary economic environment in which the Company operates. Transactions in currencies other than the Canadian dollar are recorded at the rates of exchange prevailing on the dates of transactions. At the end of each reporting period, monetary assets and liabilities that are denominated in foreign currencies are translated at the rates prevailing at that date. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Gains or losses on translation are included in profit or loss for the period.

c) Exploration and evaluation assets

Costs incurred before the Company has obtained the legal rights to explore an area are expensed in the period in which they are incurred.

Once the legal right to explore a property has been acquired, costs to acquire the property along with costs directly related to exploration and evaluation are capitalized. These direct expenditures include such costs as materials used, surveying costs, drilling costs, payments made to contractors and depreciation on plant and equipment acquired and used during the exploration phase. Costs not directly attributed to exploration and evaluation activities, including general and administrative overhead costs, are expensed in the period in which they occur.

Government tax credits received are recorded as a reduction to the cumulative costs incurred on the related property and are recorded in the year they are received.

Exploration and evaluation assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amount, which is the higher of value in use and fair value less costs to sell, the asset is written down accordingly with a charge to profit or loss.

Impairment reviews for the Company's exploration and evaluation assets are carried out on a project by project basis at each reporting period, with each project representing a single cash generating unit. An impairment review for an exploration and evaluation asset is undertaken when indicators of impairment arise, but typically when one of the following circumstances apply:

• The right to explore the area has expired or will expire in the near future with no expectation of renewal;
• Substantive expenditure on further exploration for and evaluation of mineral resources in the area is neither planned nor budgeted;
• No commercially viable deposits have been discovered, and the decision had been made to discontinue exploration in the area; and
• Sufficient work has been performed to indicate that the carrying amount of the expenditure.

Once the technical feasibility and commercial viability of extracting the mineral resource has been determined, the property is considered to be a mine under development and is classified as "mine under construction." Exploration and evaluation assets are tested for impairment before the assets are transferred.

Recoverability of the carrying amount of any exploration and evaluation asset is dependent on successful development and commercial exploitation, or alternatively sale of the respective areas of interest.

Exploration and evaluation assets are classified as intangible assets.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

3. MATERIAL ACCOUNTING POLICIES (continued):

e) Decommissioning, restoration and similar liabilities

An obligation to incur restoration, rehabilitation and environmental costs arises when environmental disturbance is caused by the exploration or development of a mineral property interest. Such costs arising from the decommissioning of plant and other site preparation work, discounted to their net present value, are provided for and capitalized to the carrying amount of the asset, along with a corresponding liability as soon as the obligation to incur such costs arises. The timing of the actual expenditure is dependent on a number of factors such as the life and nature of the asset, the operating license conditions and, when applicable, the environment in which the mine operates.

Discount rates using a pre-tax rate that reflects the time value of money are used to calculate the net present value. These costs are recognized in profit or loss over the economic life of the related asset, through amortization using either the units-of-production or the straight-line method. The corresponding liability is progressively increased as the effect of discounting unwinds creating an expense recognized in profit or loss.

Decommissioning costs are also adjusted for changes in estimates. Those adjustments are accounted for as a change in the corresponding capitalized cost, except where a reduction in costs is greater than the unamortized capitalized cost of the related assets, in which case the capitalized cost is reduced to nil and the remaining adjustment is recognized in profit or loss.

The operations of the Company have been, and may in the future be, affected from time to time in varying degree by changes in environmental regulations, including those for site restoration costs. Both the likelihood of new regulations and their overall effect upon the Company are not predictable. The Company currently has no known material restoration, rehabilitation and environmental obligations.

f) Share capital

Common shares, options and warrants are classified as equity. Transaction costs directly attributable to the issue of common shares, options and warrants are recognized as a deduction from equity, net of any tax effects.

