Galiano Gold Inc (GAU) 6-K, filed Feb 13, 2020

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of February 2020

Commission File No. 001-33580

ASANKO GOLD INC. (Translation of registrant's name into English)

Suite 1640, 1066 West Hastings Street Vancouver, British Columbia, V6E 3X1, Canada (Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F

Form 20-F [ ] Form 40-F [X]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1) [ ]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7) [ ]

SUBMITTED HEREWITH

Exhibits 99.1 to 99.2 included with this report are hereby incorporated by reference into the registrant's registration statement on Form F-10 (File no. 333-222363) (the "Registration Statement"), and to be a part thereof from the date on which this report is submitted, to the extent not superseded by documents or reports subsequently filed or furnished.

Exhibits
99.1	Consolidated financial statements for the years ended December 31, 2019 and 2018.
99.2	Management's Discussion & Analysis for the year ended December 31, 2019.
99.3	News Release
99.4	Consent of KPMG LLP

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

ASANKO GOLD INC.

/s/ Fausto Di Trapani Fausto Di Trapani Chief Financial Officer

Date: February 13, 2020

Asanko Gold Inc.: Exhibit 99.1 - Filed by newsfilecorp.com

CONSOLIDATED FINANCIAL STATEMENTS

Years ended December 31, 2019 and 2018

(Expressed in United States dollars, unless otherwise noted)

TABLE OF CONTENTS
Management’s Responsibility for Financial Reporting	2
Report of the Independent Auditor	3 - 4
Consolidated Statements of Financial Position	5
Consolidated Statements of Operations and Comprehensive Income (Loss)	6
Consolidated Statements of Changes in Equity	7
Consolidated Statements of Cash Flow	8
Notes to the Consolidated Financial Statements	9 - 55

MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL REPORTING

Management’s Report on Financial Statements

The consolidated financial statements of Asanko Gold Inc. have been prepared by, and are the responsibility of, the Company’s management. The consolidated financial statements have been prepared by management on a going concern basis in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). When alternative accounting methods exist, management has chosen those it deems most appropriate in the circumstances. Financial statements are not exact since they include certain amounts based on estimates and judgements. Management has determined such amounts on a reasonable basis in order to ensure that the financial statements are presented fairly, in all material respects.

The Board of Directors is responsible for ensuring management fulfills its financial reporting responsibilities. The Audit Committee meets with the Company’s management and external auditors to discuss the results of the audits and to review the consolidated financial statements prior to the Audit Committee’s submission to the Board of Directors for approval. The Audit Committee also reviews the quarterly financial statements and recommends them for approval to the Board of Directors, reviews with management the Company’s systems of internal control, and reviews the scope of the external auditors’ audit and non-audit work. The Audit Committee is appointed by the Board, and all of its members are independent directors.

The consolidated financial statements have been audited by KPMG LLP, Chartered Professional Accountants, in accordance with the standards of the Public Company Accounting Oversight Board (United States) on behalf of the shareholders.

Management’s Report over Internal Controls over Financial Reporting

Management has developed and maintains systems of internal accounting and administrative controls in order to provide, on a reasonable basis, assurance that the financial information is relevant, reliable and accurate and that the Company's assets are appropriately accounted for and adequately safeguarded. All internal control systems have inherent limitations, including the possibility of circumvention and overriding of controls, and therefore, may not prevent or detect misstatements. Management has assessed the effectiveness of the Company’s internal control over financial reporting based on the framework in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on management’s assessment, the Company’s internal control over financial reporting is effective as at December 31, 2019.

“Greg McCunn”	“Fausto Di Trapani”
Greg McCunn	Fausto Di Trapani
Director and Chief Executive Officer	Executive Vice President and Chief Financial Officer

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors

Asanko Gold Inc.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of financial position of Asanko Gold Inc. and subsidiaries (the Company) as of December 31, 2019 and 2018, the related consolidated statements of operations and comprehensive income (loss), changes in equity, and cash flows for each of the years in the two-year period ended December 31, 2019, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and its financial performance and its cash flows for each of the years in the two-year period ended December 31, 2019, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

Change in Accounting Principle

As discussed in Note 3(g) to the consolidated financial statements, the Company changed its method of accounting for leases due to the adoption of IFRS16 - Leases as of January 1, 2019.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the Company’s auditor since 2011

//s// KPMG LLP

Chartered Professional Accountants

Vancouver, Canada February 11, 2020

**ASANKO GOLD INC.**CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AS AT DECEMBER 31, 2019 AND 2018 (In thousands of United States Dollars)09

		December 31, 2019	December 31, 2018
	Note
Assets
Current assets
Cash and cash equivalents		31,109	10,358
Receivables		161	236
Receivable due from related party	6	4,183	2,328
Prepaid expenses and deposits		347	180
		35,800	13,102
Non-current assets
Financial assets	7	108,025	173,135
Interest in Joint Venture	8	-	126,264
Right-of-use asset	9	589	-
Property, plant and equipment		90	114
		108,704	299,513
Total assets		144,504	312,615
Liabilities
Current liabilities
Accounts payable and accrued liabilities		2,234	3,473
Lease liability	9	83	-
		2,317	3,473
Non-current liabilities
Long-term incentive plan liability	11(b)	416	300
Lease liability	9	514	-
		930	300
Total liabilities		3,247	3,773
Equity
Share capital	10	578,385	578,853
Equity reserves	11	50,072	49,261
Accumulated deficit		(487,200	(319,272
Total equity		141,257	308,842
Total liabilities and equity		144,504	312,615

All values are in US Dollars.

Gold Fields transaction	1
Commitments and contingencies	12
Subsequent event	26

The accompanying notes form an integral part of these consolidated financial statements.

Approved on behalf of the Board of Directors:

"Greg McCunn"	“Marcel de Groot”
Director	Director

**ASANKO GOLD INC.**CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In thousands of United States Dollars, except dollar per share amounts)

		2019	2018
	Note
Revenue	13	-	161,918
Cost of sales:
Production costs	14	-	(79,008
Depreciation and depletion		-	(41,944
Royalties		-	(8,096
Total cost of sales		-	(129,048
Income from mine operations		-	32,870
Share of net loss related to joint venture	8	(126,264	(1,050
Service fee earned as operators of joint venture	6	4,963	1,892
Exploration and evaluation expenditures		-	(2,333
General and administrative expenses	15	(11,828	(11,660
(Loss) income from operations and joint venture		(133,129	19,719
Loss due to loss of control of subsidiaries	1,16	-	(143,261
Finance income	17	871	5,555
Finance expense	18	(35,650	(10,737
Foreign exchange (loss) gain		(20	20
Loss before income taxes		(167,928	(128,704
Current income tax expense	19	-	(1,079
Deferred income tax expense	19	-	(11,430
Net loss and comprehensive loss for the year		(167,928	(141,213
Net income (loss) attributable to:
Common shareholders of the Company		(167,928	(141,372
Non-controlling interest		-	159
Net loss for the year		(167,928	(141,213
Loss per share attributable to common shareholders:
Basic		(0.74	(0.64
Diluted		(0.74	(0.64
Weighted average number of shares outstanding:
Basic	20	225,867,169	220,108,770
Diluted	20	225,867,169	220,108,770

All values are in US Dollars.

The accompanying notes form an integral part of these consolidated financial statements.

ASANKO GOLD INC.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

(In thousands of United States Dollars, except for number of common shares)

		Number of shares		Share capital	Equity reserves	Accumulated deficit	Non- controlling interest	Total equity
	Note
Balance as at December 31, 2017		203,449,957		561,441	48,326	(177,900	740	432,607
Issuance of common shares for:
Private placement, net of share issuance costs	10(c)	22,354,657		17,412	-	-	-	17,412
Share-based payments		-		-	935	-	-	935
Derecognition of non-controlling interest on <br> loss of control	16	-		-	-	-	(899	(899
Net loss and comprehensive loss for the year		-		-	-	(141,372	159	(141,213
Balance as at December 31, 2018		225,804,614		578,853	49,261	(319,272	-	308,842
Issuance of common shares on exercise of <br> share-based options	11(a)	403,116		490	(158	-	-	332
Shares repurchased and cancelled under <br> normal course issuer bid	10(d)	(1,108,920	)	(958	-	-	-	(958
Share-based payments	11(a),11(b)	-		-	969	-	-	969
Net loss and comprehensive loss for the year		-		-	-	(167,928	-	(167,928
Balance as at December 31, 2019		225,098,810		578,385	50,072	(487,200	-	141,257

All values are in US Dollars.

The accompanying notes form an integral part of these consolidated financial statements.

**ASANKO GOLD INC.**CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (In thousands of United States Dollars)

		2019	2018
	Note
Operating activities:
Net loss for the period		(167,928	(141,213
Adjustments for:
Loss due to loss of control of subsidiaries	1,16	-	143,261
Share of net loss related to joint venture	8	126,264	1,050
Depreciation and depletion		98	41,991
Share-based payments	14,15	1,789	1,645
Interest and other income	17	(871	(5,555
Finance expense	18	35,640	10,737
Deferred income tax expense	19	-	11,430
Unrealized foreign exchange loss (gain)		20	(48
Operating cash flow before working capital changes		(4,988	63,298
Change in non-cash working capital	21	(3,760	(29,869
Cash provided by (used in) operating activities		(8,748	33,429
Investing activities:
Expenditures on mineral properties, plant and equipment		(39	(53,912
Gold Fields investment in joint venture	1,16	20,000	165,000
Redemption of preferred shares in joint venture	7(a)	10,000	-
Joint venture transaction costs paid	16	-	(4,795
Cash and cash equivalents derecognized on loss of control	16	-	(24,368
Interest received		210	383
Cash provided by investing activities		30,171	82,308
Financing activities:
Shares issued for cash under private placement, net of share
issuance costs	10(c)	-	17,412
Shares issued for cash on exercise of share-based options	11(a)	332	-
Shares repurchased under normal course issuer bid	10(d)	(958	-
Office lease payments	9	(39	-
Repayment of long-term debt	1	-	(163,754
Interest and associated withholding tax paid		-	(8,299
Cash used in financing activities		(665	(154,641
Impact of foreign exchange on cash and cash equivalents		(7	(68
Increase (decrease) in cash and cash equivalents during the year		20,751	(38,972
Cash and cash equivalents, beginning of year		10,358	49,330
Cash and cash equivalents, end of year		31,109	10,358
Supplemental cash flow information	21

All values are in US Dollars.

The accompanying notes form an integral part of these consolidated financial statements.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

1. Nature of operations

Asanko Gold Inc. (“Asanko” or the “Company”) was incorporated on September 23, 1999 under the laws of British Columbia, Canada, with its head office and principal address located at 1066 West Hastings Street, Suite 1640, Vancouver, British Columbia, V6E 3X1, Canada. The Company’s registered and records office is located at Suite 2600, Three Bentall Centre, 595 Burrard Street, Vancouver, V7X 1L3.

The Company’s principal business activity is the exploration and development of mineral property interests and operation of the Asanko Gold Mine (“AGM”) through a 50:50 joint venture arrangement (the “JV”) associated with the Company’s previously held 90% economic interest in the AGM (see Gold Fields Transaction below). The Government of Ghana has a 10% free-carried interest in the AGM. The AGM consists of two neighboring gold projects, the Obotan Project and the Esaase Project, both located in the Amansie West District of the Republic of Ghana (“Ghana”), West Africa.

In addition to its interest in the AGM, the Company’s interest in the JV also includes a 50% interest in a portfolio of other Ghanaian gold concessions in various stages of exploration.

Gold Fields Transaction

On July 31, 2018, the Company completed a transaction (the “JV Transaction”) with a subsidiary of Gold Fields Limited (“Gold Fields”), under which, among other things:

• the Company and Gold Fields each own a 45% economic interest in Asanko Gold Ghana Limited (“AGGL”), the former Asanko subsidiary that owns the AGM, with the Government of Ghana retaining a 10% free-carried interest in the AGM;

• the Company and Gold Fields each own a 50% interest in Adansi Gold Company (GH) Limited (“Adansi Ghana”), the former Asanko subsidiary that owns a number of exploration licenses; and

• the Company and Gold Fields each acquired a 50% interest in a newly formed entity, Shika Group Finance Limited (“JV Finco”).

• In exchange for the above, Gold Fields agreed to make a $185.0 million contribution to the JV. Of this contribution amount, $165.0 million was received on closing of the transaction, while $10.0 million was received on August 29, 2019 and a further $10.0 million on December 19, 2019.

In addition to Gold Fields’ contribution to the JV, Gold Fields also subscribed for 22,354,657 common shares of the Company for gross proceeds of $17.6 million (note 10(c)).

Concurrent with the closing of the JV Transaction, the Company settled the then outstanding amount of $163.8 million under the Definitive Senior Facilities Agreement (“DSFA”) with a special purpose vehicle of RK Mine Finance Trust I (“Red Kite”), including all outstanding debt principal and accrued interest, and the JV emerged from the JV Transaction debt-free.

In connection with the JV Transaction, the Company finalized the terms of the associated Joint Venture Agreement (the “JVA”) that governs the management of the JV, in July 2018. Under the terms of the JVA, the Company remains the manager and operator of the JV and receives an arm’s length fee for services rendered to the JV of $6.1 million per annum (originally $6.0 million, but adjusted annually for inflation). A management committee was formed, with equal representation from both Asanko and Gold Fields, to govern the operating and development activities of the JV.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

1. Nature of operations (continued)

The JVA therefore established joint control of the JV and the Company no longer retains control of the AGM and associated properties. As the JV is structured within the legal entities of AGGL, Adansi Ghana and JV Finco, the JV represents a joint venture as defined under IFRS 11 – Joint Arrangements, and the Company commenced equity accounting for its interest in the JV effective July 31, 2018, the date on which the JV Transaction was completed. At this date, the Company derecognized all the assets and liabilities of its former Ghanaian subsidiaries, as well as the carrying amount of previously recognized non-controlling interests in AGGL.

Concurrent with the closing of the JV Transaction, the Company recognized the fair value of the consideration received from Gold Fields, as well as the fair value of the investment that the Company retained in the JV. Based on the fair value of the Company’s retained interest in the JV, the Company recognized a post-tax loss of $143.3 million associated with the loss of control of AGGL and Adansi Ghana.

2. Basis of presentation

(a) Statement of compliance

These consolidated financial statements have been prepared using accounting policies in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and Interpretations issued by the International Financial Reporting Interpretations Committee (“IFRIC”).

These consolidated financial statements were authorized for issue and approved by the Board of Directors on February 11, 2020.

(b) Basis of presentation and consolidation

The financial statements have been prepared on a historical cost basis, except for financial instruments carried at fair value.

All amounts are expressed in thousands of United States dollars, unless otherwise stated, and the United States dollar is the functional currency of the Company and each of its subsidiaries. References to C$ are to Canadian dollars.

These consolidated financial statements incorporate the financial information of the Company and its subsidiaries as at December 31, 2019. Subsidiaries are entities controlled by the Company. Control exists when the Company has power, directly or indirectly, to govern the financial and operating policies of an entity as to obtain benefits from its activities. Subsidiaries are included in the consolidated financial statements of the Company from the effective date of acquisition up to the effective date of disposition or loss of control.

All significant intercompany amounts and transactions between the Company and its subsidiaries have been eliminated on consolidation.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

2. Basis of presentation (continued)

The principal subsidiaries and joint ventures to which the Company is a party, as well as their geographic locations, were as follows as at December 31, 2019:

			Classification and accounting
Affiliate name	Location	Interest	method
Asanko Gold South Africa (PTY) Ltd.	South Africa	100%	Consolidated
Asanko International (Barbados) Inc.	Barbados	100%	Consolidated
Asanko Gold (Barbados) Inc.	Barbados	100%	Consolidated
Asanko Gold Ghana Limited	Ghana	45%	Joint venture; equity method
Adansi Gold Company (GH) Limited	Ghana	50%	Joint venture; equity method
Shika Group Finance Limited	Isle of Man	50%	Joint venture; equity method

These consolidated financial statements include all revenue and expenses of AGGL and Adansi Ghana for the period January 1, 2018 to July 31, 2018, being the period during which the Company had control of these subsidiaries.

3. Significant accounting policies

(a) Business combinations

Acquisitions of subsidiaries and businesses are accounted for using the acquisition method. The cost of the business combination is measured as the aggregate of the fair value at the date of acquisition of the consideration transferred in exchange for the interest in the acquiree. The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS 3 are recognized at their fair values at the acquisition date. The acquisition date is the date the Company obtains control over the acquiree, which is generally the date that consideration is transferred and the Company acquires the assets and assumes the liabilities of the acquiree. The Company considers all relevant facts and circumstances in determining the acquisition date.

Acquisition-related costs, other than costs to issue equity securities of the acquirer, including investment banking fees, legal fees, accounting fees, valuation fees and other professional or consulting fees are expensed as incurred. The costs to issue equity securities of the Company as consideration for the acquisition are deducted from share capital as share issue costs.

Goodwill arising on acquisition is recognized as an asset and initially measured at cost, being the excess of the cost of the business combination over the Company’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognized. If, after reassessment, the Company’s interest in the net fair value of the acquiree’ s identifiable assets, liabilities and contingent liabilities exceeds the cost of the business combination, the excess is recognized immediately in the consolidated statement of operations and comprehensive income (loss).

(b) Investments in joint arrangements

The Company conducts a portion of its business through joint arrangements where the parties are bound by contractual arrangements establishing joint control and decisions about the activities that significantly affect the returns of the investee require unanimous consent. A joint arrangement is classified as either a joint operation or a joint venture, subject to the terms that govern each investor's rights and obligations in the arrangement.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

In a joint operation, the investor has rights and obligations to the separate assets and liabilities of the investee and in a joint venture, the investors have rights to the net assets of the joint arrangement. For a joint operation, the Company recognizes its share of the assets, liabilities, revenue, and expenses of the joint arrangement, while for a joint venture, the Company accounts for its investment in the joint arrangement using the equity method.

Under the equity method, the Company’s investment in a joint venture is initially recognized at cost and subsequently increased or decreased to recognize the Company's share of net earnings or losses of the joint venture, after any adjustments necessary for impairment losses after the initial recognition date. The total carrying amount of the Company's investment in a joint venture also includes any long-term debt interests which in substance form part of the Company's net investment. The Company’s share of a joint venture’s losses that are in excess of its investment are recognized only to the extent that the Company has incurred legal or constructive obligations or made payments on behalf of the joint venture. The Company's share of net earnings or losses of a joint venture are recognized in net earnings during the period. Dividends and repayment of capital received from a joint venture are accounted for as a reduction in the carrying amount of the Company’s investment. Intercompany balances between the Company and its joint ventures are not eliminated.

At the end of each reporting period, the Company assesses whether there is any objective evidence that an investment in a joint venture is impaired. Objective evidence includes observable data indicating there is a measurable decrease in the estimated future cash flows of the joint venture’s operations. When there is objective evidence that an investment is impaired, the carrying amount of such investment is compared to its recoverable amount, being the higher of its fair value less costs of disposal and value-in-use. If the recoverable amount of an investment is less than the carrying amount, the carrying amount is reduced to its recoverable amount and a corresponding impairment loss is recognized in the period in which the relevant circumstances are identified. When an impairment loss reverses in a subsequent period, the carrying amount of the investment is increased to the revised estimate of the recoverable amount to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had an impairment loss not been previously recognized. A reversal of an impairment loss is recognized in net earnings in the period in which the reversal occurs.

Similar to the assessment of impairment for subsidiaries, the Company reviews the mining properties and plant and equipment for a joint operation at the cash-generating unit level to determine whether there is any indication that these assets are impaired.

Transactions in foreign currencies are initially recorded at the functional currency rate of exchange at the date of the transaction.

Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency rate of exchange at the date of the statement of financial position. Foreign exchange gains (losses) are recorded in the consolidated statement of operations and comprehensive income (loss) for the year.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

(d) Cash and cash equivalents

Cash and cash equivalents consist of cash on hand and short-term investments with original maturity dates of less than ninety days or that are fully redeemable without penalty or loss of interest.

(e) Inventories

Gold on hand, gold in process and stockpiled ore inventories are recorded at the lower of weighted average production cost and net realizable value. Production costs include the cost of raw materials, direct labour, mine-site overhead expenses and applicable depreciation and depletion. Net realizable value is calculated as the estimated price at the time of sale based on prevailing and long- term metal prices less estimated future costs to convert the inventories from their respective states into saleable form less estimated costs to sell.

Production costs are included in work-in-process inventory based on current costs incurred up to the point of dore production. The costs of finished goods represent the costs of work-in-process inventories plus applicable treatment costs. The costs of inventories sold during the period are presented as cost of sales in the statement of operations and comprehensive income (loss) for the period.

Additions to the cost of ore stockpiles are based on the related current cost of production for the period, while reductions in the cost of ore stockpiles are based on the weighted-average cost per tonne of ore in the stockpile. Stockpiles are segregated between current and non-current inventories in the consolidated statement of financial position based on the planned period of usage.

Supplies and spare parts are valued at the lower of weighted-average cost and net realizable value. Replacement costs of materials and spare parts are generally used as the best estimate of net realizable value. Provisions are recorded to reduce the carrying amount of materials and spare parts inventory to net realizable value to reflect current intentions for the use of redundant or slow-moving items. Provisions for redundant and slow-moving items are made by reference to specific items of inventory. The Company reverses write-downs where there is a subsequent increase in net realizable value and where the inventory is still on hand.

(f) Mineral properties, plant and equipment

(i) Mineral properties Recognition

Capitalized costs of mining properties include the following:

costs assigned to mining properties acquired in business combinations;
expenditures incurred to develop mineral properties including pre-production stripping costs;
stripping costs in the production phase of a mine if certain criteria have been met (see below);
costs to define and delineate known economic resources and develop the project;
borrowing costs attributable to qualifying mining properties;
costs incurred during testing of the processing facility, net of proceeds from sales, prior to operating in the manner intended by management; and
estimates of reclamation and closure costs.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

Stripping costs

In open pit mining operations, it is necessary to incur costs to remove overburden and other mine waste materials in order to access the ore from which minerals can be extracted economically. Stripping costs incurred in order to provide initial access to the ore body (referred to as pre-production stripping) are capitalized as incurred. Stripping costs incurred during the production stage of an open pit mine are accounted for as production costs in the consolidated statement of operations and comprehensive income (loss) during the period that the stripping costs were incurred, unless these costs provide a future economic benefit. Production phase stripping costs are considered to generate a future economic benefit when (i) it is probable that future economic benefit associated with the stripping activity will flow to the entity; (ii) the entity can identify the component of the ore body for which access has been improved; and (iii) the costs relating to the stripping activity associated with that component can be measured reliably. These costs are capitalized as mine development costs.

Production costs are allocated between inventory produced and the stripping asset based on the volume of waste extracted compared with the expected volume, for a given volume of ore production. Stripping costs incurred and capitalized during the production phase are depleted using the units-of-production method over the proven and probable reserves of the component of the ore body to which access has been improved as a result of the specific stripping activity.

Management reviews the estimates of the waste and ore in each identified component of operating open pit mines at the end of each financial year, and when events and circumstances indicate that such a review should be made. Deferred stripping assets are written-down to their recoverable amount when their carrying value is not considered supportable. Changes to the estimated identification of components and the associated waste and ore within each component are accounted for prospectively.

Exploration and evaluation expenditures

Exploration and evaluation expenditures include the costs of acquiring rights to explore, exploratory drilling and related exploration costs incurred on sites without an existing mine and on areas outside the boundary of a known mineral deposit which contain proven and probable reserves. Exploration and evaluation expenditures incurred on a mineral deposit, with the exception of acquisition costs and costs arising from the recognition of an asset retirement obligation, are expensed as incurred up to the date of establishing that costs incurred on a mineral deposit are technically feasible and commercially viable.

Expenditures incurred on a mineral deposit subsequent to the establishment of its technical feasibility and commercial viability are capitalized and included in the carrying amount of the related mining property.

The technical feasibility and commercial viability of a mineral deposit is assessed based on a combination of factors, such as, but not limited to:

the extent to which mineral reserves or mineral resources have been identified through a feasibility study or similar level document;
the results of optimization studies and further technical evaluation carried out to mitigate project risks identified in the feasibility study;
the status of environmental permits, and
the status of mining leases or permits.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

Borrowing costs

Borrowing costs directly relating to the financing of qualifying assets are added to the capitalized cost of those related assets until such time as the assets are substantially ready for their intended use or sale which, in the case of mining properties, is when they are capable of commercial production. Where funds have been borrowed specifically to finance a project, the amount capitalized represents the actual borrowing costs incurred. Where the funds used to finance a project form part of general borrowings, the amount capitalized is calculated using a weighted average of rates applicable to relevant general borrowings of the Company during the period. Capitalized borrowing costs are depreciated over the life of the related asset.

All other borrowing costs are recognized in the consolidated statement of operations and comprehensive income (loss) in the year in which they are incurred. Borrowing costs are included as part of interest paid in the statement of cash flows.

Depletion

Mining properties in production are depleted on a mine-by-mine basis using the units-of-production method over the mine’s estimated proven and probable reserves, with the exception of deferred stripping which is depleted using the unit-of- production method over the reserves that directly benefit from the specific stripping activity, and will commence when the mine is capable of operating in the manner intended by management.

The Company uses a number of criteria to assess whether the mine is in the condition necessary for it to be capable of operating in a manner intended by management. These criteria include, but are not limited to:

completion of operational commissioning of each major mine and plant component;
demonstrated ability to mine and mill consistently and without significant interruption at a pre-determined average rate of designed capacity;
the passage of a reasonable period of time for testing of all major mine and plant components;
gold recoveries at or near expected production levels; and
a significant portion of available funding is directed towards operating activities.

Mining properties in development are not depleted.

(ii) Plant and equipment

Recognition

The cost of plant and equipment consists of the purchase price, costs directly attributable to the delivery of the asset to the location and the condition necessary for it to be capable of operating in the manner intended by management, including the cost of testing whether these assets are operating in the manner intended by management. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost can be measured reliably. Where significant components of an asset have differing useful lives, depreciation is calculated on each separate component.

Depreciation

Depreciation of an asset begins when it is available for use, i.e. when it is in the location and condition necessary for it to be capable of operating in the manner intended by management.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

The carrying amounts of plant and equipment are depreciated using either the straight-line or units-of-production method over the shorter of the estimated useful life of the asset or the life of mine. The significant classes of depreciable plant and equipment and their estimated useful lives are as follows:

Asset Class	Estimated Useful Life
Fixed plant & related components and infrastructure	Units of production over life of mine
Mobile and other mine equipment components	3 to 12 years
Computer equipment and software	3 years
Right-of-use assets	Straight-line over lease term

Management reviews the estimated useful lives, residual values and depreciation methods of the Company’s plant and equipment at the end of each financial year, and when events and circumstances indicate that such a review should be made. Changes to estimated useful lives, residual values or depreciation methods resulting from such review are accounted for prospectively.

Major maintenance and repairs

Expenditure on major maintenance and repairs includes the cost of replacement parts of assets and overhaul costs. Where an asset or part of an asset is replaced and it is probable that future economic benefits associated with the item will be available to the Company, that expenditure is capitalized and the carrying amount of the item replaced derecognized. Similarly, overhaul costs associated with major maintenance are capitalized when it is probable that future economic benefits will be available and any remaining carrying amounts of the cost of previous overhauls are derecognized. All other maintenance and repair costs are expensed as incurred.

(iii) Impairment of non-financial assets

The carrying amounts of assets included in mining interests are reviewed for impairment when events and changes in circumstances indicate that the related carrying amounts may not be recoverable. If any such indication exists, the recoverable amount of the relevant cash-generating unit (“CGU”) is estimated in order to determine the extent of impairment. A CGU is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. Previously, the Company’s CGUs were its significant mine sites, represented by its principal producing mining properties and significant development projects.

