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


                                  FORM 10-KSB/A

                    ANNUAL REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                    For the fiscal year ended: July 31, 2005


                      IN VERITAS MEDICAL DIAGNOSTICS, INC.
                   ===========================================
                  (formerly IN VIVO MEDICAL DIAGNOSTICS, INC.)
                  --------------------------------------------
                 (Name of small business issuer in its charter)


         Colorado                    000-49972                  84-1579760
-------------------------------------------------------------------------------
(State or other jurisdiction   (Commission File Number)        (IRS Employer
    of incorporation)                                        Identification No.)


     The Green House, Beechwood Business Park North,
                   Inverness, Scotland                         IV2 3BL
     -------------------------------------------------        ----------
        (Address of principal executive offices)              (Zip Code)


                 Issuer's telephone number: 011 44-1463-667-347

      Securities registered under Section 12 (b) of the Exchange Act: NONE

                     Securities registered under Section 12
                            (g) of the Exchange Act:
                     Common Stock, par value $.001 per share
                     ---------------------------------------

Check  whether  the issuer  (1) has 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.

                                 Yes [X] No [_]

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).

                                 Yes [_] No [X]

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the best of the  registrant's  knowledge,  in  definitive  proxy or  information
statements  incorporated  by reference in Part III of this Form  10-KSB/A or any
amendment to this Form 10-KSB/A. [_]

State the issuer's revenues for the most recent fiscal year: $879,847

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates  computed by reference to the price at which the common equity
was sold,  or the average bid and asked  price of such  common  equity,  as of a
specified date within the past 60 days.

As of October 31, 2005: $5,617,334

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 56,261,308 shares of common stock,
$.001 par value per share, as of October 10, 2005.

Transitional Small Business Disclosure Format (check one): Yes [_] No [X]


<PAGE>
                                TABLE OF CONTENTS
                                -----------------
                                                                            Page
                                                                            ----

                                     PART I

Item 1.     DESCRIPTION OF BUSINESS...........................................2
Item 2.     DESCRIPTION OF PROPERTY..........................................19
Item 3.     LEGAL PROCEEDINGS................................................19
Item 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS..............19


                                    PART II

Item 5.     MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.........20
Item 6.     MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION........22
Item 7.     FINANCIAL STATEMENTS.............................................F-1
Item 8.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
            ACCOUNTING AND FINANCIAL DISCLOSURE..............................30
Item 8A.    CONTROLS AND PROCEDURES..........................................30


                                    PART III

Item 9.     DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
            PERSONS; COMPLIANCE WITH SECTION 16(b) OF THE EXCHANGE ACT.......30
Item 10.    EXECUTIVE COMPENSATION...........................................31
Item 11.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
            MANAGEMENT.......................................................32
Item 12.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS...................34
Item 13.    EXHIBITS AND REPORTS ON FORM 8-K.................................35
Item 14.    PRINCIPAL ACCOUNTANT FEES AND SERVICES...........................38

SIGNATURES  .................................................................39



                                       2
<PAGE>

                                     PART I

Item 1. DESCRIPTION OF BUSINESS

General Overview

In Veritas Medical Diagnostics, Inc. (formerly In Vivo Medical Diagnostics, Inc.
and Sports  Information and Publishing  Corp.) (the "Company") is engaged in the
development of lateral  applications of novel measurement  techniques in medical
devices with `near-patient' (i.e. point of care) testing applications.

Recent Financings

September 2005 Financing

                                       3
<PAGE>
Standby Equity Distribution Agreement

On September 7, 2005,  the Company  entered into a Standby  Equity  Distribution
Agreement  (the  "Distribution  Agreement")  with  Cornell  Capital  Partners LP
("Cornell")  providing for the sale and issuance to Cornell of up to $10,000,000
of  Common  Stock  over a period of up to 24 months  after  the  signing  of the
Distribution Agreement.  Under the Distribution Agreement,  the Company may sell
to Cornell up to $500,000  in shares of its common  stock (the  "Common  Stock")
once every five trading  days at a price of 97% of the lowest  closing bid price
(as reported by Bloomberg  L.P.),  of the Common Stock on the  principal  market
where the Common Stock is traded for the five consecutive trading days following
a notice by the Company to Cornell of its intention to sell shares.  The Company
will  also  pay  a 5%  commitment  fee  upon  each  sale  of  shares  under  the
Distribution  Agreement.  Cornell  has  agreed not to short any of the shares of
Common Stock.

18% Secured Convertible Debentures

Also on  September  7, 2005,  the Company  entered  into a  Securities  Purchase
Agreement  (the  "Purchase  Agreement")  with  Montgomery  Equity  Partners Ltd.
("Montgomery"),  an  affiliated  fund of Cornell,  providing for the sale by the
Company to Montgomery of its 18% secured convertible debentures in the aggregate
principal amount of $750,000 (the  "Debentures") of which $300,000 was funded on
September  7,  2005;  $200,000  shall be funded two  business  days prior to the
Company's  completion of its audited  financial  statements  for the fiscal year
ended July 31, 2005, and;  $250,000 shall be funded within five business days of
the date the Registration  Statement is declared effective by the SEC. Under the
Purchase  Agreement,  the Company also issued to Montgomery  three-year warrants
(the "Warrants") to purchase 350,000 shares of Common Stock at $0.001 per share.

In addition to the  foregoing,  the Company  entered into a Securities  Purchase
Agreement (the "Accredited Investor Purchase Agreement") with the investors (the
"Accredited  Investors")  in its  April  2005  financing  pursuant  to which the
Accredited  Investors  agreed to exchange the securities  that they purchased in
such  financing  for an aggregate of $556,500  principal  amount of  Debentures.
Specifically,  the  Accredited  Investors  agreed to  exchange an  aggregate  of
863,845 units (the "Units"), as well as a warrant to purchase an additional Unit
for an aggregate of $556,500 principal amount of Debentures. Each Unit consisted
of one share of 5% convertible  preferred stock of the Company,  $.001 par value
per share, and one warrant to purchase one share of the Company's common stock.

The Debentures  mature on the first anniversary of the date of issuance and bear
interest  at the annual  rate of 18% in cash.  The  Company is  required to make
monthly  interest  payments  commencing on October 7, 2005,  and to make monthly
principal payments commencing on March 7, 2006.

Holders may convert,  at any time, the principal  amount  outstanding  under the
Debentures into shares of Common Stock, at a conversion price per share equal to
$0.144,  subject to adjustment.  Upon three-business day advance written notice,
the Company may redeem the  Debentures,  in whole or in part.  In the event that
the closing bid price of the Common Stock on the date that the Company  provides
advance  written notice of redemption or on the date  redemption is made exceeds
the conversion  price then in effect,  the redemption will be calculated at 112%
of the Debentures' face value.

As further  security for its  obligations  under the Purchase  Agreement and the
Accredited  Investor Purchase  Agreement,  the Company has deposited into escrow
25,685,000  shares (the  "Escrow  Shares") of common  stock.  The Escrow  Shares
shares are deemed issued but not outstanding.

April 2005 Financing

On April 15, 2005, we completed the sale of 863,845  units (the  "Units"),  each
Unit  consisting of one share of 5% convertible  preferred stock of the Company,
$.001 par value per share (the "Preferred  Stock"),  and one warrant to purchase
one  share  of the  Company's  common  stock  (the  "Warrants"),  to  accredited
investors  pursuant for an aggregate  purchase price of approximately  $561,500.
The aggregate purchase price consisted of the sale of $401,500 of Units for cash
and the sale of $160,000 of Units for the forgiveness of debt. In addition, each
purchaser of a Unit received a warrant to purchase an additional Unit (the "Unit
Warrants").  The  aforementioned  securities  were  sold in  reliance  upon  the
exemption  afforded by the  provisions of Regulation  D, as  promulgated  by the
Securities and Exchange Commission under the Securities Act of 1933, as amended.
Subsequent to the  completion of the Standby Equity  Distribution  Agreement and
the sale of the 18% secured  convertible  debentures  pursuant to the Securities
Purchase  Agreement  in  September  2005,  the  Company  prepared  and  filed  a
registration  statement on Form SB-2 with the Securities and Exchange Commission
for  the  purpose  of  registering  the  securities  underlying  such  financing
transactions.  In connection  therewith,  the Company has received comments from
the  Commission  indicating  that,  in the  Commission's  view,  based  upon the
structure of the transactions,  the Company may not register the securities sold
in the financing transactions.  As a result, the Company has been in discussions
with the investors in the recent financing  transactions  regarding the possible
restructuring of these financing  transactions.  No assurance can be given as to
when, or if, the  transactions  will be  restructured,  or that the transactions
will be  restructured  in a manner that is acceptable to the Commission to allow
registration of the securities sold in these transactions.

                                      4
<PAGE>

History

The Company was originally  incorporated  under the laws of Colorado on November
7, 2003 under the name Sports  Information  Publishing  Corp.  ("SIPC")  for the
purpose of engaging in sports prognostication.

On July 30, 2004,  the security  holders of Hall Effect Medical  Products,  Inc.
consummated the  transactions  contemplated  by a share exchange  agreement (the
"Share  Exchange  Agreement"),  dated as of June 30,  2004,  by and among Sports
Information and Publishing Corp. , Michael D. Tanner,  HEMP Trustees Limited, as
the corporate trustee of the HEMP Employment  Benefit Trust, John Fuller,  Brian
Cameron,  Westek  Limited,  and the  security  holders  of Hall  Effect  Medical
Products,  Inc. As a result of the exchange,  Hall Effect Medical Products, Inc.
became our wholly owned subsidiary ("In Vivo DE").

Thereafter,  the parties to the Share Exchange  agreed to amend the terms of the
agreement  to correct  certain  information  regarding  (i) the number of shares
issued in connection with the  transactions  contemplated by the agreement,  and
(ii) the  capitalization  of the Company both before and after the  transactions
contemplated by the agreement.

Pursuant to the Share Exchange, as amended, the Company:

o issued to the  former  holders  of  8,000,000  shares of In Vivo DE  preferred
stock, an aggregate of 34,343,662 shares of our 4% voting redeemable convertible
preferred stock (the "4% Preferred Stock");

o issued  to the  former  holders  of  shares  of In Vivo DE  common  stock,  an
aggregate of 38,636,453 shares of our common stock;

o issued 1,636,233  additional shares of our common stock to holders of $467,495
of promissory  notes ($450,000 of which was converted by July 31, 2004),  issued
by In Vivo DE's wholly owned  subsidiaries,  Hall Effect  Technologies  Ltd. and
Jopejo Ltd., in exchange for the cancellation of such notes; and

                                       4
<PAGE>
o agreed  to cause  the  resignation  of all  current  members  of our  board of
directors and appoint new directors as  designated  by certain  shareholders  or
affiliates of In Vivo DE.

Each full share of the Company's 4% Preferred  Stock is  convertible at any time
after October 31, 2005, at the option of the holder,  into one full share of our
common  stock.  The  shares  of 4%  Preferred  Stock  vote,  together  with  our
outstanding  common stock on an "as converted"  basis, at any regular or special
meeting of our stockholders  called for the purpose of electing directors of our
company or to vote on any other  matter  requiring  shareholder  approval  under
Colorado corporate law.