The Company bifurcates units which consist of common shares and share purchase warrants using the residual value approach, whereby it measures the common share component of the unit at fair value using market prices at the date of issuance as input values and then allocates the residual value, if any, of the units over the fair value of the common shares to the warrant component. The value of the warrant component is credited to share-based payment reserve. When warrants are exercised, forfeited or expire, the corresponding value is transferred from share-based payment reserve to common shares.

g) Flow-through shares

Resource expenditure deductions for income tax purposes may be renounced to investors in accordance with income tax legislation for flow-through share arrangements. On issuance of flow-through common shares, the Company bifurcates the flow-through share proceeds into: (i) share capital, for the fair value of common shares without a flow-through feature (based on quoted trading prices), and (ii) a flow-through share premium liability, for the amount investors pay for the flow-through feature (in excess of the quoted trading price of the common shares). As resource expenditures are incurred, the Company derecognizes the liability and recognizes other income.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

3. MATERIAL ACCOUNTING POLICIES (continued):

g) Flow-through shares (continued):

Proceeds from the issuance of flow-through shares are restricted, to be used only for Canadian resource expenditures, and must be incurred within a two-year period before a 10% penalty tax applies on any unspent amount that has been renounced.

h) Share-based payments

Employees (including directors and senior executives) of the Company may receive a portion of their remuneration in the form of share-based payments, whereby employees render services in consideration for equity instruments ("equity-settled transactions"). The costs of equity-settled transactions with employees are measured by reference to the fair value at the date on which they are granted.

Where equity instruments are issued for goods or services to non-employees, the transaction is measured at the fair value of the goods or services received by the Company. When the fair value of the goods or services cannot be reliably estimated, they are measured at the fair value of the equity instrument.

The costs of equity-settled transactions are recognized, together with a corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award ("vesting date"). The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the Company's best estimate of the number of equity instruments that will ultimately vest. The profit or loss charge or credit for a period represents the movement in cumulative expense recognized as at the beginning and end of that period and the corresponding amount is represented in share-based payments reserve.

No expense is recognized for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition, which are treated as vesting irrespective of whether or not the market condition is satisfied provided that all other performance and/or service conditions are satisfied.

Where the terms of an equity-settled award are modified, the minimum expense recognized is the expense as if the terms had not been modified. An additional amount is recognized on the same basis as the amount of the original award for any modification which increases the total fair value of the share-based payment arrangement or is otherwise beneficial to the recipient as measured at the date of modification.

i) Income taxes

Income tax expense represents the sum of tax currently payable and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current tax

Current tax expense is the expected tax payable on the taxable income for the year. The tax rates and tax laws used to compute the amount are those that are substantively enacted by the date of the statement of financial position.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

3. MATERIAL ACCOUNTING POLICIES (continued):

i) Income taxes (continued):

Deferred tax

Deferred taxes are provided using the liability method on temporary differences at the date of the statement of financial position between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.

Deferred tax liabilities are recognized for all taxable temporary differences, except:

• where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable earnings; and
• in respect of taxable temporary differences associated with investments in subsidiaries, associates, and interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred tax assets are recognized for all deductible temporary differences and carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be utilized except:

• where the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable earnings; and
• in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred income tax assets are recognized only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilized.

The carrying amount of deferred tax assets is reviewed at the date of each statement of financial position and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax assets to be utilized. Unrecognized deferred tax assets are reassessed at the date of each statement of financial position and are recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the date of the statement of financial position.