The carrying amounts of the CGUs are compared to their recoverable amounts where the recoverable amount is the higher of value-in-use and fair value less costs to sell (“FVLCS”). For mining assets, when a binding sale agreement and observable market prices are not readily available, FVLCS is estimated using a discounted cash flow approach for each of the Company’s cash generating units (CGUs) to which the individual assets are allocated. The assumptions used in determining the FVLCS for the CGU’s include long-term mining plans, long-term commodity prices, discount rates and foreign exchange rates. If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount is reduced to its recoverable amount. An impairment is recognized immediately in the consolidated statement of operations and comprehensive income (loss).

Where an impairment loss subsequently reverses, the carrying amount of the asset (CGU) is increased to the revised estimate of its recoverable amount (however, the increased carrying amount shall not exceed the net carrying amount that would have been recognized should no impairment loss have been previously recognized for the asset (or CGU) in prior years).

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

(iv) Derecognition

Upon disposal or abandonment, the carrying amounts of mining properties and plant and equipment are derecognized and any associated gains or losses are recognized in the consolidated statement of operations and comprehensive income (loss).

(g) Leases

The Company applies IFRS 16 – Leases to account for contracts or arrangements containing a lease. At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company applies the definition of a lease in IFRS 16. This policy is applied to contracts entered into on or after January 1, 2019.

At commencement or on modification of a contract that contains a lease component, the Company allocates the consideration in the contract to each lease component on the basis of its relative stand-alone prices.

The Company recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset, or the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Company by the end of the lease term or the cost of the right-of-use asset reflects that the Company will exercise a purchase option. In that case, the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate. The Company determines its incremental borrowing rate by obtaining interest rates from various external financing sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased.

Lease payments included in the measurement of the lease liability comprise the following:

• fixed payments, including in-substance fixed payments;

• variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the commencement date;

• amounts expected to be payable under a residual value guarantee; and

• the exercise price under a purchase option that the Company is reasonably certain to exercise, lease payments in an optional renewal period if the Company is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Company is reasonably certain not to terminate early.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the Company’s estimate of the amount expected to be payable under a residual value guarantee, if the Company changes its assessment of whether it will exercise a purchase, extension or termination option, or if there is a revised in-substance fixed lease payment. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

Short-term leases and leases of low-value assets

The Company has elected not to recognize right-of-use assets and lease liabilities for leases of low-value assets and short-term leases, including office equipment. The Company recognises the lease payments associated with these leases as an expense on a straight- line basis over the lease term.

(h) Provisions

General

Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the Company expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognized as a separate asset, but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the consolidated statement of operations and comprehensive income (loss) net of any reimbursement. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognized as finance expense in the consolidated statement of operations and comprehensive income (loss).

Asset retirement provisions

An obligation to incur restoration, rehabilitation and environmental costs arises when environmental disturbance is caused by the exploration, development or ongoing production of a mineral property interest. The Company records the estimated present value of future cash flows associated with site reclamation as a liability when the liability is incurred with a corresponding increase in the carrying value of the related assets. Discount rates using a pre-tax, risk-free rate that reflect the time value of money are used to calculate the net present value. The liability is accreted over time to reflect the unwinding of the discount with the accretion expense included in finance costs in the consolidated statement of operations and comprehensive income (loss). Changes in estimates or circumstances include changes in legal or regulatory requirements, increased obligations arising from additional mining and exploration activities, changes to cost estimates, changes to the discount rate and changes to the risk-free interest rates.

(i) Revenue from contracts with customers

Revenue is derived from the sale of gold and by-products. Revenue is recognized for contracts with customers when there is persuasive evidence that all of the following criteria are met:

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

the parties to the contract have approved the contract (in writing, orally or in accordance with other customary business practices) and are committed to perform their respective obligations;
the Company can identify each party's rights regarding the goods or services to be transferred;
the Company can identify the payment terms for the goods or services to be transferred;
the contract has commercial substance (i.e. the risk, timing or amount of the Company’s future cash flows is expected to change as a result of the contract); and
it is probable that the Company will collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer.

Revenue from gold is generally recorded at the time of physical delivery of the refined gold, which is also the date when control of the gold passes to the customer. Revenue from saleable gold produced during the testing phase of production activities is deducted from capitalized mine development costs.

(j) Royalties and mining taxes

Payments to governments that are based on a measure of income less expense are accounted for in accordance with the Company’s income tax accounting policy. Payments to governments which are based on gross amounts such as revenue are classified in accordance with the substance of the transaction; this means that for royalties calculated based on revenues, the royalty is presented as a reduction of revenues and that for royalties calculated based on production costs, the royalty is presented as an increase in cost of sales.

(k) Financial instruments

(i) Financial assets

Recognition and measurement

The Company recognizes a financial asset in its statement of financial position when the Company becomes party to the contractual provisions of the instrument. All financial assets are initially recorded at fair value plus directly attributable transaction costs and classified as either (i) financial assets subsequently measured at amortized cost, (ii) financial assets subsequently measured at fair value through other comprehensive income or (iii) financial assets subsequently measured at fair value through profit or loss. The basis of classification takes into consideration both the Company’s business model for managing and the contractual cash flow characteristics of the financial assets.

A financial asset is measured at amortized cost if the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

A financial asset is measured at fair value through other comprehensive income if the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

A financial asset is measured at fair value through profit or loss unless it is measured at amortised cost or at fair value through other comprehensive income. Fair value changes in financial assets classified as fair value through profit or loss, if any, are recognized in the consolidated statement of operations and comprehensive income (loss).

Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognized when:

the contractual rights to receive cash flows from the asset have expired, or
the Company has transferred its contractual rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through ‘arrangement; and either

(a) the Company has transferred substantially all the risks and rewards of ownership of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

(ii) Financial liabilities

Recognition and measurement

All financial liabilities are initially recorded at fair value less transaction costs. All financial liabilities are subsequently measured at amortized cost using the effective interest method, except for:

financial liabilities at fair value through profit or loss;
financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuing involvement approach applies;
financial guarantee contracts;
commitments to provide a loan at a below-market interest rate; and
contingent consideration recognized by an acquirer in a business combination to which IFRS 3, Business combinations, applies.

An entity may, at initial recognition, irrevocably designate a financial liability as measured at fair value through profit or loss when a contract contains one or more embedded derivatives, or when doing so results in more relevant information, because either (a) it eliminates or significantly reduces a measurement or recognition inconsistency (i.e. an accounting mismatch); or (b) a group of financial liabilities or financial assets and financial liabilities is managed and its performance is evaluated on a fair value basis.

Fair value changes of financial liabilities classified as fair value through profit or loss, if any, are recognized in the consolidated statement of operations and comprehensive income (loss).

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

(iii) Embedded derivatives

The Company may enter into derivative contracts or financial instruments and non-financial contracts containing embedded derivatives. Embedded derivatives are required to be accounted for separately at fair value as derivatives when the risks and characteristics of the embedded derivatives are not closely related to those of their host contract, and the host contract is not designated as fair value through profit or loss. These embedded derivatives are measured at fair value with changes in fair value recognized in the consolidated statement of operations and comprehensive income (loss).

(l) Share-based compensation

The Company has a share option plan and restricted share unit (“RSU”) plan which are described in notes 11(a) and 11(b), respectively. For share options, the fair value of share-based compensation awards is determined at the date of grant using the Black-Scholes option pricing model. The Company records all share-based compensation for options using the fair value method with graded vesting. Under the fair value method, share-based payments are measured at the fair value of the consideration received or the fair value of the equity instruments issued or liabilities incurred, whichever is more reliably measurable, and are charged over the vesting period to the consolidated statement of operations and comprehensive income (loss). The offset is credited to Equity reserves (within equity in the consolidated statement of financial position) ratably over the vesting period, after adjusting for the number of awards that are expected to vest.

Expenses recognized for forfeited awards are reversed. For awards that are cancelled, any expense not yet recognized is recognized immediately in the statement of operations and comprehensive income (loss).

Where the terms of an equity-settled award are modified, as a minimum an expense is recognized as if the terms had not been modified over the original vesting period. In addition, an expense is recognized for any modification which increases the total fair value of the share-based payment arrangement as measured at the date of modification, over the remainder of the vesting period.

For cash-settled share-based payments, including RSUs, the Company measures the goods or services acquired and the liability incurred at the fair value of the liability. The corresponding share-based compensation expense is recognized over the vesting period of the award. As these awards will be settled in cash, the liability is remeasured at fair value at each reporting period and at the date of settlement, with changes in fair value recognized in the consolidated statement of operations and comprehensive income (loss) in the period incurred.

(m) Income taxes

Income tax on the profit or loss for the periods presented comprises current and deferred income tax. Income tax is recognized in the consolidated statement of operations and comprehensive income (loss) except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current income tax expense is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at period end, adjusted for amendments to tax payable with regards to previous years.

Deferred income tax is recognized in respect of unused tax losses, tax credits and temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the tax rates that have been substantively enacted at the reporting date.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

3. Significant accounting policies (continued)

A deferred income tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. To the extent that the Company does not consider it probable that a future income tax asset will be recovered, it does not recognize the asset.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its tax assets and liabilities on a net basis.

The Company records foreign exchange gains and losses representing the impacts of movements in foreign exchange rates on the tax bases of non-monetary assets and liabilities which are denominated in foreign currencies. Foreign exchange gains and losses relating to the translation of the deferred income tax balance from local statutory accounts to functional currency accounts are included in deferred income tax expense or recovery in the consolidated statement of operations and comprehensive income (loss).

(n) Income (loss) per share

Basic income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. The computation of diluted income (loss) per share assumes the conversion, exercise or contingent issuance of securities only when such conversion, exercise or issuance would have a dilutive effect on income (loss) per share. For this purpose, the treasury stock method is used for the assumed proceeds upon the exercise of stock options and warrants that are used to purchase common shares at the average market price during the period.

4. Changes in accounting standards

(a) Accounting standards adopted during the year

The Company adopted the following new IFRS standards effective January 1, 2019. The nature and impact of each new standard on the Company’s current year financial statements, and prior year comparatives, if any, are outlined below. Adoption of these standards were made in accordance with the applicable transitional provisions.

Several other new standards and amendments came into effect on January 1, 2019; however, they did not impact the Company’s consolidated financial statements.

Leases

In January 2016, the IASB issued IFRS 16 – Leases ("IFRS 16") which replaces IAS 17 – Leases and its associated interpretative guidance. For those assets determined to meet the definition of a lease, IFRS 16 introduces significant changes to the accounting by lessees, introducing a single, on-balance sheet accounting model that is similar to current finance lease accounting, with limited exceptions for short-term leases or leases of low value assets. Lessor accounting remains similar to current accounting practice. The standard is effective for annual periods beginning on or after January 1, 2019.

The Company has not identified any material leases or other contracts containing a lease to be recognized on balance sheet as of January 1, 2019.

The adoption of IFRS 16 did however impact the JV. Previously, the JV recognized monthly fixed payments for equipment to mining contractors as production costs. Under IFRS 16, these fixed monthly payments are capitalized as a right-of-use asset (and corresponding lease liability) and commencing January 1, 2019, are no longer presented as production costs; rather, the JV recognizes a depreciation charge for the right-of-use assets and an interest expense on the lease liabilities.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

4. Changes in accounting standards (continued)

The JV elected to adopt the practical expedient in IFRS 16 to not reassess whether a contract is, or contains, a lease at the date of initial application. Any contracts or agreements that were not previously identified as containing a lease under IAS 17 or IFRIC 4, were not reassessed as of January 1, 2019. Therefore, IFRS 16 was applied only to contracts entered into (or modified) on or after January 1, 2019.

On adoption of IFRS 16, the JV recognized right-of-use assets and lease liabilities of $36.6 million as at January 1, 2019. However, the net impact on the profit and loss of the JV for the year ended December 31, 2019 was not materially different from accounting for these contracts under IAS 17 and, as a result, the adoption of IFRS 16 did not have a material impact on the Company’s equity pick- up for the year.

(b) Accounting standards and amendments issued but not yet adopted

The following standards and interpretations, which may be applicable to the Company, have been issued but are not yet effective as of December 31, 2019:

Revised Conceptual Framework

In March 2018, the IASB issued the revised Conceptual Framework (“Framework”), which sets out the fundamental concepts for financial reporting to ensure consistency in standard-setting decisions and that similar transactions are treated in a similar way, so as to provide useful information to users of financial statements. The revised Framework, which is effective January 1, 2020, will inform future standard-setting decisions but does not impact existing IFRS. The Company does not expect the Framework to have a significant impact on its accounting policies.

5. Significant accounting judgements and estimates

Estimates

Equity investment in joint venture

When facts and circumstances suggest the carrying value of the Company’s equity investment in the JV may be impaired, the Company is required to estimate the recoverable amount of its equity investment through a fair value less cost of disposal or value-in-use approach. Estimating the recoverable amount requires management to make significant estimates about the future life of mine cash flow of the AGM which may include, but may not be limited to, changes to the current estimates of in-situ ounces, ore tonnes to be mined in future periods, strip ratios, head grades, recovery rates, gold price assumptions, mining costs, processing costs, trucking costs, capital and closure costs, as well as discount rates.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

5. Significant accounting judgements and estimates (continued)

Reserves and Resources

Estimates of the quantities of proven and probable mineral reserves and mineral resources form the basis for the Company’s life-of- mine plans, which are used for a number of key business and accounting purposes, including: the calculation of depreciation expense, the capitalization of stripping costs, the forecasting and timing of cash flows related to the asset retirement provision and impairment assessment, if any. In addition, when required, the life-of-mine plans are used in impairment tests for mineral properties, plant and equipment. To the extent that these estimates of proven and probable mineral reserves and resources varies, there could be changes in depreciation expense, stripping asset and asset retirement provision recorded.

Depletion of mineral interests

Estimates are made of recoverable ounces in the Company’s mining properties which are depleted based on recoverable tonnes contained in proven and probable reserves. To the extent that changes are made to the estimate of proven and probable reserves, the depletion charge may change. In addition, mineral properties, plant and equipment are depreciated to their estimated residual value over the estimated useful life of the asset. Should the actual useful life of the mineral properties, plant or equipment vary, future depreciation charges may change.

Inventory valuation of production costs

The Company estimates quantities of ore on stockpiles and in process and the recoverable gold contained in this material in order to determine the cost of inventories and the weighted average costs of finished goods sold during the period. To the extent that these estimates vary, production costs of finished goods may change.

Net realizable value of inventory

Estimates of net realizable value are based on the most reliable evidence available, at the time that the estimates are made, of the amount that the inventories are expected to realize. In order to determine the net realizable value of gold dore, gold-in-process and stockpiled ore, the Company estimates future metal selling prices, production forecasts, realized grades and recoveries, timing of processing, and future costs to convert the respective inventories into saleable form, if applicable. Reductions in metal price forecasts, increases in estimated future costs to convert, reductions in the number of recoverable ounces, and a delay in timing of processing can result in a write-down of the carrying amounts of the Company’s stockpiled ore inventory.

Materials and other supplies held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. However, to the extent net realizable of materials and spares must be estimated, replacement costs of the materials and spare parts are generally used as the best estimate of net realizable value.

Current and deferred Income taxes

In assessing the probability of realizing income tax assets recognized, management makes estimates related to expectations of future taxable income, applicable tax opportunities, expected timing of reversals of existing temporary differences and the likelihood that tax positions taken will be sustained upon examination by applicable tax authorities. Levels of future taxable income are affected by, among other things, market gold prices, production costs, quantities of proven and probable gold reserves, interest rates and foreign currency exchange rates.

Where applicable tax laws and regulations are either unclear or subject to varying interpretations, it is possible that changes in these estimates could occur that materially affect the amounts of deferred income tax assets and liabilities recorded in the financial statements. Changes in deferred tax assets and liabilities generally have a direct impact on earnings in the period that the changes occur.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

5. **Significant accounting judgements and estimates (continued)**Deferred stripping

To determine whether stripping costs incurred during the production phase of a mining property relate to reserves and resources that will be mined in a future period and therefore should be capitalized, the Company makes estimates of the stripping activity over the life of the component of reserves and resources which have been made accessible. In addition, judgement is involved when allocating production costs between inventory produced and the stripping asset; the allocation is based on the volume of waste extracted compared with the expected volume, for a given volume of ore production. To the extent that these estimates and judgements change, there could be a change to the amount of production costs which are deferred to the statement of financial position.

Estimated assets retirement provisions

Provisions for reclamation and closure cost obligations represents management’s best estimate of the present value of the future cash outflows required to settle closure cost liabilities. Significant judgements and estimates are required in forming assumptions of future activities, future cash outflows and the timing of those cash outflows. These assumptions are formed based on environmental and regulatory requirements or the Company’s environmental policies which may give rise to constructive obligations. The Company’s assumptions are reviewed at the end of each reporting period and adjusted to reflect management’s current best estimate and changes in any of the above factors can result in a change to the provision recognized by the Company. Changes to these estimates and judgements may result in actual expenditures in the future differing from the amounts currently provided for.

Preferred shares

The Company holds preferred shares (without a fixed redemption date) in the JV which have been classified as financial assets measured at fair value through profit or loss. Management estimated the fair value of these preference shares by discounting the forecasted future cash flows from the AGM. Several estimates were made to determine the forecasted future cash flows including, but not limited to, long-term realized gold prices, mineable reserves/resources, mining and processing costs per tonne, ore grades, and metallurgical recoveries. Additionally, judgement was required to determine the appropriate discount rate used to calculate the present value of the forecasted future cash flows. Changes in one or more of these assumptions could lead to a materially different fair value estimate of the preferred shares.

Judgements

Impairment of equity investment in joint venture

The Company considers both external and internal sources of information in assessing whether there are any indications that its equity investment in the JV is impaired. External sources of information the Company considers include changes in the market, economic and legal environment in which the JV operates that are not within its control and affect the recoverable amount of the Company’s equity investment. Internal sources of information the Company considers include the manner in which mining properties and plant and equipment of the JV are being used or are expected to be used and indications of economic performance of the assets. The estimates and judgements are subject to risk and uncertainty; hence, there is the possibility that changes in circumstances will alter these projections, which may impact the recoverable amount of the assets. In such circumstances, the carrying value of the Company’s equity investment in the JV may be impaired or a prior period’s impairment charge reversed with the impact recorded in the consolidated statement of operations and comprehensive income (loss).

Functional currency

The determination of a subsidiary’s functional currency often requires significant judgment where the primary economic environment in which an entity operates may not be clear. This can have a significant impact on the consolidated results of the Company.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

6. Receivable due from related party

Under the JVA, the Company entered into a services agreement with the JV whereby the Company will remain manager and operator of the AGM. In consideration for the Company’s services as manager and operator, the JV will pay the Company an annual fee of $6.0 million (adjusted annually for inflation). During the year ended December 31, 2019, the Company earned a service fee of $5.0 million (year ended December 31, 2018 – $1.9 million). For the year ended December 31, 2019, the service fee was comprised of a gross service fee of $6.0 million, respectively, less withholding taxes payable in Ghana of $1.0 million (year ended December 31, 2018 – gross service fee of $2.5 million less withholding taxes of $0.6 million). As at December 31, 2019, the Company had a receivable due from the JV in respect of the service fee in the amount of $4.2 million, net of withholding taxes (December 31, 2018 - $2.3 million).

All transactions with related parties have occurred in the normal course of operations and were measured at the exchange amount agreed to by the parties. All amounts are unsecured, non-interest bearing and have no specific terms of settlement.

7. Financial assets

As part of the JV Transaction (notes 1 and 8), the Company subscribed to 204.9 million non-voting fixed redemption price redeemable preferences shares in JV Finco (the “preference shares”). The preference shares were issued at a par value of $1 per redeemable share, resulting in a face value of the preference shares of $204.9 million.

a) Redeemable preference shares with no fixed redemption date

	December 31, 2019	December 31, 2018
		$
Balance, beginning of year	153,651	-
Initial recognition of preferred shares at fair value	-	148,850
Fair value adjustment for the year	(35,626	4,801
Redemption of preferred shares during the year	(10,000	-
Balance, end of year	108,025	153,651

All values are in US Dollars.

184.9 million of the preference shares, that the Company originally subscribed for as part of the JV Transaction, have no fixed redemption date. As these preference shares have no contractual fixed terms of repayment that arise on specified dates, they are measured at fair value through profit or loss at each reporting period-end. On closing of the JV Transaction, these preference shares were recognized at their fair value of $148.9 million as at July 31, 2018. On initial recognition, the Company estimated the fair value of the preference shares using a discounted cash flow model, discounting $184.9 million of forecasted future cash flows from the AGM at a discount rate of 6.5%.

During the year ended December 31, 2019, the JV redeemed $10.0 million of the preference shares, bringing the Company’s holding to 174.9 million preference shares in the JV (December 31, 2018 – 184.9 million preference shares).

As at December 31, 2019, the Company re-measured the fair value of the redeemable preference shares to $108.0 million in order to reflect management’s latest estimate of the future cash flows of the JV (see Impairment testing in note 8) at a discount rate of 8.4%. As a result, the Company recorded a downward fair value adjustment of $35.6 million in finance expense for the year ended December 31, 2019 (year ended December 31, 2018 – $4.8 million positive fair value adjustment recorded in finance income). These preference shares are classified as a Level 3 financial asset in the fair value hierarchy.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

7. Financial assets (continued)

b) Redeemable preference shares with determinable redemption date

	December 31, 2019	December 31, 2018
		$
Balance, beginning of year	19,484	-
Initial recognition at fair value	-	19,231
Redemptions during the year	(20,000	-
Accretion income for the year	516	253
Balance, end of year	-	19,484

All values are in US Dollars.

The remaining preference shares (with an original face value of $20.0 million) were redeemable from JV Finco based on an agreed Esaase development milestone, but in any event to be paid by no later than December 31, 2019 (note 1). On closing of the JV Transaction, the $20.0 million preference shares were recognized at fair value using a discounted cash flow model. Management estimated the fair value of the $20.0 million preference shares by discounting the contractual future cash flows (assumed to be payable by December 31, 2019) at a discount rate of 2.7%, resulting in a fair value of $19.2 million as at July 31, 2018. Subsequent to initial recognition, these preference shares were measured at amortized cost.

On August 29, 2019, the Company received $10.0 million from Gold Fields based on the agreed Esaase development milestone, while a further $10.0 million was received on December 19, 2019, bringing the balance at December 31, 2019 to $nil (December 31, 2018 – $19.5 million).

For the year ended December 31, 2019, the Company recognized accretion income of $0.5 million in finance income in the Statement of Operations and Comprehensive Income (Loss) (year ended December 31, 2019 – $0.3 million).

8. Investment in joint venture

As at December 31, 2019, the Company’s 45% interest in the Asanko Gold Mine was accounted for using the equity method. The following table summarizes the change in the carrying amount of the Company’s investment in the joint venture:

	December 31, 2019	December 31, 2018

Balance, beginning of year	126,264	-
Initial recognition of investment in joint venture	-	127,314
Company's share of net loss of the JV for the year	(126,264	(1,050
Balance, end of year	-	126,264

All values are in US Dollars.

The Company’s interest in the net loss of the JV of $126.3 million was recorded net of the Company’s attributable share of an impairment of $130.3 million (or 45% of $289.6 million) that was recognized by the JV during the year ended December 31, 2019.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

Impairment testing

During the year ended December 31, 2019, the Company and its JV partners announced that the scope of the ongoing work associated with the AGM’s life of mine (the “AGM LOM”) plan would:

• target a remaining mine life of 8-10 years with gold production of 225,000 to 250,000 ounces per year;

• contemplate resources based on Localized Uniform Conditioning methodology;

• be based on NI43-101 standards and consistent with Gold Field’s operating practices;

• be based on Measured and Indicated Mineral Resources using Datamine Mine Stope Optimization software;

• not include any major development capital investments such as further processing plant expansions or Esaase ore transportation infrastructure; and

• be based on metallurgical recovery estimates for Esaase fresh ore based on an updated metallurgical model, which would in turn be based on a test-work program currently underway.

The Company previously prepared its Amended and Restated Definitive Feasibility Study related to the AGM on June 5, 2017 (and amended and restated on December 20, 2017, the “12/17 DFS”). The 12/17 DFS has been filed on SEDAR and is available on the Company’s website. The 12/17 DFS previously estimated the AGM’s remaining life of mine to be between 14 and 21 years (ending 2030 - 2037) with gold production ranging from 108,000 ounces to 497,000 ounces.

As discussed above, the current AGM LOM plan contemplates a remaining mine life of 8-10 years (2027-2029) with gold production ranging from 225,000 to 250,000 ounces per year. Additionally, while the Company previously disclosed that it expected that global resource gold ounces at Esaase would remain approximately the same as previously stated, as a result of the continued work associated with the AGM LOM plan the Company now expects that the resource base for the AGM may reduce significantly.

Therefore, given that the target mine life and production is expected to result in the extraction of materially less than the total previously estimated reserves and resources of the AGM, the Company considered this to represent an indicator of possible impairment. Accordingly, the Company assessed the recoverable amount of the AGM, which was based on management’s estimate of the fair value less cost of disposal of the AGM. The fair value less cost of disposal of the AGM (on a 100% basis) was estimated to be $211.8 million and included life of mine cash flow projections, on the basis of the updated scope.

The Company has completed its work associated with the AGM LOM plan; however, the AGM LOM plan is still being reviewed by the JV management committee, and the life of mine cash flow projections that are used in the impairment assessment are not based on a published National Instrument 43-101 technical report (“NI 43-101 report”). The extent of any change in reserves and resources cannot be precisely determined until the NI 43-101 report is finalized and published. Notwithstanding, the estimate of the recoverable amount of the AGM incorporates management’s best estimate based on information available to management at the time of preparing these audited consolidated financial statements. Management’s estimate of the fair value of the AGM is classified as Level 3 in the fair value hierarchy.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

It was determined that an impairment of $289.6 million was required at the AGM based on its estimate of the recoverable amount of the AGM.

The Company’s impairment testing at December 31, 2019 incorporated the following assumptions:

Pricing assumption

For the purpose of the impairment assessment, the Company’s estimated gold price considered analysts’ consensus pricing for the estimated duration of the AGM LOM plan. The gold price assumptions were as follows:

Gold price assumption	2020	2021	2022 to 2024	Long-term	Weighted <br>Average
Gold price (per ounce)	$1,500	$1,425	$1,400	$1,350	$1,373

Discount rate assumption

Projected cash flows were discounted using a post-tax discount rate of 8.4% which represents the weighted-average cost of capital commensurate with the risks associated with the AGM’s cash flows, and includes estimates for risk-free interest rates, market value of equity, market return on equity, share volatility and a target debt-to-equity ratio.

Sensitivity analysis

Due to the sensitivity of the recoverable amount to the various judgments and estimates, specifically long-term metal prices, as well as unforeseen factors, any significant change in key assumptions and inputs could result in changes in impairment charges to be recorded in future periods. The following table highlights the assumptions and estimates that management believes are most sensitive to estimating the recoverable amount. Any change in these assumptions and estimates could have a material impact on the estimated recoverable amount of the AGM.

Assumption	Sensitivity	Impact on recoverable amount (100% basis)
		Increase ($’millions)	Decrease <br>($’millions)
Gold price (weighted average)	+/- $100/oz	$98.6	$130.3
Discount rate	+/- 1.0%	$7.9	$7.4
ASANKO GOLD INC.
---
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

Operating and financial results of the JV for the years ended December 31, 2019 and 2018

Summarized financial information for the Company's investment in the JV, on a 100% basis, is outlined in the table below. Note that for the period January 1, 2018 to July 31, 2018, the Company controlled the AGM and therefore the financial results during this period have been included in the Company’s consolidated Statement of Operations and Comprehensive Income (Loss) for the year ended December 31, 2018.