In Vivo DE was subsequently  merged into the parent Company.  Effective April 8,
2005, the Company changed its name from In Vivo Medical Diagnostics,  Inc. to In
Veritas Medical Diagnostics, Inc.

Our Subsidiaries

We have two wholly owned  subsidiaries,  IVMD(UK) Ltd.  ("IVMD(UK)")  and Jopejo
Ltd.  ("Jopejo"),  both of which are incorporated  under the laws of England and
Wales and based in Inverness, Scotland.

IVMD(UK),  formerly  Hall Effect  Technologies  Ltd ("HET")  built a platform of
patents from which to exploit unique commercial  applications.  HET's operations
were, historically, funded in part from development contracts and government
grants,  with a majority  of funding  provided by Westek  Ltd.  The  controlling
interest  of  Jopejo  Ltd.,  a  biotech  research  company   utilizing   similar
development  techniques,  was purchased by Abacus Trust Company  Limited and the
operations of the companies merged to achieve development savings.

The  fundamental  premise is in the  transfer  of  measurement  technology,  the
principles of which are known and established in the world of physical  science,
into medical devices with global near-patient applications. This is done through
the creation of novel, patented methods and apparatus for which IVMD is the sole
owner of the  intellectual  property.  One  application,  forecast  to  generate
royalty  revenues from 2005 onwards,  is in the final phase of development  with
route-to-market secured through a major distributor.

Products and Services

We currently have applied for eleven patents (see table below),  from granted to
pending, covering the generic application of our products and technology. We are
currently  working on a number of additional  patents for submission  during the
next year.  We have allowed two  additional  patents to lapse because we believe
that they are no longer core to our  business and have no  commercial  value for
us. We have engineered prototypes on three distinct products:

o a prothrombin  device for measuring the clotting or coagulation  time of blood
in patients at risk of heart disease and stroke - a critical  measurement  for a
condition affecting millions worldwide

o a suite of products for fetal heart  monitoring  and  predicting  the onset of
labor several weeks in advance of the commencement of labor pains

o a device to establish proof of principle, and a prototype to demonstrate a low
cost and non-harmful alternative to conventional X-ray imaging

We have also  established the concept and are developing  proof of principle for
other low-cost and safe magnetic detection systems for additional  applications,
including:

o a  minimally-invasive,  rapid and accurate  system for  detection of compounds
within blood

o a non-invasive  glucose  monitoring  system for diabetics  which can be merely
clipped to a  patient's  ear lobe (or other area with  blood rich  tissue)  and,
without  taking  blood from the patient,  will measure  levels of glucose in the
blood;

o a rapid, non-invasive monitoring device for osteoporosis

o a surgical instrument positioning system.

                                       5
<PAGE>
The initial commercial product was a computer input device based on our patented
technology,  known as the "Evomouse,"  which was developed to the point of sale.
Although  the  initial  response  in the  computer  peripheral  press  was  very
encouraging,  we  determined  that this  device is non-core to the future of our
business.  Accordingly,  we  discontinued  production and are seeking to sell or
license  rights to the  "Evomouse."  We have recently  entered into an agreement
with UTEK, and American corporation, for the potential sale or licensing of this
technology.

Services

We have  built a  successful  reputation  for  delivering  rapid  prototype  and
production   development  programs.   Using  skilled  managers  with  experience
transferable from other industrial sectors, we can take our concept applications
to prototype and even  production  release stage,  in timescales  vastly shorter
than conventional project management would suggest.

Commercial Arrangements

We entered into a development contract and license agreement for our prothrombin
blood clotting measuring device with Inverness Medical  Innovations,  Inc (IMA -
Amex) ("IMI"),  located in Boston, MA. The development contract contributed over
$2 million,  over an 18-month  period,  and  culminates  in the  delivery of the
initial  batch of units for market  launch  during the last  quarter of calendar
year 2005.

Thereafter, under our agreement with IMI, we will grant an exclusive,  worldwide
license to IMI for the use of our technology to produce and market a prothrombin
blood clotting  measuring device for which we will receive a royalty equal to 2%
of all net sales of such device.

In  September  2001,  we entered into a letter of intent with Rosti (UK) Ltd., a
subsidiary  of AP  Moller,  which is a high  quality  plastics  and  electronics
supplier to the medical industry,  located in Copenhagen,  Denmark, for research
into the  exploitation  of additional  commercial  product  applications  of our
monitoring  systems with their  customer  base,  which  includes Sony  Ericsson,
Nokia, Aventis, GlaxoSmithKline and Maersk Medical.

In addition, our glucose monitoring technology has been examined by Novo Nordisk
(Denmark),  the world's  largest  supplier of insulin for  diabetics,  which has
expressed  that it will enter into a  commercial  agreement  with us when we are
able to demonstrate proof of principle in blood.

                                       6
<PAGE>
Product Descriptions

The table set forth below briefly describes our key products, their applications
and advantages over current technology and products.
<TABLE>
<CAPTION>
------------------------------ ---------------------- ------------------------ ------------------------
          Technology                  Product           Key Applications/            Advantage
                                                             Market
------------------------------ ---------------------- ------------------------ ------------------------
<S>       <C>                  <C>                    <C>                       <C>
          Blood analyte        Prothrombin blood      Minimally-invasive,      Small, cheap device
          measurement          clotting measuring     accurate and safe,       with rapid measurement
                               device                 characteristic           using world leading
                                                      measuring device for     blood sample size
                                                      heart attack and
                                                      stroke sufferers
------------------------------ ---------------------- ------------------------ ------------------------

          Fetal heart rate     Consumer and           Reliable at-home and     Small, external
          monitor              professional  medical  professional-medical     device. Reliable
                               fetal well being       heart rate monitor for   detection and
                               monitor                unborn babies            continuous signal
                                                                               display. Ease of use.
                                                                               Current professional
                                                                               medical devices are
                                                                               unreliable. No device
                                                                               capable of untrained
                                                                               use exists. Device
                                                                               can be produced at
                                                                               significantly less cost
    IN DEVELOPMENT                                                             than current in-market
                                                                               devices.
------------------------------ ---------------------- ------------------------ ------------------------





------------------------------ ---------------------- ------------------------ ------------------------
          Technology                  Product           Key Applications/            Advantage
                                                             Market
------------------------------ ---------------------- ------------------------ ------------------------
          Labor predictor      Predictor of labor     Accurate prediction of   High negative and
                               onset                  onset of labor from 6    positive predictive
                                                      weeks out.  Consumer     success. Ease of use.
                                                      device for maternity     No competition exists
                                                      planning                 either in professional
                                                      In hospital,             medical or consumer
                                                      professional care for    markets
                                                      mothers identified
                                                      at-risk for pre-term
                                                      delivery.
------------------------------ ---------------------- ------------------------ ------------------------
          Blood analyte        Biomarker monitor      Accurate measurement     Highly sensitive, very
          measurement                                 using very low blood     low cost in comparison to
                                                      Volume of a number of    any competitive system.
                                                      Biomarkers including     Multiple measurements
                                                      Heart attack, HIV,       with one blood sample
                                                      Cholesterol and cancer
    IN RESEARCH

------------------------------ ---------------------- ------------------------ ------------------------

          Blood analyte        Blood glucose monitor  Non-invasive, accurate   Small, inexpensive
          measurement                                 and safe, glucose (and   device with rapid
                                                      other) concentration
                                                      continuous bulk
    IN RESEARCH                                       measuring device
                                                      measurement
------------------------------ ---------------------- ------------------------ ------------------------


                                       7
<PAGE>

          Medical imaging      Digital scanning       Non-invasive, safe,      Small and portable,
                               machine                high quality             cheap, continuous
    IN RESEARCH                                       alternative to 2D        display.  No ionizing
                                                      X-ray scanning           radiation.
------------------------------ ---------------------- ------------------------ ------------------------

          Bone density         Osteoporosis detection Non-invasive instant     No ionizing
          monitor              and monitoring device  display of bone          radiation.  Cheap and
    IN RESEARCH                                       mineral density for      accurate
                                                      osteoporosis patients
------------------------------ ---------------------- ------------------------ ------------------------

          Internal Surgery     In- theatre detection  Safe and accurate 3D     Alternative to low
                               system                 positioning of           power X-rays, use with
    IN RESEARCH                                       instruments and probes   tomography
                                                      during surgery
------------------------------ ---------------------- ------------------------ ------------------------
</TABLE>



The advantages of our technology can be summarized as follows:

o our  devices  represent  the  transfer  of known  technology  from  physics to
medicine;

o our  technology  can measure  non-invasively  or with very low  analyte/sample
size;

o the magnetic fields applied to human use are benign and safe;

o our  devices  can  be  produced  and  sold  at a much  lower  cost  than  most
competitive products;

o our devices give 'next generation' technical superiority by:

o operating from direct current to high alternating current frequencies;

o measuring very low levels of displacement; and

o working with low level magnetic fields

Marketing Strategy

Our strategy is to maximize the novel use of  transferable  techniques,  exploit
our core skills to build a solid intellectual property platform and optimize our
exit  timing for each  appropriate  application  of the  technology  to maximize
shareholder value.

For each product or group of products we have sought partners who can:

o help us identify the market and commercial opportunity;

o contribute to the research and development program; and

o be the ultimate manufacturer and/or distributor of the end product.

Recent Achievements

Since June 2001, our management team has achieved the following:

o Focused  development  of our  technology to create value around a portfolio of
linked biomedical products, with enormous potential global market applications.

                                       8
<PAGE>
o  Demonstrated  the ability to develop a new,  novel  product  from  concept to
manufacturing  in China,  with the  establishment  of marketing and distribution
channels.

o  Created  a  core   skills   base   suited  to  the  science  and  fast  track
commercialization of these projects.

o Created a network of  specialists  to allow rapid,  low  overhead  delivery of
solutions.

o Focused  research  programs  delivering  proof of principle on the  biomedical
applications of the Hall Effect.

o Established a licensing and distribution  agreement,  and initiated letters of
intent and  negotiations  with major  biomedical  companies  leading to up to 16
separate product opportunities.

o Two of our eleven core patents have been  granted and the  remaining  nine are
pending.  We have recently  allowed our Evomouse patents to lapse to concentrate
on funding  our core  patent  strategy We are  currently  working on  additional
patent  applications  and filings  using the Hall Effect  (discussed  below) and
other transferable technologies to niche exploitation areas.

o Secured capital  investment from the UK government via the Inverness and Nairn
Enterprise  Regional  Development  Board which has taken equity and guaranteed a
program to provide partial funding for three major development programs.

o Started two PhD.  Research  programs  at  Strathclyde  University  in Glasgow,
Scotland to further our research in non-invasive analyte measurement.  These are
due for review in October this year

Scientific Platform

The Hall Effect and Magnetic Systems

We  have  unique   expertise   with  the  Hall  Effect  as  applied  to  medical
applications.  The Hall Effect is a physical  principle  that was  discovered in
1875, but whose  applications  were not fully utilized until the introduction of
modern high sensitivity and custom-made semiconductors and contemporary computer
processing power.

The  definition of the Hall Effect is the  generation  of an electric  potential
perpendicular  to both an electric  current flowing along a conducting  material
and an external  magnetic field applied at right angles to the plane  containing
the current and Hall field.

