Appia Rare Earths & Uranium : Audited Financial Statements, September 30, 2021

APPIA RARE EARTHS AND URANIUM CORP.

(formerly "APPIA ENERGY CORP.")

FINANCIAL STATEMENTS

For the years ended September 30, 2021 and 2020

(Expressed in Canadian $)

MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL STATEMENTS

The accompanying financial statements have been prepared by and are the responsibility of the management of Appia Rare Earths and Uranium Corp. (the "Company"). The financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") and reflect management's best estimates and judgments based on currently available information. The Company has developed and maintains a system of internal controls in order to ensure, on a reasonable and cost- effective basis, the reliability of the financial information.

The Board of Directors is responsible for ensuring that management fulfills its responsibility and is ultimately responsible for reviewing and approving the consolidated financial statements. The Board carries out this responsibility principally through its Audit Committee. The financial statements have been audited by Wasserman Ramsay, an independent firm of chartered professional accountants. Their report outlines the scope of their examination and opinion on the financial statements.

DATED this 25th day of January, 2022.

APPIA ENERGY CORP.

Per: (signed) "Tom Drivas"

Name: Tom Drivas

Title: Chief Executive Officer

Per: (signed) "Frank van de Water"

Name: Frank van de Water

Title: Chief Financial Officer

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INDEPENDENT AUDITORS' REPORT

To the Shareholders of

Appia Rare Earths & Uranium Corp.:

Opinion

We have audited the financial statements of Appia Rare Earths & Uranium Corp. (the "Company"), which comprise the statements of financial position as at September 30, 2021 and 2020, and the statements of changes in equity, loss and comprehensive loss and cash flows for the years then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at September 30, 2021 and 2020, and its financial performance and its cash flows for the years then ended in accordance with International Financial Reporting Standards (IFRSs).

Basis for Opinion

We conducted our audits 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 indicates that for the year ended September 30, 2021 the Company incurred losses of $1,278,359 and had an accumulated deficit of $14,919,739 at year end. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate 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.

Other information

Management is responsible for the other information. The other information comprises:

• Management's Discussion and Analysis

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 identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

We obtained Management's Discussion and Analysis prior to the date of this auditor's report. If, based on the work we have performed on this other information, 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 StatementsManagement is responsible for the preparation and fair presentation of the financial statements in accordance with IFRS, 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.

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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.

Auditors' 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.
• 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.

The engagement partner on the audit resulting in this independent auditors' report is Kevin Ramsay.

Markham, Ontario	Chartered Professional Accountants
January 25, 2022	Licensed Public Accountants

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APPIA RARE EARTHS AND URANIUM CORP.

Statements of Financial Position

(Expressed in Cdn $)

	September 30,	September 30,
As at	2020
2021
	(Restated)
	$
	$
Assets
Current	7,844,422
Cash and cash equivalents (note 4)	1,764,921
Accounts receivable	249,562	71,229
Prepaid expenses	32,570	75,637
Total current assets	8,126,554	1,911,787
Non-current assets	825,687
Acquisition cost of properties (note 5)	814,415
Deferred exploration expenditures (notes 3 and 5)	7,857,131	3,290,821
Exploration camp and equipment (note 6)	991,047	120,723
Total assets	17,800,419	6,137,746
Liabilities
Current	1,136,862
Accounts payable & accruals	331,256
Due to related parties (note 11)	680,242	805,555
Flow-through share premium (note 8)	693,425	165,000
Total liabilities	2,510,529	1,301,811
Nature of operations and going concern (note 1)
Subsequent events (note 14)
Shareholders' equity	22,893,656
Share capital (note 7(a))	14,063,465
Warrants (note 7(c))	2,353,150	737,435
Contributed surplus (note 9)	4,962,823	3,676,415
Deficit	(14,919,739)	(13,641,380)
Total shareholders' equity	15,289,890	4,835,935
Total liabilities and shareholders' equity	17,800,419	6,137,746

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

APPROVED ON BEHALF OF THE BOARD on January 25, 2022.
"Signed"	"Signed"
Anastasios (Tom) Drivas	Frank van de Water

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