All disclosures in this note 8 are on a 100% JV basis, unless otherwise indicated. The JV applies the same accounting policies as the Company.

Years ended December 31, 2019 and 2018

		2019	2018
	Note
Revenues	(i)	340,969	283,873
Production costs	(ii)	(199,234	(158,047
Depreciation and depletion	(viii)	(95,418	(76,273
Royalties	(ii)	(17,159	(14,250
Income from mine operations		29,158	35,303
Exploration and evaluation expenditures		(6,092	(3,370
General and administrative expenses		(6,549	(8,808
Income from operations		16,517	23,125
Impairment		(289,589	-
Fair value adjustment associated with JV Transaction	(iii)	-	(126,897
Finance expense	(xii)	(8,905	(11,088
Finance income		283	252
Foreign exchange gain		1,171	1,181
Net loss before taxes		(280,523	(113,427
Current income tax expenses		-	(19
Deferred income tax expense	(iv)	-	(11,430
Net loss after tax for the year		(280,523	(124,876
Company's share of net loss of the JV for the year		(126,264	(1,050

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

The assets and liabilities of the Asanko Gold Mine JV, on a 100% basis, as at December 31, 2019 and 2018 were as follows:

		December 31, 2019	December 31, 2018
	Note	$	$
Assets
Current assets
Cash and cash equivalents		40,758	21,648
Restricted cash	(xii)	3,000	-
Receivables		9,516	4,513
Inventories	(v)	49,968	68,141
Prepaid expenses and deposits		2,031	2,693
VAT receivable		10,556	12,317
		115,829	109,312
Non-current assets	(vi),(vii),(viii)	238,781	490,825
Total assets		354,610	600,137
Liabilties
Current liabilities
Accounts payable and accrued liabilities		62,153	52,656
Lease liability	(ix)	18,142	-
		80,295	52,656
Non-current liabilities
Lease liability	(ix)	5,063	-
Long-term incentive plan liability		402	217
Deferred tax liability		-	-
Asset retirement provisions	(x)	56,148	34,036
		61,613	34,253
Total liabilities		141,908	86,909
Equity		212,702	513,228
Total liabilities and equity		354,610	600,137

The Company has provided the following incremental disclosures for stakeholders to evaluate the financial performance and financial condition of the AGM. All amounts in the following tables and descriptions are on a 100% basis.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

(i) Revenues

In 2013, concurrent with the former debt project financing, AGGL entered into an offtake agreement with a special purpose vehicle of RK Mine Finance Trust I (“Red Kite”) with the following details (the “Offtake Agreement”):

sale of 100% of the future gold production from the AGM up to a maximum of 2.2 million ounces to Red Kite;
Red Kite to pay for 100% of the value of the gold ten business days after shipment;
a provisional payment of 90% of the estimated value will be made one business day after delivery;
the gold sale price will be a spot price selected during a nine-day quotational period following shipment of gold from the mine;
performance obligations of the AGM are satisfied once the refining outturn report is provided to Red Kite; and
should AGGL wish to terminate the Offtake Agreement, a termination fee will be payable according to a schedule dependent upon the total funds drawn under the Red Kite debt arrangement as well as the amount of gold delivered under the Offtake Agreement at the time of termination.

During the year ended December 31, 2019, the AGM sold 248,862 ounces of gold to Red Kite in accordance with the Offtake Agreement.

Included in revenue of the AGM is $0.8 million relating to by-product silver sales for the year ended December 31, 2019 (year ended December 31, 2018 – $0.9 million). Additionally, $2.2 million of gold sales related to pre-production activities at Esaase were capitalized to MPP&E of the AGM during the year ended December 31, 2019 (year ended December 31, 2018 – $1.1 million).

As of December 31, 2019, the AGM has delivered 839,373 ounces to Red Kite under the Offtake Agreement. The Offtake Agreement was not affected by the JV Transaction and will remain in effect until all contracted ounces have been delivered to Red Kite or AGGL elects to terminate the Offtake Agreement and pay the associated fee.

(ii) Production costs and royalties

The following is a summary of production costs by nature, on a 100% basis, incurred during the years ended December 31, 2019 and 2018:

	December 31, 2019	December 31, 2018

Raw materials and consumables	(49,560	(53,949
Salary and employee benefits	(33,015	(25,106
Contractors (net of deferred stripping costs)	(97,443	(94,652
Change in stockpile, gold-in-process and gold dore inventories	(3,056	25,184
Insurance, government fees, permits and other	(15,749	(9,018
Share-based payments	(411	(506
Total production costs	(199,234	(158,047

All values are in US Dollars.

During the year ended December 31, 2019, the AGM recognized a $19.1 million downward adjustment to the carrying value of its stockpile inventory to reflect the net realizable value of lower grade ore that has been added to stock during the year, of which $7.9 million was recorded as production costs and $11.2 million as depreciation expense.

During the year ended December 31, 2018, the AGM recognized a $15.7 million downward adjustment to the carrying value of its stockpile inventory to reflect the net realizable value of lower grade ore that had been added to stock during the year, of which $9.9 million was recorded as production costs and $5.8 million as depreciation expense.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

All of the AGM’s concessions are subject to a 5% gross revenue royalty payable to the Government of Ghana. The AGM’s Akwasiso mining concession is also subject to an additional 2% net smelter return royalty payable to the previous owner of the mineral tenement, and the AGM’s Esaase mining concession is also subject to an additional 0.5% net smelter return royalty payable to the Bonte Liquidation Committee.

(iii) Fair value adjustment associated with JV Transaction

During the year ended December 31, 2018, the Company recognized a $143.3 million after-tax consolidated loss associated with loss of control following the JV Transaction (see note 16). Of this loss, an after-tax amount of $126.9 million was recognized in records of the AGM as follows:

	December 31, 2018

Mineral properties, plant and equipment	(154,675
Deferred income tax liability	34,204
	(120,471
Accelerated accretion on long-term debt	(6,226
Transaction costs directly related to JV Transaction	(200
Fair value adjustment associated with JV Transaction	(126,897

All values are in US Dollars.

(iv) Deferred income taxes

The deferred tax expense recognized for the year ended December 31, 2018 of $11.4 million arose due to timing differences with respect to tax and accounting depreciation on the AGM’s mineral properties, plant and equipment.

(v) Inventories

The following is a summary of inventories held by the AGM, on a 100% basis, as at December 31, 2019 and 2018:

	December 31, 2019	December 31, 2018

Gold dore on hand	2,804	-
Gold-in-process	1,726	5,325
Ore stockpiles	58,641	55,698
Materials and spare parts	18,679	17,004
Total inventories	81,850	78,027
Less non-current inventories:
Ore stockpiles	(31,882	(9,886
Total current inventories	49,968	68,141

All values are in US Dollars.

Refer to note 8(ii) for disclosure of net realizable value adjustments recognized on the AGM’s stockpile inventory during the years ended December 31, 2019 and 2018.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

(vi) Reclamation deposit

The AGM is required to provide security to the Environmental Protection Agency of Ghana (“EPA”) for the performance by the AGM of its reclamation obligations in respect of the Abriem, Abore and Adubea mining leases. The initial security totaled $8.5 million and comprised a reclamation deposit in the amount of $1.7 million and a bank guarantee of $6.8 million, which was provided by Asanko (note 12). The reclamation deposit accrues interest and is carried at $1.9 million at December 31, 2019 (December 31, 2018 – $1.9 million).

The AGM deposited the Reclamation Deposit in a Ghanaian Bank in the joint names of the AGM and the EPA. The reclamation deposit matures annually, but the AGM is required to reinstate the deposit until receiving a final reclamation completion certificate from the EPA. The AGM is expected to be released from this requirement 45 days following the third anniversary of the date that the AGM receives a final completion certificate.

(vii) Right-of-use assets

The following table shows the movement in the right-of-use asset related to mining contractor services agreements of the AGM for the year ended December 31, 2019:

	December 31, 2019

Balance, beginning of year	-
Initial recognition of right-of-use assets upon adoption of IFRS 16	36,616
Recognition of mining contractor services agreements entered into during the year	10,502
Depreciation expense	(17,255
Derecognition associated with termination of contractor services agreement	(10,343
Balance, end of year	19,520

All values are in US Dollars.

As at December 31, 2019, the carrying value of right-of-use assets associated with mining contractor services agreements was $19.5 million (December 31, 2018 – $nil), net of $17.3 million of depreciation expense recorded for the year ended December 31, 2019 (year ended December 31, 2018 – $nil).

(viii) Mineral properties, plant and equipment

Additions to mineral properties, plant and equipment

During the year ended December 31, 2019, the AGM capitalized $25.0 million in expenditures related to mineral properties, plant and equipment, not including capitalized deferred stripping costs, asset retirement costs and right-of-use assets (year ended December 31, 2018 – $26.0 million).

Deferred stripping

During the year ended December 31, 2019, the AGM deferred a total of $34.0 million of stripping costs to depletable mineral interests (year ended December 31, 2018 – $59.8 million) while depletion expense of $39.0 million was charged on deferred stripping assets and recorded as depreciation and depletion expense (year ended December 31, 2018 – $25.3 million).

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

Depreciation and depletion

During the year ended December 31, 2019, the AGM recognized depreciation and depletion expense of $100.6 million (including depreciation and depletion on right-of-use assets and on deferred stripping assets), of which $5.2 million was allocated to the cost of inventories (year ended December 31, 2018 – depreciation and depletion expense of $89.7 million, of which $13.4 million was allocated to the cost of inventories).

(ix) Lease liability

The following table shows the movement in the lease liability related to mining contractor services agreements of the AGM for the year ended December 31, 2019:

	December 31, 2019

Balance, beginning of year	-
Initial recognition of lease liability upon adoption of IFRS 16	36,616
Recognition of lease agreements entered into during the year	10,502
Lease payments made during the year	(15,386
Interest expense	1,817
Derecognition associated with termination of contractor services agreement	(10,344
Total lease liability, end of year	23,205
Less: current lease liability	(18,142
Total non-current lease liability, end of year	5,063

All values are in US Dollars.

During the year ended December 31, 2019, the AGM provided a notice of termination to one of its mining contractors and derecognized the lease liability and right-of-use asset associated with this lease agreement. A termination fee was accrued for at December 31, 2019 and was included in production costs during the year ended December 31, 2019.

(x) Reclamation provision

The following table shows the movement in the asset retirement obligation of the AGM as at December 31, 2019 and 2018:

	December 31, 2019	December 31, 2018
		$
Balance, beginning of year	34,036	30,790
Accretion expense	903	888
Change in obligation	21,309	2,358
Reclamation undertaken during the year	(100	-
Balance, end of year	56,148	34,036

All values are in US Dollars.

The decommissioning liability consists of reclamation and closure costs for the JV’s Ghanaian mining properties. Reclamation and closure activities include land rehabilitation, dismantling of buildings and mine facilities, ongoing care and maintenance and other costs.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

(xi) Revolving credit facility

In October 2019, the JV entered into a $30.0 million revolving credit facility (the “RCF”) with Rand Merchant Bank (“RMB”). The term of the RCF is three years, maturing in September 2022 and bears interest on a sliding scale of between LIBOR plus a margin of 4% and LIBOR plus a margin of 3.8%, depending on security granted to RMB. Commitment fees in respect of the undrawn portion of the RCF will be on a similar sliding scale of between 1.40% and 1.33%. As at December 31, 2019, the balance drawn under the RCF was $nil.

(xii) Hedging instruments and finance expense

In June 2019, the AGM entered into zero cost collar instruments with a group of leading commercial banks to manage the AGM’s exposure to gold price risk. The hedging instruments cover 90,000 ounces of gold production with put/call spreads ranging from $1,300 per ounce to $1,517 per ounce and matured at 15,000 gold ounces per month over a period of six months from July 1, 2019 to December 31, 2019. As at December 31, 2019, all hedging instruments had matured.

The AGM recognized a realized loss of $4.4 million on its hedging instruments, inclusive of withholding taxes, for the year ended December 31, 2019 (year ended December 31, 2018 – $nil). The realized loss was presented as part of finance expense in the profit and loss of the JV.

The AGM was required to deposit $3.0 million as collateral on the gold collars. This cash has been presented as restricted cash as at December 31, 2019 and was collected subsequent to year-end.

The following is a summary of finance expenses incurred by the JV during the years ended December 31, 2019 and 2018:

	December 31, 2019	December 31, 2018

Realized loss on hedging instruments	(4,440	-
Interest on lease liabilities	(1,817	-
Interest charges on Red Kite loan and associated withholding taxes	-	(10,142
Fees and expenses associated with revolving credit facility	(1,670
Accretion charges on asset retirement provisions	(903	(888
Other	(75	(58
Total finance expense	(8,905	(11,088

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

8. Investment in joint venture (continued)

(xiii) The cash flows of the AGM, on a 100% basis, were as follows for the years ended December 31, 2019 and 2018:

	December 31, 2019	December 31, 2018

Cash provided by (used in):
Operating cash flow before working capital changes	109,785	100,454
Operating activities	120,375	72,487
Investing activities	(62,672	(85,633
Financing activities	(35,272	12,820
Impact of foreign exchange on cash and cash equivalents	(321	(71
Increase (decrease) in cash and cash equivalents during the year	22,110	(397
Cash and cash equivalents, beginning of year	21,648	22,045
Cash and cash equivalents and restricted cash, end of year	43,758	21,648

All values are in US Dollars.

9. Right-of-use asset and lease liability

During the year ended December 31, 2019, the Company entered into a lease agreement for corporate office space with an effective date of September 1, 2019. Upon obtaining the contractual right to use the new office space, the Company recognized a right-of-use asset and corresponding lease liability for the office space lease agreement in accordance with IFRS 16, amounting to $0.6 million. The following table shows the movement in the right-of-use asset related to corporate office space lease agreement for the year ended December 31, 2019.

	December 31, 2019

Balance, beginning of year	-
Recognition of office space lease agreement entered into during the year	624
Depreciation expense	(35
Balance, end of year	589

All values are in US Dollars.

The following table shows the movement in the lease liability related to corporate office space lease agreement for the year ended December 31, 2019:

	December 31, 2019

Balance, beginning of year	-
Recognition of office space lease agreement entered into during the year	624
Lease payments made during the year	(39
Interest expense	12
Total lease liability	597
Less: current lease liability	(83
Total non-current lease liability	514

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

10. Share capital

(a) Authorized:

Unlimited common shares without par value or restrictions; and

Unlimited preferred shares without par value or restrictions.

(b) Issued and outstanding common shares

	Number of shares		Amount

Balance, December 31, 2017	203,449,957		561,441
Issued pursuant to private placement, net of share issuance
cost (note 10(c))	22,354,657		17,412
Balance, December 31, 2018	225,804,614		578,853
Issued pursuant to exercise of share-based options (note 11(a))	403,116		490
Shares repurchased and cancelled under normal course issuer
bid (note 10(d))	(1,108,920	)	(958
Balance, December 31, 2019	225,098,810		578,385

All values are in US Dollars.

On April 4, 2018, in connection with the JV Transaction (note 1), Gold Fields acquired a 9.9% interest in the Company through a private placement. The Company issued 22,354,657 common shares of Asanko at a price of approximately $0.79 (C$1.01) per share for gross proceeds of $17.6 million. Concurrent with the completion of the private placement, the Company entered into an investor rights agreement with Gold Fields which provides certain rights to Gold Fields to participate in future Asanko share issuances in order to maintain its 9.9% shareholding for a period of up to five years.

(d) Normal course issuer bid

On November 12, 2019, the Company received approval from the Toronto Stock Exchange (“TSX”) to commence a normal course issuer bid (“NCIB”) on November 15, 2019 to purchase up to 11,310,386 common shares, representing 5% of the Company’s issued and outstanding common shares on the date thereof. Purchases pursuant to the NCIB will be made on the open market through the facilities of the TSX and NYSE American Stock Exchange (“NYSE American”).

All common shares purchased by the Company under the NCIB will be purchased at the market price at the time of acquisition in accordance with the rules and policies of the TSX and NYSE American and applicable securities laws. All common shares acquired by the Company under the NCIB will be cancelled and purchases will be funded out of the Company’ working capital. Although the Company has a present intention to acquire its common shares pursuant to the NCIB, the Company will not be obligated to make any purchases and purchases may be suspended by the Company at any time. The NCIB will terminate on November 14, 2020, or earlier if the maximum number of shares under the NCIB have been purchased. The Company reserves the right to terminate the NCIB earlier if it feels it is appropriate to do so.

In accordance with the rules of the TSX, the maximum daily purchases on the TSX under the NCIB will be 33,499 common shares, which is 25% of the average daily trading volume for the Company's common shares on the TSX for the six months ended October 31, 2019. In addition, maximum daily purchases under the NCIB on the NYSE American will be subject to Rule 10b-18 which specifies that daily purchases may not exceed 25% of average daily trading volume for the four weeks preceding such trading

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

10. Share capital (continued)

date. These maximum daily limits will apply to purchases on the respective markets, except where such purchases are made in accordance with "block purchases" exemptions under applicable TSX and NYSE American policies.

During the year ended December 31, 2019, the Company repurchased for cancellation a total of 1,108,920 common shares under the NCIB program for $1.0 million (average acquisition price of $0.86 per share).

11. Equity reserves

(a) Share-based options

The Company maintains a rolling share-based option plan providing for the issuance of share-based options for up to 9% of the Company’s issued and outstanding common shares. The Company may grant options from time to time to its directors, officers, employees and other service providers. On May 22, 2017, the Company amended its share-based option plan. All options granted prior to this date vest 25% on the date of grant and 12.5% every three months thereafter for a total vesting period of 18 months. Any options granted subsequent to May 22, 2017 vest 33% every twelve months following the grant date for a total vesting period of three years.

During the year ended December 31, 2019, the Company granted 3,803,700 stock options, with a weighted average exercise price of C$0.99 per option, to directors, officers and employees of the Company. Additionally, during the year ended December 31, 2019, 403,116 stock options were exercised by directors, officers and/or employees of the Company for total aggregate proceeds of $0.3 million (year ended December 31, 2018 – nil).

During the year ended December 31, 2019, the Company recognized share-based payments expense relating to stock options of $1.0 million (December 31, 2018 – $0.9 million share-based payment expense of which $32 was capitalized to mineral properties).

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

11. Equity reserves (continued)

The following table is a reconciliation of the movement in share-based options for the year:

			Weighted average
	Number of Options		exercise price
			C$
Balance, December 31, 2017	12,578,625		2.52
Granted	2,739,802		1.08
Cancelled/Expired	(1,836,000	)	2.48
Balance, December 31, 2018	13,482,427		2.22
Granted	3,803,700		0.99
Exercised	(403,116	)	1.09
Cancelled/Expired	(4,314,649	)	2.07
Balance, December 31, 2019	12,568,362		1.93

The fair value of the share-based options granted is determined using the Black Scholes pricing model. For all grants during the year ended December 31, 2019, the weighted average expected life, dividend yield and forfeiture rate were 3.79 years, nil and 3.10%, respectively. For all grants during fiscal 2018, the assumed life, dividend yield and forfeiture rate were 3.62 years, nil and 2.56%, respectively.

Other conditions and assumptions were as follows:

				Weighted
		Weighted	Weighted	average Black-
	Number of	average	average	Scholes value
	options	exercise price	volatility	assigned
Period	granted	C		C$
Year ended December 31, 2018	2,739,802	1.08	68.81%	0.51
Year ended December 31, 2019	3,803,700	0.99	66.93%	0.50

All values are in US Dollars.

The following table summarizes the share-based options outstanding and exercisable at December 31, 2019:

	Total options outstanding
		Weighted	Weighted	Weighted	Weighted
Range of exercise price	Number	average	average	average	average
		contractual life	exercise	contractual life	exercise
		(years)	price C	(years)	price C$
C$0.00-C$1.00	3,355,000	4.15	0.97	-	-
C$1.01-C$2.00	4,321,737	2.40	1.43	1.64	1.71
C$2.01-C$3.00	2,454,625	0.17	2.09	0.17	2.09
C$3.01-C$4.00	2,267,000	2.16	3.97	2.16	3.97
C$4.01-C$5.00	170,000	1.57	4.38	1.57	4.38
	12,568,362	2.38	1.93	1.30	2.61

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

11. Equity reserves (continued)

(b) Restricted Share Units (“RSU”)

The Company has an approved Restricted and Performance Share Unit Cash Plan (the “RSU Plan”). Under the RSU Plan, the Company may grant share units from time to time to its directors, officers and employees. RSUs are awards for service which upon vesting and settlement entitle the recipient to receive a cash payment equal to the fair market value of a common share at the vesting date. The Board shall, at its sole discretion, determine any and all vesting conditions of granted RSUs.

During the year ended December 31, 2019, the Company granted 2,024,553 RSUs to directors, officers and employees of the Company. For all RSUs granted during the year, the awards vest in three equal tranches over a service period of three years. For all RSUs granted during the year ended December 31, 2019, the estimated forfeiture rate was 2.56% (December 31, 2018 – 2.56%).

The following table is a reconciliation of the movement in RSUs for the years presented:

	Number of RSUs
	December 31, 2019		December 31, 2018
Balance, beginning of year	1,455,180		-
Granted	2,024,553		2,393,247
Derecognized on closing of JV Transaction	-		(918,457	)
Settled in cash	(481,622	)	-
Cancelled/Expired	(754,856	)	(19,610	)
Balance, end of year	2,243,255		1,455,180

The RSUs granted are cash-settled awards and, therefore, represent a financial liability which is required to be marked-to-market at each reporting period-end with changes in fair value recognized in the Statement of Operations and Comprehensive Income (Loss). For the year ended December 31, 2019, the Company recognized share-based compensation expense in relation to RSUs of $0.8 million (year ended December 31, 2018 – $0.8 million, with $14 capitalized to mineral properties, plant and equipment).

As at December 31, 2019, the Company recognized a financial liability for cash-settled RSUs of $1.0 million (December 31, 2018 - $0.5 million). The financial liability associated with the cash-settled awards is recorded in accounts payable and accrued liabilities, for amounts expected to be settled within one year, and a separate non-current liability for amounts to be settled in excess of one year. The following table is a reconciliation of the movement in the RSU liability for the years presented:

	December 31, 2019	December 31, 2018

Balance, beginning of year	541	-
Awards vested during the year, net of cancelled/expired awards	819	605
Settled in cash during the year	(359	-
Derecognized on closing of the JV Transaction	-	(64
Total RSU liability, end year	1,001	541
Less: current portion of RSU liability	(585	(241
Total non-current RSU liability, end of year	416	300

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

12. Commitments and contingencies

Commitments

As at December 31, 2019, the Company had contractual obligations totaling $3.4 million (December 31, 2018 - $4.0 million).

The following table reflects the Company’s contractual obligations as they fall due, excluding commitments and liabilities of the JV, as at December 31, 2019:

	Within		Over	At December 31,	At December 31,
	1 year	2 - 5 years	5 years	2019	2018
Accounts payable and accrued liabilities	1,649	-	-	1,649	3,232
Long-term incentive plan (cas h-settled awards)	585	416	-	1,001	541
Corporate office leases	214	518	91	823	202
Total	2,448	934	91	3,473	3,975

In addition to the above commitments, the Company has provided various parent company guarantees related to the unfunded portion of the AGM’s reclamation bond in the amount of $6.8 million.

Contingencies

Due to the nature of its business, the Company may be subject to regulatory investigations, claims, lawsuits and other proceedings in the ordinary course of its business. While the Company cannot reasonably predict the ultimate outcome of these actions, and inherent uncertainties exist in predicting such outcomes, the Company believes that the ultimate resolution of these actions is not reasonably likely to have a material adverse effect on the Company’s financial condition or future results of operations.

13. Revenue

The Company sold all gold produced from January 1, 2018 to July 31, 2018, the period during which the Company controlled the AGM, under an Offtake Agreement with Red Kite (refer to note 8(i) for further details on revenue earned by the AGM for the twelve months ended December 31, 2019 and 2018). During this period, the Company sold 125,687 ounces of gold.

During the period January 1, 2018 to July 31, 2018, revenue included $0.5 million relating to by-product silver sales.

The following table provides information about receivables from contracts with customers at January 1, 2018 and December 31, 2018:

	December 31, 2018

Balance, beginning of year	1,249
Revenue recognized	161,918
Payments collected	(156,880
Derecognized on closing of JV Transaction	(6,287
Balance, end of year	-

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

14. Production costs by nature

The following is a summary of production costs incurred by the Company during the periods that it controlled the AGM, being the seven months ended July 31, 2018. The table below therefore includes the results for the AGM from January 1, 2018 to July 31, 2018, but does not include the results of the AGM from August 1, 2018 to December 31, 2018.

	Year ended December 31,
	2019	2018
	$
Raw materials and consumables	-	(30,401
Salary and employee benefits	-	(12,782
Contractors (net of deferred stripping costs)	-	(47,929
Change in stockpile, gold-in-process and gold dore inventories	-	15,934
Insurance, government fees, permits and other	-	(3,473
Share-based payments	-	(357
Total production costs	-	(79,008

All values are in US Dollars.

All of the Company’s concessions are subject to a 5% gross revenue royalty payable to the Government of Ghana. Royalty expense is presented as a separate component of cost of sales.

15. General and administrative expenses

The following is a summary of general and administrative expenses incurred by the Company during the years ended December 31, 2019 and 2018. Note that the table below includes the results for the AGM from January 1, 2018 to July 31, 2018, being the period during which the Company controlled the AGM, but does not include the results of the AGM from August 1, 2018 to December 31, 2018.

	Year ended December 31,
	2019	2018

Wages, benefits and consulting	(7,723	(6,533
Office, rent and administration	(800	(1,527
Professional and legal	(452	(1,308
Share-based payments	(1,789	(1,258
Travel, marketing, investor relations and regulatory	(966	(987
Other	(98	(47
Total	(11,828	(11,660

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

16. Joint venture transaction

On July 31, 2018, the Company completed the JV Transaction to sell 50% of Asanko’s 90% interest in the AGM and associated properties (see note 1). In conjunction with closing of the JV Transaction, the Company contributed its intercompany loans receivable from AGGL and Adansi Ghana ($454.4 million) to JV Finco. Of the Company’s contribution, $204.9 million was capitalized into redeemable preference shares in JV Finco, with the balance being converted to equity in JV Finco. Additionally, the Company contributed another $5.0 million of cash as part of its equity investment in JV Finco, bringing its total equity investment in JV Finco to $254.5 million.

Upon closing of the JV Transaction, the Company derecognized the carrying amounts of the net assets of AGGL and Adansi Ghana, as well as the carrying amount of previously recognized non-controlling interests in AGGL, and recognized the fair value of the Company’s interest in the JV (see notes 1 and 7).

An after-tax loss of $143.3 million was recognized associated with the loss of control of the Company’s former Ghanaian subsidiaries and was determined as at July 31, 2018 as follows:

	July 31, 2018

Fair value of interest retained
Fair value of financial assets (note 7)	168,081
Fair value of equity interest in JV	127,314
	295,395
Less net assets derecognized
Cash and cash equivalents	24,368
Receivables	6,356
Inventories	63,460
Prepaid expenses and deposits	3,274
VAT receivable	9,672
Reclamation deposit	1,851
Exploration and evaluation as sets	13,085
Mineral properties, plant and equipment	602,989
Accounts payable and accrued liabilities	(47,269
Financial liabilities	(165,000
Long-term incentive plan liability	(64
Asset retirement provisions	(31,217
Deferred income tax liability	(53,211
Non-controlling interest	(899
	427,395
	(132,000
Accelerated accretion on long-term debt (note 16)	(6,226
Transaction costs directly related to JV Transaction	(5,035
Loss associated with loss of control of former Ghanaian subsidiaries	143,261

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

16. Joint venture transaction (continued)

The loss associated with the loss of control was allocated to the following assets and liabilities of the disposal group as at the date of the closing of the JV Transaction:

	December 31, 2018

Mineral properties, plant and equipment	(185,211
Deferred income tax liability	53,211
	(132,000
Accelerated accretion on long-term debt	(6,226
Transaction costs directly related to JV Transaction	(5,035
Loss associated with loss of control of former Ghanaian subsidiaries	(143,261

All values are in US Dollars.