Deferred tax assets and deferred tax liabilities are offset if, and only if, a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend to either settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax assets or liabilities are expected to be settled or recovered.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

3. MATERIAL ACCOUNTING POLICIES (continued):

j) Earnings (loss) per share

Basic earnings (loss) per share is calculated by dividing the net income (loss) for the period available to common shareholders by the weighted average number of shares outstanding during the period. Diluted earnings per share reflect the potential dilution of securities that could share in earnings. The Company uses the treasury stock method of calculating fully diluted earnings per share amounts, whereby any proceeds from the exercise of dilutive instruments are assumed to be used to purchase common shares at the average market price during the period. Basic and diluted loss per share are the same for the periods presented, as the effect of dilutive instruments outstanding, during the periods presented, would be anti-dilutive.

k) Financial instruments

i) Recognition

The Company recognizes a financial asset or financial liability on the statement of financial position when it becomes party to the contractual provisions of the financial instrument. Financial assets are initially measured at fair value and are derecognized either when the Company has transferred substantially all the risks and rewards of ownership of the financial asset, or when cash flows expire. Financial liabilities are initially measured at fair value and are derecognized when the obligation specified in the contract is discharged, cancelled or expired.

A write-off of a financial asset (or a portion thereof) constitutes a derecognition event. Write-off occurs when the Company has no reasonable expectation of recovering the contractual cash flows of a financial asset.

ii) Classification and measurement

The Company determines the classification of its financial instruments at initial recognition. Financial assets and financial liabilities are classified according to the following measurement categories:

• a) those to be measured subsequently at fair value, either through profit or loss ("FVTPL") or through other comprehensive income ("FVTOCI"); and
• b) those to be measured subsequently at amortized cost.

The classification and measurement of financial assets after initial recognition at fair value depends on the business model for managing the financial asset and the contractual terms of the cash flows. Financial assets that are held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are solely payments of principal and interest on the principal outstanding, are generally measured at amortized cost at each subsequent reporting period. All other financial assets are measured at their fair values at each subsequent reporting period, with any changes recorded through profit or loss or through other comprehensive income (which designation is made as an irrevocable election at the time of recognition).

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

3. MATERIAL ACCOUNTING POLICIES (continued):

k) Financial instruments (continued):

After initial recognition at fair value, financial liabilities are classified and measured at either:

i) amortized cost;
ii) FVTPL, if the Company has made an irrevocable election at the time of recognition, or when required (for items such as instruments held for trading or derivatives); or
iii) FVTOCI, when the change in fair value is attributable to changes in the Company's credit risk.

The Company reclassifies financial assets when and only when its business model for managing those assets changes. Financial liabilities are not reclassified.

Transaction costs that are directly attributable to the acquisition or issuance of a financial asset or financial liability classified as subsequently measured at amortized cost or FVTOCI are included in the fair value of the instrument on initial recognition. Transaction costs for financial assets and financial liabilities classified at FVTPL are expensed in profit or loss.

The Company's financial assets consists of cash and cash equivalents and interest receivable which are classified and subsequently measured at amortized cost. The Company's financial liabilities consist of trade and other payables which are classified and measured at amortized cost using the effective interest method. The 'effective interest rate' is the rate that discounts estimated future cash payments over the expected life of the financial instrument to the gross carrying amount of the financial asset or the amortized cost of the financial liability. The effective interest rate is calculated considering all contractual terms of the financial instruments, except for the expected credit losses of financial assets. Interest expense is reported in profit or loss.

iii) Impairment

The Company assesses all information available, including on a forward-looking basis the expected credit losses associated with any financial assets carried at amortized cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. To assess whether there is a significant increase in credit risk, the Company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition based on all information available, and reasonable and supportable forward-looking information.

I) Significant accounting judgments and estimates

The preparation of these financial statements requires management to make judgments and estimates and form assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of expenses during the reporting period. On an ongoing basis, management evaluates its judgments and estimates in relation to assets, liabilities and expenses. Management uses historical experience and various other factors it believes to be reasonable under the given circumstances as the basis for its judgments and estimates. Actual outcomes may differ from these estimates under different assumptions and conditions.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

3. MATERIAL ACCOUNTING POLICIES (continued):

I) Significant accounting judgments and estimates (continued):

The areas that require significant estimations or where measurements are uncertain are as follows:

Share-based payments

The Company uses the Black-Scholes Option Pricing Model for valuation of share-based payments. Option pricing models require the input of subjective assumptions including expected price volatility, interest rate and forfeiture rate. Changes in the input assumptions can materially affect the fair value estimate and the Company's earnings and equity reserves.

