United
  States Securities and Exchange Commission

Washington,
  D.C. 20549

FORM10-QSB



|S | QUARTERLY
        REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
        ACT OF 1934For the quarterly period ended  March 31st
        2006
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



|£ | TRANSITION
        REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
        ACTFor the transition period from ____________ to ____________
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

Commission
  file number:000-33191





VISUALMED
  CLINICAL SOLUTIONS CORP.

(Exact
  name of small business issuer as specified in its charter)





| | NEVADA(State of other jurisdiction ofincorporation or organization) |  | 88-0436055(IRS Employer Identification 
        Number) | 
| | ------------------------------------------------------------------- |  | ------------------------------------------------------- | 

1035Laurier Street West

Montreal,
  Quebec

Canada
  H2V 2L1

(Address
  of principal executive offices)

(514)
  274-1115

(Issuers
  telephone number)

(Former
  name, former address and former fiscal year, if changed since last report)

|Check
        whether the issuer (1) filed all reports required to be filed by Section
        13 or 15(d) of the Exchange Act during the past 12 months (or for such
        shorter period that the registrant was required to file such reports)
        and (2) has been subject to such filing requirements for the past
        90 days.YesSNo£
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Indicate
        by check mark whether the registrant is a shell company (as defined in
        Rule 12b-2 of the Exchange Act). Yes£NoS                                                                                                                                                                                                             

APPLICABLE
  ONLY TO CORPORATE ISSUERS

As of May 18th 2006, the issuer had 45,473,845 outstanding
  shares of common stock.

_____________________

Transitional
  Small Business Disclosure Format (Check one):Yes£NoS



---





PART I.

ITEM 1. - Financial Statements

VisualMED
Clinical Solutions Corp.
(A Development Stage Company)
(Unaudited)

|                                               |  |      
|---------------------------------------------- |  | -----
|                                               |  | Index
|                                               |  |      
|Consolidated Balance Sheets                    |  | F1  
|                                               |  |      
|Consolidated Statements of Operations          |  | F2  
|                                               |  |      
|Consolidated Statements of Cash Flows          |  | F3  
|                                               |  |      
|Consolidated Notes to the Financial Statements |  | F4  

---



VisualMED Clinical Solutions Corp.
(A Development Stage Company)
Consolidated Balance Sheets
(expressed in U.S. dollars)

|                                                                                                                             |  |  |                                    |   |                     |            |  
|---------------------------------------------------------------------------------------------------------------------------- |  |  | ---------------------------------- | - | ------------------- | ---------- | -
|                                                                                                                             |  |  | March 31,
  2006
  $
  (Unaudited) |   | June 30,
  2005
  $
|Assets                                                                                                                       |  |  |                                    |   |                     |            |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Current
  Assets                                                                                                             |  |  |                                    |   |                     |            |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Cash                                                                                                                         |  |  | 150,261                            |   |                     | 348,410    |  
|Advances to related parties (Note 3)                                                                                         |  |  | 37,532                             |   |                     | 57,265     |  
|Prepaid expenses                                                                                                             |  |  | 800,434                            |   |                     | 454,777    |  
|Inventory                                                                                                                    |  |  | 13,587                             |   |                     |           |  
|Other assets                                                                                                                 |  |  | 48,790                             |   |                     | 14,512     |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Total
  Current Assets                                                                                                       |  |  | 1,050,604                          |   |                     | 874,964    |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Property and
  Equipment (Note 4)                                                                                            |  |  | 71,638                             |   |                     | 33,390     |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Total Assets                                                                                                                 |  |  | 1,122,242                          |   |                     | 908,354    |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Liabilities
  and Stockholders Equity (Deficit)                                                                             |  |  |                                    |   |                     |            |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Current
  Liabilities                                                                                                        |  |  |                                    |   |                     |            |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Accounts payable                                                                                                             |  |  | 249,699                            |   |                     | 96,850     |  
|Accrued liabilities                                                                                                          |  |  | 163,097                            |   |                     | 105,350    |  
|Notes payable                                                                                                                |  |  |                                   |   |                     | 651,865    |  
|Current portion of capital lease
obligation                                                                                  |  |  | 3,678                              |   |                     | 3,244      |  
|Deferred revenue                                                                                                             |  |  | 26,042                             |   |                     | 67,000     |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Total
  Current Liabilities                                                                                                  |  |  | 442,516                            |   |                     | 924,309    |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Capital
  Lease Obligation                                                                                                   |  |  | 4,063                              |   |                     | 6,515      |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Total
  Liabilities                                                                                                          |  |  | 446,579                            |   |                     | 930,824    |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Commitments
  (Notes 1 and 8)                                                                                                |  |  |                                    |   |                     |            |  
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Stockholders
  Equity (Deficit)                                                                                             |  |  |                                    |   |                     |            |  
|Preferred
  Stock,                                                                                                           |  |  |                                    |   |                     |            |  
|Authorized: 15,000,000 shares, Series A 10% Cumulative; par value
  $0.00001;
  Issued and outstanding: nil shares           |  |  |                                   |   |                     |           |  
|Authorized:10,000,000 shares, Undesignated; par value $0.00001; 
  Issued and outstanding: nil shares                        |  |  |                                   |   |                     |           |  
|Common
  Stock,                                                                                                              |  |  |                                    |   |                     |            |  
|Authorized: 100,000,000 shares, par value $0.00001;
  Issued and outstanding: 44,899,845 and 42,381,400 shares, respectively |  |  | 449                                |   |                     | 424        |  
|Additional
  Paid-in Capital                                                                                                 |  |  | 13,258,091                         |   |                     | 6,687,006  |  
|Accumulated
  Other Comprehensive Loss                                                                                       |  |  | (16,225                            | ) |                     | (7,171     | )
|Deficit
  Accumulated During the Development Stage                                                                           |  |  | (12,566,652                        | ) |                     | (6,702,729 | )
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Total
  Stockholders Equity (Deficit)                                                                                       |  |  | 675,663                            |   |                     | (22,470    | )
|                                                                                                                             |  |  |                                    |   |                     |            |  
|Total
  Liabilities and Stockholders Equity (Deficit)                                                                       |  |  | 1,122,242                          |   |                     | 908,354    |  
|                                                                                                                             |  |  |                                    |   |                     |            |  

(The accompanying notes are an integral part
of these consolidated financial statements)

F-1

---



VisualMED Clinical Solutions Corp.
(A Development Stage Company)
Consolidated Statements of Operations
(expressed in U.S. dollars)
(Unaudited)