17. Finance income

The following is a summary of finance income incurred by the Company during the years ended December 31, 2019 and 2018. Specifically, the table below includes the results for the AGM from January 1, 2018 to July 31, 2018, being the period during which the Company controlled the AGM, but does not include the results of the AGM from August 1, 2018 to December 31, 2018

	Year ended December 31,
	2019	2018
	$	$
Fair value adjustment on redeemable preference shares (note 7(a))	-	4,801
Accretion income on redeemable preference shares (note 7(b))	516	253
Interest income and other	355	501
Total finance income	871	5,555

18. Finance expense

The following is a summary of finance expenses incurred by the Company during the years ended December 31, 2019 and 2018. Specifically, the table below includes the results for the AGM from January 1, 2018 to July 31, 2018, being the period during which the Company controlled the AGM, but does not include the results of the AGM from August 1, 2018 to December 31, 2018.

	Year ended December 31,
	2019	2018

Fair value adjustment on redeemable preference shares (note 7(a))	(35,626	-
Interest on lease liability (note 9)	(12	-
Interest charges on Red Kite loan and associated withholding taxes	-	(9,987
Accretion charges on asset retirement provisions	-	(429
Other	(12	(321
Total finance expense	(35,650	(10,737

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

19. Income tax

a) Tax expense

Income tax expense differs from the amount that would result from applying the Canadian federal and provincial income tax rates to earnings from continuing operations before taxes. These differences result from the following items:

	Year ended December 31,
	2019	2018

Average statutory tax rate	27%	27%
Income (loss) before income taxes	(167,928	(128,704
Expected income tax expense (recovery)	(45,341	(34,750
Increase in income tax expense (recovery) resulting from:
Permanent differences
Share of net loss related to joint venture	34,091	283
Fair value adjustment and accretion on redeemable preferences shares	9,480	(1,365
Share-based payments	483	310
Withholding taxes	292	(450
Other	(46	614
Loss associated with loss of control	-	47,312
Effect of differences in tax rate in foreign jurisdictions	8	(7,164
Change in unrecognized tax assets	1,033	6,676
Withholding tax	-	1,079
Foreign exchange and other	-	(36
Income tax expense	-	12,509

All values are in US Dollars.

b) Deferred tax liabilities and assets

The significant components of the Company’s deferred tax assets and liabilities were as follows:

	Year ended December 31,
	2019	2018
		$
Lease liability	159	-
Right-of-use asset	(159	-
Total	-	-

All values are in US Dollars.

As at December 31, 2019, the Company has tax losses of $55.6 million (December 31, 2018 – $47.4 million) in Canada which expire between 2026 and 2039.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

19. Income tax (continued)

Deductible temporary differences and unused tax losses for which no deferred tax assets have been recognized are attributable to the following:

	Year ended December 31,
	2019	2018
	$	$
Property, plant and equipment	66	50
Share issuance costs	26	146
Investment in associate	275	275
Accounts payable and accrued liabilities	4	-
Lease liability	2	-
Capital losses	2,476	2,476
Non-capital losses carried forward	15,035	12,689
Foreign tax credits	724	-
Total	18,608	15,636

The aggregate amount of deductible temporary differences associated with investments in subsidiaries for which deferred taxes have not been recognized as at December 31, 2019 was $175.1 million (December 31, 2018 – deductible temporary differences of $13.7 million).

20. Earnings (loss) per share attributable to common shareholders

For the years ended December 31, 2019 and 2018, the calculation of basic and diluted earnings per share is based on the following data:


		2018
Earnings ()
Net income (loss) attributable to common	)	(141,372	)
Number of shares
Weighted average number of ordinary shares - basic		220,108,770
Effect of dilutive share options and warrants		-
Weighted average number of ordinary shares - diluted		220,108,770

All values are in US Dollars.

For the years ended December 31, 2019 and 2018, the effect of all potentially dilutive securities was anti-dilutive, given that the Company reported a net loss for both years.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

21. Supplemental cash flow information

The following table discloses non-cash transactions impacting the Statements of Cash Flows. Note that the table below includes the results for the AGM from January 1, 2018 to July 31, 2018, being the period during which the Company controlled the AGM, but does not include the results of the AGM from August 1, 2018 to December 31, 2018.

	December 31,	December 31,
	2019	2018
	$
Capitalized office lease under IFRS 16	624	-
Change in asset retirement provisions included in mineral properties, plant and equipment	-	(2
Change in accounts payable related to mineral properties, plant and equipment	-	3,028
Share-based compensation included in mineral properties, plant and equipment	-	46

All values are in US Dollars.

Changes in non-cash working capital consist of the following:

	Year ended December 31,
	2019	2018

Receivables	(1,864	(6,879
VAT receivable	-	(4,132
Prepaid expenses	(176	28
Inventories	-	(17,691
Accounts payable and accrued liabilities	(1,720	(1,195
Change in non-cash working capital	(3,760	(29,869

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

22. Segmented information

Geographic Information

As at December 31, 2019, the Company has only one reportable operating segment being the corporate function with its head office in Canada. However, prior to the JV Transaction, the Company had two reportable segments. Ghana was the Company’s only segment with mining operations with Canada acting as a head office function.

Total assets in Ghana include the Company's 45% interest in the Asanko Gold Mine JV. The operating results presented below include the results of the AGM up to July 31, 2018, the date on which the Company ceased to control the AGM.

Geographic allocation of total assets and liabilities

December 31, 2019	Canada	Ghana	Total
	$	$	$
Current assets	35,800	-	35,800
Property, plant and equipment and right-of-use assets	679	-	679
Other non-current assets	-	108,025	108,025
Total assets	36,479	108,025	144,504
Current liabilities	2,317	-	2,317
Non-current liabilities	930	-	930
Total liabilities	3,247	-	3,247
December 31, 2018	Canada	Ghana	Total
	$	$	$
Current assets	13,102	-	13,102
Mineral properties, plant and equipment	114	-	114
Other non-current assets	-	299,399	299,399
Total assets	13,216	299,399	312,615
Current liabilities	3,473	-	3,473
Non-current liabilities	300	-	300
Total liabilities	3,773	-	3,773
ASANKO GOLD INC.
---
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

22. Segmented information (continued)

Geographic allocation of the Statement of Operations and Comprehensive Income (loss)

December 31, 2019	Canada	Ghana	Total
		$
Revenue	-	-	-
Cost of sales
Production costs	-	-	-
Depreciation and depletion	-	-	-
Royalties	-	-	-
Total cost of sales	-	-	-
Income from mine operations	-	-	-
Share of net loss related to joint venture	(126,264	-	(126,264
Service fee earned as operators of joint venture	4,963	-	4,963
General and administrative expenses	(11,828	-	(11,828
Loss from operations and joint venture	(133,129	-	(133,129
Finance income	871	-	871
Finance expense	(35,650	-	(35,650
Foreign exchange loss	(20	-	(20
Loss before income taxes	(167,928	-	(167,928
Current income tax expense	-	-	-
Deferred income tax expense	-	-	-
Net loss and comprehensive loss for the year	(167,928	-	(167,928

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

22. Segmented information (continued)

December 31, 2018	Canada	Ghana	Total

Revenue	-	161,918	161,918
Cost of sales
Production costs	-	(79,008	(79,008
Depreciation and depletion	-	(41,944	(41,944
Royalties	-	(8,096	(8,096
Total cost of sales	-	(129,048	(129,048
Income from mine operations	-	32,870	32,870
Share of net loss related to joint venture	(1,050	-	(1,050
Service fee earned as operators of joint venture	1,892	-	1,892
Exploration and evaluation expenditures	-	(2,333	(2,333
General and administrative expenses	(7,094	(4,566	(11,660
Income (loss) from operations	(6,252	25,971	19,719
Loss due to loss of control of subsidiaries	(16,364	(126,897	(143,261
Finance income	5,457	98	5,555
Finance expense	(334	(10,403	(10,737
Foreign exchange loss	(115	135	20
Loss before income taxes	(17,608	(111,096	(128,704
Current income tax expense	(1,060	(19	(1,079
Deferred income tax expense	-	(11,430	(11,430
Net loss and comprehensive loss for the year	(18,668	(122,545	(141,213

All values are in US Dollars.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

23. Capital management

The Company’s objectives in managing capital are to ensure that the Company has the financial capacity to support its operations with sufficient capability to manage unforeseen operational or industry developments, ensure the Company has the capital and capacity to support the long-term growth strategies of the JV, and to provide returns for shareholders and benefits for other stakeholders. The Company defines capital that it manages as total shareholders’ equity, being a total of $141.3 million as at December 31, 2019 (December 31, 2018 – $308.8 million).

The Company is not subject to externally imposed capital requirements or covenants.

The Company manages its capital structure and makes adjustments to it in light of general economic conditions, the risk characteristics of the underlying assets and the Company’s working capital requirements associated with ongoing operations and corporate development plans. The Company does not currently pay out dividends, however an NCIB program was initiated in November 2019 (see note 10(d)). The Board of Directors reviews and approves any material transactions out of the ordinary course of business, including proposals on acquisitions or other major investments or divestitures, as well as capital and operating budgets. The Company’s investment policy is to invest its cash in highly liquid short-term interest-bearing investments with maturities of 90 days or less from the original date of acquisition.

The Company has not made any changes to its policies and processes for managing capital during the year.

24. Financial instruments

As at December 31, 2019, the Company’s financial instruments consist of cash and cash equivalents, receivable due from related party, preferred shares in the JV, accounts payable and accrued liabilities and long-term incentive plan liability. The Company classifies cash and cash equivalents and the related party receivable as financial assets measured at amortized cost, while accounts payable and accrued liabilities are classified as other financial liabilities and measured at amortized cost. The long-term incentive plan liability is a financial liability measured at fair value through profit or loss and falls within Level 3 of the fair value hierarchy as discussed below.

Refer to note 7 for the classification and measurement of the preferred share financial assets. The fair value hierarchy comprises:

Level 1 – fair values based on unadjusted quoted prices in active markets for identical assets or liabilities;

Level 2 – fair values based on inputs that are observable for the asset or liability, either directly or indirectly; and

Level 3 – fair values based on inputs for the asset or liability that are not based on observable market data.

The Company’s policy for determining when a transfer occurs between levels in the fair value hierarchy is to assess the impact at the date of the event or the change in circumstances that could result in a transfer. There were no transfers between the levels during 2019 or 2018.

The fair values of all financial assets and liabilities measured at amortized cost approximate their carrying values given their short-term to maturity.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

24. Financial instruments (continued)

The risk exposure arising from these financial instruments is summarized as follows:

(a) Credit risk

Credit risk is the risk of an unexpected loss if a customer or the issuer of a financial instrument fails to meet its contractual obligations. The Company is subject to credit risk on the cash and cash equivalent balances held at banks in each of Canada and South Africa. The risk of loss associated with cash investments is considered to be low as the Company’s cash and cash equivalents were held in highly-rated Canadian and South African banking institutions. As at December 31, 2019, the Company had a receivable due from the JV of $4.2 million (December 31, 2018 – $2.3), interest receivable of $0.1 million (December 31, 2018 – $0.1 million) and a loan receivable from a third party in the amount of $0.3 million, the latter of which has been fully provided against (December 31, 2018 – $0.3 million which was fully provided against).

Credit risk associated with the related party receivable is considered to be low based on the liquidity of available funds of the JV. The Company expects to receive GST refunds on a regular basis from the Canada Revenue Agency and makes monthly GST filings (as required by law). The Company does not consider there to be a significant credit risk related to the GST receivable balance as at December 31, 2019.

In addition, the Company is exposed to credit risk on its preferred share investments in the JV (note 7). With respect to the 174.9 million preference shares, credit risk is mitigated by monitoring the financial condition of the JV on a regular basis. The Company’s maximum exposure to credit risk in relation to the preferred shares at the reporting date is the carrying value of the financial asset totaling $108.0 million.

(b) Liquidity risk

Liquidity risk encompasses the risk that the Company cannot meet its financial obligations as they fall due. The Company manages liquidity risk through a rigorous planning and budgeting process, which is reviewed and updated on a regular basis, to help determine the funding requirements to support current operations, expansion and development plans, and by managing the Company’s capital structure (note 23). By managing liquidity risk, the Company aims to ensure that it will have sufficient liquidity to settle obligations and liabilities as they fall due. Subsequent to the JV Transaction, the Company has no current direct sources of revenue and any free cash flows generated by AGM are no longer within the Company’s exclusive control as the disposition of cash from the JV is governed by the JVA (note 1). However, through a combination of the Company’s cash balance, cash flows from its investment in the JV, and the ongoing management fee receipts from the JV, the Company believes it is in a position to meet all working capital requirements, contractual obligations and commitments as they fall due. The Company’s cash flows, however, and its ability to meet working capital requirements and contractual obligations are significantly influenced by the price of gold and the performance of the AGM. The Company aims to manage its liquidity by ensuring that, even in a low gold price environment, it can manage spending and provide adequate cash flow to meet all commitments.

As at December 31, 2019, the Company had a cash and cash equivalents balance of $31.1 million (December 31, 2018 – $10.4 million) allowing it to settle current accounts payable and accrued liabilities of $2.2 million (December 31, 2018 – $3.5 million) as they become due.

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

24. Financial instruments (continued)

(i) 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. As disclosed in note 7, the Company holds preferred shares in the JV which are carried at fair value through profit or loss with fair value determined by reference to a discounted cash flow model. Changes in interest rates would impact the discount rate applied to forecast future cash flows and accordingly the fair value of the preferred shares; however, changes in interest rates would not impact the amount or timing of forecast future cash flows.

With other variables, unchanged, a 1% decrease (increase) in the annualized interest rate would have resulted in a $3.9 million increase and $3.6 million decrease, respectively, to the after-tax net loss for year ended December 31, 2019 (year ended December 31, 2018 – $4.2 million).

The Company’s cash and cash equivalents earn interest income at variable rates and accordingly future interest income is subject to fluctuations in short-term interest rates. A +/-1% change in short-term interest rates would not have a material impact on the Company’s interest income for the year ended December 31, 2019.

(ii) Foreign currency risk

As at December 31, 2019 and 2018, the Company’s exposure to foreign currency risk was limited to the following balances:

December 31, 2019
	Foreign currency amount			Equivalent
	C	ZAR
Cash and cash equivalents	195	2,588		330
Receivables	31	34		26
Accounts payable and accrued liabilities	(1,511	(826	)	(1,209
RSU liability	(1,315	-		(1,001
Lease liability	(784	-		(597
Net exposure to foreign currency	(3,384	1,796		(2,451

All values are in US Dollars.

December 31, 2018
	Foreign currency amount				Equivalent
	C	ZAR
Cash and cash equivalents	162	2,556		-	311
Receivables	318	-		-	233
Accounts payable and accrued liabilities	(797	(163	)	(42	(668
Net exposure to foreign currency	(317	2,393		(42	(124

All values are in US Dollars.

A +/-10% change in the prevailing exchange rates as at December 31, 2019, with all other variables held constant, would have resulted in a $0.2 million decrease (increase) to the after-tax net loss for the year ended December 31, 2019 (year ended December 31, 2018 – immaterial).

ASANKO GOLD INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018<br><br> <br>(In thousands of United States Dollars, unless otherwise noted)

24. Financial instruments (continued)

(iii) Price risk

Price risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market prices, other than those arising from currency risk or interest rate risk. Future cash flows from the JV are expected to be received as redemption of the Company’s preference shares in the JV (note 7). The JV’s available cash flows (to redeem the preference shares issued to the Company) are expected to fluctuate due to changes in gold prices. During the year, the JV entered into a hedging program to manage the AGM’s exposure to gold price risk. As at December 31, 2019, there were no active gold hedges in place by the JV.

A 10% increase or decrease in the gold price assumptions as at December 31, 2019, with all other variables held constant, would have resulted in a $41.2 million increase (decrease) to the fair value of the Company’s preference shares in the JV (note 7), which would impact the Company’s after-tax net income (loss) by the same amount (December 31, 2018 – $0.2 million).

25. Related party transactions

In addition to the service fee earned as operator of the JV (note 6), the Company’s related party transactions included compensation paid to key management personnel, which were as follows:

	Year ended December 31,
	2019	2018
	$	$
Salaries and benefits	3,251	2,373
Share-based payments	466	312
Total compensation	3,717	2,685

Key management personnel consist of directors and officers of the Company.

26. Subsequent event

On February 11, 2020, the Company received a $15.0 million distribution from the JV, bringing the Company’s holding to 159.9 million preference shares in the JV.

Asanko Gold Inc.: Exhibit 99.2 - Filed by newsfilecorp.com

MANAGEMENT’S DISCUSSION AND ANALYSIS

For the years ended December 31, 2019 and 2018

(Expressed in United States dollars)

TABLE OF CONTENTS
1.	Overview of the business	2-3
2.	Highlights and key business developments	4-6
3.	Results of the AGM	7-16
4.	Financial results of the Company	17-19
5.	Selected quarterly financial data	20
6.	Outlook	21
7.	Liquidity and capital resources	21-24
8.	Non-GAAP measures	25-30
9.	Summary of outstanding share data	30
10.	Related party transactions	30
11.	Critical accounting policies and estimates	30-31
12.	Risks and uncertainties	31-32
13.	Internal control	32-33
14.	Qualified person	33
15.	Cautionary statements	33-36
ASANKO GOLD INC.
---
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

This Management’s Discussion and Analysis (“MD&A”) of Asanko Gold Inc. (“Asanko” or the “Company”) has been prepared by management as of February 11, 2020 and should be read in conjunction with the Company’s consolidated annual financial statements for the years ended December 31, 2019 and 2018 and the notes related thereto.

Additional information on the Company, including its most recent Annual Information Form (“AIF”) is available under the Company’s profile at www.sedar.com and the Company’s website: www.asanko.com.

Unless otherwise specified, all financial information has been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board. All dollar amounts herein are expressed in United States dollars (“US dollars”) unless stated otherwise. References to $ means US dollars and C$ are to Canadian dollars.

This MD&A contains forward-looking statements and should be read in conjunction with the risk factors described in sections “12. Risks and uncertainties” and “15. Cautionary statements” at the end of this MD&A.

1. Overview of the business

Following the conclusion of the Gold Fields Transaction (see “Gold Fields Transaction”) on July 31, 2018, Asanko holds a 45% economic interest in the Asanko Gold Mine (the “AGM”) and gold exploration tenements (collectively the “joint venture” or “JV”) on both the Asankrangwa and Sefwi Gold Belts in the Republic of Ghana (“Ghana”), West Africa. Asanko are the operators of the joint venture and receive an annual service fee from the JV.

Asanko’s vision is to build a mid-tier gold mining company through a combination of organic growth, exploration, accretive M&A activities and the disciplined deployment of its financial resources. The Company’s shares are listed on the Toronto Stock Exchange (“TSX”) and the NYSE American (“NYSE”) under the symbol “AKG”.

The AGM is a multi-deposit complex, with two main deposits, Nkran and Esaase, eight satellite deposits and a carbon-in-leach (“CIL”) processing plant, with a current design capacity of five million tonnes per annum (“Mtpa”).

Asanko has prepared an updated Life of Mine plan for the AGM (the “AGM LOM plan”) which focuses on the high level development for the AGM previously announced (see “Updated Life of Mine Plan and Associated Impairment Loss”). The Company has completed its work associated with the AGM LOM plan; however, the AGM LOM plan is still being reviewed by the JV management committee. The Company expects to update its technical disclosures in Q1 2020, based on its work on the AGM LOM plan.

Gold Fields Transaction

On July 31, 2018, the Company completed a transaction with a subsidiary of Gold Fields Limited (“Gold Fields”), under which Gold Fields obtained a 50% interest in the JV (45% interest in the AGM), in exchange for a $185.0 million contribution by Gold Fields to the JV (the “JV Transaction”). Of this contribution amount, $165.0 million was paid upon closing of the transaction, $10.0 million was received on August 29, 2019, and a further $10.0 million was received by the Company on December 19, 2019. In addition to Gold Fields’ contribution to the JV, Gold Fields also subscribed for 22,354,657 common shares of the Company for gross proceeds of $17.6 million.

Concurrent with the closing of the JV Transaction, the Company settled the amount of $163.8 million which was payable at the time under a Definitive Senior Facilities Agreement, including all outstanding debt principal and accrued interest. As a result, the Company emerged from the JV Transaction debt-free. The Company recognized the fair value of the consideration received from Gold Fields, as well as the fair value of the investment that the Company retained in the JV and recognized a $143.3 million loss associated with the loss of control of its former Ghanaian subsidiaries Asanko Gold Ghana Limited (“AGGL”) and Adansi Gold Company Ghana Limited (“Adansi Ghana”). The Company’s 2018 AIF contains further details regarding the rights and obligations of the participants to the JV.

Updated Life of Mine Plan and Associated Impairment Loss

During the year ended December 31, 2019, the Company and its JV partners announced that the scope of the ongoing work associated with the AGM LOM plan would:

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

• target a remaining mine life of 8-10 years with gold production of 225,000 to 250,000 ounces per year;

• contemplate resources based on Localized Uniform Conditioning methodology;

• be based on NI43-101 standards and consistent with Gold Field’s operating practices;

• be based on Measured and Indicated Mineral Resources using Datamine Mine Stope Optimization software;

• not include any major development capital investments such as further processing plant expansions or Esaase ore transportation infrastructure; and

• be based on metallurgical recovery estimates for Esaase fresh ore based on an updated metallurgical model, which would in turn be based on a test-work program currently underway.

The Company previously prepared its Amended and Restated Definitive Feasibility Study related to the AGM on June 5, 2017 (and amended and restated on December 20, 2017, the “12/17 DFS”). The 12/17 DFS has been filed on SEDAR, www.sedar.com, and is available on the Company’s website at www.asanko.com. The 12/17 DFS previously estimated the AGM’s remaining life of mine to be between 14 and 21 years (ending 2030 - 2037) with gold production ranging from 108,000 ounces to 497,000 ounces. Refer to the 12/17 DFS for further detail regarding the mineral reserve estimate.

Therefore, given that the target mine life and production is expected to result in the extraction of materially less than the total previously estimated reserves and resources of the AGM, the Company considered this to represent an indicator of possible impairment. Accordingly, the Company was required to assess the recoverable amount of the AGM, which was based on management’s estimate of the fair value less cost of disposal of the AGM. The fair value less cost of disposal of the AGM (on a 100% basis) was estimated to be $211.8 million and included life of mine cash flow projections, on the basis of the updated scope.

At December 31, 2019, the carrying value of the AGM’s single cash generating unit was $289.6 million greater than its recoverable amount. Based on this assessment, a $289.6 million impairment was recorded against the non-current assets of the AGM during the year ended December 31, 2019, of which the Company recognized its interest of $130.3 million (or 45% of $289.6 million) as part of the Company’s share of the net loss related to joint venture.

The full narrative and technical report, reflecting the results of the AGM LOM plan, is expected to be published in Q1 2020 on SEDAR at www.sedar.com.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

2. Highlights and key business developments

Q4 2019 and full year (“FY”) 2019 business developments include the following operating and financial results of the AGM on a 100% basis (unless otherwise stated).

FY 2019 Operating highlights of the AGM (on a 100% basis)

• Record annual gold production of 251,044 ounces during the year ended December 31, 2019, exceeding the upper end of 2019 production guidance of 225,000-245,000 ounces.

• Ore mined during 2019 totaled 5.07 million tonnes (“Mt”) at an average grade of 1.5 g/t and a total strip ratio of 5.1:1.

• The processing plant delivered a record annual milling performance with throughput of 5.50Mt, at an average plant feed grade of 1.5 g/t.

• Gold recovery of 94% continuing to exceed design.

• The AGM generated $120.4 million of cash flows from operating activities (after taking into account favorable working capital changes of $10.6 million) and free cash flow^1^of $44.0 million during 2019.

• For the year ended December 31, 2019, AISC was $1,112/oz, exceeding the upper-end of guidance of $1,040 - $1,060/oz by approximately 5%. This was due to reliance on the processing of lower grade ore from stockpiles and the Esaase pits, following an upper bench slippage in the western wall of the Nkran pit during Q4 2019.

• There was one lost-time injury (“LTI”) and total recordable injury (“TRI”) reported during the year. The AGM maintained LTI and TRI frequency rates of 0.16 per million employee hours worked for FY 2019.

Q4 2019 Operating highlights of the AGM (on a 100% basis)

• There was one LTI and TRI reported during the quarter.

• Record quarterly gold production of 66,112 ounces.

• Ore mined during Q4 2019 totaled 1.41Mt, at an average mined grade of 1.6 g/t and a total strip ratio of 3.5:1. The decrease in strip ratio from Q3 2019 was due to a reduction in waste mining at Nkran as the Cut 2 pushback was concluded in early Q4 2019.

• The processing plant delivered another record quarterly milling performance with throughput of 1.46Mt, at an average plant feed grade of 1.5 g/t.

• Gold recovery of 94%.

• The AGM incurred operating cash costs per ounce^1^of $790, total cash costs per ounce^1^of $863 and all-in sustaining costs per ounce^1^(or “AISC”) of $969 in Q4 2019. The reduction in AISC from Q3 2019 was primarily due to lower waste mining at Nkran resulting from the completion of the Cut 2 pushback in Q4 2019.

• The AGM received the “Mining Company of the Year” award from the Ghana Chamber of Mines for a second year in a row.

Q4 2019 Financial highlights of the AGM (on a 100% basis)

The following financial information includes the operating and financial results of the AGM on a 100% basis (unless otherwise stated).

• Q4 2019 gold sales of 66,095 ounces generated a record $96.8 million of gold sales proceeds at an average realized gold price of $1,465 per ounce, an increase of $21.7 million from Q4 2018. Revenue for Q4 2019 amounted to $97.1 million and includes by-product sales of $0.2 million.

• Total cost of sales (including depreciation and depletion and royalties) amounted to $88.0 million in Q4 2019, an increase of $12.9 million from Q4 2018. The increase in cost of sales was primarily due to an increase in gold ounces sold and higher depreciation expense related to the depletion of Nkran deferred stripping costs and Esaase mine development costs.

^______________________________________________1^See “8. Non-GAAP measures”

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

• Income from mine operations improved to $9.1 million in Q4 2019, compared to a loss from mine operations $0.8 million in Q4 2018. The improvement in income from mine operations was due to an increase in realized gold prices from $1,215/oz to $1,465/oz and higher gold sales volumes, partly offset by higher depreciation expense as previously noted.

• The JV’s income from operations amounted to $5.4 million for the quarter, compared to a net loss from operations of $4.0 million in Q4 2018. The improvement in income from operations was due to an increase in mine operating income, partly offset by increased exploration and evaluation expenditures.

• The AGM reported Adjusted EBITDA^1^of $31.8 million in Q4 2019 compared to $17.4 million in Q4 2018. The increase in Adjusted EBITDA^1^was primarily driven by an increase in realized gold prices and higher gold sales volumes, partly offset by higher exploration and evaluation expenditures.

• The AGM generated $45.4 million of cash flows from operating activities (after taking into account favorable working capital changes of $11.6 million) and free cash flow^1^of $28.9 million during Q4 2019. This compares to $12.9 million of cash flows from operating activities and negative $8.6 million of free cash flow^1^during Q4 2018. The improvement in free cash flow was the result of a $19.1 million increase in income from operations (excluding depreciation and depletion), as well as a favorable change in non-cash working capital of $16.6 million from Q4 2018 to Q4 2019. Additionally, as a result of strategic initiatives to reduce capital expenditure, there was a $9.3 million decrease in cash flows associated with capital expenditure from Q4 2018 to Q4 2019. These factors were partly offset by $4.3 million of payments made to mining contractors for leases capitalized under IFRS 16 and $3.7 million paid to the counterparties of the gold hedging instruments.