The preparation of financial statements in accordance with IFRS requires the Company to make judgments, apart from those involving estimates, in applying accounting policies. The most significant judgments in applying accounting policies in the Company's financial statements include:

Title to Mineral Property Interests

Although the Company has taken steps to verify title to mineral properties in which it has an interest, these procedures do not guarantee the Company's title. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects.

Impairment of exploration and evaluation assets

The carrying value and recoverability of exploration and evaluation assets requires management to make certain estimates, judgments and assumptions about each project. Management considers the economics of the project, including the latest resource prices and the long-term forecasts, and the overall economic viability of the project.

m) New standards, interpretations and amendments

Certain new standards, interpretations, amendments and improvements to existing standards were issued by the IASB or IFRIC and did not have a material impact on the financial statements.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

4. AMOUNTS RECEIVABLE

The Company's amounts receivable is comprised of the following:

	Year-ended March 31,
	2025	2024
Interest receivable	$ 6,418	$ 13,613
Sales tax recoverable	4,603	95,466
	$ 11,021	$ 109,079

5. EXPLORATION AND EVALUATION ASSETS

On October 6, 2020, the Company entered into an agreement with Val-d'Or Mining Corporation ("Val-d'Or") for the purchase of 100% interest in a mineral property, referred to as the Ducros Property, located in the Val d'Or area of Quebec, Canada. The Company issued 358,934 special warrants at their fair value of $0.50 for the purchase of the mineral property. The 358,934 special warrants were subsequently converted, at no additional cost, into 358,934 common shares of the Company.

During the year-ended March 31, 2025, the Company returned an aggregate of 237 mining claims back to Val-d'Or. As at March 31, 2025, the Company had 45 (2024 – 282) contiguous mining claims as part of its exploration holdings. It was determined the mining claims returned, were no longer considered part of the core claims held by the Company of merit.

The Company is subject to net smelter return royalties and an associated area of interest which includes the additional staked property. During the year ended March 31, 2025, the Company paid to Val-d'Or, an early annual advanced royalty payment of $10,000.

During the year-ended March 31, 2025, management identified impairment indicators for the property as currently there are no substantive expenditures budgeted or planned. In accordance with IAS 36 – Impairment of Assets, an impairment loss of $13,971,572 was recognized in profit or loss reducing the carrying value to a nominal amount. Despite the impairment, the Company continues to hold the legal rights to explore the property.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

5. EXPLORATION AND EVALUATION ASSETS (continued):

During the years ended March 31, 2025 and 2024, the Company incurred the following exploration expenditures on the property:

	For the year-ended		Cumulative expenditures to
	March 31,		March 31,
	2025	2024	2025	2024
Acquisition Costs
Land acquisition	$ -	$ -	$ 211,850	$ 211,850
Exploration Costs
Assays	-	547,696	1,674,127	1,674,127
Biochemistry	-	18,533	133,765	133,765
Consulting	39,955	31,868	91,213	51,258
Drilling	-	1,495,966	5,169,606	5,169,606
Environmental baseline	-	130,224	130,224	130,224
Equipment rentals	8,760	126,686	936,628	927,868
Geochemistry	-	65,577	65,577	65,577
Geology	-	1,133,545	4,094,079	4,094,079
Geophysics	-	153,798	1,270,353	1,270,353
Lodging and meals	7,200	305,472	503,983	496,783
Metallurgy	-	128,593	128,593	128,593
Permits and licenses	-	7,834	142,749	142,749
Supplies and materials	-	497,492	1,304,862	1,304,862
Exploration tax credit	(74,517)	(1,703,159)	(1,886,036)	(1,811,519)
Impairment	(13,971,572)	-	(13,971,572)	-
	(13,990,174)	2,940,125	(211,849)	13,778,325
Total exploration & evaluation expenditures	$(13,990,174)	$ 2,940,125	$ 1	$ 13,990,175

6. FLOW-THROUGH SHARE PREMIUM LIABILITY

During the year-ended March 31, 2023, the Company issued an aggregate of 2,653,037 flow-through shares (each, a "FT Share") for gross proceeds of $6,570,288. The flow-through premium was determined to be $2,002,700 and the Company recognized that amount as a liability prior to the renunciation of the exploration expenditures.