|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|------------------------------------------ |  | ------------------------------------------------------------------------------------ | ------------------------------ |  | ----------------------------- | ---------- | -------- |  | ---------- | - |  | ---------- | - |  | ---------- | -
|                                           |  | Accumulated from
  September 7, 1999
  (Date of Inception)
  to March 31,
  2006
  $ |                                |  |                               |            |          |  |            |   | 
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |  
|                                           |  |                                                                                      | Three Months Ended
  March 31, |  | Nine Months Ended
  March 31, |           
|                                           |  |                                                                                      | 2006
  $                       |  | 2005
  $                      |            | 2006
  $ |  | 2005
  $   |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Revenue                                    |  | 300,196                                                                              |                                |  |                               | 145,361    |          |  |           |   |  | 300,196    |   |  |           |  
|Cost of
  sales                            |  | 181,750                                                                              |                                |  |                               | 80,141     |          |  |           |   |  | 181,750    |   |  |           |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Gross Profit                               |  | 118,446                                                                              |                                |  |                               | 65,220     |          |  |           |   |  | 118,446    |   |  |           |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Expenses                                   |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Customer service                           |  | 872,939                                                                              |                                |  |                               | 194,742    |          |  | 102,918    |   |  | 443,929    |   |  | 335,305    |  
|Amortization                               |  | 20,229                                                                               |                                |  |                               | 6,857      |          |  | 1,201      |   |  | 15,473     |   |  | 1,897      |  
|Development costs                          |  | 1,362,317                                                                            |                                |  |                               | 356,271    |          |  | 47,766     |   |  | 800,961    |   |  | 344,562    |  
|General and administration                 |  | 3,317,295                                                                            |                                |  |                               | 2,172,743  |          |  | 240,461    |   |  | 2,630,002  |   |  | 500,869    |  
|Sales and marketing                        |  | 2,204,469                                                                            |                                |  |                               | 2,044,291  |          |  | 64,203     |   |  | 2,120,858  |   |  | 82,093     |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Total
  Expenses                           |  | 7,777,249                                                                            |                                |  |                               | 4,774,904  |          |  | 456,549    |   |  | 6,011,223  |   |  | 1,264,726  |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Net Loss
  From Operations                 |  | (7,658,803                                                                           | )                              |  |                               | (4,709,684 | )        |  | (456,549   | ) |  | (5,892,777 | ) |  | (1,264,726 | )
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Other Income
  (Expenses)                  |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Interest                                   |  | (40,399                                                                              | )                              |  |                               | (681       | )        |  | (16,203    | ) |  | (681       | ) |  | (32,562    | )
|Financing costs                            |  | (4,514,285                                                                           | )                              |  |                               |           |          |  | (4,514,285 | ) |  |           |   |  | (4,514,285 | )
|Foreign exchange gain (loss)               |  | 36,567                                                                               |                                |  |                               | (37,579    | )        |  | 17,645     |   |  | 29,535     |   |  | 17,679     |  
|Gain on forgiveness of debt                |  | 12,689                                                                               |                                |  |                               |           |          |  |           |   |  |           |   |  |           |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Net Loss Before Discontinued Operations    |  | (12,164,231                                                                          | )                              |  |                               | (4,747,944 | )        |  | (4,969,392 | ) |  | (5,863,923 | ) |  | (5,793,894 | )
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Discontinued
  Operations                  |  | (402,421                                                                             | )                              |  |                               |           |          |  |           |   |  |           |   |  | (1,143     | )
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Net Loss for
  the Period                  |  | (12,566,652                                                                          | )                              |  |                               | (4,747,944 | )        |  | (4,969,392 | ) |  | (5,863,923 | ) |  | (5,795,037 | )
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Other Comprehensive Loss                   |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Foreign currency
  translation adjustments |  | (16,225                                                                              | )                              |  |                               | 29,953     |          |  | (4,590     | ) |  | (9,054     | ) |  | (31,558    | )
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Comprehensive
  Loss                       |  | (12,582,877                                                                          | )                              |  |                               | (4,717,991 | )        |  | (4,973,982 | ) |  | (5,872,977 | ) |  | (5,826,595 | )
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Net Loss Per
  Share  Basic and Diluted   |  |                                                                                      |                                |  |                               | (0.11      | )        |  | (0.12      | ) |  | (0.13      | ) |  | (0.14      | )
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  
|Weighted
  Average Shares Outstanding      |  |                                                                                      |                                |  |                               | 44,287,000 |          |  | 40,052,000 |   |  | 43,542,000 |   |  | 42,064,000 |  
|                                           |  |                                                                                      |                                |  |                               |            |          |  |            |   |  |            |   |  |            |  

(The accompanying notes are an integral part
of these consolidated financial statements)

F-2

---



VisualMED Clinical Solutions Corp.
(A Development Stage Company)
Consolidated Statements of Cash Flows
(expressed in U.S. dollars)
(Unaudited)

|                                                                              |  |                                                    |            |                                                    |  |            |  
|----------------------------------------------------------------------------- |  | -------------------------------------------------- | ---------- | -------------------------------------------------- |  | ---------- | -
|                                                                              |  | For the Nine
  Months Ended
  March 31,
  2006
  $ |            | For the Nine
  Months Ended
  March 31,
  2005
  $ | 
|Operating
  Activities                                                        |  |                                                    |            |                                                    |  |            |  
|Net loss                                                                      |  |                                                    | (5,863,923 | )                                                  |  | (5,795,037 | )
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Adjustments
  to reconcile net loss to net cash used in operating activities: |  |                                                    |            |                                                    |  |            |  
|Amortization                                                                  |  |                                                    | 15,473     |                                                    |  | 1,897      |  
|Stock-based compensation                                                      |  |                                                    | 4,054,303  |                                                    |  | 4,514,285  |  
|Common stock issued for interest                                              |  |                                                    |           |                                                    |  | 32,063     |  
|Common stock issued for services                                              |  |                                                    |           |                                                    |  | 100,000    |  
|Write off of assets                                                           |  |                                                    |           |                                                    |  | 924        |  
|Changes in
  operating assets and liabilities                                 |  |                                                    |            |                                                    |  |            |  
|Prepaid expenses                                                              |  |                                                    | (345,351   | )                                                  |  | (403,112   | )
|Inventory                                                                     |  |                                                    | (13,587    | )                                                  |  |           |  
|Other assets                                                                  |  |                                                    | (10,392    | )                                                  |  | (25,290    | )
|Deferred revenue                                                              |  |                                                    | (40,958    | )                                                  |  | 67,000     |  
|Advances and receivables                                                      |  |                                                    | (2,043     | )                                                  |  | (67,384    | )
|Accounts payable and accrued liabilities                                      |  |                                                    | 205,298    |                                                    |  | 144,248    |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Net Cash
  Used In Operating Activities                                       |  |                                                    | (2,001,180 | )                                                  |  | (1,430,406 | )
|                                                                              |  |                                                    |            |                                                    |  |            |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Investing
  Activities                                                        |  |                                                    |            |                                                    |  |            |  
|Purchase of property and equipment                                            |  |                                                    | (51,818    | )                                                  |  | (12,424    | )
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Net Cash
  Used In Investing Activities                                       |  |                                                    | (51,818    | )                                                  |  | (12,424    | )
|                                                                              |  |                                                    |            |                                                    |  |            |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Financing
  Activities                                                        |  |                                                    |            |                                                    |  |            |  
|Proceeds from short term loans                                                |  |                                                    | 514,094    |                                                    |  |           |  
|Proceeds from the sale of common stock                                        |  |                                                    | 1,350,848  |                                                    |  |           |  
|Repayment of capital lease obligation                                         |  |                                                    | (2,507     | )                                                  |  |           |  
|Proceeds from notes payable                                                   |  |                                                    |           |                                                    |  | 1,674,612  |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Net Cash
  Provided By Financing Activities                                   |  |                                                    | 1,862,435  |                                                    |  | 1,674,612  |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Effect of
  Exchange Rate Changes on Cash                                     |  |                                                    | (7,585     | )                                                  |  | (31,549    | )
|                                                                              |  |                                                    |            |                                                    |  |            |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Increase
  (Decrease) in Cash                                                 |  |                                                    | (198,148   | )                                                  |  | 200,233    |  
|Cash 
  Beginning of Period                                                  |  |                                                    | 348,409    |                                                    |  | 692        |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Cash  End
  of Period                                                        |  |                                                    | 150,261    |                                                    |  | 200,925    |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Non-Cash
  Financing Activities                                               |  |                                                    |            |                                                    |  |            |  
|Common stock issued for services                                              |  |                                                    |           |                                                    |  | 100,000    |  
|Common stock issued for settlement of notes
  payable and accrued interest    |  |                                                    | 1,165,959  |                                                    |  | 1,706,675  |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|                                                                              |  |                                                    |            |                                                    |  |            |  
|Supplemental
  Disclosures                                                    |  |                                                    |            |                                                    |  |            |  
|Interest paid                                                                 |  |                                                    |           |                                                    |  |           |  
|Income taxes paid                                                             |  |                                                    |           |                                                    |  |           |  
|                                                                              |  |                                                    |            |                                                    |  |            |  

(The accompanying notes are an integral part
of these consolidated financial statements)

F-3

---



VisualMED
Clinical Solutions Corp.
(A Development Stage Company)Notes to the Consolidated Financial Statements
(expressed in U.S. dollars)
(Unaudited)