We  have  pioneered  the  use  of  Hall  Effect  devices  in  highly   sensitive
proportional measurement,  exploiting their ability to measure to extremely high
levels of accuracy in many environments.  We have combined this basic technology
with magnetic system design and digital signal processing to create non-invasive
measurement  systems  which can  characterize  compounds  and  measure  bulk and
concentration at a molecular level.

Advanced Electronics and Signal Management

In developing these very accurate measuring  devices,  we have built substantial
knowledge and intellectual property around the acquisition and processing of low
and ultra-low level electrical signals,  with particular attention to techniques
for noise  cancellation,  compensatory  processes  for  extraneous  signals  and
temperature  effects.  In particular,  these  techniques have significant use in
fetal monitoring  applications where low-level  electrical signals acquired from
the patient can be effectively processed, enabling novel and valuable diagnosis.

These advantages combine to produce opportunities for the measurement of medical
conditions  either  never  before  measured  or  in  so  effective  a  way  that
near-patient  monitoring previously greatly demanded but technically impossible,
can now be a cost-effective reality.

                                       9
<PAGE>
Intellectual Property

We believe that our science and  capability is unique.  In view of the low level
of published  research and patent activity around these measurement  principles,
to our  knowledge,  no  other  company  or  group  has  attempted  to use  these
techniques for these levels of measurement to develop product applications.  Our
intellectual property is based upon our ability:

o to work at an appropriate physical level to specify magnetic systems

o to develop high  sensitivity  Hall Effect devices using Molecular Beam Epitaxy
(manufacturing) techniques;

o  to  use  the  Hall  Effect  in  high   precision   proportional   measurement
applications;

o to provide  advanced signal  processing and control  techniques to extract low
level signals in biological systems; and

o to establish  techniques for measuring  low-level  effects with high levels of
precision.

In all cases, we own the intellectual  property associated with our products and
applications. In addition to our issued patents and pending patent applications,
we are in the  process of filing for several  additional  patents at both a core
principle and application levels.

Our eleven core patents and patent applications consist of the following:



 Patents                        Pending                              Granted
---------------------------     ----------------------------------   -----------
Blood Coagulation (Unipath)     China, European Patent, Japan, US
Ref: 23827.GB
---------------------------     ----------------------------------   -----------
Blood Monitor (Q-Meter)         China, European Patent, Japan, US
Ref: 1 (4)
---------------------------     ----------------------------------   -----------
Blood Monitor                   China, European Patent, Japan, US
(Susceptibility)
Ref: 1 (5)
---------------------------     ----------------------------------   -----------
Heart Monitor                   China, European Patent, Japan, US
Ref: FP3061
---------------------------     ----------------------------------   -----------
Immunoassay                     China, European Patent, Japan, US
Ref: P/25260
---------------------------     ----------------------------------   -----------
Labor Prediction                European Patent, Japan               United
Ref: FP2708                                                          Kingdom, US
---------------------------     ----------------------------------   -----------
Magnetic Separation             First Filing
Priority Date:
19/06/2004 GB
---------------------------     ----------------------------------   -----------
Medical electrode               China, European Patent, Japan, US
Ref: P3129
---------------------------     ----------------------------------   -----------
Immuoassay - measurement of     First Filing
Presence and concentration
Of compounds in fluids
Supercedes Magnetic
Seperation
---------------------------     ----------------------------------   -----------

Scanner                         China, European Patent, Japan, US
Ref: 1 (3)
Surgical Positioning            China, European Patent
Ref: 1 (2)
---------------------------     ----------------------------------   -----------

* European Patent

                                       10
<PAGE>
Path from Research to Products

Most advanced in development is the prothrombin time measuring device,  with our
goal to deliver a finished product under our commercial development license with
IMI in 2005.

Our fetal monitoring  applications are  technologically the second most advanced
in our medical device portfolio as we enter the second phase of clinical trials.
To support the direction of our product development in line with our strategy of
keeping  the  application  focused on the end user,  we have  already  conducted
market  research in clinics in both the US and the UK. These have  substantiated
the end product  portfolio and given critical insights into the potential issues
related to the ultimate marketing of the products

Next in line  products  will be those from the  minimally  invasive  immunoassay
suite.  It is likely that the first  Biomarkers  to be measured  would be in the
area of DVT ( deep vein thrombosis ) or heart attack / stroke markers.

Although  a  significant  number  of  other  product   opportunities  are  under
consideration for magnetic susceptibility and dielectric dissipative measurement
systems  (and  we  believe   substantially   more  are  undoubtedly  yet  to  be
considered), the focus of our ongoing development research has been to establish
a core  platform  with  specific  emphasis on  non-invasive  measurement  of the
glucose content of blood.

Initial Commercialization Strategy

The prothrombin blood clotting time measurement  device and the fetal monitoring
devices  utilize  much of the core  science and  technology  that applies to the
applications in research.

The  nature  of the  commercial  contracts  for  these  two  products  is  quite
different.  For the  prothrombin  time  measurement  device  we are  essentially
providing a front-end  measuring system for a product that will be independently
developed, produced and marketed by the Unipath division of IMI.

In the case of the fetal monitoring  devices,  we have produced  semi-engineered
prototypes for clinical  trials Our commercial  strategy for these devices is to
have the  devices  produced  and  assembled  for us in China and  contract  with
partners  that can assist us in marketing  and  distributing  the  products.  We
intend to rely on our  distribution  partner's  experience and contacts with the
end-users on issues of product features,  functions and performance criteria. We
are also in  discussions  with a second  commercial  partner  who would take the
product into the US, Europe and other world  markets.  These  arrangements  only
cover the consumer range of products and further  partnerships  are being sought
for professional medical devices.

Products

Prothrombin Blood Coagulation Time Measuring Device

The prothrombin  time (PT) is one of the most important  laboratory  measures to
determine  the  functionality  of the blood  coagulation  system.  It is used in
patient care to diagnose diseases of coagulation, assess the risk of bleeding in
patients undergoing  operative  procedures,  monitor patients being treated with
oral anticoagulant  (coumadin) therapy,  and evaluate liver function.  The PT is
performed  by  measuring  the clotting  time of  platelet-poor  plasma after the
addition of calcium  and  thromboplastin,  a  combination  of tissue  factor and
phospholipid.

Both of the techniques in development,  magnetic  susceptibility  and dielectric
dissipation,  can more  easily be  applied to  measuring  in-vitro  rather  than
in-vivo  analytes.  The  principles  of  measurement  remain the same.  For this
specific  application  however,  we are developing  the magnetic  susceptibility
method  as we  have  ascertained  that  this  gives  us the  most  accurate  and
repeatable measurement of clotting time and also the best grounds for a suite of
unchallengeable patents.

As in the current  practice in diabetic glucose  monitoring,  we extract a small
drop of blood from a finger  and place it on a strip.  The prime  advantages  in
using our PT measurement system over current devices are twofold:  (a) cost, and
(b) the fact that our device only  requires  less than 3  microliters  of blood,
significantly  less invasive than the 20  microliters  of blood  required by the
only  comparable  systems.  This makes it more likely to be used  frequently and
hence reduce the downstream cost of care for patients.

                                       11
<PAGE>
Market for PT Monitors

During  the last few years PT  monitors  have been  increasingly  proposed  as a
substitute for  conventional  laboratory  systems to control oral  anticoagulant
treatment.  The  distinct  advantage  is  that  they  can be  used  for  patient
self-testing. Their use in combination with computer programs designed to adjust
the dosage is predicted to open a new era in oral  anticoagulant  monitoring and
all parties involved will benefit from such a revolution.

Physicians in charge  (specialists  and general  practitioners)  will be able to
handle the  increasing  numbers of patients on oral  anticoagulants.  Laboratory
workers now engaged in lengthy  routines  will now be available for other tasks.
Health  services  groups and  organizations  may save a  considerable  amount of
economic   resources   now  spent  in  the   management   of  patients  on  oral
anticoagulants. Patients themselves will benefit by spending less time attending
overcrowded waiting rooms.

An estimated 17 million people  worldwide die of  cardiovascular  diseases every
year,  particularly heart attacks and strokes (Source:  WHO). The total European
market  revenues in 2004 is  estimated to be 150 million euro and is expected to
increase to 375  million  euro in 2009 with  marked  increases  in point of care
testing and  decreases in laboratory  testing and sample size forecast  (Source:
Frost & Sullivan)

The current  benchmark PT monitor is the CoaguChek system marketed by Roche. Our
patents in the PT monitors  include both the  configuration  of the  measurement
apparatus and the detail of the strip design. The principal advantages of our PT
Monitor over the CoaguChek system is shown in the table below.



Feature            CoaguChek                      IVMD
------------------ ------------------------------ ------------------------------
Pain of use        Inhibitive                     Micro-lance - `pin-prick'
------------------ ------------------------------ ------------------------------
Blood volume       20 microliters                 <3 microliters
------------------ ------------------------------ ------------------------------
Ease of use        Complex & error prone process
------------------ ------------------------------ ------------------------------
Size of device     Desk top                       Hand-held; mobile phone
------------------ ------------------------------ ------------------------------
Cost of device     $1,295                          nominal
------------------ ------------------------------ ------------------------------
Cost of strip      $4.83                           nominal
------------------ ------------------------------ ------------------------------


Power consumption Multi, hi-capacity batteries Pen-torch style, low-capacity

Fetal Monitoring Devices

We are currently  completing  development of two  interlinked  fetal  monitoring
devices - fetal heart  monitoring and the prediction of labor onset (POLO) - has
had two phases of clinical trials conducted in Leeds, England.

Fetal  heart rate is the most  reliable  measure of fetal  well-being  and is an
important  part of antenatal and  intrapartum  care.  Currently  physicians  and
midwives  use  auscultation  - merely  listening  through  a  trumpet - or small
ultrasound devices that detect the fetal heart through the Doppler effect.  Both
methods are unreliable  and do not give accurate  diagnostic  capability.  Labor
onset (palpation of tightenings and contractions) is currently estimated through
observation  of uterine  activity by the mother,  the  general  practitioner  or
midwife.  Again there is little predictive  accuracy in these methods and, while
there are interventions to manage prematurity,  Their application follows no key
rules and is often subjective.

                                       12
<PAGE>
There  are  a  number  of  diagnostic,  specialist,  hospital-based  systems  in
development but these are costly,  expert-centered  and not highly successful in
negative and positive prediction of labor onset.

There are no methods  available or in  development  for home,  unskilled  use by
mothers-to-be  for listening to their developing  baby's heartbeat or predicting
the onset of their labor.

Through  developing a practical  application from a recently  published piece of
science  regarding  myometrial  activity,  we have  created  devices  capable of
extracting low-level electrical signals from the uterus.

These are acquired from electrodes  placed on the surface of the abdomen and, by
using in-house developed algorithms can demonstrate birth onset windows from two
weeks in advance.  In addition,  the fetal heart rate can be extracted  from the
resulting algorithms and an instant display of fetal well being given.