Balance as at March 31, 2022	$	-
Liability incurred on flow-through shares issued		2,002,700
Settlement of flow-through share liability on incurring expenditures		801,300
Balance as at March 31, 2023		1,201,400
Settlement of flow-through share liability on incurring expenditures		1,201,400
Balance as at March 31, 2024 and 2025	$	-

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

7. COMMON SHARES

a) Authorized:

An unlimited number of common shares with no par value.

As at March 31, 2025, nil (2024 – 19,576) common shares were held in escrow.

b) During the year-ended March 31, 2025, the following common shares were issued:

• On November 13, 2024, the Company completed a private placement offering raising $250,000 from the sale of 2,000,000 units at $0.125 per unit. Each unit is comprised of one common share and one-half of one share purchase warrant exercisable for a period of two years. Each whole warrant is exercisable into one common share at a price of $0.225 per common share. The warrants were valued at $nil. The Company incurred $3,459 in share issuance costs associated with the private placement.

During the year-ended March 31, 2024, no common shares were issued by the Company.

8. SHARE-BASED PAYMENTS RESERVE

a) Warrants:

The changes in warrants during the years ended March 31, 2025 and 2024 are as follows:

	Year-ended March 31,
	2025		2024
	Number of warrants	Weighted-average exercise price	Number of warrants	Weighted-average exercise price
Balance at April 1,	754,182	$ 3.00	1,416,037	$ 3.00
Expired	(754,182)	3.00	(661,855)	3.00
Issued	1,000,000	0.225	-	-
Balance, March 31,	1,000,000	$ 0.225	754,182	$ 3.00

Warrants outstanding as at March 31, 2025 are as follows:

Expiry Date	Number of warrants	Exercise Price
November 13, 2026	1,000,000	$ 0.225

As at March 31, 2025, the weighted average life remaining of warrants outstanding was 1.62 years (2024 – 0.70 years).

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Quebec Nickel Corp. Notes to the Financial Statements March 31, 2025 and 2024 (Stated in Canadian Dollars)

8. SHARE-BASED PAYMENTS RESERVE (continued):

b) Stock Options:

On August 3, 2022, the Company adopted a stock option plan in accordance with the rules and policies of the CSE. The terms of any award are determined by the Board, provided that no options may be granted with an exercise price lower than the greater of the closing market price of the Common Shares on (a) the trading day prior to the date of the grant of the stock options, and (b) the date of grant of the stock options, and the term may not exceed 10 years. The aggregate number of securities available for issuance under the plan may not exceed 10% of the number of common shares of the Company issued and outstanding from time to time.

During the year ended March 31, 2025, the following stock options were granted by the Company:

• On November 26, 2024, the Company granted 525,000 stock options to various directors, officers and consultants at an exercise price of $0.225. The stock options expire on November 26, 2026 and vested immediately upon grant. The Company recognized $33,600 for share-based payments.

The fair value of the 525,000 stock options was estimated using the Black-Scholes option pricing model assuming a risk-free interest rate of 3.20%, a dividend yield of nil, a weighted average expected annual volatility of the Company's share price of 129% and an expected life of 2 years. The fair value of the stock options was $0.06 per option. The expected volatility assumption is based on the estimated volatility of the Company's share price over a two-year period. The risk-free interest rate is based on yield curves on the Canadian government zero-coupon bonds or Canadian government treasury bills with a remaining term equal to the options' expected life.