• During Q4 2019, the JV commenced returning invested capital to the JV partners, with an initial distribution of $20.0 million.

• As at December 31, 2019, the JV had cash of $43.8 million on hand (3.0 million of which was restricted in favour of a gold hedging counterparty and released on January 3, 2020), $9.1 million in receivables from gold sales and $2.8 million in gold on hand.

Q4 2019 key consolidated financial information of the Company

The following financial information comprises the consolidated results of the Company for Q4 2019:

• On November 12, 2019, the Company received approval from the TSX to commence a normal course issuer bid (“NCIB”) on November 15, 2019 to purchase up to 11,310,386 common shares, representing 5% of the Company’s issued and outstanding common shares on the date thereof. During Q4 2019, the Company repurchased and cancelled a total of 1,108,920 common shares under the NCIB program for $1.0 million (average acquisition price of $0.86 per share).

• On December 19, 2019, the Company received the final of two $10.0 million payments from Gold Fields based on the achievement of the agreed Esaase development milestone and an additional $10.0 million distribution from the JV. These payments were recorded as redemptions of the previously recognized preference shares.

• As at December 31, 2019, the Company had cash of $31.1 million on hand and $4.3 million in receivables.

• Subsequent to year-end, on February 11, 2020, the Company received another $15.0 million distribution from the JV.

• The Company reported a net loss after tax of $21.2 million in Q4 2019 compared to a net loss of $0.9 million in Q4 2018. The increase in net loss for Q4 2019 was predominantly the result of a $20.2 downward fair value adjustment of the Company’s redeemable preference shares in order to reflect the change in the estimated amount and timing of the cash flows expected to be distributed by the JV in accordance with the change in the AGM LOM plan. These factors were partly offset by a decrease in general and administrative (“G&A”) expenses following the restructuring of the executive management team during Q3 2019.

• Adjusted net income^1^for Q4 2019 amounted to $0.9 million ($0.00 earnings per share) compared to an adjusted net loss^1^of $0.9 million ($0.00 loss per share) in Q4 2018. The improvement in adjusted net income^1^was due to the Company’s 45% interest in the net earnings of the AGM, which reported income from operations in Q4 2019 compared to a net loss from operations in Q4 2018. In addition, the Company reduced its G&A expenses in Q4 2019 by $0.8 million. These factors were partly offset by a reduction in accretion income and fair value adjustments on the Company’s preferred share investments in the JV compared to Q4 2018.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

• Adjusted EBITDA^1^for Q4 2019 amounted to $12.6 million, compared to $6.1 million in Q4 2018. The increase in Adjusted EBITDA^1^was primarily a result of the increase in the AGM’s mine operating earnings.

• Cash used in operating activities in Q4 2019 was $1.6 million, compared to cash used in operating activities of $1.9 million in Q4 2018. The decrease in cash used in operations was due to lower G&A costs partly offset by an increase in working capital investments.

Board Changes

On October 24, 2019, the Company announced that Ms. Judith Mosely will join the Company’s Board effective January 1, 2020.

On January 2, 2020, the Company announced the resignation of Mr. William Smart from its Board of Directors. Concurrently, the Company announced that Mr. Colin Steyn, Chair of the Board of Directors, decided that he will not seek re-election at the next Annual General Meeting which is expected to be held on or about April 30, 2020. The Company has initiated a search for an independent director to replace Mr. Steyn on the slate of directors to be nominated for election at the 2020 Annual General Meeting.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

3. Results of the AGM

All results of the AGM in this section are on a 100% basis, unless otherwise noted. The Company’s attributable economic interest in the AGM is 45%.

3.1 Operating performance

The following table and subsequent discussion provide a summary of the operating performance of the AGM (on a 100% basis) for the three months and years ended December 31, 2019 and 2018, unless otherwise noted.

	Three months ended December 31,		Year ended December 31,
	2019	2018	2019	2018
Key mine performance data of the AGM (100% basis)
Ore tonnes mined (000 t)	1,405	1,370	5,071	4,898
Waste tonnes mined (000 t)	4,956	8,370	25,719	39,244
Total tonnes mined (000 t)	6,361	9,740	30,790	44,142
Strip ratio (W:O)	3.5	6.1	5.1	8.0
Average gold grade mined (g/t)	1.6	1.5	1.5	1.4
Mining cost ($/t mined)^2^	4.86	4.13	4.52	3.62
Ore tonnes milled (000 t)	1,460	1,238	5,498	5,180
Average mill head grade (g/t)	1.5	1.6	1.5	1.5
Average recovery rate (%)	94%	95%	94%	94%
Processing cost ($/t treated)	10.83	12.39	10.91	11.16
Gold produced (ounces)	66,112	59,823	251,044	223,152
Gold sold (ounces)	66,095	61,821	248,862	227,772
Silver produced (ounces)	14,270	15,246	47,312	56,993
Silver sold (ounces)	13,858	15,367	51,273	55,768
Operating cash costs ($ per gold ounce)^1^	790	811	776	688
Total cash costs ($ per gold ounce)^1^	863	872	845	750
All -in sustaining costs ($ per gold ounce)^1^	969	1,072	1,112	1,072

^2^ For the year ended December 31, 2019, mining cost per tonne excludes a provision for a one-time contract termination

a) Health and Safety

There was one LTI reported during the quarter. The AGM’s LTI and TRI frequency rate for the twelve months ended December 2019 amounted to 0.16 per million employee hours worked.

b) Mining

During the quarter, the AGM sourced ore from the Nkran and Esaase pits, as well as run-of-mine (“ROM”) stockpiles. During the quarter, 2.62Mt of waste and 0.85Mt of ore at a gold grade of 1.9 g/t were mined from the Nkran pit. In Q4 2019, the Esaase pits collectively delivered 0.56Mt of ore at a gold grade of 1.3 g/t and a strip ratio of 4.2:1. Operations at Esaase will continue mining oxides through Q1 2020 with the goal of achieving an optimal fresh to oxide ore blend delivered to the SAG mill. During the quarter, work associated with the resettlement of the Tetrem village continued and the relocation project is expected to be handed over to the community by Q4 2020 and completed by Q1 2021.

^______________________________________________1^See “8. Non-GAAP measures”

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

Late in Q4 2019, an upper bench slippage in the western wall of the Nkran pit resulted in a higher reliance on the processing of lower-grade ore from stockpiles and the Esaase pits. Through the continuous use of slope stability radar monitoring, the event was anticipated, and the pit was vacated in advance of the slippage with no injuries or damage to equipment. Full mining operations resumed in the Nkran pit three days after the slippage with a focus on clean-up operations which resulted in fewer ore tonnes being mined from the Nkran pit and the overall contained gold mined from the AGM being lower than anticipated. The slippage is not expected to materially affect planned 2020 production and its impact on the longer term mine plan has been included in the updated AGM LOM plan (see “Updated Life of Mine Plan and Associated Impairment Loss”).

Going forward, the mine plan for 2020 will source ore primarily from Cut 2 at Nkran and Esaase, while the development of the Akwasiso pit is also expected to recommence and contribute approximately 30% of the planned ore tonnes for 2020. These ore sources will be augmented where necessary with run-of-mine stockpile material.

Mining cost per tonne for Q4 2019 was $4.86 compared to $4.13 during Q4 2018, an increase of 18%. The higher mining cost per tonne in Q4 2019 was predominantly due to volume differences as fewer total tonnes mined during Q4 2019 had the effect of increasing fixed mining cost on a per unit basis. The higher mining cost also reflects the additional fixed cost of Esaase mining contract (which commenced in Q1 2019). These factors were partly offset by reductions in drill and blast cost and load and haul cost during Q4 2019.

c) Processing

The AGM produced a record 66,112 ounces of gold during the fourth quarter of 2019, as the processing plant achieved a record quarterly milling rate, with 1.46Mt of ore processed at a grade of 1.5 g/t and metallurgical recovery averaging 94%. The gold feed grade processed through the mill was marginally lower than that mined during the quarter as the AGM employs a differential stockpiling and feed arrangement process, in line with the AGM LOM plan.

Metallurgical recovery continued to exceed design as a result of higher-than-design gravity recovery performance. This performance highlights the capability of the recovery circuit to run at higher throughput levels whilst still maintaining recovery performance.

Processing cost per tonne for Q4 2019 was $10.83 compared to $12.39 during Q4 2018, a decrease of 13%. The improvement in processing cost per tonne was predominantly due to the positive volume variance as the higher throughput during Q4 2019 had the effect of decreasing fixed processing costs on a per unit basis. The higher throughput during Q4 2019 relative to Q4 2018 was partly due to the increase in oxide tonnes within the plant’s feed blend, following the ramp-up in mining at Esaase during 2019.

d) Total cash costs and AISC (for the AGM on a 100% basis)

For the three months and the year ended December 31, 2019, total cash costs per ounce^1^were $863/oz and $845/oz, respectively, compared to total cash costs per ounce during the three months and year ended December 31, 2018 of $872/oz and $750/oz, respectively. Cash costs were lower in Q4 2019 (when compared to Q4 2018) due to the impact of higher gold sales volumes which had the effect of decreasing fixed production costs on a per unit basis. Total cash costs per ounce^1^was also impacted by a reduction associated with fixed mining contractor costs ($63/oz) which, due to the adoption of IFRS 16 – Leases (“IFRS 16”, see “11.2 Changes in Accounting Policies including Initial Adoption”), is now presented as part of AISC^1^rather than total cash cost per ounce^1^. These factors were partly offset by an increase in mining costs, as well as ore transportation costs associated with trucking ore from Esaase to the process plant ($47/oz for the quarter). The improved gold price during Q4 2019 gave rise to higher royalty expense compared to Q4 2018. In addition, total cash cost per ounce^1^benefitted from lower net realizable value (“NRV”) adjustments to stockpile inventory, the cash cost component of which represented a reduction in production costs of $0.6 million in Q4 2019, compared to an increase in production costs of $6.5 million in Q4 2018. The reduction in the NRV adjustments quarter-on-quarter was predominantly due to the improvement in the forecasted realized gold prices from a year ago.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

Relative to Q3 2019, total cash costs per ounce^1^were lower in Q4 2019, decreasing by 1% from $872 to $863, as a result of the impact of higher gold sales volumes in Q4 2019, which had the effect of decreasing cash production cost on a per-unit basis. In addition, the AGM recognized a $0.6 million reduction to production costs ($9/oz decrease) associated with NRV adjustments to stockpile inventory; whereas, in Q3 2019, the AGM recognized $1.9 million increase in production costs ($30/oz increase) associated with NRV adjustments to stockpile inventory. These factors were partly offset by the impact of a decrease in the amount of stripping costs that was deferred during Q4 2019 (due to the Cut 2 pushback at Nkran being completed early in Q4 2019) and thus more operational waste mining costs were included in total cash costs per ounce^1^during Q4 2019.

For the three months and year ended December 31, 2019, AlSC^1^for the AGM amounted to $969/oz and $1,112/oz, respectively, compared to AISC^1^of $1,072/oz for both the three months and the year ended December 31, 2018, respectively. The decrease in AlSC^1^from Q4 2018 to Q4 2019 was predominantly due to the previously described lower total cash costs per ounce^1^(decrease of $9/oz), a $77/oz decrease in deferred stripping costs due to the completion of Cut 2 at Nkran in early Q4 2019, and the impact of higher gold sales volumes which had the effect of decreasing fixed costs on a per unit basis.

Relative to Q3 2019, AlSC^1^for Q4 2019 decreased from $1,179/oz to $969/oz, a decrease of 18%. Total cash costs per ounce^1^were $9/oz lower in Q4 2019, while both capitalized stripping costs (decrease of $111/oz) and G&A expenses (decrease of $14/oz) reduced in Q4 2019 which were partly offset by an increase in sustaining capital expenditures (increase of $7/oz). Additionally, the impact of mining contractor lease payments was lower in Q4 2019 due to timing differences in the settlement of contractor payables (decrease of $85/oz).

For the three months and year ended December 31, 2019, the AGM incurred non-sustaining capital and exploration expenditures of $15.9 million and $25.5 million, respectively, compared to $10.5 million and $24.1 million during the respective comparative periods in 2018. The higher non-sustaining expenditure for Q4 2019 was primarily due to $1.6 million higher exploration expense associated with annual mineral rights fees, as well as $3.8 million higher development capital, which included costs associated with the resettlement of the Tetrem village near Esaase and upgrades to the Esaase haul road.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

3.2 Selected financial results of the AGM

The following tables present excerpts of the financial results of the JV for the three months and years ended December 31, 2019 and 2018. These results are presented on a 100% basis. For a complete income statement of the JV, refer to note 8 of the Company’s consolidated annual financial statements for the years ended December 31, 2019 and 2018.

Three months and years ended December 31, 2019 and 2018

	Three months ended December 31,		Year ended December 31,
	2019	2018	2019	2018
(in thousands of US dollars)
Revenue	97,075	74,224	340,969	283,873
Cost of sales:
Production costs	(52,582	(50,456	(199,234	(158,047
Depreciation and depletion	(30,578	(20,845	(95,418	(76,273
Royalties	(4,853	(3,768	(17,159	(14,250
Income from mine operations	9,062	(845	29,158	35,303
Exploration and evaluation expenditures	(2,219	(612	(6,092	(3,370
Finance expense	(1,095	(232	(8,905	(11,088
Income tax recovery (expense)	-	460	-	(11,449
Average realized price per gold ounce sold ($)	1,465	1,215	1,376	1,247
Average London PM fix ($)	1,481	1,228	1,393	1,269
All -in sustaining costs ($ per gold ounce)^1^	969	1,072	1,112	1,072
All -in sustaining margin ($ per gold ounce)^1^	496	143	264	175
All -in sustaining margin ($'000)^1^	32,783	8,840	65,700	39,860

All values are in US Dollars.

Revenue

During Q4 2019, the AGM sold 66,095 ounces of gold at an average realized gold price of $1,465/oz for total revenue of $97.1 million (including $0.2 million of by-product revenue). During Q4 2018, the AGM sold 61,821 ounces of gold at an average realized gold price of $1,215/oz for total revenue of $74.2 million (including $0.2 million of by-product revenue and net of $1.1 million of gold sales related to pre-production activities at Esaase that were capitalized to mineral, properties, plant and equipment (“MPP&E”)). The increase in revenues quarter-on-quarter was therefore a function higher average realized gold prices and sales volumes in Q4 2019.

During the year ended December 31, 2019, the AGM sold 248,862 ounces of gold at an average realized gold price of $1,376/oz for proceeds of $342.4 million. Revenues of $341.0 million also included $0.8 million of by-product revenue and were presented net of $2.2 million of gold sales related to pre-production activities at Esaase that were capitalized to MPP&E. In the comparative year of 2018, the AGM sold 227,772 ounces of gold at an average realized gold price of $1,247/oz for total revenue of $283.9 million (including $0.9 million of by-product revenue and net of $1.1 million of gold sales related to pre-production activities at Esaase that were capitalized to MPP&E). The increase in revenues during the 2019 year was therefore a function of higher average realized gold prices and higher sales volumes in 2019.

The AGM continues to sell all the gold it produces to Red Kite under an offtake agreement. The terms of the offtake agreement require the AGM to sell 100% of its gold production up to a maximum of 2.2 million ounces to Red Kite. As of December 31, 2019, 839,373 ounces have been delivered to Red Kite under the offtake agreement (December 31, 2018 – 590,511 ounces).

_________________________________________^1^ See “8. Non-GAAP measures”

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

Production costs and royalties

During Q4 2019, the AGM incurred production costs of $52.6 million, compared to $50.5 million in Q4 2018. Production costs were higher in Q4 2019 due to higher sales volumes, partly offset by lower total cash costs per ounce^1^in Q4 2019.

During the year ended December 31, 2019, the AGM incurred production costs of $199.2 million, compared to $158.0 million for the year ended December 31, 2018. Production costs were higher in 2019 due to higher total cash costs per ounce^1^and higher sales volumes. Additionally, during the year ended December 31, 2019, the JV provided for a one-time contract termination fee relating to one of the JV’s mining contractors.

Production costs for the three months and year ended December 31, 2019 were reported net of stripping costs of $0.3 million and $34.0 million (three months and year ended December 31, 2018 – $7.9 million and $59.8 million, respectively). Stripping costs are deferred to mineral properties in accordance with the AGM’s accounting policy for stripping costs. To the extent that excess waste is mined during the period in an identified component of the mine, as compared to the expected waste (based on the component- specific stripping ratio), a portion of costs are deferred to mineral properties.

The Ghanaian government charges a 5% royalty on revenues earned through sales of minerals from the AGM concessions. The AGM’s Akwasiso mining concession is also subject to a 2% net smelter return royalty payable to the previous owner of the mineral tenement; additionally, the AGM’s Esaase concession is also subject to a 0.5% net smelter return royalty payable to the Bonte Liquidation Committee. Royalties are presented as a component of cost of sales and amounted to $4.9 million and $17.2 million for the three months and year ended December 31, 2019 (three months and year ended December 31, 2018 – $3.8 million and $14.3 million, respectively). Royalty expense was higher during Q4 2019 and the year ended December 31, 2019 due to higher earned revenues, as well as the commencement of commercial operations at Esaase (which attracts an incremental 0.5% royalty). Royalty expense for the year ended December 31, 2019 compared to the prior year was positively impacted by lower production from Akwasiso (which attracts an incremental 2% royalty).

Depletion and depreciation

Depreciation and depletion expense for Q4 2019 amounted to $30.6 million, including $16.1 million of depletion associated with previously capitalized deferred stripping cost, as a result of 1.41Mt of ore mined during the quarter. This compares to depreciation and depletion of $20.8 million for Q4 2018, which included $8.6 million of depletion associated with previously capitalized deferred stripping costs and was based on 1.37Mt of ore mined during the comparative period. Depreciation and depletion expense increased from Q4 2018 due to depletion expense on previously capitalized deferred stripping costs on Cut 2 at Nkran, as well as the carrying value of Esaase mineral interests being added to the depreciable cost base of producing mineral properties during the current year. Additionally, depreciation was higher in 2019 due to the adoption of IFRS 16, which resulted in certain mining contractor costs being capitalized and depreciated rather than being presented as production costs. During the three months ended December 31, 2019, the AGM recorded an adjustment to the carrying value of stockpile inventory in order to reflect the net realizable value of stockpiled ore, of which $2.4 million was recorded as depreciation expense. In comparison, the portion of the net realizable value adjustment allocated to depreciation during the same period in 2018 amounted to $2.7 million.

Depreciation and depletion expense for the year ended December 31, 2019 amounted to $95.4 million, including $39.0 million of depletion associated with previously capitalized deferred stripping cost, as a result of 5.07Mt of ore mined during the year. This compares to depreciation and depletion of $76.3 million for the year ended December 31, 2018, which included $25.3 million of depletion associated with previously capitalized deferred stripping costs and was based on 4.90Mt of ore mined during the comparative period. Depreciation and depletion expense for 2019 increased from 2018 due to more ore tonnes mined and depletion expense on previously capitalized deferred stripping costs on Cut 2 at Nkran, as well as a net increase in the depreciable cost base of producing mineral properties. The net increase in depreciable cost base was partly due to Esaase reaching commercial production and the adoption of IFRS 16, which resulted in certain mining contractor costs being capitalized and depreciated rather than being presented as production costs, which were partly offset by the recognition of a fair value adjustment associated with the JV Transaction which was recorded in Q3 2018. Additionally, during the year ended December 31, 2019, the AGM recorded a $19.1 million adjustment to reduce the carrying value of stockpile inventory in order to reflect its net realizable value, of which $11.2 million was recorded as depreciation expense. In comparison, in 2018, the AGM recorded a $23.4 million adjustment to reduce the carrying value of stockpile inventory, of which the portion recorded as depreciation amounted to $8.9 million.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

Impairment

In connection with the work completed with regards to the AGM LOM plan (see “Updated Life of Mine Plan and Associated Impairment Loss”), management identified an indicator of possible impairment and was required to assess the recoverable amount the AGM. The recoverable amount of the AGM was based on management’s estimate of the fair value less cost of disposal of the AGM. The fair value less cost of disposal of the AGM (on a 100% basis) was estimated to be $211.8 million and included life of mine cash flow projections, on the basis of the updated scope of the AGM LOM plan. The Company has completed its work associated with the AGM LOM plan; however, the AGM LOM plan is still being reviewed by the JV management committee. The Company determined that an impairment of $289.6 million was required at the AGM based on its estimate of the recoverable amount of the AGM.

Management’s estimate of the fair value of the AGM is classified as Level 3 in the fair value hierarchy, and incorporated the following assumptions:

Pricing assumption

Gold price assumption	2020	2021	2022 to 2024	Long-term	Weighted Average
Gold price (per ounce)	$1,500	$1,425	$1,400	$1,350	$1,373

Discount rate assumption

Sensitivity analysis

Assumption	Sensitivity	Impact on recoverable amount of AGM (100% basis)
		Increase ($’millions)	Decrease <br>($’millions)
Gold price (weighted average)	+/- $100/oz	$98.6	$130.3
Discount rate	+/- 1.0%	$7.9	$7.4

Exploration and evaluation expenditures

During Q4 2019, the AGM incurred $2.2 million on exploration and evaluation (“E&E”) expenditures compared to $0.6 million in Q4 2018. The increase in E&E expense was primarily related to incremental accruals for annual mineral rights fees.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

During the year ended December 31, 2019, the AGM incurred $6.1 million on E&E expenditures compared to $3.4 million in the comparative year. The increase in E&E expense was primarily related to incremental accruals for annual mineral rights fees, as well as exploratory drilling costs on the Tontokrom and Opeimu targets.

Finance expense

The following is a summary of finance expenses incurred by the AGM JV during the three months and years ended December 31, 2019 and 2018:

	Three months ended December 31,				Year ended December 31,
(in thousands of US dollars)	2019		2018		2019		2018
Realized gain (loss) on gold hedging instruments	1,174		-		(4,440	)	-
Interest on lease liabilities	(307	)	-		(1,817	)	-
Interest charges on Red Kite loan and associated <br> withholding taxes	-		-		-		(10,142	)
Fees and expenses associated with revolving <br> credit facility	(1,670	)	-		(1,670	)	-
Accretion charges on asset retirement provisions	(272	)	(217	)	(903	)	(888	)
Other	(20	)	(15	)	(75	)	(58	)
Total finance expense	(1,095	)	(232	)	(8,905	)	(11,088	)

Finance expense in Q4 2019 increased by $0.9 million compared to Q4 2018 due to legal fees and standby charges ($1.7 million increase) associated with the AGM’s Revolving Credit Facility (“RCF”) and interest expense on IFRS 16 mining contractor lease liabilities ($0.3 million increase). These factors were partly offset by realized gains of $1.2 million on gold collar hedging instruments, inclusive of withholding taxes (three months ended December 31, 2018 – $nil). In June 2019, the AGM entered into a zero cost collar gold hedging program with a group of leading commercial banks to help manage the AGM’s exposure to gold price risk during a period of high sustaining capital expenditures at Nkran Cut 2 as well as the Tetrem village relocation. The hedging instruments covered 90,000 ounces of gold production with put/call spreads ranging from $1,300 per ounce to $1,517 per ounce and matured at 15,000 gold ounces per month over a period of six months from July 1, 2019 to December 31, 2019. As at December 31, 2019, all hedging instruments had matured.

Finance expense for the year ended December 31, 2019 reduced from the comparative period due to the repayment of the AGM’s $163.8 million long-term debt concurrent with the completion of the JV Transaction on July 31, 2018. Finance expense for the year ended December 31, 2019 is comprised of a $4.4 million realized loss on settlement of gold hedging instruments, inclusive of withholding taxes, $1.8 million of interest on IFRS 16 lease liabilities, $1.7 million of legal fees and standby charges associated with the AGM’s RCF and $0.9 million of accretion expense on the AGM’s asset retirement provisions.

Income tax expense

The AGM recorded a deferred tax expense of $nil for both the three months and year ended December 31, 2019 compared to a deferred income tax recovery of $0.5 million and a deferred tax expense of $11.4 million for the three months and year ended December 31, 2018, respectively. The decrease in deferred tax expense in 2019 reflects the fact that, following the conclusion of the work associated with the AGM LOM plan, the carrying value of the AGM’s producing mineral properties were reduced to an amount less than their associated tax base. The AGM has not recognized deferred tax assets relating to tax loss carry forwards as it is not currently considered probable that these losses will be utilized prior to their expiry (5-year expiry from the date incurred).

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

3.3 Cash flow results of the AGM

The following table provides a summary of cash flows for the AGM on a 100% basis for the three months and years ended December 31, 2019 and 2018:

	Three months ended December 31,				Year ended December 31,
AGM 100% Basis (in thousands of US dollars)	2019		2018		2019		2018
Cash provided by (used in):
Operating cash flows before working capital changes	33,808		17,805		109,785		100,454
Operating activities	45,440		12,873		120,375		72,487
Investing activities	(12,242	)	(21,495	)	(62,672	)	(85,633	)
Financing activities	(25,866	)	(90	)	(35,272	)	12,820
Impact of foreign exchange on cash and cash equivalents	(142	)	(71	)	(321	)	(71	)
Increase in cash and cash equivalents during the period	7,190		(8,783	)	22,110		(397	)
Cash and cash equivalents, beginning of period	36,568		30,431		21,648		22,045
Cash and cash equivalents, end of period	43,758		21,648		43,758		21,648

Cash flows from operating activities

During Q4 2019, the AGM generated cash flows from operations of $45.4 million, being cash inflows before working capital changes of $33.8 million and inflows from non-cash working capital of $11.6 million. Cash inflows of $11.6 million from non-cash working capital were primarily the result of an $8.5 million increase in accounts payable and accruals, a $4.4 million decrease in receivables and VAT receivable and a $1.0 million decrease in prepaid expenses. These factors were partly offset by a $2.2 million increase in inventories. The $8.5 million increase in operating accounts payable and accruals during Q4 2019 was predominantly due to the fact that all mining contractor payables at year-end were considered to relate to operating activities, following the cessation of stripping activities in Q3 2019, whereas they were partly considered to relate to investing activities (deferred stripping costs) in earlier periods.

The increase in operating cash flows in Q4 2019 compared to Q4 2018 as demonstrated in the table above was primarily a result of higher mine operating income excluding depreciation expense and a favorable change in non-cash working capital relating to in the collection of VAT receivable and trade receivables and a decrease in inventories. This was partly offset by a $2.7 million cash payment to settle the AGM’s gold collar hedging contracts.

During the year ended December 31, 2019, the AGM generated cash flows from operations of $120.4 million, being cash inflows before working capital changes of $109.8 million and inflows from non-cash working capital of $10.6 million. Cash inflows of $10.6 million from non-cash working capital were primarily the result of a $9.9 million increase in accounts payable and accruals, a $1.4 million decrease in inventories and a $0.7 million decrease in prepaid expenses. These factors were partially offset by a $1.3 million increase in receivables and VAT receivable.

The increase in operating cash flows for the year ended December 31, 2019 compared to the 2018 year as demonstrated in the table above was primarily a result of a higher mine operating income excluding depreciation expense and a favorable change in non-cash working capital relating to a decrease in inventories and decrease in receivables and VAT receivable, partially offset by a decrease in accounts payable and accruals. Additionally, in 2019, the AGM incurred a $3.7 million cash payment to settle the AGM’s gold collar hedging contracts.