The second stage of clinical trials which has been completed has proven that the
device can generate a 7 to 14 day initial warning of labour onset, followed by a
3 to 6 day final  indication.  This was achieved in normal  spontaneous  births.
This is in line with market requirements obtained during market research clinics

Market for Fetal Monitoring Devices

There  are  600,000  births  in the UK  each  year,  4,000,000  in the US and an
estimated  4,000,000 in the  countries of the rest of the world in which we have
patents  granted or pending,  excluding  China. In  consideration  of the market
size,  socio-demographics  play a key  role  in  estimating  the  potential  for
'over-the-counter'  device  sales while health care  'cost-of-quality'  plays an
important factor in professional  medical devices - particularly with respect to
the care of the 15% of  mothers  who are  currently  considered  'at  risk'  for
premature  delivery.  These factors have been taken into account when developing
the  market  research  clinics  we have  held in the UK and US.  We have not yet
studied detailed market  socio-demographics  to determine the size of the market
for our products in China.

Our Suite of Fetal Monitoring Products

A suite of  products  are  envisioned  with  linked  styling  and  progressively
increasing levels of diagnostic and data storage capability to cater to both `at
home' and maternity ward use.

A further  element in the product suite is the  inclusion of disposable  contact
pads which are used with the predictor and professional medical products.  These
are uniquely keyed to the machines and provide an important revenue generator.

Ultimately  this product will enable a  significant  advance in near patient and
remote care through  software  which is easily  downloadable  and  transmissible
using conventional communications media.

In Research

Minimally invasive Biomarker Analysis products - Immunoassay

These products use advanced magnetic  techniques to look for biomarkers in blood
samples. Generally these are in very low volume, and require high sensitivity to
accurately  provide  diagnosis.  By a process of  magnetically  "tagging"  these
biomarkers,  their  measurement  can be  substantially  amplified  to  provide a
sensitive, Point of Care, diagnostic tool.

The market for Immunoassay

The In Vitro Diagnostics  market in the USA was worth on its own $11.9billion in
2002 and this  represents  35-40% of world market.  These are mainly  laboratory
tests as there are few Point of Care devices available.  The market is served by
30 key companies but is dominated by the larger suppliers Eg Roche Holding, J&J,
Abbott Labs, Beckman Coulter, Becton Dickinson, Bayer, Dade Behring

Within this  market,  the  Immunoassay  segment is estimated at c60% with 80% of
sales to top 10 manufacturers.

                                       13
<PAGE>
Market  growth  estimates  are  based  around  10-15%  pa to 2009 in four  major
segments :

- Influenza antigen
- Prostate-specific antigen
- Hepatitis C virus antigen
- Myocardial marker

By  creating  a  fast,   sensitive,   low  cost  immunoassay  device  the  rapid
trauma/paramedic  diagnosis  of  heart  conditions  alone  would  allow  earlier
interventions and significantly lower downstream  healthcare costs with improved
patient outcomes.

Non-Invasive Blood Analyte Measurement Products

Two  methodologies  are in  development  which can,  either in  isolation  or in
combination, identify and measure analytes within a fluid or suspension.

The first technique, `magnetic susceptibility',  subjects the sample, in-vivo or
in-vitro,  to a  known  magnetic  field.  As all  substances,  whether  para  or
diamagnetic,  are  susceptible  to the field by virtue of the ions and electrons
within the molecule,  they are displaced by varying amounts.  By introducing our
developed  magnetic  systems and circuitry,  this  displacement  can be measured
using sensitive,  but conventional,  Hall Effect devices and appropriate  signal
analysis software (again unique to HET).

The  second  technique,  `dielectric  dissipation',  quantifies  the  dielectric
properties  and in  particular,  the loss factors of the subject  analyte at the
resonance frequency of the molecule.  By determining the energy loss, or quality
factor, of the analyte its  concentration in fluid can be determined.  Where the
resonant  frequency of different analytes is very similar a known magnetic field
can be introduced to displace the molecules  and  differentiate  their  resonant
frequencies.

Our  work  in  this  area  has  focused  on the  non-invasive,  continuous  bulk
measurement of the glucose content of blood.

The Market for Glucose Measuring Devices

Worldwide  annual sales of  self-monitoring  glucose products for diabetics were
estimated  to  have  totaled  $5  billion  in  2003  and  are  forecast  to grow
approximately 10% compounded annually (Source:  Abbott Laboratories).  Worldwide
there are estimated to be currently 175.0 million diabetics, forecast to rise to
366 million by 2030 as diagnosis  improves and lifestyles  become more sedentary
(Source: WHO). Primary diabetes care costs are a significant factor but indirect
costs are a more substantial burden to healthcare services as diabetes is one of
the most  prevalent  causes of  blindness,  kidney  disease,  nerve  disease and
amputations, heart disease and stroke.

A typical  diabetic in the developed  world consumes  between $320 and $1,120 of
resource and  materials  per annum.  Management  of the  condition may require a
sample of blood to be drawn several times every day - an often painful process.

Currently,  the supply of glucose testing  equipment is dominated by Johnson and
Johnson, Roche Diagnostics, Abbott Medicines and Bayer Diagnostics with combined
sales of 87% of disposable  strips.  The US market  reached $2.6 billion in 2002
with an estimated compound annual growth rate (2002-2005) of 13.1%. Therefore it
is key to improve glucose meter technologies to encourage frequent testing.

All the major players,  and some smaller  technology  companies,  are developing
technologies to measure non-or  minimally-invasive.  Minimally  invasive methods
are based on either a correlation of  interstitial  fluid glucose  content or an
implant   able   glucose    biosensor.    Non-invasive    methods   use   linear
absorption/transmission  spectra of near infrared  light or the magneto  optical
rotator  effect.  Some are close to market  launch but all are costly,  sizeable
machines and none measure bulk readings or continuously.

Our Glucose Blood Monitoring product is being designed to be a pocket calculator
sized  device  with a small clip to attach to the ear lobe or finger to obtain a
reading.  The  advantages  are  that it will be  safe,  truly  non-invasive  and
accurately monitor and provide  continuous,  bulk trends in real time. It can be
produced very cheaply and provide  substantial  cost savings and health benefits
to users over time.

We believe that it will be capable of being offered to healthcare purchasers, in
consideration  of the benefits to health  authorities,  for a wholesale price of
$200.

                                       14
<PAGE>
We believe that the market  potential  for this product is huge, as reflected in
the statistics set forth below:
<TABLE>
<CAPTION>


                   No of            25 year         Memo:            Memo:            Target use       Target sales
                   diagnosed        predicted       Self             Self             within           volume by
                   diabetics        growth          monitoring       monitoring       diabetic         year 5
                   (`000)           (%)             market size      market           population at    (`000)*
                                                    ($m)             forecast
                                                                     year 5
                                                                     growth (%)
------------------ ---------------- --------------- ---------------- ---------------- ---------------- ---------------
<S>                <C>              <C>              <C>             <C>              <C>  <C>         <C>
UK                 1,440            27               154.4           16.0             1 in 15          96
------------------ ---------------- --------------- ---------------- ---------------- ---------------- ---------------
USA                10,300           47              1001.6           13.8             1 in 15          687
------------------ ---------------- --------------- ---------------- ---------------- ---------------- ---------------
W. Europe          7,100            35               982.4           16.0             1 in 25          355
------------------ ---------------- --------------- ---------------- ---------------- ---------------- ---------------
Other Regions**    30,400           32               639.2                            1 in 100         304
------------------ ---------------- --------------- ---------------- ---------------- ---------------- ---------------
India              22,900           150                                               1 in 200         115
------------------ ---------------- --------------- ---------------- ---------------- ---------------- ---------------
China              18,600           102                                               1 in 250         75
------------------ ---------------- --------------- ---------------- ---------------- ---------------- ---------------
Memo: World Total  154,400          94              2777.6           $6.4 billion
                                                                     by year 5
------------------ ---------------- --------------- ---------------- ---------------- ---------------- ---------------
</TABLE>


* Assumes  that the  product  will have a 5 year life  cycle and that sales will
peak at the target level

**  Countries  outside  of Europe  and the US where  patent  cover is pending or
granted

Other Potential Products

In addition to Glucose blood  monitoring,  our intellectual  property covers the
use of the  technology  for the measure and  monitoring  of any blood  analyte -
either one which occurs  naturally  or is  introduced  (i.e.,  through a drug or
carrier). Typical examples of minimally or non-invasive applications are:

o Oxygen - continuous oximetry
o Estrogen - fertility measurement
o Protein markers - for gene evaluation / modification programs
o Drugs
o Alcohol

Medical Imaging

Currently simple, two-dimensional imaging is carried out in hospitals and dental
practices using conventional X-ray techniques. This relies on the use of harmful
ionizing  radiation and operators,  and patients,  must take great care to avoid
damaging overexposure.

The magnetic susceptibilities of bone and blood rich tissue differ significantly
and  therefore  when part of a body is placed  between a magnetic  source and an
array of Hall devices differential  measurements can be taken to create an image
with  very high  resolution.  If a TFT  screen,  a device  similar  to a lap-top
computer,  is  utilized  with pixel  dedicated  Hall  Effect  chips then a small
portable,  and even flexible,  device can be created. This creates opportunities
for new and existing markets for low cost, high quality imaging.

In the UK the 355 hospital  trusts have anything from a single unit in a cottage
hospital to 15-20 X-ray rooms in a large  hospital.  Increasingly  hospitals are
using digitally  mastered  images to hold and network patient files.  Diagnostic
imaging  sales are on the  increase  both in the UK and the US with x-rays being
the largest growth sector.

                                       15
<PAGE>
US figures are shown in the table below.
<TABLE>
<CAPTION>
------------------- ----------------- ----------------- ----------------- ----------------- -----------------
                    1999 $ million    % Market Share    2004 $ million    % Market Share    AAGR %
                                      1999                                2004              1999-2004
------------------- ----------------- ----------------- ----------------- ----------------- -----------------
<S>                 <C>               <C>               <C>               <C>               <C>
X- ray and          1923.5            47.3              2794.5            52.1              7.8
digital X-ray
------------------- ----------------- ----------------- ----------------- ----------------- -----------------
CT and ultrasound   1707.2                              2091.1                              4.1
------------------- ----------------- ----------------- ----------------- ----------------- -----------------
Nuclear medicine    401.7                               474.4                               3.4
------------------- ----------------- ----------------- ----------------- ----------------- -----------------
Total               4033.4                              5360.0                              5.9
------------------- ----------------- ----------------- ----------------- ----------------- -----------------
</TABLE>


The target for this  product is a variant of the  2-dimensional  imaging,  X-ray
market currently dominated by Philips,  Seimens and Toshiba. This device will be
substantially  cheaper with no harmful  effects,  require less user skill and be
more  compact to the point that a portable  unit is planned  for use in-situ for
trauma cases. In dentistry,  where different  manufacturers  compete, it will be
attractive  on cost and function as well as being  intrinsically  safer and more
user  friendly  and will be a direct  replacement  for the  current  intra-  and
pan-oral devices.

Bone Mineral Densitometry

Osteoporosis  affects  one in three  women and one in fifteen men in the western
world. As a health care issue it is becoming more prevalent as lifestyles become
more sedentary and diet less varied. In addition the  de-mineralization  of bone
in young  children  is becoming  an issue of  increasing  concern in the western
world, as diets are becoming less mineral rich - particularly in calcium.  There
are  further  complications  in  the  scanning  of  children  for  bone  mineral
deficiency as current  processes  require the child to lie perfectly still for a
number of minutes.

