In 1542, the Virreinato del Per was a possession of the Crown of Castile - colonial administrative district that originally contained most of Spanish-ruled South America, governed from the capital of Lima (present-day Peru). The Viceroyalty of Peru was most of (present-day) Latin America and almost all of South America. http://en.wikipedia.org/wiki/File:Theviceroyaltyofperu.png
After the Spanish conquest of Peru the first Audiencia was constituted. In 1542, the Spanish created the Viceroyalty of New Castile, that shortly afterwards would be called the Viceroyalty of Peru. In 1544, Holy Roman Emperor Charles V (King Charles I of Spain) named Blasco Núñez Vela Peru's first viceroy, but the viceroyalty was not organized until the arrival of Viceroy Francisco de Toledo in 1572. Toledo made an extensive tour of inspection of the colony. Francisco Álvarez de Toledo y Pacheco
The founding Families were largely conversos and members of the Royal Family who had great incentive to harvest Peruvian Silver and Gold.