Cash used in investing activities

During Q4 2019, the AGM invested $12.2 million in additions to MPP&E. The total expenditure on MPP&E during the quarter included $3.4 million relating to capitalization of deferred stripping costs ($0.3 million in deferred stripping additions plus a $3.1 million reduction in payables relating to stripping costs), $1.3 million in sustaining capital and $7.5 million in development capital. Sustaining capital related primarily to raising the height of the tailings storage facility and capital spares, while development capital included development activities at Esaase, costs associated with a village relocation and upgrades to the Esaase haul road to improve overall safety and reduce cycle times.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

The decrease in cash flows invested in MPP&E from Q4 2018 to Q4 2019 was primarily due to lower capitalized stripping costs as the Cut 2 pushback at Nkran was concluded in early Q4 2019 and a reduction in development capital as Q4 2018 included development costs related to establishing the Esaase mining project and construction of the Esaase haul road connecting the Esaase deposit to the processing plant.

During the year ended December 31, 2019, the AGM invested $63.0 million in additions to MPP&E. The total expenditure on MPP&E during the year included $37.1 million relating to capitalization of deferred stripping costs ($34.0 million in deferred stripping additions plus a $3.1 million reduction in payables relating to stripping costs), $6.4 million in sustaining capital and $19.5 million in development capital. Sustaining capital related primarily to raising the height of the tailings storage facility, while development capital included bulk sampling activities for Esaase, construction of an interim haul road (and subsequent upgrades) and the commencement of a village relocation. Total cash flows used in investing activities of $62.7 million was presented net of interest received of $0.3 million.

The decrease in cash flows invested in MPP&E for 2019 compared to the 2018 year was primarily due to 2018 including upgrades to the processing plant, the replacement of the SAG mill motor, Esaase site establishments costs, and capitalized stripping costs relating to the commencement of the Cut 2 pushback at Nkran. These factors were partially offset by a decrease in accounts payable related to capitalized stripping costs in 2019.

Cash used in financing activities

During the three months and year ended December 31, 2019, $25.9 million and $35.3 million of cash used in financing activities, respectively, related primarily to a distribution of $20.0 million to the JV partners ($10.0 million distribution to each JV partner), which was partly offset by Gold Fields’ final $10.0 million investment in the AGM relating to the JV Transaction. Additionally, commencing with the adoption of IFRS 16 on January 1, 2019, there was a change in presentation of a portion of payments made to the JV’s mining contractors which are required to be presented within financing activities as principal and interest payments associated with leases contained within the JV’s mining contractor services agreements. See section “11. Critical accounting policies and estimates”. Note that as of December 31, 2019, there were $3.7 million in payables relating to the JV’s aforementioned mining contractors.

The increase in cash flows used in financing activities from Q4 2018 to Q4 2019 related to the aforementioned preferred share distributions to the JV partners (net of Gold Fields’ $10.0 million investment in the JV) and the presentation of lease payments made to mining contractors in accordance with IFRS 16.

The increase in cash flows used in financing activities during the year ended December 31, 2019 compared to the year ended December 31, 2018 was due to the preferred share distribution made to the JV partners in Q4 2019 (net of Gold Fields’ $10.0 million investment in the JV) and the presentation of IFRS 16 mining contractor lease payments being classified as a financing activity (prior year presented in operation activities), while in 2018 cash inflows from financing activities related to preferred share investments by the JV partners associated with the closing of the JV Transaction totaling $185.0 million, partly offset by the repayment of the AGM’s former debt facility (and related interest and withholding taxes) totaling $172.1 million.

Liquidity position

As at December 31, 2019, the JV held cash and cash equivalents of $43.8 million ($3.0 million of which was restricted in favour of a gold hedging counterparty and released on January 3, 2020), $9.1 million in receivables from gold sales and $2.8 million in gold on hand (December 31, 2018 – $21.6 million in cash and cash equivalents and $4.3 million in receivables from gold sales).

In October 2019, the JV entered into a $30.0 million RCF with Rand Merchant Bank (“RMB”). The term of the RCF is three years, maturing in September 2022 and bears interest on a sliding scale of between LIBOR plus a margin of 4% and LIBOR plus a margin of 3.8%, depending on security granted to RMB. Commitment fees in respect of the undrawn portion of the RCF are on a similar sliding scale of between 1.40% and 1.33%. As at December 31, 2019, the balance drawn under the RCF was $nil.

The Company does not control the funds of the JV. The liquidity of the Company is further discussed in section “7. Liquidity and capital resources.”

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

3.4 Development and exploration update

The following discussion relates to the AGM’s current and planned development activities (on a 100% basis), as well as the exploration work performed during the period on tenements held within the JV’s land package.

a) Development of the Esaase Deposit

The Esaase deposit is being mined using open pit contractor mining. Mining activities are currently focused on oxide extraction and are expected to move into more competent fresh rock in the second half of 2020. Mining has extended to the South and both the Esaase Main (Central) and Esaase South pits are expected to be mined in 2020. All mining and environmental permits relating to the Esaase operations have been received.

The haul road to connect the Esaase pit to the existing haul road network at Obotan was commissioned in Q1 2019. Extensive upgrades to the haul road were made in Q4 2019 with the objective of improving safety on the road and reducing cycle times. Mining is currently restricted to day-shift only and the Esaase material is being trucked to the processing plant at Obotan. The AGM LOM plan expects nightshift mining at Esaase to commence during Q1 2020. Esaase oxide ore makes up approximately 40% of the current mill feed.

b) Production Geology

During Q4 2019, mining geology continued to focus on the in-pit mining operations and involved detailed bench mapping, intensive grade control drilling and subsequent modelling. Grade control drilling for Obotan activities in Q4 2019 recorded a total of 15,040m from 677 holes using two RC rigs yielding 11,800 samples for analysis.

RC drilling for the Esaase operation included 26,040m from 1,543 holes yielding 20,400 samples for analysis. All geological related activities have been implemented within this new pit, with particular emphasis on structural mapping which was incorporated into the grade control and modelling interpretations to date.

Validation and continuous improvement of the resource, reserve and grade control modelling remains a focus of the technical team and will continue into 2020.

c) Exploration

The JV holds a large land package of 21,300 hectares on the Asankragwa Gold Belt. In 2017, the Company undertook a prospectivity analysis assessing the potential of identified exploration targets based on structural architecture, geochemistry, geological mapping and topography. An exploration strategy was developed, in collaboration with the JV partner, to test high priority targets with the objective of replacing mining depletion with resources near existing mining operations and infrastructure as well as testing potential new discoveries.

In November 2019, exploration drilling commenced at the Fromenda target, also situated in the southern exploration camp. A total of 28 holes was planned. To date, 10 holes were completed (1,850 m) and the balance of the drill program is expected to continue into 2020. The Fromenda target is located approximately 20km southwest of the processing plant, along the Fromenda Shear Zone Corridor. The target was historically drill-tested in 2003 and 2004, producing exploration results that warranted a new round of drilling.

Ground geophysics has been progressing well over the Esaase deposit. Data processing is underway with preliminary imaging from the Gradient Array IP and Resistivity across the Esaase deposit, mimicking the mineralization trends from original exploration core logged and mapping in the current pit.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

4. Financial results of the Company

The following table is a summary of the Consolidated Statements of Operations and Comprehensive Income (Loss) of the Company for the three months and years ended December 31, 2019 and 2018. Note that the table below and subsequent discussion includes 100% of the results for the AGM for the periods January 1, 2018 to July 31, 2018, being the period during which the Company controlled the AGM. For the three months and year ended December 31, 2019 and the period from August 1, 2018 to September 30, 2018, the Company has recognized its share of the net income (loss) of the JV. As a result, most of the variances in the table below are attributable to the deconsolidation of the AGM due to the closing of the JV Transaction. For a more meaningful discussion on variations associated with the AGM’s results, see section “3.2 Selected financial results of the AGM”. Those variances not affected by the deconsolidation of the AGM are discussed in further detail following the table.

	Three months ended December 31,		Year ended December 31,
	2019	2018	2019	2018	2017
(in thousands of US dollars, except per share amounts)
Revenue	-	-	-	161,918	256,203
Cost of sales:
Production costs	-	-	-	(79,008	(116,628	)
Depreciation and depletion	-	-	-	(41,944	(64,153	)
Royalties	-	-	-	(8,096	(12,810	)
Total cost of sales	-	-	-	(129,048	(193,591	)
Income from mine operations	-	-	-	32,870	62,612
Share of net loss related to joint venture	-	(1,306	(126,264	(1,050	-
Service fee earned as operators of joint venture	1,223	1,117	4,963	1,892	-
Exploration and evaluation expenditures	-	-	-	(2,333	(2,050	)
General and administrative expenses	(2,368	(3,200	(11,828	(11,660	(12,590	)
Income (loss) from operations and joint venture	(1,145	(3,389	(133,129	19,719	47,972
Loss due to loss of control of subsidiaries	-	-	-	(143,261	-
Finance income	135	2,530	871	5,555	609
Finance expense	(20,180	(4	(35,650	(10,737	(17,810	)
Foreign exchange gain (loss)	(15	(12	(20	20	(383	)
Income (loss) before income taxes	(21,205	(875	(167,928	(128,704	30,388
Current income tax expense	-	8	-	(1,079	(1,301	)
Deferred income tax expense	-	-	-	(11,430	(22,774	)
Net income (loss) and comprehensive income (loss) for the period	(21,205	(867	(167,928	(141,213	6,313
Net income (loss) attributable to:
Common shareholders of the Company	(21,205	(867	(167,928	(141,372	5,776
Non-controlling interest	-	-	-	159	537
	(21,205	(867	(167,928	(141,213	6,313
Income (loss) per share attributable to common shareholders:
Basic	(0.09	(0.00	(0.74	(0.64	0.03
Diluted	(0.09	(0.00	(0.74	(0.64	0.03
Weighted average number of shares outstanding:
Basic	225,948,601	225,804,614	225,867,169	220,108,770	203,333,111
Diluted	225,948,601	225,804,614	225,867,169	220,108,770	204,394,452

All values are in US Dollars.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

Share of net earnings (loss) related to joint venture

Effective July 31, 2018, the Company began equity accounting for its interest in the JV. Accordingly, the Company recognized its 45% proportionate share of the net earnings of the JV of $nil and $4.1 million for the three months and year ended December 31, 2019 (three months and year ended December 31, 2018 – share of net loss of $1.3 million and $1.1 million, respectively). The Company’s share of the net earnings of the JV for Q4 2019 is net of the Company’s 45% interest in the $4.4 million (adjustment) to the impairment recorded by the JV during Q4 2019.

Service fee earned as operators of the joint venture

In accordance with the Joint Venture Agreement (“JVA”), the Company is the operator of the AGM and, in consideration for managing the operations of the mine, receives a gross annual service fee from the JV of $6.0 million (adjusted annually for inflation). For the three months and year ended December 31, 2019, the Company earned a gross service fee of $1.5 million (less withholding taxes of $0.2 million) and $6.0 million (less withholding taxes of $1.0 million), respectively.

During the three months and year ended December 31, 2018, the Company earned a gross service fee of $1.5 million (less withholding taxes of $0.4 million) and $2.5 million (less withholding taxes of $0.6 million), respectively. The service fee earned in 2018 was lower than 2019 due to the fact that the JV Transaction closed on July 31, 2018, resulting in the Company operating the AGM JV and earning a service fee in 2018 for the period from August 1, 2018 to December 31, 2018.

General and administrative (“G&A”) expenses

G&A expenses for the three months and year ended December 31, 2019 and 2018 comprised:

	Three months ended December 31,		Year ended December 31,
	2019	2018	2019	2018
(in thousands of US dollars)	$	$	$	$
Wages, benefits and consulting	1,249	2,221	7,723	6,533
Office, rent and administration	238	238	800	1,527
Professional and legal	123	204	452	1,308
Share-based payments	506	338	1,789	1,258
Travel, marketing, investor relations and regulatory	212	186	966	987
Other	40	13	98	47
Total G&A expense	2,368	3,200	11,828	11,660

G&A expenses in Q4 2019 were $0.8 million lower than Q4 2018 primarily due to a $1.0 million reduction in wages, benefits and consulting resulting from lower payroll costs due to the restructuring of the executive management team. This was partially offset by an increase in share-based payments expense of $0.2 million.

For the year ended December 31, 2019, G&A expenses were $0.2 million higher than 2018. Wages, benefits and consulting expense were higher in 2019 due in part to non-recurring costs associated with the restructuring of the executive management team of $1.5 million. This was offset by the impact of the deconsolidation of the G&A expenses of the AGM which during the year ended December 31, 2018 amounted to $1.3 million of wages, benefits and consulting expense. In addition, wages, benefits and consulting reported for the first seven months of 2018 were presented net of a recovery of service fees (between the Company and the AGM) of $1.0 million, whereas in 2019 the benefit of the services fees is presented separately in the Company’s Statement of Operations and Comprehensive Income (Loss).

Office, rent and administration and professional and legal fees were higher during the year ended December 31, 2018 as the year included the G&A expenses of the AGM for the period January 1^st^to July 31^st^, 2018 when the Company’s former Ghanaian subsidiaries were still under the Company’s control, resulting in these expenses being higher by $0.9 million. Additionally, the Company’s professional and legal fees were higher in 2018 due to costs associated with completing the JV Transaction.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

Share-based payments expense for the year ended December 31, 2019 was higher than 2018 due to an increase in the number of vested awards as well as an increase in the Company’s share price during 2019.

Loss due to loss of control of subsidiaries

On July 31, 2018, the Company completed the JV Transaction to sell 50% of Asanko’s 90% interest in the AGM (see section “Gold Fields Transaction”). Upon closing of the JV Transaction, the Company derecognized the carrying amounts of the net assets of AGGL and Adansi Ghana, as well as the carrying amount of previously recognized non-controlling interests in AGGL, and recognized the fair value of the Company’s interest in the JV. Additionally, the Company adjusted the expected life of its long-term debt due to the expected closing of the JV Transaction and recognized accelerated accretion for the year ended December 31, 2018 of $6.2 million, bringing the carrying value of the debt to its maturity value of $163.8 million for which it was settled. The accelerated accretion expense was presented in the loss on loss of control of the AGM, along with $5.0 million of transaction costs, for a total loss associated with the loss of control of the Company’s former Ghanaian subsidiaries of $143.3 million for the year ended December 31, 2018.

Finance income

Finance income includes interest earned on cash balances and changes in the amortized cost of the Company’s preferred share (fixed redemption date) investment in the JV. For the three months and year ended December 31, 2019, the Company recognized income of $0.1 million and $0.5 million, respectively, on changes in the amortized costs of the Company’s preferred share (fixed redemption date) investment in the JV.

During the three months and year ended December 31, 2018, the Company recognized $2.5 million and $5.6 million of finance income which was primarily related to fair value adjustments on the Company’s preferred share investment in the JV (no fixed redemption date) of $2.4 million and $4.8 million, respectively. The decrease in finance income from 2018 to 2019 is due to the fact the Company recorded a $35.6 million downward fair value adjustment on its preferred share investment in the AGM JV (see “Finance expense” below) and this mark-to-market loss was recorded in finance expense for the year ended December 31, 2019.

Finance expense

Finance expense includes changes in fair value of the Company’s preferred share investment in the JV (no fixed redemption date), interest on lease liabilities and banking fees. For the three months and year ended December 31, 2019, the Company recognized a downward fair value adjustment of $20.1 million and $35.6 million, respectively, on changes in the fair value of the Company’s preferred share investment in the JV. The downward fair value adjustment was a result of a change in the estimated amount and timing of the cash flows expected to be distributed by JV.

During the three months and year ended December 31, 2018, the Company recognized finance expense of $4,000 and $10.7 million, respectively. The increase in finance expense from Q4 2018 to Q4 2019 is due to the aforementioned downward fair value adjustment of $20.1 million on changes in the fair value of the Company’s preferred share investment in the JV. The decrease in finance expense from fiscal 2018 to 2019 is due to the 2018 year including interest expense on the Company’s former credit facility with Red Kite.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

5. Selected quarterly financial data

The following table provides summary unaudited financial data for the last eight quarters. Except for basic and diluted income (loss) per share and adjusted basic and diluted income (loss) per share^1^, the totals in the following table are presented in thousands of US dollars.

	2019				2018
	Q4	Q3	Q2	Q1	Q4	Q3	Q2	Q1

Revenue	-	-	-	-	-	30,665	66,823	64,430
Total cost of sales	-	-	-	-	-	(33,373	(50,740	(44,935
Income (loss) from mine operations	-	-	-	-	-	(2,708	16,083	19,495
Share of net earnings (loss) related to joint venture	-	(126,047	6,135	(6,352	(1,306	256	-	-
Service fee earned as operators of joint venture	1,223	1,488	1,126	1,126	1,117	775	-	-
Exploration and evaluation expenditures	-	-	-	-	-	(419	(1,789	(125
General and administrative expenses	(2,368	(3,199	(3,456	(2,805	(3,200	(2,904	(3,246	(2,310
Income (loss) from operations and joint venture	(1,145	(127,758	3,805	(8,031	(3,389	(5,000	11,048	17,060
Recovery (loss) due to loss of control of subsidiaries	-	-	-	-	-	1,293	(144,554	-
Other income (expenses)	(20,060	(19,758	2,302	2,717	2,514	2,603	(5,128	(5,151
Income tax (expense) recovery	-	-	-	-	8	(121	(3,277	(9,119
Net income (loss) for the period	(21,205	(147,516	6,107	(5,314	(867	(1,225	(141,911	2,790
Basic and diluted income (loss) per share	(0.09	(0.65	0.03	(0.02	0.00	(0.00	(0.63	0.01
Adjusted net income (loss) for the period attributable<br> to common shareholders ^1^	941	793	6,107	(5,314	(867	(1,640	2,287	2,109
Adjusted basic and diluted income (loss) per share <br> attributable to common shareholders ^1^	0.00	0.00	0.03	(0.02	0.00	(0.01	0.01	0.01

All values are in US Dollars.

Since the commencement of commercial production at the Asanko Gold Mine effective April 1, 2016, and specifically from Q3 2016 onwards, the Company saw mining operations achieve expected levels of production, resulting in comparable revenues and income from mine operations, until the Company completed the JV Transaction effective July 31, 2018, concurrent with which the Company commenced equity accounting for its interest in the AGM.

Commencing in Q3 2018, the Company has been recognizing its 45% interest in the net income after tax of the JV for each quarter.

For periods prior to Q3 2018, other income (expense) included interest expense on the Company’s long-term debt (which was settled in July 2018). In Q3 and Q4 2018, as well as Q1 and Q2 2019, other income included fair value adjustments on the Company’s preferred share investments in the JV.

The Company also recognized a $143.3 million loss on loss of control of its former Ghanaian subsidiaries, as part of the JV Transaction, in 2018.

In Q3 2019, the Company recognized an impairment on its equity investment in the AGM JV totaling $128.3 million which was presented as part of the Company’s share of the net loss related to the joint venture. Additionally, in Q3 2019, the Company recognized a $20.0 million downward fair value adjustment on its preferred share investment in the JV which was presented as finance expense.

In Q4 2019, the Company recognized a $20.1 million downward fair value adjustment on its preferred share investment in the JV resulting from the finalization of its work over the AGM LOM plan which was presented as finance expense.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

6. Outlook

2020 Guidance for the Asanko Gold Mine (100% basis)

In 2020, the AGM is targeting 225,000 to 245,000 ounces of gold production at AISC^1^of $1,000 to $1,100/oz. AISC includes budgeted sustaining capital expenditures of $11 million, primarily for a tailings storage facility lift of $7 million.

The mine plan for 2020 will source ore primarily from Cut 2 at Nkran, and Esaase, while the development of the Akwasiso pit is also expected to recommence and contribute approximately 30% of the planned ore tonnes for the year. These ore sources will be augmented where necessary with run-of-mine stockpile material.

Development capital is forecast at $24 million, primarily for the Tetrem village relocation. In addition, $10 million is budgeted for exploration, mainly around the highly prospective Tontokrom – Miradani – Fromenda mineralized trend.

7. Liquidity and capital resources

A key financial objective of the Company is to actively manage its own cash balance and liquidity in order to meet the Company’s strategic plans, as well as those of the JV in accordance with the JV agreement. The Company shares control of the JV and aims to manage the JV in such a manner to generate positive cash flows from the AGM’s operating activities in order to fund its operating, capital and project development requirements. A summary of the Company’s net assets and key financial ratios related to liquidity are as follows. Note that the December 31, 2019 and 2018 balances below, unless otherwise noted, do not include any assets and liabilities of the JV.

	December 31, 2019	December 31, 2018
(in thousands of US dollars, except outstanding shares and options)	$	$
Cash and cash equivalents	31,109	10,358
Other current assets	4,691	2,744
Non-current assets	108,704	299,513
Total assets	144,504	312,615
Current liabilities	2,317	3,473
Non-current liabilities	930	300
Total liabilities	3,247	3,773
Working capital	33,483	9,629
Total equity	141,257	308,842
Total common shares outstanding	225,098,810	225,804,614
Total options outstanding	12,568,362	13,482,427
Key financial ratios
Current ratio	15.45	3.77
Total liabilities -to-equity	0.02	0.01

The Company held cash and cash equivalents of $31.1 million and $4.3 million in receivables as at December 31, 2019. During Q3 2019, the Company received the first of two $10.0 million payments from Gold Fields associated with the JV Transaction and on December 19, 2019 the Company received the second $10.0 million payment from Gold Fields. Additionally, during Q4 2019, the JV redeemed 10.0 million of the Company’s preference shares resulting in a $10.0 million cash payment being received by the Company. Subsequent to year end, on February 11, 2020, the Company received an additional $15.0 million distribution from the JV on its preferred share investment.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

Subsequent to the JV Transaction, other than the JV service fee, the Company has no current direct sources of revenue and any free cash flows generated by the AGM are no longer within the Company’s exclusive control as the disposition of cash from the JV is governed by the JVA. The JVA provides that “Distributable Cash” will be calculated and distributed quarterly, if available. Further information regarding the definition of “Distributable Cash” is included in section “8.4 EBITDA and Adjusted EBITDA”. However, given the Company’s cash balance and ongoing service fee receipts from the JV, the Company believes it is in a position to meet all working capital requirements, contractual obligations and commitments as they fall due (see “Commitments” below) during the next 24 months.

Normal course issuer bid

On November 12, 2019, the Company received approval from the TSX to commence the NCIB on November 15, 2019 to purchase up to 11,310,386 common shares, representing 5% of the Company’s issued and outstanding common shares on that date. Purchases pursuant to the NCIB are being made on the open market through the facilities of the TSX and NYSE.

All common shares purchased by the Company under the NCIB are purchased at the market price at the time of acquisition in accordance with the rules and policies of the TSX and NYSE and applicable securities laws. All common shares acquired by the Company under the NCIB are cancelled and purchases will continue to be funded out of the Company’ working capital. Although the Company has a present intention to acquire its common shares pursuant to the NCIB, the Company will not be obligated to make any purchases and purchases may be suspended by the Company at any time in accordance with applicable securities laws. The NCIB will terminate on November 14, 2020, or earlier if the maximum number of shares under the NCIB have been purchased. The Company reserves the right to terminate the NCIB earlier in accordance with applicable securities laws if it feels it is appropriate to do so.

In accordance with the rules of the TSX, the maximum daily purchases on the TSX under the NCIB will be 33,499 common shares, which is 25% of the average daily trading volume for the Company's common shares on the TSX for the six months ended October 31, 2019. In addition, maximum daily purchases under the NCIB on the NYSE will be subject to Rule 10b-18 which specifies that daily purchases may not exceed 25% of average daily trading volume for the four weeks preceding such trading date. These maximum daily limits will apply to purchases on the respective markets, except where such purchases are made in accordance with "block purchase" exemptions under applicable TSX and NYSE policies.

During the year ended December 31, 2019, the Company repurchased and cancelled a total of 1,108,920 common shares under the NCIB program for $1.0 million (average acquisition price of $0.86 per share).

Equity

The Company is financially stable with a total liabilities-to-equity ratio of 0.02 as at December 31, 2019.

Commitments

The following table summarizes the Company’s contractual obligations as at December 31, 2019 and 2018. Note the following table excludes commitments and liabilities of the JV for both years presented.

					Total	Total
(in thousands of US dollars)	Within 1 year	2 - 3 years	4 -5 years	Over 5 years	December 31, 2019	December 31, 2018
Accounts payable and accrued liabilities	1,649	-	-	-	1,649	3,232
Long-term incentive plan (cash-settled awards)	585	416	-	-	1,001	541
Corporate office leases	214	250	268	91	823	202
Total	2,448	666	268	91	3,473	3,975

In addition to the above commitments, the Company has provided various parent company guarantees related to the unfunded portion of the AGM’s reclamation bonds in the amount of $6.8 million.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

During Q3 2019, the Company entered into a lease agreement for corporate office space with an effective date of September 1, 2019. Upon obtaining the contractual right to use the new office space, the Company recognized a right-of-use asset and corresponding lease liability for the office space lease agreement in accordance with IFRS 16, amounting to $0.6 million. Obligations under the corporate office space lease agreement have been included in the table above.

Contingencies

Due to the nature of its business, the Company may from time to time be subject to regulatory investigations, claims, lawsuits and other proceedings in the ordinary course of its business. While the Company cannot reasonably predict the ultimate outcome of any such actions, and inherent uncertainties exist in predicting such outcomes, the Company believes that the ultimate resolution of these actions is not reasonably likely to have a material adverse effect on the Company’s financial condition or future results of operations.

Cash flows

The following table provides a summary of cash flows for the three months and year ended December 31, 2019 and 2018:

	Three months ended December 31,				Year ended December 31,
(in thousands of US dollars)	2019		2018		2019		2018
Cash provided by (used in):
Operating cash flows before working capital changes	(560	)	(1,755	)	(4,988	)	63,298
Operating activities	(1,589	)	(1,904	)	(8,748	)	33,429
Investing activities	20,061		(1,986	)	30,171		82,308
Financing activities	(987	)	(2	)	(665	)	(154,643	)
Impact of foreign exchange on cash and cash equivalents	(11	)	-		(7	)	(66	)
Increase (decrease) in cash and cash equivalents during the <br> period	17,474		(3,892	)	20,751		(38,972	)
Cash and cash equivalents, beginning of period	13,635		14,250		10,358		49,330
Cash and cash equivalents, end of period	31,109		10,358		31,109		10,358

Cash provided by operating activities

During Q4 2019, the Company utilized cash flows in operations of $1.6 million, net of cash outflows in working capital of $1.0 million (Q4 2018 – utilized cash flows in operations of $1.9 million, consisting of cash outflows before working capital changes of $1.8 million and outflows from non-cash working capital of $0.1 million). In Q4 2019, cash outflows of $1.0 million from non-cash working capital were primarily the result of a $1.3 million increase in receivables, partly offset by a $0.2 million increase in accounts payable and accruals and a $0.1 million decrease in prepaid expenses.

During the year ended December 31, 2019, the Company utilized cash flows from operations of $8.7 million, net of cash outflows in working capital of $3.8 million (year ended December 31, 2018 – operating cash flows generated of $33.4 million, consisting of cash inflows before working capital changes of $63.3 million and outflows from non-cash working capital of $29.9 million). For the year ended December 31, 2019, cash outflows of $3.8 million from non-cash working capital were primarily the result of a $1.7 million decrease in accounts payable and accruals, $1.9 million increase in receivables and a $0.2 million increase in prepaid expenses.

Cash flows from operations were lower for the year ended December 31, 2019 compared to the same period in 2018 due to the deconsolidation of the AGM as a result of the closing of the JV Transaction, which took effect as of July 31, 2018. Accordingly, the consolidated cash flows for the year ended December 31, 2018 include 100% of the cash flows of the AGM for the period January 1, 2018 to July 31, 2018 and so are not to that extent comparable to the current year.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

Cash from (used in) investing activities

During the three months and year ended December 31, 2019, the Company generated cash of $20.1 million and $30.2 million, respectively, through investing activities, compared to the same periods in 2018 where the Company utilized cash of $2.0 million and generated cash of $82.3 million, respectively.