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1. | Development
  Stage Company                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The Company
  was incorporated in the State of Nevada on September 7, 1999. The Company
  changed its name to VisualMed Clinical Solutions Corporation on November 30,
  2004. In September 1999 the Company purchased three mineral claims
  representing forty-four units, situated in the Greenwood Mining Division in
  the Province of British Columbia, Canada. The Companys original business
  plan was to acquire, explore and develop mineral properties and to ultimately
  seek earnings by exploiting the mineral claims. Pursuant to an Agreement
  dated September 23, 2004 (the Agreement), which closed on October 13, 2004,
  the Company agreed to issue 31,866,000 split-adjusted restricted shares of
  common stock to Visual Healthcare Corporation (VHCC) in exchange for
  certain assets of VHCC consisting of property and equipment and a suite of
  clinical software modules (the modules) that are the key components of a
  Clinical Information System for healthcare facilities. VHCC is a Nevada
  corporation, based in Montreal, Canada, involved in developing software
  solutions targeting clinical medicine and related areas of the healthcare
  market. The Company has the right to exploit, commercialize, install, support
  and upgrade the modules purchased. The rights to exploit, commercialize,
  install, support and upgrade are worldwide, except for that part of the U.S.
  market, as well as the Chinese and the Japanese language markets, into which
  VHCC has entered into exclusivity agreements with other unaffiliated
  companies. As the result of the transaction, VHCC controlled 80% of the
  Company.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The
  Companys new business plan involves the distribution of medical software,
  and the Company, in connection with the closing of the Agreement discussed
  above, decided to discontinue its mineral exploration efforts. These mineral
  interests will be allowed to lapse. The Company is primarily involved in
  activities related to the distribution of medical software and is considered
  to be a development stage company. At March 31, 2006, the Company had working
  capital of $608,088 and has incurred losses of $12,566,652 since inception.
  The ability of the Company to emerge from the development stage with respect
  to any planned principal business activity is dependent upon its successful
  efforts to raise additional equity financing and then attain profitable
  operations. Management has plans to seek additional capital through equity
  and/or debt offerings. There is no guarantee that the Company will be able to
  complete any of the above objectives. These financial statements do not
  include any adjustments to the recoverability and classification of recorded
  asset amounts and classification of liabilities that may be necessary should
  the Company be unable to continue as a going concern. These factors raise
  substantial doubt regarding the Companys ability to continue as a going
  concern.                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|2. | Summary of
  Significant Accounting Principles                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|a) | Basis of
  Presentation and Fiscal Year                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | These
  consolidated financials statements and related notes are presented in
  accordance with accounting principles generally accepted in the United
  States, and are expressed in U.S. dollars. The Company has not produced
  significant revenues from its principal business and is a development stage
  company as defined by Statement of Financial Accounting Standard (SFAS) No.
  7 Accounting
  and Reporting by Development Stage Enterprises. These financial
  statements include the accounts of the Company and its wholly-owned
  subsidiary, VisualMed Clinical Systems Marketing Inc., a company incorporated
  and based in Quebec, Canada. All intercompany transactions and balances have
  been eliminated. The Companys fiscal year-end is June 30.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|b) | Use of
  Estimates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | The
  preparation of financial statements in conformity with U.S. generally
  accepted accounting principles requires management to make estimates and
  assumptions that affect the reported amounts of assets and liabilities and
  disclosure of contingent assets and liabilities at the date of the financial
  statements and the reported amounts of revenues and expenses during the
  reporting period. Actual results could differ from those estimates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

F-4

---



VisualMED
Clinical Solutions Corp.
(A Development Stage Company)
Notes to the Consolidated Financial Statements
(expressed in U.S. dollars)
(Unaudited)

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2. | Summary of
  Significant Accounting Principles (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|c) | Cash and
  Cash Equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The Company
  considers all highly liquid instruments with a maturity of three months or
  less at the time of issuance to be cash equivalents.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|d) | Property and
  Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Property and
  equipment is stated at cost, less accumulated amortization, and consists of
  office furniture, computer hardware and software, leasehold improvements and
  assets under capital lease. Amortization of office furniture is computed
  using the straight-line method over five years. Amortization of computer hardware
  and software is computed using the straight-line method over three years.
  Amortization of leasehold improvements is computed using the straight-line
  method over five years. Amortization of assets under capital lease is
  computed using the straight-line method over the term of the lease.                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|e) | Long-Lived
  Assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | In
  accordance with SFAS No. 144 Accounting
  for the Impairment or Disposal of Long-Lived Assets, the carrying
  value of intangible assets and other long-lived assets is reviewed on a regular
  basis for the existence of facts or circumstances that may suggest
  impairment. The Company recognizes impairment when the sum of the expected
  undiscounted future cash flows is less than the carrying amount of the asset.
  Impairment losses, if any, are measured as the excess of the carrying amount
  of the asset over its estimated fair value.                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|f) | Foreign
  Currency Transactions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The
  Companys functional and reporting currency is the United States dollar. The
  functional currency of the Companys subsidiary is the Canadian dollar. The
  financial statements of the subsidiary are translated to United States
  dollars in accordance with SFAS No. 52 Foreign
  Currency Translation using period-end rates of exchange for
  assets and liabilities, and average rates of exchange for the period for
  revenues and expenses. Translation gains (losses) are recorded in accumulated
  other comprehensive income (loss) as a component of stockholders equity.
  Foreign currency transaction gains and losses are included in current operations.                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|g) | Development
  Costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Costs
  related to the enhancement of existing medical software modules are expensed
  as incurred until technological feasibility in the form of a working model
  has been established. The time period between the establishment of
  technological feasibility and completion of product development is expected
  to be short, therefore the Company has not capitalized any product
  development costs during the period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|h) | Basic and
  Diluted Net Income (Loss) Per Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The Company computes
  net income (loss) per share in accordance with SFAS No. 128 Earnings
  per Share, which requires presentation of both basic and diluted
  earnings per share (EPS) on the face of the income statement. Basic EPS is
  computed by dividing net income (loss) available to common shareholders
  (numerator) by the weighted average number of shares outstanding
  (denominator) during the period. Diluted EPS gives effect to all dilutive
  potential common shares outstanding during the period including stock options,
  using the treasury stock method, and convertible preferred stock, using the
  if-converted method. In computing diluted EPS, the average stock price for
  the period is used in determining the number of shares assumed to be
  purchased from the exercise of stock options or warrants. Diluted EPS
  excludes all dilutive potential shares if their effect is anti dilutive.

F-5

---



VisualMED
Clinical Solutions Corp.
(A Development Stage Company)
Notes to the Consolidated Financial Statements
(expressed in U.S. dollars)
(Unaudited)

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2. | Summary of
  Significant Accounting Principles (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|i) | Financial
  Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | The carrying
  value of cash, accounts payable, accrued liabilities, advances to related
  parties, and notes payable approximate fair value due to the relatively short
  maturity of these instruments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|j) | Inventory                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | Inventory
  consists of computer hardware and software acquired for specific revenue
  contracts and also includes related support and implementation costs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|k) | Revenue
  Recognition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | The Company
  recognizes revenue related to sales and licensing of medical software in
  accordance with Statement of Position No. 97-2 Software Revenue Recognition (SOP 97-2), as amended by
  Statement of Position No. 98-9 Software
  Revenue Recognition with Respect to Certain Arrangements.
  Pursuant to SOP 97-2 and Staff Accounting Bulletin No. 104 Revenue
  Recognition, revenue will only be recognized when the price is
  fixed or determinable, persuasive evidence of an arrangement exists, the
  service is performed, and collectibility is reasonably assured. The Companys
  revenue contracts are accounted for in conformity with Accounting Research
  Bulletin No. 45 Long-Term Construction-Type Contracts,
  using the relevant guidance in SOP 81-1 Accounting for Performance of Construction-Type and
  Certain Production-Type Contracts, unless specified criteria for
  separate accounting for any service element are met. The Company also follows
  the guidance in Emerging Issues Task Force (EITF) Issue No. 00-21 Revenue
  Arrangements with Multiple Deliverables relating to the
  separability of deliverables included in an arrangement into different units
  of accounting and the allocation of an arrangements consideration to those
  units of accounting. It does not address when revenue should be recognized
  for the units of accounting. The Company received $35,000 during the period
  for annual license renewal fees, which are recognized in revenue over the
  term of the license. At March 31, 2006, the balance of deferred revenue is
  $26,042. Incremental direct costs related to contract acquisition and
  origination, which result in deferred revenue, are expensed as incurred. Any
  allowance for doubtful accounts is based on the Companys detailed assessment
  of the collectibility of specific customer accounts. Any significant customer
  accounts that are not expected to be collected are excluded from revenues. To
  date, the Company has not experienced any losses from uncollectible accounts.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|l) | Comprehensive
  Loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | SFAS No. 130
  Reporting Comprehensive Income,
  establishes standards for the reporting and display of comprehensive loss and
  its components in the financial statements. For the nine month periods ended
  March 31, 2006 and 2005, the Companys only component of comprehensive loss
  was foreign currency translation adjustments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|m) | Reclassifications                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | Certain
  reclassifications have been made to the prior periods financial statements
  to conform to the current periods presentation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