In conjunction  with a commercial  partner,  we are researching a variant of the
medical  imaging  technology  which also  utilizes  the  dielectric  dissipative
measuring   technique  to  detect  and  quantify   more   accurately   and  more
conveniently,  the onset and early stages of the disease.  We have filed patents
in this area for the application of our technology.

Two product streams are envisioned. The first is a hospital use device of a size
capable of performing whole body scans. The second is a hand-held device,  which
could scan a finger or vertebrae,  and give accurate and rapid  readouts of bone
mineral   levels.   Both  devices  would  give  an  instant  reading  against  a
patient-trend benchmark.

While we have yet to formally  conduct a market  review we  estimate  the market
value for  over-the-counter  devices alone to grow to in excess of $800 million*
per year by 2007.  A full study will be launched  when the concept  demonstrator
stage is reached.

Internal Surgery

This project is a spin-off from our positional work. Using sensitive Hall Effect
devices in a magnetic field accurate  internal  positioning of surgical  probes,
instruments and other internal medical devices can be achieved. Current practice
uses  low  power  X-rays  and  computer  tomography  however  this  carries  the
disadvantage of using ionizing radiation. This is of particular value in keyhole
surgery and the treatment of certain  cancers and where magnetic  markers can be
used to identify  locations  within the body.  Ideally  this  technology  can be
combined  with  force  feedback  techniques.  Patents  have  been  filed and the
development program specified.

Product Summary - Technologies and Applications Currently in Development

                                       16
<PAGE>
The  following  definitions  set forth the current stage of  development  of our
technology, in terms of the products we have proven as to concept,  functionally
demonstrated, produced prototypes, or are in actual volume production.

<TABLE>
<CAPTION>
Phase 1                 Phase 2               Phase 3             Phase 4                Phase 5
----------------------- --------------------- ------------------- ---------------------- --------------------
<S>                     <C>                   <C>                 <C>                    <C>
Concept Proving         Functional            Semi - engineered   Fully - engineered     Volume Production
                        demonstration         prototypes          prototypes
----------------------- --------------------- ------------------- ---------------------- --------------------
Bench and laboratory    Bench simulator       Batch production    As final production    For sale to market
to substantiate         which can             to finished         version used for
hypothesis              demonstrate           design using some   field trials in
                        capabilities          production          market
                                              materials and
                                              techniques
----------------------- --------------------- ------------------- ---------------------- --------------------
                                              3 and 4 may         run                    Tooling will start
                                              concurrently        depending on           in advance of...
                                              confidence          levels in
                                              materials and       production
                                              techniques
----------------------- --------------------- ------------------- ---------------------- --------------------
0+ 6 months             0+ 10 months          0+ 16 months        0+20 months            0+24 months
----------------------- --------------------- ------------------- ---------------------- --------------------
Capability:
----------------------- --------------------- ------------------- ---------------------- --------------------
IVMD  - current         IMDV + resource       Small consortium    Larger consortium      Current market
                                              Current market      Current market player  player
                                              player
----------------------- --------------------- ------------------- ---------------------- --------------------
</TABLE>

The current  product  development  status of our technology may be summarized as
follows:


<TABLE>
<CAPTION>
Technology                   Product                    Key Applications                 Development Stage
---------------------------- -------------------------- -------------------------------- --------------------
<C>                             <C>                   <C>                                 <C>
1. Blood analyte             Fast, sensitive low cost   Cardiac, HIV, Drug diagnosis             2
                             Biomarker measurement      and measurement

2. Blood glucose monitor     Non-invasive, accurate     Routine measurement of glucose           1
                             Point of care              For self management
                                                        Of glucose

                             1

---------------------------- -------------------------- -------------------------------- --------------------
3. BAM (minimally invasive)  Point of care blood
                             Minimally - invasive, safe 3 analysis accurate
                             monitoring of
                             clinical conditions such as
                                                        Coagulation time
---------------------------- -------------------------- -------------------------------- --------------------
4. Medical imaging           Professional medical       Non-invasive, safe, high -               3
                             scanner                    quality alternative to 2D X-
                             Portable imaging device    ray scanning
                             Dental imaging device
---------------------------- -------------------------- -------------------------------- --------------------
5. Medical imaging           Bone densitometry Professional medical Non-invasive                 2
                             and safe 1 densitometer measurement of onset and
                             OTC variant for home use status of osteoporosis
                             (esp. for female use)
---------------------------- -------------------------- -------------------------------- --------------------
6. Surgical Positioning      Internal surgery Instrument
                             position Safe and 1 accurate 3D 1 monitor
                             positioning of instruments

---------------------------- -------------------------- -------------------------------- --------------------
7. Fetal heart rate monitor  Fetal heart monitor        Reliable at- home and                    3
                                                        professional medical heart
                                                        rate monitor for unborn babies

---------------------------- -------------------------- -------------------------------- --------------------
8. Labor predictor           Labor predictor-OTC        Accurate prediction of onset             3
                             Labor predictor-           of labor from 6 weeks out
                             professional medical
---------------------------- -------------------------- -------------------------------- --------------------
</TABLE>
                                       17
<PAGE>
PRODUCT DESIGN, PROTECTION, MANUFACTURING AND PRODUCTION

We have established the following relationships to enable us to develop, produce
and protect our product  applications and technologies to create our operational
platform:

o Chinese manufacturing - HET is active in manufacturing and assembling products
via a number of manufacturers in China,  particularly Hen Young Manufacturing in
the Don Guan province.

o Patent/IPR  management - HET uses Wilson Gun McCaw and  Novagraaf to construct
and manage its patent  process.  Patent  files are held on the central  database
`Netspat'.

o Medius, a specialist agency for the patent/licensing process in the biomedical
field will  provide  expert  patent  audit and  positioning  of our ideas within
patent niches.

o  Double  Helix  is  responsible  for  product  positioning  through  in-market
research.

o Kinneir  Dufort  ("KD") and JAB Design  ("JAB")  have been  engaged to deliver
product design and basic  engineering  from Phase I of product  development.  KD
specializes in biomedical  products and has a significant track record with blue
chip companies.  JAB is a specialist in small  electronic  device  packaging and
prototype and production design and sourcing.

o Rosti is a specialized  plastics and  electronics  manufacturing  and assembly
company  which is part of the Danish AP M0ller  group.  It has supply  contracts
with  blue  chip  companies,   including  Siemens,  Ericsson,  Phillips,  Nokia,
GlaxoSmithKline,  Johnson & Johnson, Novo Nordisk, and other companies.  Through
working proposals  entered into between In Veritas and Rosti,  Rosti provides us
with  access to a high  quality  global  manufacturing  base and a high level of
potential licensing partners.

REVENUE GENERATION AND COMMERCIAL OPPORTUNITIES

New Product Development
Our new product  development  focus has been driven by  specific  contracts  for
products which have a clear route to market.  Research has been prioritized by a
combination  of  feasibility  and market  opportunity  based on market  research
commissioned by us.

Applied Research
Our plan is to build a pipeline  of  products  from  applications  currently  in
development.  This will be matched to a set of commercial  partners committed to
launch  products  into global  markets.  Our  technology  yields a multitude  of
product  applications for specific medical  conditions.  Further market research
and  specialist  medical  input will  translate  these  research  programs  into
end-user specific projects.

Lateral Synergies
The nature of near-patient  digital monitoring creates a further and significant
commercial   opportunity  for  electronic  data  transfer  and  remote  clinical
diagnosis  and  intervention.  All our patent  applications  consider the use of
wireless data transmission for such use.

Corporate Growth
By making the current competitive  measuring  technologies  obsolete,  our novel
applications  facilitate  revolutionary  approaches  to the  medical  diagnostic
processes in which they are applied,  which opens opportunities for an effective
acquisition  strategy targeted at some appropriately  sized but potentially less
profitable  companies who may have  established  manufacturing  and distribution
systems.

                                       18
<PAGE>
Timing of Commercialization
The approximate potential introduction of our products is shown below. Since all
products use a similar platform  technology the exact order of introduction will
depend on the order in which we secure  development  contracts  with  commercial
partners.

<TABLE>
<CAPTION>
                                Patents   Concept     Functional   Prototypes    Clinical   Production/   Commercial
                                Held      Proven      Demo                        trials    Revenues      Partner
------------------------------- --------- ----------- ------------ ------------- ---------- ------------- ---------------
<S>                               <C>      <C>        <C>          <C>             <C>       <C>          <C>
Prothrombin blood                  Y          Y            Y            Y            Y          2005            Y
coagulation timing device
------------------------------- --------- ----------- ------------ ------------- ---------- ------------- ---------------
Fetal Heart Monitoring/            Y          Y            Y            Y            Y          2006           D
POLO consumer
------------------------------- --------- ----------- ------------ ------------- ---------- ------------- ---------------
Fetal Heart Monitoring/            Y          Y            Y           2004          Y          2006           D
POLO professional medical
------------------------------- --------- ----------- ------------ ------------- ---------- ------------- ---------------
Non-invasive   blood   glucose     Y          Y          2005          2006        2006         2007           2006
monitoring
------------------------------- --------- ----------- ------------ ------------- ---------- ------------- ---------------
R2 - MID                           Y          Y          2004          2005        2005         2006           2005
------------------------------- --------- ----------- ------------ ------------- ---------- ------------- ---------------
R3 - Other                        Y/N         N          2005          2006        2006         2007          2005/6
------------------------------- --------- ----------- ------------ ------------- ---------- ------------- ---------------
</TABLE>

Government Regulation

We are subject to government  laws and  regulations  governing  health,  safety,
working conditions,  employee relations, wrongful termination,  wages, taxes and
other matters applicable to businesses in general.

Employees

We currently employ 9 full time staff members,  including directors,  laboratory
personnel and  admininstrative  personnel.  In addition,  3 of our directors are
employed on a part time basis  pursuant  to  consultancy  agreements.  All other
staffing requirements are filled by consultants and outsourcing as required.

Seasonality

We do not  anticipate  that  our  business  will be  substantially  affected  by
seasonality.

Item 2. DESCRIPTION OF PROPERTY

Our research  and  executive  offices are located at The Green House,  Beechwood
Business Park North, Inverness,  Scotland IV2 3BL in 1,128 square feet of leased
space  under a lease with an  unaffiliated  third  party,  expiring on April 25,
2006, and with an annual rent of approximately $33,600.

Item 3. LEGAL PROCEEDINGS

We are not  currently  party to any legal  proceedings  required to be disclosed
herein.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There was no matter submitted to a vote of the Company's security holders during
the fourth quarter of the fiscal year ended July 31, 2005.

                                       19
<PAGE>
                                     PART II

Item 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

Our common  stock has been  quoted on the OTC  Bulletin  Board  under the symbol
"IVME.OB". Prior to our name change from In Vivo Medical Diagnostics, Inc. to In
Veritas  Medical  Diagnostics,  Inc.,  our  common  stock was  quoted on the OTC
Bulletin  Board under the symbol  "IVVO.OB".  Prior to that we traded  under the
name Sports  Information  &  Publishing  Corporation  and were quoted  under the
symbol  "SIPC.OB".  Prior to July 14,  2004,  there was no  established  trading
market for our common stock. The following table shows the reported high and low
closing  bid  quotations  per share for our common  stock  based on  information
provided  by the OTC  Bulletin  Board.  Particularly  since our common  stock is
traded   infrequently,   such   over-the-counter   market   quotations   reflect
inter-dealer  prices,  without  markup,  markdown  or  commissions  and  may not
necessarily represent actual transactions or a liquid trading market.