During the year ended March 31, 2024, the following stock options were granted by the Company:

• On August 10, 2023, the Company granted 400,000 stock options to various directors, officers and consultants at an exercise price of $0.50. The stock options expire on August 9, 2025 and vested immediately upon grant. The Company recognized $135,200 for share-based payments.

The fair value of the 400,000 stock options was estimated using the Black-Scholes option pricing model assuming a risk-free interest rate of 4.80%, a dividend yield of nil, a weighted average expected annual volatility of the Company's share price of 135% and an expected life of 2 years. The fair value of the stock options was $0.34 per option. The expected volatility assumption is based on the estimated volatility of the Company's share price over a two-year period. The risk-free interest rate is based on yield curves on the Canadian government zero-coupon bonds or Canadian government treasury bills with a remaining term equal to the options' expected life.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

8. SHARE-BASED PAYMENTS RESERVE (continued):

b) Stock Options (continued):

The changes in stock options during the years ended March 31, 2025 and 2024 are as follows:

	Year-ended March 31,
	2025		2024
	Number of options	Weighted-average exercise price	Number of options	Weighted-average exercise price
Balance at April 1,	85,000	$ 1.10	672,500	$ 2.30
Granted	525,000	0.225	400,000	0.50
Cancelled	-	-	(572,500)	0.80
Expired	-	-	(415,000)	2.88
Balance, March 31,	610,000	$ 0.35	85,000	$ 1.10

Stock options exercisable and outstanding as at March 31, 2025 are as follows:

Expiry Date	Number of options	Exercise Price
July 28, 2026	85,000	1.10
November 26, 2026	525,000	0.225
	610,000	$ 0.35¹

¹Weighted-average exercise price.
As at March 31, 2025, the weighted average life remaining of options outstanding was 1.61 years (2024 – 2.33 years).

9. RELATED PARTY TRANSACTIONS

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or common significant influence, related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties.

The following is a summary of the related party transactions that occurred during the years ended March 31, 2025 and 2024.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

9. RELATED PARTY TRANSACTIONS (continued):

a) Compensation of key management personnel

The Company has determined that key management personnel consist of its Directors, the CEO, the CFO and the former Vice-President of Exploration.

	Year-ended March 31,
	2025	2024
Management fees paid to a company controlled by the CEO of the Company	$ 66,667	$ 136,666
Management fees paid to a company controlled by the former interim-CEO of the Company	-	57,502
Management fees paid to a company controlled by the CFO of the Company	84,000	150,000
Consulting fees paid to a company controlled by the former VP Exploration of the Company	-	249,960
Management fees paid to the independent directors of the Company	19,000	32,000
Share-based payments	19,200	77,740
Total	$ 188,867	$ 703,868

As at March 31, 2025, $3,675 (2024 - $nil) is owing to key management personnel for management fees and is included in trade and other payables.

10. FINANCIAL INSTRUMENTS

Fair value estimates are made at the statement of financial position date, based on relevant market information and other information about financial instruments. As at March 31, 2025 and 2024, the Company's financial instruments are cash and cash equivalents, interest receivable and trade and other payables. The amounts reflected in the statement of financial position approximate their fair values due to the short-term nature of these financial instruments.

The Company is exposed to various financial risks resulting from both its operations and its investment activities. The Company's management manages financial risks. The Company does not enter into financial instruments agreements, including derivative financial instruments for speculative purposes. There has been no changes in the Company's management and exposure of risks associated with financial instruments during the year ended March 31, 2025 and 2024. The Company's financial risks exposure and its financial policies are as follows:

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Quebec Nickel Corp. Notes to the Financial Statements March 31, 2025 and 2024 (Stated in Canadian Dollars)