F-6

---



VisualMED
Clinical Solutions Corp.
(A Development Stage Company)
Notes to the Consolidated Financial Statements
(expressed in U.S. dollars)
(Unaudited)

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2. | Summary of
  Significant Accounting Principles (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|n) | Income Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Potential
  benefits of income tax losses are not recognized in the accounts until
  realization is more likely than not. The Company has adopted SFAS No. 109 Accounting
  for Income Taxes as of its inception. Pursuant to SFAS No. 109,
  the Company is required to compute tax asset benefits for net operating
  losses carried forward. The potential benefit of net operating losses have
  not been recognized in these financial statements because the Company cannot
  be assured it is more likely than not it will utilize the net operating
  losses carried forward in future years.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|o) | Stock-based
  Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Prior to
  January 1, 2006, the Company accounted for stock-based awards under the
  recognition and measurement provisions of Accounting Principles Board Opinion
  No. 25 Accounting
  for Stock Issued to Employees using the intrinsic value method of
  accounting, under which compensation expense was only recognized if the
  exercise price of the Companys employee stock options was less than the
  market price of the underlying common stock on the date of grant. Effective
  January 1, 2006, the Company adopted the fair value recognition provisions of
  SFAS No. 123R Share Based Payments, using the modified retrospective
  transition method. The Company had not issued any stock options or share
  based payments prior to January 1, 2006. Accordingly, there was no effect on
  the Companys reported loss from operations, cash flows or loss per share as
  a result of adopting SFAS No 123R.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Effective
  March 2, 2006, the Company filed a Form S-8 Registration Statement in
  connection with its newly adopted 2006 Non-Qualified Stock Option Plan (the
  2006 Plan) allowing for the direct award to directors, officers, employees
  and consultants of shares or options acquire shares of the Companys common
  stock totaling 2,500,000 shares in the aggregate. On March 1, 2006, the
  Company granted stock options to acquire 595,500 common shares at an exercise
  price of $0.49 per share exercisable until March 1, 2011. On March 3, 2006,
  the Company granted stock options to acquire 1,200,000 common shares at an
  exercise price of $0.00001 until March 2, 2011. On March 10, 2006, the
  Company granted stock options to acquire 416,000 common shares at an exercise
  price of $1.90 per share exercisable until March 11, 2011. On March 10, 2006,
  the Company granted stock options to acquire 159,500 common shares at an
  exercise price of $0.00001 to March 9, 2011. The fair value for options
  granted was estimated at the date of grant using the Black-Scholes
  option-pricing model and the weighted average fair value of stock options
  granted during the three month period ended March 31, 2006, was $1.65. During
  the three month period ended March 31, 2006, the Company recorded stock-based
  compensation of $4,054,303 which is included with general and administrative
  expenses ($2,017,672), marketing expenses ($1,946,540) and development
  expenses ($90,092).

The
following table summarizes the continuity of the Companys stock options:

|                              |  |                     |           |                                          |  |         |  | 
|----------------------------- |  | ------------------- | --------- | ---------------------------------------- |  | ------- |  | 
|                              |  | Number of 
  Shares |           | Weighted
  average exercise 
  price
  $ | 
|                              |  |                     |           |                                          |  |         |  | 
|Outstanding,
  June 30, 2005  |  |                     |          |                                          |  |        |  | 
|Granted                       |  |                     | 2,371,000 |                                          |  | 0.46    |  | 
|Exercised                     |  |                     | (505,000  | )                                        |  | 0.00001 |  | 
|Expired                       |  |                     |          |                                          |  |        |  | 
|                              |  |                     |           |                                          |  |         |  | 
|Outstanding,
  March 31, 2006 |  |                     | 1,866,000 |                                          |  | 0.58    |  | 
|                              |  |                     |           |                                          |  |         |  | 

F-7

---



VisualMED
Clinical Solutions Corp.
(A Development Stage Company)
Notes to the Consolidated Financial Statements 
(expressed in U.S. dollars)
(Unaudited)

|   |                                                                                           
|-- | ------------------------------------------------------------------------------------------
|2. | Summary of
  Significant Accounting Principles (continued)                                
|   |                                                                                           
|o) | Stock-based
  Compensation (continued)                                                    
|   |                                                                                           
|   | Additional
  information regarding options outstanding as at March 31, 2006 is as follows:

|                  |   |                    |             |                                                             |             |                                       |  |                 |  |                                       |   |         |  |           |  |  |   |         | 
|----------------- | - | ------------------ | ----------- | ----------------------------------------------------------- | ----------- | ------------------------------------- |  | --------------- |  | ------------------------------------- | - | ------- |  | --------- |  |  | - | ------- | 
|                  |   |                    | Outstanding |                                                             | Exercisable |                                      
|                  |   |                    |             |                                                             |             |                                      
|Exercise
  prices |   | Number of
  shares |             | Weighted
  average
  remaining
  contractual
  life (years) |             | Weighted
  average
  exercise
  price |  | Number ofshares |  | Weighted
  average
  exercise
  price |  
|                  |   |                    |             |                                                             |             |                                       |  |                 |  |                                       |  
|                  |   |                    |             |                                                             |             |                                       |  |                 |  |                                       |   |         |  |           |  |  |   |         | 
|                  | $ | 0.00001            |             |                                                             | 854,500     |                                       |  | 4.92            |  |                                       | $ | 0.00001 |  | 819,500   |  |  | $ | 0.00001 | 
|                  | $ | 0.49               |             |                                                             | 595,500     |                                       |  | 4.93            |  |                                       | $ | 0.49    |  | 595,500   |  |  | $ | 0.49    | 
|                  | $ | 1.90               |             |                                                             | 416,000     |                                       |  | 4.95            |  |                                       | $ | 1.90    |  | 416,000   |  |  | $ | 1.90    | 
|                  |   |                    |             |                                                             |             |                                       |  |                 |  |                                       |   |         |  |           |  |  |   |         | 
|                  |   |                    |             |                                                             |             |                                       |  |                 |  |                                       |   |         |  |           |  |  |   |         | 
|                  |   |                    |             |                                                             | 1,866,000   |                                       |  | 4.93            |  |                                       | $ | 0.58    |  | 1,831,000 |  |  | $ | 0.59    | 
|                  |   |                    |             |                                                             |             |                                       |  |                 |  |                                       |   |         |  |           |  |  |   |         | 

| |                                                        
| | -------------------------------------------------------
| | The weighted
  average assumptions used are as follows:

|                                |  |                      |                  |                     |                  |                  |  |  |      |   |  |   | 
|------------------------------- |  | -------------------- | ---------------- | ------------------- | ---------------- | ---------------- |  |  | ---- | - |  | - | 
|                                |  | Three
  Months Ended |                  | Nine
  Months Ended |                 
|                                |  | March 31,
  2006     | March 31,
  2005 |                     | March 31,
  2006 | March 31,
  2005 | 
|Expected dividend yield         |  |                      | 0                | %                   |                  |                 |  |  | 0    | % |  |  | 
|Risk-free interest rate         |  |                      | 4.62             | %                   |                  |                 |  |  | 4.62 | % |  |  | 
|Expected volatility             |  |                      | 67               | %                   |                  |                 |  |  | 67   | % |  |  | 
|Expected option life (in years) |  |                      | 2.5              |                     |                  |                 |  |  | 2.5  |   |  |  | 

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|p) | Recent
  Accounting Pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | In May 2005,
  the Financial Accounting Standards Board (FASB) issued SFAS No. 154 Accounting
  Changes and Error Corrections  A Replacement of APB Opinion No. 20 and SFAS
  No. 3. SFAS 154 changes the requirements for the accounting for
  and reporting of a change in accounting principle and applies to all
  voluntary changes in accounting principle. It also applies to changes
  required by an accounting pronouncement in the unusual instance that the
  pronouncement does not include specific transition provisions. SFAS 154
  requires retrospective application to prior periods financial statements of
  changes in accounting principle, unless it is impracticable to determine
  either the period-specific effects or the cumulative effect of the change.
  The provisions of SFAS No. 154 are effective for accounting changes and
  correction of errors made in fiscal years beginning after December 15, 2005.
  The adoption of this standard is not expected to have a material effect on
  the Companys results of operations or financial position.