Cash generated by investing activities during the three months ended December 31, 2019 was the result of a $10.0 million payment received from Gold Fields in connection with the JV Transaction, a $10.0 million preferred share redemption payment from the JV, and $0.1 million of interest earned on cash and cash equivalent balances. During the three months ended December 31, 2018, cash utilized in investing activities primarily related to $2.0 million of transactions costs associated with the closing of the JV Transaction.

Cash generated by investing activities during the year ended December 31, 2019 was the result of $20.0 million payments received from Gold Fields in connection with the JV Transaction, a $10.0 million preferred share redemption payment from the JV, and $0.2 million of interest earned on cash and cash equivalent balances.

During the year ended December 31, 2018, the primary source of investing cash flows was Gold Fields’ $165.0 million investment in the JV, which was partially offset by $53.9 million spent on additions to the AGM’s MPP&E, and $4.8 million in paid transaction costs associated with the JV Transaction. Additionally, on closing of the JV Transaction, the Company presented cash and cash equivalents of the JV of $24.4 million derecognized on loss of control within investing activities.

Cash used in financing activities

During the three months and year ended December 31, 2019, $1.0 million and $0.7 million of cash was used in financing activities, compared to the same periods in 2018 where financing activities used $2,000 and $154.6 million in cash.

During the three months ended December 31, 2019, cash used in financing activities of $1.0 million related to share repurchases under the Company’s NCIB and lease payments on corporate office space.

During the year ended December 31, 2019, cash used in financing activities of $0.7 million related share repurchases under the Company’s NCIB and lease payments on corporate office space, partly offset by cash inflows of $0.3 million relating to the exercise of employee stock options.

During the year ended December 31, 2018, cash used in financing activities amounted to $154.6 million consisting of $163.8 million to repay all principal and accrued interest on the former Red Kite debt facility and $8.3 million in interest and applicable withholding taxes, which were partly offset by $17.4 million in cash received from a private placement investment by Gold Fields as part of the JV Transaction.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

8. Non-GAAP measures

The Company has included certain non-GAAP performance measures throughout this MD&A. These performance measures are employed by management to assess the Company’s operating and financial performance and to assist in business decision-making. The Company believes that, in addition to conventional measures prepared in accordance with GAAP, certain investors and other stakeholders use this information to evaluate the Company’s operating and financial performance; however, as explained elsewhere herein, these non-GAAP performance measures do not have any standardized meaning and therefore may not be comparable to similar measures presented by other issuers. Accordingly, these performance measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.

8.1 Operating cash costs per ounce and total cash costs per ounce

The Company has included the non-GAAP performance measures of operating cash costs per ounce and total cash costs per ounce on a by-product basis throughout this MD&A. In the gold mining industry, this is a common performance measure but does not have any standardized meaning. The Company follows the recommendations of the Gold Institute Production Cost Standard. The Gold Institute, which ceased operations in 2002, was a non-regulatory body and represented a global group of suppliers of gold and gold products. The production cost standard developed by the Gold Institute remains the generally accepted standard of reporting cash costs of production by many gold mining companies. Management uses operating cash costs per ounce and total cash costs per ounce to monitor the operating performance of the JV and to assess the attractiveness of potential acquisition targets. The Company believes that, in addition to conventional measures prepared in accordance with GAAP, some investors use this information to evaluate the Company’s performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Other companies may calculate operating cash costs and total cash costs per ounce differently. The JV does not calculate this information for use by both JV partners, rather it is calculated by the Company solely for the Company’s own disclosure purposes.

The following tables provide reconciliations of operating and total cash costs per gold ounce of the AGM (net of silver by-product revenues) to various operating expenses of the AGM on a 100% basis (the nearest GAAP measure) as presented in the notes to the consolidated annual financial statements of the Company for the years ended December 31, 2019 and 2018.

	Three months ended December 31,		Year ended December 31,
	2019	2018	2019	2018
(in thousands of US dollars, except per ounce amounts)	$	$	$	$
Total production costs ^4^	52,582	50,456	194,476	158,047
Share-based payment expens e included in production costs	(152)	(75)	(411)	(506)
By-product revenue	(239)	(224)	(832)	(868)
Total operating cash costs	52,191	50,157	193,233	156,673
Royalties and production taxes	4,853	3,768	17,159	14,250
Total cash costs	57,044	53,925	210,392	170,923
Gold ounces sold	66,095	61,821	248,862	227,772
Operating cash costs per gold ounce sold ($/ounce)	790	811	776	688
Total cash costs per gold ounce sold ($/ounce)	863	872	845	750

^4^ Total production costs exclude a provision for a one-time contract termination fee.

8.2 All-in sustaining costs per gold ounce

In June 2013, the World Gold Council, a non-regulatory association of many of the world’s leading gold mining companies established to promote the use of gold to industry, provided guidance for the calculation of “all-in sustaining costs per gold ounce” in an effort to encourage improved understanding and comparability of the total costs associated with mining an ounce of gold. The Company has adopted the reporting of “all-in sustaining costs per gold ounce”, which is a non-GAAP performance measure. The Company believes that the all-in sustaining costs per gold ounce measure provides additional insight into the costs of producing gold by capturing all of the expenditures required for the discovery, development and sustaining of gold production and allows the Company to assess its ability to support capital expenditures to sustain future production from the generation of operating cash flows. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, some investors use this information to evaluate the JV’s performance and ability to generate cash flow, disposition of which is subject to the terms of the JVA. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate all-in sustaining costs per ounce differently. The JV does not calculate this information for use by both JV partners, rather it is calculated by the Company solely for the Company’s own disclosure purposes.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

The following table provides a reconciliation of AISC of the AGM to various operating expenses of the AGM on a 100% basis (the nearest GAAP measure), as presented in the notes to the consolidated annual financial statements of the Company for the years ended December 31, 2019 and 2018.

	Three months ended December 31,		Year ended December 31,
	2019	2018	2019	2018
(in thousands of US dollars except per ounce amounts)	$	$	$	$
Total cash costs (as reconciled above)	57,044	53,925	210,392	170,923
General and administrative expenses - JV	1,333	2,501	6,341	8,609
Sustaining capital expenditures	1,253	1,677	6,442	3,892
Sustaining capitalized stripping costs	3,405	7,938	37,075	59,769
Reclamation cost accretion	272	218	903	888
Sustaining lease payments	436	-	13,705	-
Interest on lease liabilities	307	-	1,817	-
All-in sustaining cost	64,050	66,259	276,675	244,081
Gold ounces sold	66,095	61,821	248,862	227,772
All-in sustaining cost per gold ounce sold ($/ounce) - JV	969	1,072	1,112	1,072
Average realized price per gold ounce sold ($/ounce)	1,465	1,215	1,376	1,247
All-in sustaining margin ($/ounce)	496	143	264	175
All-in sustaining margin	32,783	8,854	65,700	39,860

Excluded from the G&A costs of the AGM is non-cash share-based compensation expense of $78,000 and $208,000 for the three months and year ended December 31, 2019, respectively (three months and year ended December 31, 2018 – $45,000 and $0.2 million, respectively).

For the three months and year ended December 31, 2019, the Company incurred corporate G&A expenses, net of the JV service fee, of $0.5 million and $4.8 million which excludes non-cash share-based compensation expense of $0.5 million and $1.8 million (three months and year ended December 31, 2018 – G&A expenses net of JV service fee of $1.8 million and $4.1 million, respectively, less non-cash share-based compensation of $0.3 million and $1.1 million, respectively). The Company’s attributable gold ounces sold for the three months and year ended December 31, 2019 was 29,743 and 111,988, respectively (three months and year ended December 31, 2018 – 27,819 and 171,625 ounces, respectively), resulting in additional all-in sustaining cost for the Company of $15/oz and $43/oz for these respective periods, in addition to the AGM’s all-in sustaining cost presented in the above table (three months and year ended December 31, 2018 – $65/oz and $24/oz, respectively).

All-in sustaining costs adjust “Total cash costs” for G&A expenses, reclamation cost accretion, sustaining capitalized stripping costs (excludes operating pits which have not achieved steady-state operations) and sustaining capital expenditures. Sustaining capital expenditures, capitalized stripping costs and reclamation cost accretion are not line items on the AGM’s financial statements. Sustaining capital expenditures are defined as those capital expenditures which do not materially benefit annual or life of mine gold ounce production at a mine site. A material benefit to a mine site is considered to be at least a 10% increase in annual or life of mine production, net present value, or reserves compared to the remaining life of mine of the operation. As such, sustaining costs exclude all expenditures at the AGM’s ‘new projects’ and certain expenditures at the AGM’s operating sites which are deemed expansionary in nature. Capitalized stripping costs represent costs incurred at steady-state operations during the period which have been deferred to mining interests as they allow the AGM to gain access to ore bodies to be mined in future periods; these costs are not considered expansionary in nature as they relate to currently identified reserves and resources. Reclamation cost accretion represents the growth in the AGM’s decommissioning provision due to the passage of time. This amount does not reflect cash outflows, but it is considered to be representative of the periodic costs of reclamation and remediation. Reclamation cost accretion is included in finance expense in the AGM’s results as disclosed in the consolidated annual financial statements of the Company for the years ended December 31, 2019 and 2018.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

The following table reconciles sustaining capital expenditures on a 100% basis for the AGM to the total capital expenditures of the AGM, as presented in the notes to the consolidated annual financial statements of the Company for the years ended December 31, 2019 and 2018. Note the comparative period reconciliation includes 100% of the capital expenditures of the AGM.

	Three months ended December 31,		Year ended December 31,
	2019	2018	2019	2018
(in thousands of US dollars)
Investing cash flows of the AGM	12,242	21,495	62,672	85,633
Less:
Sustaining capitalized stripping costs	(3,405	(7,938	(37,075	(59,769
Non-sustaining capital expenditures	(5,160	(9,763	(18,528	(21,329
Change in AP related to capital expenditures	(2,493	(2,040	(912	(391
not included in AISC
Interest income received	69	(77	285	(252
Total sustaining capital expenditures	1,253	1,677	6,442	3,892

All values are in US Dollars.

The majority of the non-sustaining capital expenditures during Q4 2019 and year ended December 31, 2019 related to development activities at Esaase, including the commencement of a village relocation.

8.3 Adjusted Net Income (Loss)

The Company has included the non-GAAP performance measures of adjusted net income (loss) and adjusted net income (loss) per share throughout this MD&A. Neither adjusted net income nor adjusted net income per share have any standardized meaning and are therefore unlikely to be comparable to other measures presented by other issuers. Adjusted net income excludes certain non-cash items from net income or net loss to provide a measure which helps the Company and investors to evaluate the results of the underlying core operations of the Company and its ability to generate cash flows. The Company believes that the presentation of adjusted net income is appropriate to provide additional information to investors regarding items that we do not expect to continue at the same level in the future or that management does not believe to reflect the Company’s ongoing operating performance. The Company further believes that its presentation of this non-GAAP financial measure provides information that is useful to investors because it is an important indicator of the strength of our operations and the performance of our core business. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The following table provides a reconciliation of adjusted net income (loss) to net income (loss) (the nearest GAAP measure) per the consolidated annual financial statements of the Company for the years ended December 31, 2019 and 2018. All adjustments are shown net of estimated tax.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018
	Three months ended December 31,		Year ended December 31,
---	---	---	---	---
	2019	2018	2019	2018
(in thousands of US dollars, except per share amounts)
Net income (loss) for the period attributable to common <br> shareholders	(21,205	(867	(167,928	(141,372
Interest in impairment of AGM	1,977	-	130,315	-
Change in fair value of preferred shares related to updated <br> LOM plan	20,169	-	40,140	-
Loss due to loss of control of the AGM	-	-	-	143,261
Adjusted net income (loss) for the period attributable to common shareholders	941	(867	2,527	1,889
Basic weighted average number of common share outstanding	225,948,601	225,804,614	225,867,169	220,108,770
Diluted weighted average number of common share <br> outstanding	225,948,601	225,804,614	225,867,169	220,108,770
Adjusted net income (loss) per share attributable to common shareholders - basic and diluted	0.00	(0.00	0.01

All values are in US Dollars.

8.4 EBITDA and Adjusted EBITDA

EBITDA provides an indication of the Company’s continuing capacity to generate income from operations before considering the Company’s financing decisions and costs of amortizing capital assets. Accordingly, EBITDA comprises net income (loss) excluding interest expense, interest income, amortization and depletion, and income taxes. Adjusted EBITDA adjusts EBITDA to exclude non-recurring items and non-cash items and includes the calculated Adjusted EBITDA of the JV. Other companies may calculate EBITDA and Adjusted EBITDA differently. The JV does not calculate this information for use by both JV partners, rather it is calculated by the Company solely for the Company’s own disclosure purposes.

The following table provides a reconciliation of EBITDA and Adjusted EBITDA attributable to the Company based on its economic interest in the JV to net income (loss) (the nearest GAAP measure) of the Company and the JV, respectively, per the consolidated annual financial statements of the Company for the years ended December 31, 2019 and 2018. All adjustments are shown net of estimated income tax.

	Three months ended December 31,		Year ended December 31,
	2019	2018	2019	2018
(in thousands of US dollars )
Net loss for the period	(21,205	(867	(167,928	(141,213
Add back:
Depreciation and depletion	(40	13	(98	41,991
Finance income	(135	(2,530	(871	(5,555
Finance expense	20,180	4	35,650	10,737
Current income tax expense	-	(8	-	1,079
Deferred income tax expense	-	-	-	11,430
EBITDA for the period	(1,200	(3,388	(133,247	(81,531
Add back (deduct):
Non-cash share based compensation	(506	338	(1,789	1,645
Loss due to loss of control of subsidiaries	-	-	-	143,261
Share of net loss related to joint venture	-	1,306	126,264	1,050
Asanko's attributable interest in JV Adjusted EBITDA	14,290	7,849	44,730	14,548
Adjusted EBITDA for the period	12,584	6,105	35,958	78,973

All values are in US Dollars.

The following table reconciles the JV’s EBITDA and Adjusted EBITDA for the three months and year ended December 31, 2019 to the results of the JV as disclosed in note 8 to the Company’s consolidated annual financial statements for the years ended December 31, 2019 and 2018. Note that for the three months and year ended December 31, 2018 in the table below, the financial results of the AGM are included for the period August 1, 2018 to September 30, 2018 only, while the financial results of the AGM for the period January 1, 2018 to July 31, 2018 were consolidated by the Company and, therefore, included in the EBITDA table above.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018
	Three months ended	Three months ended	Year ended	Five months ended	Year ended
---	---	---	---	---	---
	December 31, 2019	December 31, 2018	December 31, 2019	December 31, 20185	December 31, 2018
(in thousands of US dollars)
JV net income (loss) for the period	58	(3,099	(280,523	(2,531	(124,876
Add back:
JV depreciation and depletion	30,578	20,845	95,418	34,329	76,273
JV Finance income	(68	(76	(283	(154	(252
JV Finance expense	1,095	232	8,905	685	11,088
JV Current income tax expense	-	-	-	-	19
JV Deferred income tax expense (recovery)	-	(460	-	-	11,430
JV EBITDA for the period	31,663	17,442	(176,483	32,329	(26,318
Add back (deduct):
Impairment associated with AGM LOM plan^6^	4,393	-	289,589	-	-
JV Mining contractor lease payments (capitalized leases)	(4,301	-	(13,705	-	-
JV Adjusted EBITDA for the period	31,755	17,442	99,401	32,329	(26,318
Asanko's attributable interest in JV Adjusted EBITDA for the period	14,290	7,849	44,730	14,548	(11,843

All values are in US Dollars.

^5^ Five months ended December 31, 2018 as per note 22 of the consolidated annual financial s tatements for the years ended December 31, 2018 and 2017.

^6^ The impairment of the AGM was i dentified and assessed during the quarter ended September 30, 2019 and finalized in Q4 2019.

While the above figure reflects an estimate of the Company’s “attributable interest” in Adjusted EBITDA generated from the AGM, these funds are not within the Company’s exclusive control as the disposition of cash from the JV is governed by the JVA. The JVA provides that “Distributable Cash” will be calculated and distributed quarterly, if available. “Distributable Cash” means an amount to be calculated at each calendar quarter-end, as being the lesser of (i) cash and cash equivalents which are projected at that time to be surplus to all the JV companies taken together, after providing for all amounts anticipated to be required to be paid during a period of at least the ensuing two calendar quarters in order to pay the net obligations (net of anticipated revenues during such two subsequent quarters) which will arise out of the operations contemplated by the current approved program and budget while also providing for retention of a reasonable amount of cash and cash equivalents for working capital, contingencies and reserves, all of which factors shall be considered by the management committee); and (ii) the maximum amount permissible for distributions to shareholders of a particular JV company at that time in accordance with applicable law and the terms of any third party loan or other agreement in effect which limits distributions from the JV companies. Distributable cash is to be paid out by the JV in certain priority generally to interest and principal of loans, redemption of the preferred shares issued by JV Finco (of which shares each partner holds 175 million preferred shares as at December 31, 2019, after redemptions paid by the JV in 2019) and finally as dividends on common shares of the JV companies (which the JV partners own 45:45 with the Government of Ghana holding 10%).

8.5 Free Cash Flow

The Company uses the financial measure Free Cash Flow, which is a non-GAAP financial measure, to supplement information in its condensed consolidated interim financial statements. Free Cash Flow does not have any standardized meaning prescribed under IFRS, and therefore it may not be comparable to similar measures employed by other companies. The Company believes that in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors and analysts use this information to evaluate the JV’s performance with respect to its operating cash flow capacity to meet non-discretionary outflows of cash. The presentation of Free Cash Flow is not meant to be a substitute for the cash flow information presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. Free Cash Flow is calculated as cash flows from operating activities of the JV adjusted for cash flows associated with sustaining and non-sustaining capital expenditures and payments made to mining contractors for leases capitalized under IFRS 16.

The following table provides a reconciliation of Free Cash Flow of the AGM to its cash flows from operating activities on a 100% basis (the nearest GAAP measures), as presented in the notes to the consolidated annual financial statements of the Company for the years ended December 31, 2019 and 2018.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018
	Three months ended December 31,		Year ended December 31,
---	---	---	---	---
	2019	2018	2019	2018
(in thousands of US dollars )
Cash flows from operating activities before working capital changes	33,808	17,805	109,785	100,454
Net change in working capital	11,632	(4,932	10,590	(27,967
Cash flows from operating activtities	45,440	12,873	120,375	72,487
Less:
Cash flows used in investing activities	(12,242	(21,495	(62,672	(85,633
Mining contractor lease payments (capitalized leases)	(4,301	-	(13,705	-
Free Cash Flow for the period	28,897	(8,622	43,998	(13,146

All values are in US Dollars.

9. Summary of outstanding share data

As of the date of this MD&A, there were 224,394,617 common shares of the Company issued and outstanding and 8,971,737 share purchase options outstanding (with exercise prices ranging between C$0.86 and C$4.77 per share). The fully diluted outstanding share count at the date of this MD&A is 233,366,354.

10. Related party transactions

As at December 31, 2019, the Company’s related parties are its subsidiaries and the JV, its JV partners, and key management personnel. During normal course of operations, the Company enters into transactions with its related parties. During the three months and year ended December 31, 2019, all related party transactions were in the normal course of business including compensation payments to key management personnel.

As at December 31, 2019, the Company had a $4.2 million receivable owing from the JV in relation to the Company’s service fee earned for being the operator of the JV (December 31, 2018 – $2.3 million).

11. Critical accounting policies and estimates

11.1 Estimates and judgements

The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Management believes the estimates and assumptions used in the consolidated annual financial statements are reasonable; however, actual results could differ from those estimates and could impact future results of operations and cash flows. The Company’s significant accounting judgments and estimates are presented in note 5 of the audited annual consolidated financial statements for the years ended December 31, 2019 and 2018. During the year ended December 31, 2019, an impairment was recorded against the carrying value of the AGM, which was based on management’s estimate of the recoverable amount of the AGM. The determination of the recoverable amount of the AGM required significant estimates and judgements as discussed previously in this MD&A.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

11.2 Changes in Accounting Policies including Initial Adoption

(a) Accounting standards adopted January 1, 2019

Leases

In January 2016, the IASB issued IFRS 16 which replaces IAS 17 – Leases and its associated interpretative guidance. IFRS 16 applies a control model to the identification of leases, distinguishing between a lease and a service contract on the basis of whether the customer controls the asset being leased. For those assets determined to meet the definition of a lease, IFRS 16 introduces significant changes to the accounting by lessees, introducing a single, on-balance sheet accounting model that is similar to current finance lease accounting, with limited exceptions for short-term leases or leases of low value assets. Lessor accounting remains similar to current accounting practice. The standard is effective for annual periods beginning on or after January 1, 2019.

The Company has not identified any material leases or other contracts containing a lease to be recognized on balance sheet as of January 1, 2019.

The adoption of IFRS 16 did however impact the Company’s equity pick-up from the AGM JV. The JV recognized a right-of-use assets and lease liabilities at January 1, 2019 relating to the JV’s mining contractor agreements. Previously, the JV recognized monthly fixed payments for equipment to mining contractors as production costs. Under IFRS 16, these fixed monthly payments were capitalized as a lease and resulted in a change in their previous presentation as production costs. Rather, the JV has recognized a depreciation charge for the right-of-use assets and interest expense on the lease liabilities. The JV elected to adopt the practical expedient in IFRS 16 to not reassess whether a contract is, or contains, a lease at the date of initial application. Any contracts or agreements that were not previously identified as containing a lease under IAS 17 or IFRIC 4, were not reassessed as of January 1, 2019. Rather, IFRS 16 was applied only to contracts entered into (or changed) on or after January 1, 2019.

On adoption of IFRS 16, the JV recognized right-of-use assets and lease liabilities of $36.6 million as at January 1, 2019. However, the net impact on the profit and loss of the JV for the three and twelve months ended December 31, 2019 was not materially different from accounting for these contracts under IAS 17 and, as a result, the adoption of IFRS 16 did not have a material impact on the Company’s equity pick-up for the year.

(b) Accounting standards and amendments issued but not yet adopted

The following standards and interpretations, which may be applicable to the Company, have been issued but are not yet effective as of December 31, 2019:

Revised Conceptual Framework

12. Risks and uncertainties

12.1 Financial instruments & risk

The Company’s business, operations and future prospects are subject to significant risks. For details of these risks, refer to the risk factors set forth in the Company’s most recently filed AIF, which can be found under the Company’s corporate profile on SEDAR at www.sedar.com, and the Company’s most recently filed Form 40-F Annual Report, which can be found on EDGAR at www.sec.gov.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

Other than as disclosed below, management is not aware of any significant changes to the risks identified in the Company’s most recently filed AIF nor has the Company’s mitigation of those risks changed significantly during the year ended December 31, 2019. These risks, and the risk factors disclosed below, could materially affect the Company’s business, operations, prospects and share price and could cause actual events to differ materially from those described in forward-looking statements relating to the Company. Additional risks and uncertainties not presently known to the Company or that the Company currently considers immaterial may also impair the business, operations, prospects and share price of the Company. If any of the risks actually occur, the business of the Company may be harmed, and its financial condition and results of operations may suffer significantly.

12.2 AGM LOM

Asanko has completed its work over the AGM LOM plan, however, the AGM LOM plan is still being reviewed by the JV management committee and the life of mine cash flow projections that are used in the impairment assessment are not based on a published NI 43-101 report. As disclosed elsewhere in this MD&A, as a result of management’s expectation that the AGM LOM plan will reflect estimated total reserve extraction that is less than the total previously estimated reserves, an impairment of $289.6 million was recorded against the carrying value of the AGM. Future changes to the AGM LOM plan, which may arise from the JV management committee’s review process, may include (but may not be limited to) changes to the current estimates of in-situ ounces, ore tonnes to be mined in future periods, strip ratios, head grades, recovery rates, gold price assumptions, mining costs, processing costs, trucking costs, capital and closure costs, as well as discount rates. Changes to any of these factors may reduce the economic benefit of the AGM, including reductions in net present values and internal rates of return, and this may materially affect the Company’s future financial performance.

13. Internal control

13.1 Disclosure Controls and Procedures

Evaluation of Disclosure Controls and Procedures are designed to provide reasonable assurance that all relevant information is gathered and reported to senior management, including the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), on a timely basis so that appropriate decisions can be made regarding public disclosure. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS. Management of the Company, with the participation of the CEO and the CFO, have evaluated the design and operating effectiveness of the Company’s disclosure controls and procedures and the design as required by Canadian and United States securities legislation, and have concluded that, as of December 31, 2019, such disclosure controls and procedures were effective.

13.2 Internal Control over Financial Reporting

The Company’s management, with the participation of its CEO and CFO, is responsible for establishing and maintaining adequate internal control over financial reporting. Under the supervision of the CEO and CFO, the Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS. The Company’s internal control over financial reporting includes policies and procedures that:

• pertain to the maintenance of records that accurately and fairly reflect, in reasonable detail, the transactions and dispositions of assets of the Company;

• provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS and that the Company’s receipts and expenditures are made only in accordance with authorizations of management and the Company’s Directors; and

• provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the Company’s consolidated financial statements.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

The Company’s management, with the participation of its CEO and CFO, assessed the effectiveness of the Company’s internal control over financial reporting. In making this assessment, management used the criteria set forth in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013). Based on this assessment, management and the CEO and CFO have concluded that, as of December 31, 2019, the Company’s internal control over financial reporting was effective.

13.3 Changes in Internal Control over Financial Reporting

There has been no change in the Company’s internal control over financial reporting during the three months ended December 31, 2019 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

13.4 Limitations of controls and procedures

The Company’s management, including the CEO and CFO, believes that any disclosure controls and procedures or internal control over financial reporting, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, they cannot provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been prevented or detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by unauthorized override of the control. The design of any control system also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Accordingly, because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

14. Qualified person

The technical contents in this MD&A have been approved by Mike Begg, Pr.Sci.Nat., Senior Vice President Technical Services of Asanko Gold Inc., who is a “Qualified Person” as defined by Canadian National Instrument 43-101 (Standards of Mineral Disclosure).

15. Cautionary statements

15.1 Cautionary statement on forward-looking information

Certain statements and information contained in this MD&A constitute “forward-looking statements” within the meaning of applicable U.S. securities laws and “forward-looking information” within the meaning of applicable Canadian securities laws, which we refer to collectively as “forward-looking statements”. Forward-looking statements are statements and information regarding possible events, conditions or results of operations that are based upon assumptions about future conditions and courses of action. All statements and information other than statements of historical fact may be forward looking statements. In some cases, forward-looking statements can be identified by the use of words such as “seek”, “expect”, “anticipate”, “budget”, “plan”, “estimate”, “continue”, “forecast”, “intend”, “believe”, “predict”, “potential”, “target”, “may”, “could”, “would”, “might”, “will” and similar words or phrases (including negative variations) suggesting future outcomes or statements regarding an outlook.

Forward-looking statements in this MD&A include, but are not limited to: statements with respect to the AGM LOM; statements with respect to the AGM LOM plan, including in respect of anticipated mine life, gold production, anticipated resource and reserve levels; statements with respect to the estimated recoverable amount of the AGM and the assumptions applied in assessing the recoverable amount of the AGM; statements with respect to the Company’s plans or future financial or operating performance, the estimation of mineral reserves and resources, conclusions of economic assessments of projects, the timing and amount of estimated future production, costs of future production, future capital expenditures, costs and timing of the development of deposits, success of exploration activities, permitting time lines, requirements for additional capital, sources and timing of additional financing, realization of unused tax benefits and future outcome of legal and tax matters. Such forward-looking statements are based on a number of material factors and assumptions, including, but not limited to: the accuracy of reserve and resource, grade, mine life, cash cost, net present value, internal rate of return and production and processing estimates and other assumptions, projections and estimates made in the technical reports for the AGM or in respect of AGM; the successful completion of development and exploration projects, planned expansions or other projects within the timelines anticipated and at anticipated production levels; that mineral resources can be developed as planned; that the Company’s relationship with joint venture partners will continue to be positive and beneficial to the Company; interest and exchange rates; that required financing and permits will be obtained; general economic conditions; that labour disputes or disruptions, flooding, ground instability, geotechnical failure, fire, failure of plant, equipment or processes to operate are as anticipated and other risks of the mining industry will not be encountered; that contracted parties provide goods or services in a timely manner; that there is no material adverse change in the price of gold or other metals; competitive conditions in the mining industry; title to mineral properties; costs; taxes; the retention of the Company’s key personnel; and changes in laws, rules and regulations applicable to Asanko.