10. FINANCIAL INSTRUMENTS (continued):

a) Credit risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The Company's cash and cash equivalents and interest receivable are exposed to credit risk, with the carrying values being the Company's maximum exposure. The Company's cash and cash equivalents consists of funds held at Canadian chartered banks or occasionally, in trust with the Company's corporate lawyer. The Company's interest receivable is accrued interest on cash equivalents. Management does not believe the Company is exposed to material credit risk.

b) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities. The Company's approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when due. As at March 31, 2025, the Company had a cash and cash equivalents balance of $1,310,794 to settle trade and other payables of $51,344. All of the Company's trade and other payables have contractual maturities of 30 days or are due on demand and are subject to normal trade terms. The Company expects to fund future expenditures through the issuance of capital stock.

A summary of the cash equivalents held by the Company is as follows:

Maturity date	Principal	Interest rate per annum
February 24, 2026	$ 41,949	2.00%
January 21, 2026	1,000,000	3.45%
	$ 1,041,949	3.39%¹

¹ Weighted-average interest rate per annum

c) 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 other price risk. Management does not believe the Company is exposed to material currency or other price risk.

d) 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 as cash and cash equivalents comprise $1,310,794 held at Canadian chartered banks, of which $1,041,949 is held in cashable GICs which bear interest ranging from 2.00% to 3.45% per annum as at March 31, 2025.

The Company had no interest rate swaps or financial contracts in place as at or during the years ended March 31, 2025 and 2024.

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

11. CAPITAL MANAGEMENT

The Company's capital currently consists of common shares in the amount of $15,331,406 (2024 - $15,444,778) and its principal source of cash is from the issuance of common shares. The Company's capital management objectives are to safeguard its ability to continue as a going concern and to have sufficient capital to be able to acquire and explore mineral property assets. The Company does not have any externally imposed capital requirements to which it is subject. The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may attempt to issue new equity instruments.

As the Company's mineral property is in the exploration stage, the Company is dependent on external financing to fund its activities. In order to carry out its operations, the Company will spend its existing working capital and raise additional amounts as needed.

There were no changes in the Company's approach to capital management during the years ended March 31, 2025 and 2024.

12. SEGEMENTED REPORTING

The Company operates in a single reportable segment being the acquisition and exploration of mineral property assets in Canada.

13. INCOME TAX

Tax expense differs from the amount computed by applying the combined Canadian federal and provincial income tax rates, applicable to the Company, to the income (loss) before taxes due to the following:

	Year-ended March 31,
	2025	2024
(Loss) income before income taxes	$ (14,396,429)	$ 212,828
Canadian federal and provincial income tax rate	26.5%	26.5%
Expected income tax (recovery) expense	$ (3,815,050)	$ 56,399
Increase (decrease) in income taxes attributable to:
Permanent difference	8,920	(258,426)
Share issue costs	(351,410)	(117,033)
Change in estimate	899,660	(771,470)
Change in unrecognized deductible temporary differences	1,362,440	-
Income tax (recovery)	$ (1,895,440)	$ (1,090,530)

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Quebec Nickel Corp.

Notes to the Financial Statements

March 31, 2025 and 2024

(Stated in Canadian Dollars)

13. INCOME TAX (continued):

The Canadian income tax rate declined during the year due to changes in the law that reduced corporate tax rates in Canada. The significant components of the Company's deferred tax assets and liabilities are as follows:

	Year-ended March 31,
	2025	2024
Share issuance costs	$ 115,610	$ 350,490
Non-capital loss carry forwards	1,080,840	904,790
Exploration and exploration assets	165,990	(2,800,230)
Unrecognized deferred tax assets	(1,362,440)	-
	$ -	$ (1,544,950)

The Company has non-capital losses of approximately $4,079,000 which may be available to offset future taxable income for income tax purposes. Non-capital losses expire as follows:

Year of expiry	Non-capital losses
2041	$ 70,000
2042	687,000
2043	1,453,000
2044	1,165,000
2045	704,000
	$ 4,079,000