F-8

---



VisualMED
Clinical Solutions Corp.
(A Development Stage Company)
Notes to the Consolidated Financial Statements 
(expressed in U.S. dollars)
(Unaudited)

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2. | Summary of
  Significant Accounting Principles (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|p) | Recent
  Accounting Pronouncements (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | The FASB has
  also issued SFAS No. 155 Accounting for Certain Hybrid Financial
  Instruments and SFAS No. 156 Accounting for Servicing of Financial Assets,
  but they will not have any relationship to the operations of the Company. As
  such, a description and its impact for each on the Companys operations and
  financial position have not been disclosed.                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|q) | Interim
  Financial Statements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | These
  interim unaudited financial statements have been prepared on the same basis
  as the annual financial statements and in the opinion of management, reflect
  all adjustments, which include only normal recurring adjustments, necessary
  to present fairly the Companys financial position, results of operations and
  cash flows for the periods shown. The results of operations for such periods
  are not necessarily indicative of the results expected for a full year or for
  any future period.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|3. | Advances to
  Related Parties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

|                                                                  |     |                  |        |                 |   |        | 
|----------------------------------------------------------------- | --- | ---------------- | ------ | --------------- | - | ------ | 
|                                                                  |     | March 31,
  2006 |        | June 30,
  2005 |  
|                                                                  |     | (unaudited)      |        |                 |   |       
|                                                                  |     |                  |        |                 |   |       
|Advances to
  employees                                           | (a) | $                | 37,532 |                 | $ |       | 
|Due from
  Visual Healthcare Corporation, an affiliated company   |     |                  |       |                 |   | 664    | 
|Due from
  VisualMED Clinical Systems Inc., an affiliated company |     |                  |       |                 |   | 56,601 | 
|                                                                  |     |                  |        |                 |   |        | 
|                                                                  |     | $                | 37,532 |                 | $ | 57,265 | 
|                                                                  |     |                  |        |                 |   |        | 

|   |                                                                                                                                                
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------
|a) | Advances to
  employees of $37,532 represent amounts advanced towards travel expenses to be
  incurred. These amounts are non-interest bearing.
|   |                                                                                                                                                
|4. | Property and
  Equipment                                                                                                                       

|                         |  |      |        |                            |   |                                       |             |                                      |        |  |   |        | 
|------------------------ |  | ---- | ------ | -------------------------- | - | ------------------------------------- | ----------- | ------------------------------------ | ------ |  | - | ------ | 
|                         |  | Cost |        | Accumulated
  Amortization |   | March
  31, 2006
  Net carrying value |             | June 30,
  2005
  Net carrying value |       
|                         |  |      |        |                            |   |                                       | (unaudited) |                                      |        |  |  
|Computer hardware        |  | $    | 46,471 |                            | $ | 9,861                                 |             | $                                    | 36,610 |  | $ | 8,414  | 
|Computer
  software      |  |      | 24,647 |                            |   | 5,713                                 |             |                                      | 18,934 |  |   | 6,523  | 
|Office
  furniture       |  |      | 11,986 |                            |   | 2,674                                 |             |                                      | 9,312  |  |   | 10,654 | 
|Leasehold
  improvements |  |      | 9,127  |                            |   | 2,345                                 |             |                                      | 6,782  |  |   | 7,799  | 
|                         |  |      |        |                            |   |                                       |             |                                      |        |  |   |        | 
|                         |  | $    | 92,231 |                            | $ | 20,593                                |             | $                                    | 71,638 |  | $ | 33,390 | 
|                         |  |      |        |                            |   |                                       |             |                                      |        |  |   |        | 

| |                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Assets under
  capital lease are included in office furniture with a cost of $11,129. During
  the period ended March 31, 2006, the Company recognized amortization of
  assets under capital lease of $1,669 (June 30, 2005  $649).

F-9

---



VisualMED
Clinical Solutions Corp.
(A Development Stage Company)
Notes to the Consolidated Financial Statements 
(expressed in U.S. dollars)
(Unaudited)

|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|5. | Preferred
  Stock                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | On January
  12, 2006, the Company restated its Articles of Incorporation to increase the
  authorized share capital to 125,000,000 shares consisting of 100,000,000
  shares of common stock and 25,000,000 shares of preferred stock, of which
  15,000,000 have been designated as Series A 10% Cumulative Preferred Stock.                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | The Series A
  10% Cumulative Preferred Stock has a par value of $0.00001 per share, a
  stated value of 1.00 per share and are non-voting. The holders of the Series
  A Preferred Stock will be entitled to receive an annual dividend equal to 10%
  per annum of the stated value of 1.00 per share payable, at the option of
  the Board of Directors, in either cash or in shares of Series A Preferred
  Stock.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|6. | Common Stock                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|a) | On March 24,
  2006, the Company issued 68,616 shares of common stock upon the exercise of
  68,616 warrants at $1.25 per share for proceeds of $85,770.                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|b) | On March 13,
  2006, the Company issued 53,207 shares of common stock upon the exercise of
  53,207 warrants at $1.25 per share for proceeds of $66,509.                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|c) | On March 6,
  2006, the Company issued 178,031 shares of common stock upon the exercise of
  178,031 warrants at $1.25 per share for proceeds of $222,539.                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|d) | On March 3,
  2006, the Company issued 505,000 shares of common stock upon the exercise of
  505,000 options at $0.00001 per share for no consideration.                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|e) | On January
  20, 2006, the Company issued 136,448 shares of common stock upon the exercise
  of 136,448 warrants at $1.25 per share for proceeds of $170,560.                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|f) | On December
  14, 2005, the Company issued 138,240 shares of common stock upon the exercise
  of 138,240 warrants at $1.25 per share for proceeds of $172,800.                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|g) | On December
  2, 2005, the Company issued 100,332 shares of common stock upon the exercise
  of 100,332 warrants at $1.25 per share for proceeds of $125,415.                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|h) | On November
  4, 2005, the Company issued 67,984 shares of common stock upon the exercise
  of 67,984 warrants at $1.25 per share for proceeds of $84,980.                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|i) | On October
  7, 2005, the Company issued 137,800 shares of common stock upon the exercise
  of 137,800 warrants at $1.25 per share for proceeds of $172,250.                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|j) | On September
  6, 2005, the Company issued 200,020 shares of common stock upon the exercise
  of 200,020 warrants at $1.25 per share for proceeds of $250,025.                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|k) | On August
  26, 2005, the Company issued 180,537 shares of common stock upon the exercise
  of 180,537 warrants at $1.25 per share to settle notes payable of $225,671.                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                         
|l) | On July 19,
  2005, the Company issued 752,230 shares of common stock upon the exercise of
  752,230 warrants at $1.25 per share to settle notes payable of $940,288.                                                                                                                                                                                                                                                   

F-10

---



VisualMED
Clinical Solutions Corp.
(A Development Stage Company)
Notes to the Consolidated Financial Statements 
(expressed in U.S. dollars)
(Unaudited)

|   |                                                                           
|-- | --------------------------------------------------------------------------
|6. | Common Stock
  (continued)                                                
|   |                                                                           
|m) | Share
  Purchase Warrants:                                                
|   |                                                                           
|   | The
  following table summarizes the continuity of the Companys warrants:

|                            |  |                       |            |                                           |  |      | 
|--------------------------- |  | --------------------- | ---------- | ----------------------------------------- |  | ---- | 
|                            |  | Number of 
  Warrants |            | Weighted 
  average exercise 
  price
  $ | 
|                            |  |                       |            |                                           |  |      | 
|Balance, June 30, 2005      |  |                       | 2,275,567  |                                           |  | 1.25 | 
|Issued                      |  |                       |           |                                           |  |     | 
|Exercised                   |  |                       | (2,013,445 | )                                         |  | 1.25 | 
|                            |  |                       |            |                                           |  |      | 
|Outstanding, March 31, 2006 |  |                       | 262,122    |                                           |  | 1.25 | 
|                            |  |                       |            |                                           |  |      | 

At March 31,
2006, the following share purchase warrants were outstanding:

|                      |  |                   |      |  |               |                | 
|--------------------- |  | ----------------- | ---- |  | ------------- | -------------- | 
|Number of 
  Warrants |  | Exercise 
  Price |      |  | Expiry
  Date |               
|                      |  |                   |      |  |               |                | 
|262,122               |  | $                 | 1.25 |  |               | March 23, 2007 | 