 Quarter Ended           High           Low
------------------     ---------     ---------
October 31, 2003           --            --
------------------     ---------     ---------
January 31, 2004           --            --
------------------     ---------     ---------
April 30, 2004             --            --
------------------     ---------     ---------
July 31, 2004            3.17          1.60
------------------     ---------     ---------
October 31, 2004         3.20          1.80
------------------     ---------     ---------
January 31, 2005         2.25          0.92
------------------     ---------     ---------
April 30, 2005           1.27          0.63
------------------     ---------     ---------
July 31, 2005            0.81          0.34



As of October 10,  2005,  we had  56,261,308  shares of common  stock issued and
outstanding.  Our transfer agent is Corporate Stock Transfer,  Denver, Colorado,
(303) 282-4800.

Number of Stockholders

As of August 31,  2005,  there were  approximately  119 holders of record of our
common stock.

Dividend Policy

Historically,  we have not paid any dividends to the holders of our common stock
and we do not expect to pay any such dividends in the  foreseeable  future as we
expect to retain our future  earnings for use in the  operation and expansion of
our business.

Recent Sales of Unregistered Securities

On September 7, 2005, the Company entered into a Securities  Purchase  Agreement
(the "Purchase Agreement") with Montgomery Equity Partners Ltd.  ("Montgomery"),
an affiliated  fund of Cornell Capital  Partners,  providing for the sale by the
Company to Montgomery of its 18% secured convertible debentures in the aggregate
principal amount of $750,000 (the  "Debentures") of which $300,000 was funded on
September  7,  2005;  $200,000  shall be funded two  business  days prior to the
Company's  completion of its audited  financial  statements  for the fiscal year
ended July 31, 2005, and;  $250,000 shall be funded within five business days of
the date the Registration  Statement is declared effective by the SEC. Under the
Purchase  Agreement,  the Company also issued to Montgomery  three-year warrants
(the "Warrants") to purchase 350,000 shares of Common Stock at $0.001 per share.

                                       20
<PAGE>
In addition to the  foregoing,  the Company  entered into a Securities  Purchase
Agreement (the "Accredited Investor Purchase Agreement") with the investors (the
"Accredited  Investors") in its April 2005 financing described below pursuant to
which the  Accredited  Investors  agreed to exchange  the  securities  that they
purchased in such  financing  for an aggregate of $556,500  principal  amount of
Debentures.  Specifically,  the  Accredited  Investors  agreed  to  exchange  an
aggregate of 863,845  units (the  "Units"),  as well as a warrant to purchase an
additional  Unit for an aggregate of $556,500  principal  amount of  Debentures.
Each  Unit  consisted  of one  share of 5%  convertible  preferred  stock of the
Company, $.001 par value per share, and one warrant to purchase one share of the
Company's common stock.

In July,  2005,  we issued  100,000  shares of common  stock to CLX & Associates
pursuant to a public relation consulting agreement.

In July,  2005,  we issued  55,000  shares of  common  stock to Martin E.  Janis
pursuant to a public relation consulting agreement.

In July, 2005, we issued 5,000 shares of common stock to Raymond  Viscovitch for
services rendered.

In July,  2005,  we issued  5,000  shares of  common  stock to Cormac  Glynn for
services rendered.

On April 15, 2005, we completed the sale of 863,845  units (the  "Units"),  each
Unit  consisting of one share of 5% convertible  preferred stock of the Company,
$.001 par value per share (the "Preferred  Stock"),  and one warrant to purchase
one  share  of the  Company's  common  stock  (the  "Warrants"),  to  accredited
investors pursuant for an aggregate purchase price of approximately  $561,500. a
warrant to purchase an additional Unit (the "Unit Warrants"). The aforementioned
securities  were sold in reliance upon the exemption  afforded by the provisions
of Regulation D, as promulgated by the Securities and Exchange  Commission under
the Securities Act of 1933, as amended.

In December  2004, we entered into a  Subscription  Agreement with an accredited
investor,  NITE Capital,  L.P. (the "Investor"),  pursuant to which the Investor
purchased an aggregate principal amount of $250,000 in a 8% promissory note, and
60,096 shares of our common stock, par value $.001 per share.

On July 30, 2004,  the security  holders of Hall Effect Medical  Products,  Inc.
consummated the  transactions  contemplated  by a share exchange  agreement (the
"Share  Exchange  Agreement"),  dated as of June 30,  2004,  by and among Sports
Information  and  Publishing  Corp.  (the  "Company"),  Michael D. Tanner,  HEMP
Trustees Limited, as the corporate trustee of the HEMP Employment Benefit Trust,
John Fuller,  Brian Cameron,  Westek Limited,  and the security  holders of Hall
Effect Medical Products,  Inc. As a result of the exchange,  Hall Effect Medical
Products,  Inc.  became our wholly owned  subsidiary  and changed its name to In
Vivo Medical Diagnostics,  Inc. ("In Vivo DE").  Thereafter,  the parties to the
Share  Exchange  agreed to amend the terms of the  agreement to correct  certain
information  regarding (i) the number of shares  issued in  connection  with the
transactions  contemplated by the agreement,  and (ii) the capitalization of the
Company both before and after the  transactions  contemplated  by the agreement.
Pursuant to the Share Exchange, as amended, the Company:

o Increased its authorized  capital stock to 100,000,000  shares of common stock
and 50,000,000 shares of preferred stock;

o issued to the  former  holders  of  8,000,000  shares of In Vivo DE  preferred
stock, an aggregate of 34,343,662 shares of our 4% voting redeemable convertible
preferred stock (the "4% Preferred Stock");

o issued  to the  former  holders  of  shares  of In Vivo DE  common  stock,  an
aggregate of 38,636,453 shares of our common stock;

o issued 1,636,233  additional shares of our common stock to holders of $467,495
of promissory  notes ($450,000 of which was converted by July 31, 2004),  issued
by In Vivo DE's wholly owned  subsidiaries,  Hall Effect  Technologies  Ltd. and
Jopejo Ltd., in exchange for the cancellation of such notes; and

o agreed  to cause  the  resignation  of all  current  members  of our  board of
directors and appoint new directors as  designated  by certain  shareholders  or
affiliates of In Vivo DE.

                                       21
<PAGE>
Each full share of the Company's 4% Preferred  Stock is  convertible at any time
after October 31, 2005, at the option of the holder,  into one full share of our
common  stock.  The  shares  of 4%  Preferred  Stock  vote,  together  with  our
outstanding  common stock on an "as converted"  basis, at any regular or special
meeting of our stockholders  called for the purpose of electing directors of our
company or to vote on any other  matter  requiring  shareholder  approval  under
Colorado corporate law.

* All of the above  offerings  and sales were deemed to be exempt under rule 506
of Regulation D and Section 4(2) of the Securities  Act of 1933, as amended.  No
advertising or general solicitation was employed in offering the securities. The
offerings and sales were made to a limited  number of persons,  all of whom were
accredited  investors,  business  associates of Great  American  Family Parks or
executive  officers of Great American Family Parks,  and transfer was restricted
by Great  American  Family  Parks in  accordance  with the  requirements  of the
Securities Act of 1933. In addition to representations  by the  above-referenced
persons,   we   have   made   independent   determinations   that   all  of  the
above-referenced  persons were accredited or sophisticated  investors,  and that
they were capable of  analyzing  the merits and risks of their  investment,  and
that they understood the speculative  nature of their  investment.  Furthermore,
all of the above-referenced  persons were provided with access to our Securities
and Exchange Commission filings.

Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The following  discussion  should be read in conjunction  with our  consolidated
financial  statements and notes to those  statements.  In addition to historical
information,  the following  discussion and other parts of this quarterly report
contain forward-looking information that involves risks and uncertainties.

Overview

In Veritas Medical Diagnostics, Inc. (formerly In Vivo Medical Diagnostics, Inc.
and Sports  Information  and Publishing  Corp.) is engaged in the development of
lateral  applications  of novel  measurement  techniques in medical devices with
`near-patient' (i.e. point of care) testing applications.

We have  limited  assets  and  limited  revenues  and at July 31,  2005,  had an
accumulated deficit from inception of $6,906,574.  As a result, our auditors, in
their report on our financial statement for the fiscal year ended July 31, 2005,
have  expressed  substantial  doubt  about our  ability to  continue  as a going
concern.

Results Of Operations

Results Of  Operations  For The Fiscal  Year Ended July 31,  2005,  Compared  To
Fiscal Year Ended July 31, 2004

Revenues

During the year ended July 31,  2005 we had sales of  $879,847.  During the year
ended July 31, 2004, we had sales of $760,516.

Research & Development Expenses

For the year ended July 31, 2005, research and development costs were $1,160,175
an increase  from  $867,629  for the year ended July 31,  2004.  The increase in
2004/5 resulted from the development of our prothrombin blood clotting measuring
device together with a general increase in our research and development activity

Depreciation Expenses

Depreciation expenses for the year ended July 31, 2005 increased to $27,928 from
$21,892  for the year  ended  July  31,  2004.  This  change  is  insignificant,
reflecting the fact that  investment in fixed assets has not altered  materially
from year to year.

General & Administrative Expenses

General and  administrative  expenses for the year ended July 31, 2005 increased
to $187,897 from $166,746 for the year ended July 31, 2004. The increase in 2004
is due to our  increased  operations,  although  we  continue to maintain a very
tight overall control over the level of our general and administrative expenses.

                                       22
<PAGE>
Officer's Salaries

Officer's  salaries  increased  to  $555,153  in the year  ended  July 31,  2005
compared to $428,424 in the year ended July 31, 2004.  No increase in any of the
directors  individual  salaries  occurred  and the  increase  is  simply  due to
differing time periods between 2004 and 2005.

Stock Based Compensation

We issued stock in compensation for service  provided by several  profession and
other  advisors  and  supplies  during the year ended July 31 2005  amounting to
$526,778  compared  to $97,941 in the year  ended  July 31 2004.  This  increase
represents a general level of increase our activities coupled with our desire to
conserve cash.

Stock Options Expense

Stock  option  expense  for the year  ended  July 31, 2005 amounted  to  $52,698
compared  to zero in the year  ended July 31 2004.  There were no stock  options
which required to be accounted for as a charge in 2004.

Legal and Professional

Legal and Professional fees increased to $630,460 during the year ended July 31,
2005,  from  $194,033  in the year ended July 31,  2004.  This was a result of a
substantial  amount of transaction and commercial  legal and other  professional
work being undertaken during the year ended July 31, 2005.

Net Income (Loss)

Our net loss for the year ended July 31, 2005 was  $2,450,792,  as compared to a
net loss of $1,016,972 for the year ended July 31, 2004. This increase is mainly
due to increased expenditure on research and development, legal and professional
advice and to increased stock option expense, all of which are discussed above.