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

• mineral reserve and resource estimates may change and may prove to be inaccurate;

• LOM estimates are based on a number of factors and assumptions and may prove to be incorrect;

• the AGM has a limited operating history and is subject to risks associated with establishing new mining operations;

• sustained increases in costs, or decreases in the availability, of commodities consumed or otherwise used by the Company may adversely affect the Company;

• actual production, costs, returns and other economic and financial performance may vary from the Company’s estimates in response to a variety of factors, many of which are not within the Company’s control;

• adverse geotechnical and geological conditions (including geotechnical failures) may result in operating delays and lower throughput or recovery, closures or damage to mine infrastructure;

• the ability of the Company to treat the number of tonnes planned, recover valuable materials, remove deleterious materials and process ore, concentrate and tailings as planned is dependent on a number of factors and assumptions which may not be present or occur as expected;

• the Company’s operations may encounter delays in or losses of production due to equipment delays or the availability of equipment;

• the Company’s operations are subject to continuously evolving legislation, compliance with which may be difficult, uneconomic or require significant expenditures;

• the Company may be unsuccessful in attracting and retaining key personnel;

• labour disruptions could adversely affect the Company’s operations;

• the Company’s business is subject to risks associated with operating in a foreign country;

• risks related to the Company’s use of contractors;

• the hazards and risks normally encountered in the exploration, development and production of gold;

• the Company’s operations are subject to environmental hazards and compliance with applicable environmental laws and regulations;

• the Company’s operations and workforce are exposed to health and safety risks;

• unexpected costs and delays related to, or the failure of the Company to obtain, necessary permits could impede the Company’s operations;

• the Company’s title to exploration, development and mining interests can be uncertain and may be contested;

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

• the Company’s properties may be subject to claims by various community stakeholders;

• risks related to limited access to infrastructure and water;

• the Company’s exploration programs may not successfully expand its current mineral reserves or replace them with new reserves;

• the Company’s common shares may experience price and trading volume volatility;

• the Company’s revenues are dependent on the market prices for gold, which have experienced significant recent fluctuations;

• the Company may not be able to secure additional financing when needed or on acceptable terms;

• Company shareholders may be subject to future dilution;

• risks related to changes in interest rates and foreign currency exchange rates;

• changes to taxation laws applicable to the Company may affect the Company’s profitability and ability to repatriate funds;

• the Company’s primary asset is held through a joint venture, which exposes the Company to risks inherent to joint ventures, including disagreements with joint venture partners and similar risks;

• risks related to the Company’s internal controls over financial reporting and compliance with applicable accounting regulations and securities laws;

• the carrying value of the Company’s assets may change and these assets may be subject to impairment charges;

• the Company may be liable for uninsured or partially insured losses;

• the Company may be subject to litigation;

• the Company may be unsuccessful in identifying targets for acquisition or completing suitable corporate transactions, and any such transactions may not be beneficial to the Company or its shareholders;

• the Company must compete with other mining companies and individuals for mining interests; and

• risks related to information systems security threats.

Although the Company has attempted to identify important factors that could cause actual results or events to differ materially from those described in the forward-looking statements, you are cautioned that this list is not exhaustive and there may be other factors that the Company has not identified. Furthermore, the Company undertakes no obligation to update or revise any forward-looking statements included in, or incorporated by reference in, this MD&A if these beliefs, estimates and opinions or other circumstances should change, except as otherwise required by applicable law.

Historical results of operations and trends that may be inferred from the following discussions and analysis may not necessarily indicate future results from operations. Historically, the Company’s operations have been primarily funded from debt and share issuances, as well as the exercise of share-based options. The Company has had and may have future capital requirements in excess of its currently available resources. In the event the Company’s plans change, its assumptions change or prove inaccurate, or its capital resources in addition to projected cash flow, if any, prove to be insufficient to fund its future operations, the Company may be required to seek additional financing.

Although the Company has to-date been able to raise capital, there can be no assurance that the Company will have sufficient financing to meet its future capital requirements or that additional financing will be available on terms acceptable to the Company in the future.

Readers are cautioned that the previously published Expansion Projects (including parts of Project 5 Million and Project 10 Million of the AGM as outlined in the 12/17 DFS are not currently included in the updated AGM LOM plan (see “Updated Life of Mine Plan and Associated Impairment Loss”).

15.2 Cautionary note for United States investors

As a British Columbia corporation and a “reporting issuer” under Canadian securities laws, the Company is required to provide disclosure regarding its mineral properties, including the AGM, in accordance with Canadian National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”). NI 43-101 is a rule developed by the Canadian Securities Administrators that establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. In accordance with NI 43- 101, the Company uses the terms mineral reserves and resources as they are defined in accordance with the CIM Definition Standards on mineral reserves and resources (the “CIM Definition Standards”) adopted by the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM Council”).

ASANKO GOLD INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS<br><br> <br>FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018

The SEC has adopted amendments to its disclosure rules to modernize the mineral property disclosure requirements for issuers whose securities are registered with the United States Securities and Exchange Commission (the “SEC”) under the U.S. Exchange Act. These amendments will be effective February 25, 2019 (the “SEC Modernization Rules”). The SEC Modernization Rules will replace the historical property disclosure requirements for mining registrants that were included in SEC Industry Guide 7 (“Guide 7”), which will be rescinded. The Company is not required to provide disclosure on its mineral properties, including the AGM, under the SEC Modernization Rules as the Company is presently a “foreign issuer” under the U.S. Exchange Act and entitled to file continuous disclosure reports with the SEC under the MJDS Disclosure System between Canada and the United States.

The SEC Modernization Rules include the adoption of terms describing mineral reserves and mineral resources that are “substantially similar” to the corresponding terms under the CIM Definition Standards. As a result of the adoption of the SEC Modernization Rules, SEC will now recognize estimates of “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources”. In addition, the SEC has amended its definitions of “proven mineral reserves” and “probably mineral reserves” to be “substantially similar” to the corresponding CIM Definitions.

United States investors are cautioned that while the above terms are “substantially similar” to CIM Definitions, there are differences in the definitions under the SEC Modernization Rules and the CIM Definition Standards. Accordingly, there is no assurance any mineral reserves or mineral resources that the Company may report as ”proven reserves”, “probable reserves”, “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources” under NI 43-101 would be the same had the Company prepared the reserve or resource estimates under the standards adopted under the SEC Modernization Rules.

United States investors are also cautioned that while the SEC will now recognize “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources”, investors should not to assume that any part or all of the mineralization in these categories will ever be converted into a higher category of mineral resources or into mineral reserves. Mineralization described using these terms has a greater amount of uncertainty as to their existence and feasibility than mineralization that has been characterized as reserves. Accordingly, investors are cautioned not to assume that any “measured mineral resources”, “indicated mineral resources”, or “inferred mineral resources” that the Company reports are or will be economically or legally mineable.

Further, “inferred resources” have a greater amount of uncertainty as to their existence and as to whether they can be mined legally or economically. Therefore, United States investors are also cautioned not to assume that all or any part of the inferred resources exist. In accordance with Canadian rules, estimates of “inferred mineral resources” cannot form the basis of feasibility or other economic studies, except in limited circumstances where permitted under NI 43-101.

United States investors are also cautioned that disclosure of exploration potential is conceptual in nature by definition and there is no assurance that exploration of the mineral potential identified will result in any category of NI 43-101 mineral resources being identified.

Asanko Gold Inc.: Exhibit 99.3 - Filed by newsfilecorp.com

(All dollar amounts are United States dollars unless otherwise stated)

ASANKO GOLD REPORTS Q4 AND FULL YEAR 2019 RESULTS, AND PROVIDES 2020 GUIDANCE

Vancouver, British Columbia, February 13, 2020 - Asanko Gold Inc. ("Asanko" or the "Company") (TSX, NYSE American: AKG) reports fourth quarter ("Q4") and full year ("FY") 2019 operating and financial results and provides 2020 guidance for the Asanko Gold Mine ("AGM"), located in Ghana, West Africa. The AGM is a 50:50 joint venture ("JV") with Gold Fields Ltd (JSE, NYSE: GFI), which is managed and operated by Asanko.

Q4 2019 Asanko Gold Mine Highlights (100% basis)

Record quarterly gold production of 66,112 ounces at all-in sustaining cost^1^ ("AISC") of $969/oz
Gold sales of 66,095 ounces at an average realized price of $1,465/oz, generating gold sales proceeds of $96.8 million
Strong cash flow generation with operating cash flow of $45.4 million, and free cash flow^1^ of $28.9 million
Received the "Mining Company of the Year" award from the Ghana Chamber of Mines for the second year in a row

FY 2019 Asanko Gold Mine Highlights (100% basis)

Record proceeds of $342.4 million generated from gold sales of 248,862 ounces at an average realized price of $1,376 per ounce
Record gold production of 251,044 ounces exceeding upper end of guidance of 225,000 - 245,000 ounces
AISC of $1,112/oz, 5% higher than guidance of $1,040 - $1,060/oz
Generated operating cash flow of $120.4 million and free cash flow of $44.0 million
At December 31, 2019, the JV had cash of $43.8 million ($3.0 million of which was restricted in favour of a gold hedging counterparty and released on January 3, 2020), $9.1 million in gold receivables and $2.8 million in dore

Q4 and FY 2019 Highlights for Asanko Gold Inc.

Repurchased 1,108,920 common shares for $1.0 million through a normal course issuer bid ("NCIB") that commenced on November 15, 2019
Received the final of two $10.0 million payments from Gold Fields based on the achievement of the agreed Esaase development milestone and an additional $10.0 million distribution from the JV
At December 31, 2019, Asanko had cash and receivables of $35.5 million
Subsequent to year-end, on February 11, 2020, received another $15.0 million distribution from the JV
Appointed Judith Mosely to the Board of Directors as of January 1, 2020
Q4 2019 net loss of $21.2 million after taking a $20.2 million non-cash fair value adjustment on preference shares
Q4 2019 adjusted net income^1^ of $0.9 million and Adjusted EBITDA^1^ of $12.6 million
FY 2019 net loss of $167.9 million after taking into account an impairment charge of $126.3 million and $40.1 million downward fair value adjustment on JV preference shares
FY 2019 adjusted net income of $2.5 million and Adjusted EBITDA of $36.0 million

2020 Guidance for the Asanko Gold Mine (100% basis)

225,000 to 245,000 ounces at AISC of $1,000 to $1,100/oz
Development capital expenditure forecast to be $24 million, mainly attributable to the Tetrem village relocation
Exploration budget of $10 million

"2019 was a transitional year for the Asanko Gold Mine as it shifted focus from investing in signficant capital projects to generating positive free cash flow and began distributing capital to the JV partners," said Greg McCunn, Chief Executive Officer. "The mine achieved record production of 251,044 ounces, exceeding our guidance expectations for the year, while costs were slightly higher than expected as a result of a higher-than-expected reliance on lower grade stockpile feed during Q4. Importantly, the development plan for the life of mine was agreed by the JV partners in August and the updated Mineral Resource and Reserve estimates are expected to be issued by the end of Q1.

"Looking to the year ahead, the Asanko Gold Mine is expecting 2020 to be very similar to 2019, targeting 225,000 to 245,000 ounces of gold production at AISC of $1,000 to $1,100/oz. We also expect to continue to focus on exploration with a $10 million exploration program for the year. Our priority targets are located close to existing infrastructure."

Asanko Gold Mine - Summary of FY 2019 and Q4 2019 Operational and Financial Results (100% basis)

****	Three months ended December 31			Year ended<br>December 31
Asanko Gold Mine (100% Basis)	2019	2018		2019	2018
Ore mined ('000t)	1,405	1,370		5,071	4,898
Waste mined ('000t)	4,956	8,370		25,719	39,244
Total mined ('000t)	6,361	9,740		30,790	44,142
Strip ratio (W:O)	3.5	6.1		5.1	8.0
Average gold grade mined (g/t)	1.6	1.5		1.5	1.4
Mining cost ($/t mined)	4.86	4.13		4.52	3.62
Ore milled ('000t)	1,460	1,238		5,498	5,180
Average mill head grade (g/t)	1.5	1.6		1.5	1.5
Average recovery rate (%)	94	95		94	94
Processing cost ($/t treated)	10.83	12.39		10.91	11.16
Gold production (oz)	66,112	59,823		251,044	223,152
Gold sales (oz)	66,095	61,821		248,862	227,772
Average realized gold price ($/oz)	1,465	1,215		1,376	1,247
Operating cash costs^1^ ($/oz)	790	811		776	688
Total cash costs^1^ ($/oz)	863	872		845	750
All-in sustaining costs^1^ ($/oz)	969	1,072		1,112	1,072
All-in sustaining margin^1^ ($/oz)	496	143		264	175
All-in sustaining margin^1^($m)	32.8	8.8		65.7	39.9
Revenue ($m)	97.1	74.2		341.0	283.9
Income (loss) from operations ($m)	5.4	(4.0	)	16.5	23.1
Cash provided by operating activities ($m)	45.4	12.9		120.4	72.5

There was one lost time injury ("LTI") and total recordable injury ("TRI") reported during the quarter and during the FY, resulting in a LTI frequency rate and a TRI frequency rate of 0.16 per million employee hours worked, respectively for the FY.
Produced 66,112 and 251,044 ounces of gold in Q4 2019 and FY 2019, respectively, exceeding the upper-end of 2019 production guidance of 225,000-245,000 ounces.
During Q4 2019, the AGM sold 66,095 ounces of gold at an average realized gold price of $1,465/oz for record total gold sales proceeds of $96.8 million, an increase of $21.7 million from Q4 2018. The increase in sales proceeds quarter-on-quarter was a function of higher sales volumes and higher averaged realized gold prices in Q4 2019.
The AGM incurred operating cash costs per ounce^1^, total cash costs per ounce^1^ and AISC of $790, $863 and $969/oz, respectively, in Q4 2019.
Total cost of sales (including depreciation and depletion and royalties) amounted to $88.0 million in Q4 2019, an increase of $12.9 million from Q4 2018. The increase in cost of sales was primarily due to an increase in gold ounces sold and higher depreciation expense related to depletion expense on previously capitalized deferred stripping costs on Cut 2 at Nkran, as well as the carrying value of Esaase mineral interests being added to the depreciable cost base of producing mineral properties during the current year.
Strong cash flow generation with operating cash flow of $45.4 million, and free cash flow of $28.9 million. This compares to $12.9 million of operating cash flow and negative $8.6 million of free cash flow during Q4 2018. The improvement in free cash flow was mainly from the increase in income from operations, a favorable change in non-cash working capital and strategic initiatives to reduce capital expenditure.
AISC for the FY 2019 was $1,112/oz, which was 5% above the expected guidance range of $1,040 - $1,060/oz as a result of higher than expected processing of lower grade ore tonnes from stockpiles and the Esaase pits, following an upper bench slippage in the western wall of the Nkran pit during Q4 2019.
For the FY 2019, the JV generated $120.4 million in operating cash flow and free cash flow of $44.0 million.
As at December 31, 2019, the JV had cash of $43.8 million ($3.0 million of which was restricted in favour of a gold hedging counterparty and released on January 3, 2020), $9.1 million in gold receivables and $2.8 million in dore. The JV's $30.0 million revolving line of credit remained undrawn at year-end.

Asanko Gold Inc. - Summary of FY 2019 and Q4 2019 Financial Results

****	Three months ended<br> December 31			Year ended<br> December 31
Asanko Gold Inc. (consolidated)	2019	2018		2019	2018
Net loss attributable to common shareholders ($m)	(21.2	(0.9	)	(167.9	(141.4
Net loss per share attributable to common shareholders	(0.09	($0.00	)	(0.74	(0.64
Adjusted net income (loss) attributable to common <br><br> shareholders^1^ ($m)	0.9	(0.9	)	2.5	1.9
Adjusted net income (loss) per share attributable to common<br> shareholders^1^	0.00	($0.00	)	0.01	0.01
Adjusted EBITDA^1^($m)	12.6	6.1		36.0	79.0

All values are in US Dollars.

• The Company reported a net loss attributable to common shareholders of $21.2 million in Q4 2019 compared to a net loss of $0.9 million in Q4 2018. The increase in net loss was due to a $20.2 million downward fair value adjustment on the Company's preferred share investment in the JV.

• Reported adjusted net income of $0.9 million in Q4 2019 compared to an adjusted net loss of $0.9 million in Q4 2018. The improvement in adjusted net income was primarily driven by the increase in the AGM's operating earnings (before impairment).

• Reported Adjusted EBITDA of $12.6 million for Q4 2019 compared to $6.1 million in Q4 2018. The increase in Adjusted EBITDA was primarily a result of the increase in the AGM's mine operating earnings in Q4 2019.

• For FY 2019, the Company reported a net loss attributable to common shareholders of $167.9 million compared to a net loss attributable to common shareholders of $141.4 million in 2018.

• Reported Adjusted EBITDA of $36.0 million for FY 2019 compared to $79.0 million in 2018. The decrease in Adjusted EBITDA was primarily a result of the fact that 2018 included 100% of the operating results of the Asanko Gold Mine for the seven months prior to the JV Transaction.

2020 Guidance

The Asanko Gold Mine JV announces 2020 production guidance of 225,000 to 245,000 ounces at AISC of $1,000 to $1,100/oz (AISC includes sustaining capital of $11 million, primarily for the tailings storage facility lift of $7 million), based on a $1,300/oz gold price.

This news release should be read in conjunction with Asanko's Management Discussion and Analysis and the Consolidated Annual Financial Statements for the years ended December 31, 2019 and 2018, which are available at www.asanko.com and filed on SEDAR.

Notes:

^1^ Non-GAAP Performance Measures

The Company has included certain non-GAAP performance measures in this press release. These non-GAAP performance measures do not have any standardized meaning. Accordingly, these performance measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Refer to the Non-GAAP Measures section of Asanko's Management Discussion and Analysis for an explanation of these measures and reconciliations to the Company's reported financial results in accordance with IFRS.

Operating Cash Costs per ounce and Total Cash Costs per ounce

Operating cash costs are reflective of the cost of production, adjusted for share-based payments and by-product revenue per ounce of gold sold. Total cash costs include production royalties of 5%.

All-in Sustaining Costs Per Gold Ounce

The Company has adopted the reporting of AISC as per the World Gold Council's guidance. AISC include total cash costs, corporate overhead expenses, sustaining capital expenditure, capitalized stripping costs and reclamation cost accretion per ounce of gold sold.

Adjusted net income (loss) attributable to common shareholders

The Company has included the non-GAAP performance measures of adjusted net income (loss) attributable to common shareholders and adjusted net income (loss) per common share. Neither adjusted net income (loss) nor adjusted net income (loss) per share have any standardized meaning and are therefore unlikely to be comparable to other measures presented by other issuers. Adjusted net income (loss) excludes certain non-cash items from net income or net loss to provide a measure which helps the Company and investors to evaluate the results of the underlying core operations of the Company and its ability to generate cash flows and is an important indicator of the strength of our operations and the performance of our core business.

Adjusted EBITDA

EBITDA provides an indication of the Company's continuing capacity to generate income from operations before taking into account the Company's financing decisions and costs of amortizing capital assets. Accordingly, EBITDA comprises net income (loss) excluding interest expense, interest income, amortization and depletion, and income taxes. Adjusted EBITDA adjusts EBITDA to exclude non-recurring items and to include the Company's interest in the adjusted EBITDA of the JV. Other companies and JV partners may calculate EBITDA and Adjusted EBITDA differently.

Free cash flow

The Company believes that in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors and analysts use free cash flow to evaluate the JV's performance with respect to its operating cash flow capacity to meet non-discretionary outflows of cash. The presentation of free cash flow is not meant to be a substitute for the cash flow information presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. Free cash flow is calculated as cash flows from operating activities of the JV adjusted for cash flows associated with sustaining and non-sustaining capital expenditures and payments made to mining contractors for leases capitalized under IFRS 16.

Qualified Person Statement

The technical contents in this news release have been approved by Mike Begg, Pr.Sci.Nat., Senior Vice President Technical Services of Asanko Gold Inc., who is a "Qualified Person" as defined by Canadian National Instrument 43-101 (Standards of Mineral Disclosure).

**Enquiries:**Lynette Gould SVP Investor Relations Toll-Free (N.America): 1-855-246-7341 Telephone: +1 778 729 0608 Email: lynette.gould@asanko.com

About Asanko Gold Inc.

Asanko is focused on building a low-cost, mid-tier gold mining company through organic production growth, exploration and disciplined deployment of its financial resources. The company currently operates and manages the Asanko Gold Mine, located in Ghana, West Africa which is jointly owned with Gold Fields Ltd. The Company is strongly committed to the highest standards for environmental management, social responsibility, and health and safety for its employees and neighbouring communities. For more information, please visit www.asanko.com.

Forward-Looking and other Cautionary Information

Certain statements and information contained in this news release constitute "forward-looking statements" within the meaning of applicable U.S. securities laws and "forward-looking information" within the meaning of applicable Canadian securities laws, which we refer to collectively as "forward-looking statements". Forward-looking statements are statements and information regarding possible events, conditions or results of operations that are based upon assumptions about future conditions and courses of action. All statements and information other than statements of historical fact may be forward looking statements. In some cases, forward-looking statements can be identified by the use of words such as "seek", "expect", "anticipate", "budget", "plan", "estimate", "continue", "forecast", "intend", "believe", "predict", "potential", "target", "may", "could", "would", "might", "will" and similar words or phrases (including negative variations) suggesting future outcomes or statements regarding an outlook.

Forward-looking statements in this news release include, but are not limited to: statements in respect of AGM's generation of free cash flow and statements in respect of the future strength of Asanko's balance sheet. Such forward-looking statements are based on a number of material factors and assumptions, including, but not limited to: the accuracy of reserve and resource, grade, mine life, cash cost, net present value, internal rate of return and production and processing estimates and other assumptions, projections and estimates made in the technical reports for the AGM or in respect of AGM; the successful completion of development and exploration projects, planned expansions or other projects within the timelines anticipated and at anticipated production levels; that mineral resources can be developed as planned; that the Company's relationship with joint venture partners will continue to be positive and beneficial to the Company; interest and exchange rates; that required financing and permits will be obtained; general economic conditions; that labour disputes or disruptions, flooding, ground instability, geotechnical failure, fire, failure of plant, equipment or processes to operate are as anticipated and other risks of the mining industry will not be encountered; that contracted parties provide goods or services in a timely manner; that there is no material adverse change in the price of gold or other metals; competitive conditions in the mining industry; title to mineral properties; costs; taxes; the retention of the Company's key personnel; and changes in laws, rules and regulations applicable to Asanko.

Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to differ materially from those anticipated in such forward-looking statements. The Company believes the expectations reflected in such forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and you are cautioned not to place undue reliance on forward-looking statements contained herein. Some of the risks and other factors which could cause actual results to differ materially from those expressed in the forward-looking statements contained in this news release, include, but are not limited to: mineral reserve and resource estimates may change and may prove to be inaccurate; life of mine estimates are based on a number of factors and assumptions and may prove to be incorrect; AGM has a limited operating history and is subject to risks associated with establishing new mining operations; sustained increases in costs, or decreases in the availability, of commodities consumed or otherwise used by the Company may adversely affect the Company; actual production, costs, returns and other economic and financial performance may vary from the Company's estimates in response to a variety of factors, many of which are not within the Company's control; adverse geotechnical and geological conditions (including geotechnical failures) may result in operating delays and lower throughput or recovery, closures or damage to mine infrastructure; the ability of the Company to treat the number of tonnes planned, recover valuable materials, remove deleterious materials and process ore, concentrate and tailings as planned is dependent on a number of factors and assumptions which may not be present or occur as expected; the Company's operations may encounter delays in or losses of production due to equipment delays or the availability of equipment; the Company's operations are subject to continuously evolving legislation, compliance with which may be difficult, uneconomic or require significant expenditures; the Company may be unsuccessful in attracting and retaining key personnel; labour disruptions could adversely affect the Company's operations; the Company's business is subject to risks associated with operating in a foreign country; risks related to the Company's use of contractors; the hazards and risks normally encountered in the exploration, development and production of gold; the Company's operations are subject to environmental hazards and compliance with applicable environmental laws and regulations; the Company's operations and workforce are exposed to health and safety risks; unexpected costs and delays related to, or the failure of the Company to obtain, necessary permits could impede the Company's operations; the Company's title to exploration, development and mining interests can be uncertain and may be contested; the Company's properties may be subject to claims by various community stakeholders; risks related to limited access to infrastructure and water; the Company's exploration programs may not successfully expand its current mineral reserves or replace them with new reserves; the Company's common shares may experience price and trading volume volatility; the Company's revenues are dependent on the market prices for gold, which have experienced significant recent fluctuations; the Company may not be able to secure additional financing when needed or on acceptable terms; Company shareholders may be subject to future dilution; risks related to changes in interest rates and foreign currency exchange rates; changes to taxation laws applicable to the Company may affect the Company's profitability and ability to repatriate funds; the Company's primary asset is held through a joint venture, which exposes the Company to risks inherent to joint ventures, including disagreements with joint venture partners and similar risks; risks related to the Company's internal controls over financial reporting and compliance with applicable accounting regulations and securities laws; the carrying value of the Company's assets may change and these assets may be subject to impairment charges; the Company may be liable for uninsured or partially insured losses; the Company may be subject to litigation; the Company may be unsuccessful in identifying targets for acquisition or completing suitable corporate transactions, and any such transactions may not be beneficial to the Company or its shareholders; the Company must compete with other mining companies and individuals for mining interests; and risks related to information systems security threats.

Although the Company has attempted to identify important factors that could cause actual results or events to differ materially from those described in the forward-looking statements, you are cautioned that this list is not exhaustive and there may be other factors that the Company has not identified. Furthermore, the Company undertakes no obligation to update or revise any forward-looking statements included in, or incorporated by reference in, this news release if these beliefs, estimates and opinions or other circumstances should change, except as otherwise required by applicable law.

Neither Toronto Stock Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.

Source: Asanko Gold Inc.

7

Asanko Gold Inc.: Exhibit 99.4 - Filed by newsfilecorp.com

KPMG LLP<br><br> <br>Chartered Professional Accountants<br><br> <br>PO Box 10426 777 Dunsmuir Street<br><br> <br>Vancouver BC V7Y 1K3<br><br> <br>Canada	Telephone (604) 691-3000<br><br> <br>Fax (604) 691-3031<br><br> <br>Internet www.kpmg.ca

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference of our report dated February 11, 2020, with respect to the consolidated financial statements of Asanko Gold Inc. (the "Company") in the Company's registration statement on Form F-10 (File no. 333-222363), which report has been included in Exhibit 99.1 to the Company's current report on Form 6-K dated February 13, 2020 furnished to the United States Securities and Exchange Commission. Our report on the consolidated financial statements refers to a change to accounting policies for leases in 2019 due to the adoption of IFRS 16 - Leases.

//s// KPMG LLP

Chartered Professional Accountants

February 13, 2020

Vancouver, Canada

Galiano Gold Inc 6-K, filed Feb 13, 2020

About this 6-K