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|7. | Segment
  Disclosures                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | The Company
  operates as one operating segment which is the sale of its suite of clinical
  software modules. The Chief Executive Officer is the Companys Chief
  Operating Decision Maker (CODM) as defined by SFAS 131, Disclosure about Segments of an
  Enterprise and Related Information. The CODM allocates resources
  and assesses the performance of the Company based on the results of
  operations.                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|8. | Commitments                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | In November
  2004, the Company entered into a lease agreement for office premises at a
  rate of $67,800 (CDN$78,700) per annum including property taxes, insurance
  and other operating expenses, for a five year term expiring on September 30,
  2009, with an option to renew for an additional five years. During the period
  ended March 31, 2006, the Company incurred rent expense of $37,654. Future
  payments for the next five fiscal years are as follows:

|     |  |   |        
|---- |  | - | -------
|2006 |  | $ | 16,950 
|2007 |  | $ | 64,100 
|2008 |  | $ | 64,100 
|2009 |  | $ | 64,100 
|2010 |  | $ | 17,500 
|     |  |   |        
|     |  | $ | 226,750
|     |  |   |        

F-11

---



VisualMED
Clinical Solutions Corp.
(A Development Stage Company)
Notes to the Consolidated Financial Statements 
(expressed in U.S. dollars)
(Unaudited)

|   |                                                                                                                                                                                                                                                                                                                                         
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|9. | Subsequent
  Events                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                         
|a) | On April 1,
  2006, the Company entered into an employment agreement with the chief
  financial officer of the Company to provide services to the Company for a
  term of five years. The Company will pay CDN $150 per hour on a quarterly
  basis and may be paid in cash, or the equivalent in free trading shares of
  common stock.
|   |                                                                                                                                                                                                                                                                                                                                         
|b) | On April 3,
  2006, the Company issued 241,500 shares of common stock upon the exercise of
  241,500 options at $0.00001 per share for no consideration.                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                         
|c) | On April 3,
  2006, the Company issued 5,000 shares of common stock upon the exercise of
  5,000 options at $0.49 per share for proceeds of $2,450.                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                         
|d) | On April 21,
  2006, the Company issued 262,000 shares of common stock upon the exercise of
  262,000 options at $0.00001 per share for no consideration.                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                         
|e) | On April 21,
  2006, the Company issued 20,000 shares of common stock upon the exercise of
  20,000 options at $0.49 per share for proceeds of $9,800.                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                         
|f) | On April 21,
  2006, the Company issued 3,500 shares of common stock upon the exercise of
  3,500 options at $1.90 per share for proceeds of $6,650.                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                         
|g) | On May 8,
  2006, the Company issued 38,500 shares of common stock upon the exercise of
  38,500 options at $0.00001 per share for no consideration.                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                         
|h) | On May 8,
  2006, the Company issued 3,500 shares of common stock upon the exercise of
  3,500 options at $1.90 per share for proceeds of $6,650.                                                                                                                                                                                       

F-12

---



ITEM
2. MANAGEMENTS
DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

We
incurred losses of $5,863,923 for the nine months ending March 31, 2006. This
compares to $5,795,037 in the comparable prior year period. The principal
components of the loss involved the following:

| |   |                                                                                                                                                                                                            
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Maintenance
  and continuing development of our expanding marketing and customer support
  facilities;                                                                                                     
| |   |                                                                                                                                                                                                            
| |  | operating
  and maintaining our world-wide state-of-the-art service center capable of
  supporting client hospitals by remote support technology;                                                          
| |   |                                                                                                                                                                                                            
| |  | newly hired
  employees and consultants, and increased travel expenses as our business
  grows in the United States and overseas, and as we continue to pursue
  contracts and attend industry conferences;
| |   |                                                                                                                                                                                                            
| |  | software
  licenses;                                                                                                                                                                                       
| |   |                                                                                                                                                                                                            
| |  | expenses
  related to presentations and hospital-specific infrastructure configurations
  in order to respond to major tenders and requests for proposals from
  potential buyers; and                     
| |   |                                                                                                                                                                                                            
| |  | costs
  related to direct sales approach and first contact with potential client
  hospitals, from a steadily growing sales funnel comprising over 90 hospitals
  worldwide.                               
| |   |                                                                                                                                                                                                            
| |  | Finally, a
  small amount was devoted to professional expenses, depreciation, and filing
  fees.                                                                                                           

On
March 23, 2005, we issued 2,275,567 units at $0.75 per unit for
proceeds of $1,706,675, consisting of the settlement of notes payable of
$1,674,612 and accrued interest of $32,063, pursuant to a private placement
offering. Each unit consisted of one split-adjusted share of common stock and
one share purchase warrant. Each warrant entitles the holder to acquire one
share of common stock at $1.25 per share for a period of two years.
The fair value of the warrants was estimated at $3,851,845 using the
Black-Scholes pricing model. The following assumptions were used: average
risk-free interest rate of 3.34%; expected life of one year; dividend yield of
0%; and expected volatility of 68%.

Pursuant
to the above-mentioned private placement, we receive proceeds from warrants
exercised from time to time. During the nine-month period ending March 31,
2006, we received cash proceeds of $1,350,849 from the exercise of warrants. We
also issued common stock pursuant to warrant exercises for settlement of notes
payable and accrued interest of $1,165,959. Subsequent to the period ending
March 31, 2006, a further 574,000 options were exercised at various prices
ranging from $0.00001 per share to $1.90 per share for total proceeds of
$25,550.

Operating
expenses for the nine months ending March 31, 2006 were $6,011,223. The Company
is currently incurring expenses of approximately $217,000 per month, net of
stock-based compensation.

The
main challenges that we may have over the next year will be to continue
financing operations, continue building our base of client hospitals and
healthcare facilities, marketing of our modules and concluding strategic
alliances to help us penetrate specific marketplaces in promising geographies.
We are in the process of completing the development of a fully staffed, 24-7
help desk for customer support, capable of providing on the spot assistance to
our growing customer base. During the three month period ended March 31, 2006,
we obtained two new Canadian clients with whom we have entered into agreements
to pursue implementations of our product lines. We have hired project managers
to handle the anticipated growing in implementation, on-site technical support
and other marketing and representative activities. The continued exercise of
warrants, combined with anticipated initial and recurring revenue from current
and new clients, will provide some liquidity.

We
continue to implement our marketing and sales strategy for the VisualMED
system, and other product lines in development. We intend to continue to hire
sales and marketing executives and consultants as our business grows. Our sales
effort will continue targeting regions where current legal regulations
encourage the adoption of our clinical management modules. We are aggressively
pursuing these markets through the creation of sales consortiums that bring
together local healthcare consultants, hardware vendors and local systems
integrators.

We
are in continuing negotiations with several hospital management groups in Italy
and France for the implementation of our clinical management modules, and
continue to respond to requests for proposals from hospitals in Canada, France
and the United States.

Financial Condition, Liquidity and Capital
Resources

At
March 31, 2006, all of our principal capital resources have been acquired
through the issuance of our common stock and advances from our investors. Cash
used in operations was $2,001,180 during the nine months ending March 31, 2006.

During
the nine months ending March 31, 2006, we recognized revenue of $300,196 from
the successful delivery of

F-13

---



completed
product to customers. Of this amount, $145,361was recognized during the three
months ending March 31, 2006.

At
March 31, 2006, we had a positive working capital of $608,088, compared to a
working capital deficiency of $49,345 at June 30, 2005. We had cash on hand of
$150,261 at March 31, 2006.

We
had a net loss of $5,863,923 and $5,795,037 for the nine month periods
ending March 31, 2006 and 2005, respectively.

At
March 31, 2006, our total assets were $1,122,242, as compared to total assets
of $908,354 at June 30, 2005.

At
March 31, 2006, we had pre-paid expenses of $800,434. This amount consisted of
prepaid property taxes in the amount of $3,461, and an advance in the amount of
$796,973 to Medicool Health Systems Inc., an unaffiliated company and key
supplier of technical services to us (Medicool). The advance to Medicool was
made to ensure that a series of strategic technical services that Medicool was
contracted to provide us would be available in a timely fashion by affording
Medicool the resources to maintain a staff of technical specialists required to
make certain modifications to our products. As a result of having the benefit
of Medicools services, we should be able to better, and more efficiently,
customize our products and respond to particular client needs (including at
their initial requests for proposals) which may have a positive impact on our
financial condition and future result of operations.