Liquidity and Capital Resources

As of July 31, 2005, we had cash of $2,015.  Our current  liabilities as of July
31, 2005 aggregated $1,271,657.  In order to implement our plan of operation and
commercialize  our  products,  we intend to secure  development  contracts  with
commercial  partners committed to launching products into global markets. We may
also seek outside debt and equity  financing to fund our continuing  operations,
to the  extent  that  such  funding  is  available  under  reasonable  terms and
conditions. Subsequent to July 31, 2005 we have continued to be actively engaged
in  raising  additional  loan and  equity  finance.  A full  description  of our
activities  and  their  current  status  is set out in  note 8 to the  financial
statements.

Recent Financings

September 2005 Financing

Standby Equity Distribution Agreement

On September 7, 2005,  the Company  entered into a Standby  Equity  Distribution
Agreement  (the  "Distribution  Agreement")  with  Cornell  Capital  Partners LP
("Cornell")  providing for the sale and issuance to Cornell of up to $10,000,000
of  Common  Stock  over a period of up to 24 months  after  the  signing  of the
Distribution Agreement.  Under the Distribution Agreement,  the Company may sell
to Cornell up to $500,000  in shares of its common  stock (the  "Common  Stock")
once every five trading  days at a price of 97% of the lowest  closing bid price
(as reported by Bloomberg  L.P.),  of the Common Stock on the  principal  market
where the Common Stock is traded for the five consecutive trading days following
a notice by the Company to Cornell of its intention to sell shares.  The Company
will  also  pay  a 5%  commitment  fee  upon  each  sale  of  shares  under  the
Distribution  Agreement.  Cornell  has  agreed not to short any of the shares of
Common Stock.

                                       23
<PAGE>
18% Secured Convertible Debentures

Also on  September  7, 2005,  the Company  entered  into a  Securities  Purchase
Agreement  (the  "Purchase  Agreement")  with  Montgomery  Equity  Partners Ltd.
("Montgomery"),  an  affiliated  fund of Cornell,  providing for the sale by the
Company to Montgomery of its 18% secured convertible debentures in the aggregate
principal amount of $750,000 (the  "Debentures") of which $300,000 was funded on
September  7,  2005;  $200,000  shall be funded two  business  days prior to the
Company's  completion of its audited  financial  statements  for the fiscal year
ended July 31, 2005, and;  $250,000 shall be funded within five business days of
the date the Registration  Statement is declared effective by the SEC. Under the
Purchase  Agreement,  the Company also issued to Montgomery  three-year warrants
(the "Warrants") to purchase 350,000 shares of Common Stock at $0.001 per share.

In addition to the  foregoing,  the Company  entered into a Securities  Purchase
Agreement (the "Accredited Investor Purchase Agreement") with the investors (the
"Accredited  Investors")  in its  April  2005  financing  pursuant  to which the
Accredited  Investors  agreed to exchange the securities  that they purchased in
such  financing  for an aggregate of $556,500  principal  amount of  Debentures.
Specifically,  the  Accredited  Investors  agreed to  exchange an  aggregate  of
863,845 units (the "Units"), as well as a warrant to purchase an additional Unit
for an aggregate of $556,500 principal amount of Debentures. Each Unit consisted
of one share of 5% convertible  preferred stock of the Company,  $.001 par value
per share, and one warrant to purchase one share of the Company's common stock.

The Debentures  mature on the first anniversary of the date of issuance and bear
interest  at the annual  rate of 18% in cash.  The  Company is  required to make
monthly  interest  payments  commencing on October 7, 2005,  and to make monthly
principal payments commencing on March 7, 2006.

Holders may convert,  at any time, the principal  amount  outstanding  under the
Debentures into shares of Common Stock, at a conversion price per share equal to
$0.144,  subject to adjustment.  Upon three-business day advance written notice,
the Company may redeem the  Debentures,  in whole or in part.  In the event that
the closing bid price of the Common Stock on the date that the Company  provides
advance  written notice of redemption or on the date  redemption is made exceeds
the conversion  price then in effect,  the redemption will be calculated at 112%
of the Debentures' face value.

As further  security for its  obligations  under the Purchase  Agreement and the
Accredited  Investor Purchase  Agreement,  the Company has deposited into escrow
25,685,000  shares (the  "Escrow  Shares") of common  stock.  The Escrow  Shares
shares are deemed issued but not outstanding.

April 2005 Financing

On April 15, 2005, we completed the sale of 863,845  units (the  "Units"),  each
Unit  consisting of one share of 5% convertible  preferred stock of the Company,
$.001 par value per share (the "Preferred  Stock"),  and one warrant to purchase
one  share  of the  Company's  common  stock  (the  "Warrants"),  to  accredited
investors  pursuant for an aggregate  purchase price of approximately  $561,500.
The aggregate purchase price consisted of the sale of $401,500 of Units for cash
and the sale of $160,000 of Units for the forgiveness of debt. In addition, each
purchaser of a Unit received a warrant to purchase an additional Unit (the "Unit
Warrants").  The  aforementioned  securities  were  sold in  reliance  upon  the
exemption  afforded by the  provisions of Regulation  D, as  promulgated  by the
Securities and Exchange Commission under the Securities Act of 1933, as amended.

In connection with the offering, we entered into a Registration Rights Agreement
with the purchasers  and the placement  agent pursuant to which we are obligated
to file a  registration  statement  on Form  SB-2  (or if Form  SB-2 is not then
available  to us, on such form of  registration  statement  that is available to
effect the  registration  of the Common Shares) within 30 days after the closing
of the  offering.  We must  register at least the number of shares of our Common
Stock equal to the Common  Shares plus the number of shares  necessary to permit
the  exercise  in full  of the  Warrants.  If we do not  file  the  registration
statements with the SEC within 30 days after the closing of the offering, we are
required to make pro rata payments to the Purchasers,  as liquidated damages and
not as a penalty, in an amount equal to 2.0% of the aggregate amount invested by
each  purchaser  for each 30 day  period  or pro rata  for any  portion  thereof
following the date by which such registration  statement should have been filed.
To date, we have not filed such registration statement.

                                       24
<PAGE>
Off Balance Sheet Arrangements

We do not have any off balance sheet  arrangements  as of July 31, 2005 or as of
the date of this report.

Recently Issued Accounting Pronouncements

Statement of Financial  Accounting  Standards No. 123 (revised 2004) Share-Based
Payment (SFAS 123R) establishes standards for the accounting for transactions in
which an entity exchanges its equity instruments for goods or services.  It also
addresses  transactions  in which an entity incurs  liabilities  in exchange for
goods or  services  that are  based on the  fair  value of the  entity's  equity
instruments or that may be settled by the issuance of those equity  instruments.
This  Statement  focuses  primarily on accounting for  transactions  in which an
entity obtains  employee  services in  share-based  payment  transactions.  This
Statement  does not change  the  accounting  guidance  for  share-based  payment
transactions  with parties  other than  employees  provided in Statement  123 as
originally issued and EITF Issue No. 96-18,  "Accounting for Equity  Instruments
That Are Issued to Other Than  Employees for Acquiring,  or in Conjunction  with
Selling,  Goods or Services." This Statement does not address the accounting for
employee share ownership plans, which are subject to AICPA Statement of Position
93-6,  Employers'  Accounting for Employee Stock Ownership Plans. The Company is
required to adopt SFAS 123R effective January 1, 2006. The standard provides for
a prospective application. Under this method, the Company will begin recognizing
compensation  cost for equity based  compensation for all new or modified grants
after the date of adoption. In addition, the Company will recognize the unvested
portion  of the grant  date fair value of awards  issued  prior to the  adoption
abased on the fair values  previously  calculated  for disclosure  purposes.  At
December 31, 2004, the Company had no unvested options.

In May 2003,  the  Financial  Accounting  Standards  Board  issued  Statement of
Financial Accounting Standard ("SFAS") No. 150, Accounting for Certain Financial
Instruments with  Characteristics  of both Liabilities and Equity.  SFAS No. 150
establishes  standards  for  how  an  issuer  classifies  and  measures  certain
financial  instruments with  characteristics  of both liabilities and equity. It
requires that an issuer classify a financial instrument this is within its scope
as a liability.  Many of those instruments were previously classified as equity.
SFAS No. 150 is effective for financial  instruments  entered into after May 31,
2003,  and otherwise is effective at the  beginning of the first interim  period
beginning  after June 15,  2003,  except for  mandatorily  redeemable  financial
instruments of nonpublic entities. For nonpublic entities, mandatorily financial
instruments  are subject to SFAS No. 150 for the first  period  beginning  after
December  15,  2003.  Adoption  of SFAS No.  150 will  require  us to report any
cumulative  redeemable  preferred  stock and any  cumulative  Class C redeemable
preferred stock outstanding at the time of adoption as a liability.

RISK FACTORS

An  investment  in our shares  involves a high degree of risk.  Before making an
investment decision, you should carefully consider all of the risks described in
this  prospectus.  If any of the risks  discussed  in this  prospectus  actually
occur,  our business,  financial  condition  and results of operations  could be
materially  and  adversely  affected.  If this were to happen,  the price of our
shares  could  decline  significantly  and  you may  lose  all or a part of your
investment.  The risk  factors  described  below  are not the only ones that may
affect us. Our forward-looking  statements in this prospectus are subject to the
following risks and  uncertainties.  Our actual results could differ  materially
from those anticipated by our forward-looking statements as a result of the risk
factors below. See "Forward-Looking Statements."

Risks Related to Our Business

We have not generated any revenues and may never achieve profitability

We are a  development  stage  company  and,  to  date,  have not  generated  any
revenues. From inception through July 31, 2005, we had an accumulated deficit of
$6,906,574.  For the years ended July 31, 2005 and 2004,  we incurred net losses
of $2,450,792  and  $1,016,972,  respectively.  We cannot assure you that we can
achieve or sustain  profitability  in the future.  Our operations are subject to
the  risks  and  competition   inherent  in  the  establishment  of  a  business
enterprise. There can be no assurance that future operations will be profitable.
Revenues  and  profits,  if any,  will depend upon  various  factors,  including
whether our product development can be completed,  and if it will achieve market
acceptance.  We may not  achieve  our  business  objectives  and the  failure to
achieve  such goals  would have an adverse  impact on us.  These  matters  raise
substantial doubt about our ability to continue as a going concern.

                                       25
<PAGE>
Our auditors have included a going concern  qualification in their opinion which
may make it more difficult for us to raise capital

Our auditors have qualified their opinion on our financial statements because of
concerns about our ability to continue as a going concern.  These concerns arise
from  the fact  that we have not  generated  sufficient  cash  flows to meet our
obligations and sustain our operations.  If we are unable to continue as a going
concern, you could lose your entire investment in us.

We will need significant additional capital, which we may be unable to obtain.

Our capital  requirements  in connection  with our  development  activities  and
transition  to  commercial   operations  have  been  and  will  continue  to  be
significant.  We have depended  upon the proceeds of sales of our  securities to
private  investors to cover our operating  losses.  We will require  substantial
additional  funds  to  continue   research,   development  and  testing  of  our
technologies and products,  to obtain intellectual  property protection relating
to  our  technologies  when  appropriate,  and to  manufacture  and  market  our
products.  We anticipate  that the funds being raised by this Offering will only
be sufficient to fund our operations  for the next 24 months and,  thereafter if
we do not generate adequate cash flow from operations and licensing we will need
to raise  additional  funds.  There can be no assurance  that  financing will be
available in amounts or on terms  acceptable  to us, if at all. The inability to
obtain additional capital may reduce our ability to continue to conduct business
operations.  If we are unable to obtain additional financing,  we will likely be
required to curtail our research and development  plans.  Any additional  equity
financing may involve substantial dilution to our then existing shareholders.