At
March 31, 2006, our total liabilities were $446,579, as compared to total
liabilities of $930,824 at June 30, 2005. Most of this decrease resulted from
the settlement of notes payable of $651,865 by the issue of common stock during
the three month period ending March 31, 2006.

We
will need to raise additional equity and/or debt financing to sustain
operations over the next twelve months. Our auditors have expressed substantial
doubt about our ability to continue as a going concern in their audit report
that was included in our Form 10-KSB for the fiscal year ended June 30, 2005.

Critical Accounting Policies

Our
discussion and analysis of financial condition and results of operations are
based upon the financial statements, which have been prepared in accordance
with accounting principles generally accepted in the United States of America.
The preparation of financial statements requires management to make estimates
and judgments that affect the reported amounts of assets and liabilities,
revenues and expenses and disclosures on the date of the financial statements.
On an on-going basis, we evaluate our estimates, including, but not limited to,
those related to revenue recognition.

We
use authoritative pronouncements, historical experience and other assumptions
as the basis for making judgments. Actual results could differ from those
estimates. Critical accounting policies identified are as follows:

Long-Lived Assets

In
accordance with SFAS No. 144, Accounting
for the Impairment or Disposal of Long-Lived Assets, we test
long-lived assets or asset groups for recoverability when events or changes in
circumstances indicate that their carrying amount may not be recoverable.
Circumstances which could trigger a review include, but are not limited to:
significant decreases in the market price of the asset; significant adverse
changes in the business climate or legal factors; accumulation of costs
significantly in excess of the amount originally expected for the acquisition
or construction of the asset; current period cash flow or operating losses
combined with a history of losses or a forecast of continuing losses associated
with the use of the asset; and current expectation that the asset will more
likely than not be sold or disposed significantly before the end of its
estimated useful life.

Recoverability
is assessed based on the carrying amount of the asset and its fair value which
is generally determined based on the sum of the undiscounted cash flows
expected to result from the use and the eventual disposal of the asset, as well
as specific appraisal in certain instances. An impairment loss is recognized
when the carrying amount is not recoverable and exceeds fair value.

Foreign Currency Transactions/Balances

Our functional
and reporting currency is the United States dollar. The functional currency of
the Companys subsidiary is the Canadian dollar. The financial statements of
this subsidiary are translated to United States dollars in accordance with SFAS
No. 52, Foreign Currency Translation, using period-end rates of
exchange for assets and liabilities, and average rates of exchange for
the period for revenues and expenses. Translation gains (losses) are
recorded in accumulated other comprehensive income (loss) as a component of
stockholders equity. Foreign currency transaction gains and losses are
included in current operations.

F-14

---



Revenue Recognition

The
Company recognizes revenue related to sales and licensing of medical software
in accordance with Statement of Position No. 97-2, Software Revenue Recognition (SOP 97-2), as
amended by Statement of Position No. 98-9, Software Revenue Recognition with Respect to Certain
Arrangements. Pursuant to SOP 97-2 and Staff Accounting Bulletin
No. 104 Revenue Recognition,
revenue will only be recognized when the price is fixed or determinable,
persuasive evidence of an arrangement exists, the service is performed, and
collectibility is reasonably assured. The Company also follows the guidance in
Emerging Issues Task Force (EITF)
Issue No. 00-21 Revenue Arrangements with
Multiple Deliverables relating to the separability of deliverables
included in an arrangement into different units of accounting and the
allocation of an arrangements consideration to those units of accounting. It
does not address when revenue should be recognized for the units of accounting.
Incremental direct costs related to contract acquisition and origination, which
result in deferred revenue, are expensed as incurred. Any allowance for
doubtful accounts is based on the Companys detailed assessment of the
collectibility of specific customer accounts. Any significant customer accounts
that are not expected to be collected are excluded from revenues.

Disclosure Regarding Forward-Looking
Statements

Certain
statements contained in this quarterly report on Form 10QSB/A constitute
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements involve known and unknown risks, uncertainties
and other factors which may cause deviations in actual results, performance or
achievements to be materially different from any future results, performance or
achievement expressed or implied. Such factors include but are not limited to:
market and customer acceptance of and satisfaction with our products, market
demand for our products; fluctuations in foreign currency markets; the use of
estimates in the preparation of our financial statements; the impact of
competitive products and pricing in our field; the ability to develop and
launch new products in a timely fashion; government and industry regulatory
environment; fluctuations in operating results, including, but not limited to,
spending on research and development, spending on sales and marketing
activities, spending on technical and product support; and other risks outlined
in previous filings with the Securities and Exchange Commission, and in this
quarterly report on Form 10-QSB/A. The words believe, expect, may,
anticipate, intend and plan and similar expressions identify forward-looking
statements. Such statements are subject to risks and uncertainties that cannot
be quantified and, consequently, actual results may differ materially from
those expressed or implied by such forward-looking statements. You are
cautioned not to place undue reliance on these forward-looking statements. The
terms Company, we, us, our, VisualMED and the Registrant
refer to
VisualMED Clinical Solutions Corp., a Nevada corporation, and its subsidiaries.

Factors
that could cause actual results to differ from those expressed in
forward-looking statements include, but are not limited to:

| |   |                                                                                                                                                                                                                                                                                                                                      
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Our limited
  operating history;                                                                                                                                                                                                                                                                                                     
| |   |                                                                                                                                                                                                                                                                                                                                      
| |  | Our auditors
  have issued a going concern opinion. Therefore we may not be able to achieve
  our objectives and may have to suspend or cease operations;                                                                                                                                                                            
| |   |                                                                                                                                                                                                                                                                                                                                      
| |  | Because we
  have historically incurred losses and these losses may increase in the
  future, we must begin generating a profit from our operations. If we do not
  begin generating a profit we may have to suspend or cease operations;                                                                                            
| |   |                                                                                                                                                                                                                                                                                                                                      
| |  | We have
  experienced a history of losses and expect to incur future losses. Therefore,
  we must continue to raise money from investors to fund our operations. If we
  are unable to fund our operations, we will cease doing business;                                                                                            
| |   |                                                                                                                                                                                                                                                                                                                                      
| |  | Because we
  depend on a limited number of third parties to manufacture and supply
  critical components for our products and services, if a third party
  manufacturer should cease operations or refuse to sell components to us, we
  may have to suspend or cease operations;                                                    
| |   |                                                                                                                                                                                                                                                                                                                                      
| |  | If we cannot
  deliver the VisualMed systems our customers demand, we will be unable to
  attract customers, which would likely result in a loss of income and
  eventually a termination of our operations;                                                                                                                         
| |   |                                                                                                                                                                                                                                                                                                                                      
| |  | Competition
  from companies with already established marketing links to our potential
  customers may adversely affect our ability to market our products;                                                                                                                                                                          
| |   |                                                                                                                                                                                                                                                                                                                                      
| |  | Our parent
  company has significant influence over our corporate decisions;                                                                                                                                                                                                                                                         
| |   |                                                                                                                                                                                                                                                                                                                                      
| |  | Because we
  do not have any patents, we rely on trade secrets, confidentiality agreements
  and contractual agreements, which may not be adequate to protect our
  proprietary interests. If our proprietary interests are divulged to the
  public, our operations may be adversely impacted and we may have to cease
  operations;

F-15

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| |   |                                                                                                                                                                                                                                                                                                     
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | We may be
  exposed to liability claims if products based on our technologies are
  marketed and sold. We have liability insurance coverage in the amount of
  $1,000,000, however, if a judgment is rendered against us in excess of the
  amount of our coverage, we may have to cease operations;
| |   |                                                                                                                                                                                                                                                                                                     
| |  | Third
  parties may claim that our current or future products or services infringe
  their proprietary rights or assert other claims against us;                                                                                                                                                    
| |   |                                                                                                                                                                                                                                                                                                     
| |  | Fluctuations
  in the value of foreign currencies could result in increased product costs
  and operating expenses;                                                                                                                                                                                 
| |   |                                                                                                                                                                                                                                                                                                     
| |  | We must be
  able to respond to rapidly changing technology, services and standards in
  order to remain competitive;                                                                                                                                                                               
| |   |                                                                                                                                                                                                                                                                                                     
| |  | Because the
  market for our common stock is limited, our investors may not be able to
  resell their shares of common stock;                                                                                                                                                                       
| |   |                                                                                                                                                                                                                                                                                                     
| |  | Because our
  common stock is subject to penny stock rules, the liquidity of investments
  may be restricted.                                                                                                                                                                                       

|                                |  | 
|------------------------------- |  | 
|ITEM 3. CONTROLS AND PROCEDURES

As
of the end of the period covered by this report, under the supervision and with
the participation of our management, including Gerard Dab, our Chief Executive
Officer, and Larry Kurlander, our Chief Financial Officer, we have evaluated
the effectiveness of our disclosure controls and procedures (as defined in Rule
13a-15(e) of the Securities and Exchange Act of 1934 (Exchange Act)). Based on
that evaluation, our Chief Executive Officer and our Chief Financial Officer
have concluded that these disclosure controls and procedures are effective to
ensure that information required to be disclosed in our annual reports filed
under the Exchange Act is recorded, processed, summarized and reported within
the time periods specified in Securities Exchange Commission rules and forms.
There were no changes in our internal control over financial reporting during
the fiscal quarter ended March 31st 2006 that have materially
affected, or are reasonably likely to materially affect, our internal control
over financial reporting.

Our officers
believe that our disclosure controls and procedures are effective to ensure
that information required to be disclosed in the reports that VisualMED files
or submits under the Exchange Act is accumulated and communicated to
management, including our Chief Executive Officer and our Chief Financial
Officer in order to allow timely decisions regarding required disclosure. There
are frequent daily communications among all of our executives, including Chief
Executive Officer, Chief Financial Officer, Chief Operating Officer, President
and our Vice President for Finance. All of our budgetary decisions and all of
our billing and other expenditures require the written, signed approval of at
least three of our executives. All issues regarding disclosures and procedures
are discussed in a timely fashion, including all financial and other key
operational information. Current disclosure controls and procedures are
governed by the Board of Directors, and any changes to such controls and
procedures must be made with the Boards approval.

F-16

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PART II

|ITEM
        1. | LEGAL
        PROCEEDINGS
|--------------- | -------------------------

From
  time to time we may be involved in litigation incidental to the conduct of our
  business, such as contractual matters and employee-related matters. Currently,
  we are not a party to any material legal proceeding or litigation, whether current
  or threatened, nor are any of our officers, directors or affiliates, a party
  adverse to us in any legal proceeding or litigation.



|ITEM
        2. | UNREGISTERED
        SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|--------------- | -------------------------------------------------------------------



On
  March 24, 2006, we issued to Aton Select Fund Ltd. 68,616 shares of common stock
  upon the exercise of 68,616 warrants at $1.25 per share for proceeds of $85,770.
  The warrants were issued pursuant to Regulation S of the Securities Act. The
  transaction was with a non-US person and the transaction was consummated outside
  the United States.



On
  March 13, 2006, we issued to Aton Select Fund Ltd. 53,207 shares of common stock
  upon the exercise of 53,207 warrants at $1.25 per share for proceeds of $66,509.
  The warrants were issued pursuant to Regulation S of the Securities Act. The
  transaction was with a non-US person and the transaction was consummated outside
  the United States.



On
  March 6, 2006, we issued 178,031 shares of common stock upon the exercise of
  178,031 warrants at $1.25 per share for proceeds of $222,539 (55,320 shares
  of common stock to Aton Select Fund Ltd., and 122,711 shares of common stock
  to Asset Protection Fund Ltd.). The warrants were issued pursuant to Regulation
  S of the Securities Act. The transaction was with a non-US person and the transaction
  was consummated outside the United States.



On
  March 3, 2006, we issued 505,000 shares of common stock upon the exercise of
  505,000 options at $0.00001 per share for no consideration (25,000 shares of
  common stock to Claude Pellerin, 200,000 shares of common stock to Mellissa
  Rozine-Sognon, 200,000 shares of common stock to Giovanni Franco Scanzi, 15,000
  shares of common stock to Emile Malka, 25,000 shares of common stock André
  G. Nadeau, 15,000 shares of common stock to Sam Sonnenschein, and 25,000 shares
  of common stock to Frank Dejak). The warrants were issued pursuant to Regulation
  S of the Securities Act. The transaction was with a non-US person and the transaction
  was consummated outside the United States.



On
  January 20, 2006, we issued to Aton Select Fund Ltd. 136,448 shares of common
  stock upon the exercise of 136,448 warrants at $1.25 per share for proceeds
  of $170,560. The warrants were issued pursuant to Regulation S of the Securities
  Act. The transaction was with a non-US person and the transaction was consummated
  outside the United States.



|ITEM
        6. | EXHIBITS
        AND REPORTS ON FORM8-K
|--------------- | ---------------------------------------



|(a) |  |  | Exhibits |  | Description                                                                                                                                                                                                           
|--- |  |  | -------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |  |  | 3.1      |  | Articles
        of Incorporation (incorporated by reference to Exhibit 3.1 to the Companys
        Registration Statement on Form SB2 (Registration No. 33394835)
        filed with the SEC on January 18, 2001).
|    |  |  | 3.2      |  | Amendment
        to the Articles of Incorporation (incorporated by reference to Exhibit
        3.2 to the Companys Quarterly Report on Form 10QSB filed with
        the SEC on February 22, 2005).               
|    |  |  | 3.3      |  | ByLaws
        (incorporated by reference to Exhibit 3.2 to the Companys Registration
        Statement on Form SB2 (Registration No. 33394835) filed with
        the SEC on January 18, 2001).                  





F-17

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| |  |  | 31.1 |  | Certification
        of Principal Executive Officer pursuant to Rule 13a-15(e) and Rule 15d-15(e),
        promulgated under the Securities and Exchange Act of 1934, as amended.
| |  |  | ---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |  | 31.2 |  | Certification
        of Principal Financial Officer pursuant to Rule 13a-15(e) and Rule 15d-15(e),
        promulgated under the Securities and Exchange Act of 1934, as amended.
| |  |  | 32.1 |  | Certification
        pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
        of the Sarbanes-Oxley Act of 2002 (Principal Executive Officer).             
| |  |  | 32.2 |  | Certification
        pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
        of the Sarbanes-Oxley Act of 2002 (Principal Financial Officer).             





SIGNATURES

Pursuant
  to the requirements of Section 13 or 15(d) of the Securities and Exchange Act
  of 1934, the Registrant has duly caused this report to be signed on its behalf
  by the undersigned, thereunto duly authorized, on this 18th day of
  May, 2006.



| |  | VISUALMED
        CLINICAL SOLUTIONS CORP.(Registrant)
| |  | ------------------------------------------------------
| |  | By:                                                   
| |  |                                                       



F-18

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|Exhibits |  | Description                                                                                                                                                                                                           
|-------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1      |  | Articles
        of Incorporation (incorporated by reference to Exhibit 3.1 to the Companys
        Registration Statement on Form SB2 (Registration No. 33394835)
        filed with the SEC on January 18, 2001).
|3.2      |  | Amendment
        to the Articles of Incorporation (incorporated by reference to Exhibit
        3.2 to the Companys Quarterly Report on Form 10QSB filed with
        the SEC on February 22, 2005).               
|3.3      |  | ByLaws
        (incorporated by reference to Exhibit 3.2 to the Companys Registration
        Statement on Form SB2 (Registration No. 33394835) filed with
        the SEC on January 18, 2001).                  
|3.4      |  | Regulation
        FD Disclosure (incorporated by reference to Form 8-K filed with SEC on
        April 6th 2006).                                                                                                    
|3.5      |  | Regulation
        FD Disclosure (incorporated by reference to Form 8-K filed with SEC on
        April 10th 2006).                                                                                                   
|3.6      |  | Regulation
        FD Disclosure (incorporated by reference to Form 8-K filed with SEC on
        April 25th 2006).                                                                                                   
|31.1     |  | Certification
        of Principal Executive Officer pursuant to Rule 13a-15(e) and Rule 15d-15(e),
        promulgated under the Securities and Exchange Act of 1934, as amended.                                    
|31.2     |  | Certification
        of Principal Financial Officer pursuant to Rule 13a-15(e) and Rule 15d-15(e),
        promulgated under the Securities and Exchange Act of 1934, as amended.                                    
|32.1     |  | Certification
        pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
        of the Sarbanes-Oxley Act of 2002 (Principal Executive Officer).                                                 
|32.2     |  | Certification
        pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
        of the Sarbanes-Oxley Act of 2002 (Principal Financial Officer).                                                 

F-19

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