We are a  development  stage  company  and may be unable to  develop  or license
commercially feasible products.

We are a  development  stage  company  and have not  generated  any  significant
revenues  from  commercial  operations.  Although we have  developed  commercial
models of  Evomouse  and  functional  demonstration  models for our fetal  heart
monitor  and  prothrombin   blood-clotting   monitor,   we  have  not,  as  yet,
manufactured any fully-engineered prototype models for commercial demonstration.
We may not be able to produce effectively  functioning prototype models or final
products in commercial  quantities at acceptable costs, or, if produced,  we may
not be able to successfully market the products, directly or in conjunction with
third parties.

Our future  revenues are dependent on  establishing  licenses,  joint venture or
distribution arrangements with established companies.

Our ability to generate revenue from the sale of our products will be dependent,
among other things,  upon our ability to enter into  licenses,  joint venture or
distribution  arrangements  with established  businesses with existing sales and
marketing  infrastructures.  Although we have entered into  agreements  with the
Unipath  division of Inverness  Medical  Innovations,  and are negotiating  with
several  other  companies,  we have only  generated  revenues of  $1,420,830  of
development and grant funding from these  companies and government  initiatives.
There can be no assurance  that we will be able to generate  revenues or profits
under any such agreements,  if and when formalized. In addition, given our early
stage of development  and limited capital  resources,  the terms demanded by any
prospective  licensee or joint  venture  partner may not be  attractive to us or
otherwise enable us to achieve our strategic objectives and goals.

Our products may not gain market acceptance.

The products we are currently  developing utilize new technologies.  As with any
new technologies,  in order for us to be successful,  our technologies must gain
market  acceptance.  Since we  design  our  products  to  exploit  markets  that
presently  utilize or are  serviced by  products  from  competing  technologies,
meaningful commercial markets may not develop for our products.

                                       26
<PAGE>
We have limited manufacturing and marketing experience.

Achieving  marketing  acceptance for our technologies and proposed products will
require  substantial  marketing  efforts and expenditure of significant funds to
educate key original  equipment  manufacturers,  or OEMs, as to the  distinctive
characteristics  and anticipated  benefits of our products and technologies.  We
currently  have  limited  manufacturing  and  marketing  experience  and limited
financial,  personnel and other  resources to undertake the extensive  marketing
activities that are necessary to market our products and technologies.

The development of our products and technology is uncertain.

Our  development  efforts  are  subject to  unanticipated  delays,  expenses  or
technical or other problems, as well as the possible insufficiency of funding to
complete development. Our success will depend upon our products and technologies
meeting  acceptable  cost  and  performance  criteria,  and  upon  their  timely
introduction into the marketplace. All of our proposed products and technologies
may  never  be  successfully  developed,  and  even if  developed,  they may not
satisfactorily perform the functions for which they are designed.  Additionally,
these  products  may  not  meet  applicable  price  or  performance  objectives.
Unanticipated  technical  or other  problems  may accrue  which would  result in
increased costs or material delays in their development or commercialization.

Our products may contain defects.

Our  products  may contain  deficiencies  that  become  apparent  subsequent  to
widespread commercial use. Remedying such errors could delay our plans and cause
us to incur  additional  costs which would have a material adverse effect on our
financial position.

We depend on third party product design changes.

Our success  will depend upon our ability to make our products  compatible  with
the  products  of  third-party  manufacturers.  In  addition,  we will depend on
potential  customers  redesigning or otherwise modifying their products to fully
utilize our  products  and  technologies.  Our failure to make our  products and
technology compatible with products of third-party  manufacturers or the failure
of potential  customers to make  necessary  modifications  to or redesign  their
products to accommodate our products could have a material adverse effect on our
ability to sell or license our technologies and products.

We are operating in a highly competitive market.

The  development  and  marketing  of medical  products  and devices is extremely
competitive.  In many  cases  we will  compete  with  entrenched  multi-national
corporations,  such as Johnson &  Johnson,  Roche and  others,  all of whom have
similar products already being  manufactured  and sold.  Competitors  range from
development stage companies to major domestic and international companies,  most
of which have substantially  greater financial,  technical,  marketing and human
resource capabilities than we have, as well as established positions in markets,
name brand recognition, and established ties with OEMs. These or other companies
may succeed in developing  products or technologies that are more effective than
those being  developed by us or which would  render our products and  technology
obsolete or non-competitive in the marketplace.

Our patents and proprietary rights are difficult to protect.

Our  ability  to  compete  effectively  will  depend in part on our  ability  to
maintain the proprietary  nature of our technology and  manufacturing  processes
through a  combination  of patent and trade  secret  protection,  non-disclosure
agreements and other  arrangements.  We have  completed a substantial  amount of
invention  disclosure  documentation.  Thus far, we have: one patent granted; we
have  allowed  one  patent to lapse in a non core  area;,  we have nine  patents
pending  and; we have one patent in draft.  We intend to continue to file patent
applications covering our products when and where appropriate. Such filings will
be costly and time consuming.  Patents may not issue from  applications  and any
issued  patents  may  not  provide  adequate  protection  for  our  products  or
processes.  Our  competitors  may  independently  patent  technologies  that are
substantially   equivalent   or  superior  to  our   technology.   In  addition,
competitors'  products may infringe  upon our patents and the cost of protecting
our rights relative to such infringement may be prohibitive  thereby undermining
our ability to protect products effectively.

                                       27
<PAGE>
Foreign countries may not provide adequate patent protection.

Patent  applications  filed in certain  foreign  countries  are subject to laws,
rules and procedures which differ from those of the United States and the United
Kingdom.  Foreign  patent  applications  filed by us related to United States or
United Kingdom patents may not be issued.  Furthermore,  some foreign  countries
provide  significantly  less  patent  protection  than the United  States or the
United  Kingdom.   We  could  incur   substantial   costs  in  defending  patent
infringement  suits  brought by others and in  prosecuting  patent  infringement
suits against third party infringers.

We depend on our key personnel.

The  development  and  marketing of our  technology  will be dependent  upon the
skills and  efforts of a small  group of  management  and  technical  personnel.
Losing the services of any of our key  personnel  could have a material  adverse
effect  on our  operations.  Furthermore,  recruiting  and  retaining  qualified
technical personnel to perform research,  development and technical support work
in the future will be critical to our success. We may not be able to continue to
recruit and retain skilled and experienced personnel.

We may not be able to manage growth and expansion effectively.

Rapid  growth  of  our  business  may   significantly   strain  our  management,
operational  and technical  resources.  If we are successful in obtaining  rapid
market  penetration  of our  products,  we will be required to  manufacture  and
deliver large volumes of quality  products to our customers on a timely basis at
a  reasonable  cost.  Our  strategy is that we will NOT  manufacture  but create
partnerships with manufacturers.  This could potentially strain our operational,
management and financial systems and controls.

Our  confidentiality  agreements  may  not  adequately  protect  our  unpatented
proprietary information.

We rely on  confidentiality  agreements  to protect our  unpatented  proprietary
information,   know-how  and  trade   secrets.   Our   competitors   may  either
independently  develop the same or similar  information  or obtain access to our
proprietary information. In addition, we may not prevail if we assert challenges
to  intellectual  property  rights  against third parties.  In this regard,  our
employees are required to enter into agreements  providing for  confidentiality,
the  assignment  of rights to inventions  made by them while  employed by us, as
well as for  non-competition and  non-solicitation  during their employment term
and one year  thereafter.  Our  employees may not comply with the terms of these
agreements.

We may become subject to risks inherent in  international  operations  including
currency exchange rate fluctuations and tariff regulations.

To the extent we in the future  sell or license  our  products  or  technologies
outside  the United  Kingdom,  we will be subject to the risks  associated  with
fluctuations  in  currency  exchange  rates.  We may also be  subject  to tariff
regulations and requirements for export licenses,  particularly  with respect to
the export of certain technologies (which licenses may on occasion be delayed or
difficult to obtain),  unexpected  changes in  regulatory  requirements,  longer
accounts  receivable   requirements,   difficulties  in  managing  international
operations,  potentially adverse tax consequences,  restrictions on repatriation
of earnings and the burdens of complying with a wide variety of foreign laws.

We maintain modest  insurance  coverage and therefore we could incur losses as a
result of an uninsured loss.

We maintain  theft and  casualty  insurance.  In  addition,  we maintain key man
insurance on the following two employees in the amount of $1,000,000  each: John
Fuller,  our Chief  Executive  Officer,  and Brian Cameron,  our Chief Operating
Officer.  We carry liability  insurance on our Prediction of Labour Onset trials
of up to $5,000,000,  and standard United Kingdom employee  liability  insurance
that is compulsory for all United Kingdom companies.

The following risks relate principally to our common stock and its market value:

There is a limited  market for our common stock which may make it more difficult
for you to dispose of your stock

                                       28
<PAGE>
Our common stock is quoted on the OTC Bulletin Board under the symbol "IVME.OB."
There is a limited trading market for our common stock.  Accordingly,  there can
be no  assurance  as to the  liquidity  of any markets  that may develop for our
common  stock,  the  ability of  holders of our common  stock to sell our common
stock, or the prices at which holders may be able to sell our common stock.

Our stock price may be volatile

The market price of our common  stock is likely to be highly  volatile and could
fluctuate  widely in price in  response  to various  factors,  many of which are
beyond our control, including:

o  technological  innovations  or  new  products  and  services  by  us  or  our
competitors;
o additions or departures of key personnel;
o sales of our common stock
o our ability to integrate operations, technology, products and services;
o our ability to execute our business plan;
o operating results below expectations;
o loss of any strategic relationship;
o industry developments;
o economic and other external factors; and
o period-to-period fluctuations in our financial results.

Because we have a limited  operating  history with no revenues to date,  you may
consider any one of these factors to be material.  Our stock price may fluctuate
widely as a result of any of the above listed factors.

In  addition,  the  securities  markets  have  from  time  to  time  experienced
significant  price and volume  fluctuations  that are unrelated to the operating
performance  of  particular  companies.   These  market  fluctuations  may  also
materially and adversely affect the market price of our common stock.

We have not paid dividends in the past and do not expect to pay dividends in the
future. Any return on investment may be limited to the value of our common stock

We have never paid cash  dividends  on our  common  stock and do not  anticipate
paying cash dividends in the foreseeable future. The payment of dividends on our
common stock will depend on earnings, financial condition and other business and
economic  factors  affecting  it at such  time as the  board  of  directors  may
consider  relevant.  If we do not pay  dividends,  our common  stock may be less
valuable  because a return on your investment will only occur if its stock price
appreciates.

Our common stock is deemed to be penny stock with a limited trading market

Our common stock is currently listed for trading on the OTC Bulletin Board which
is  generally  considered  to be a less  efficient  market than  markets such as
NASDAQ or other national exchanges, and which may cause difficulty in conducting
trades and difficulty in obtaining future financing. Further, our securities are
subject to the "penny  stock  rules"  adopted  pursuant to Section 15 (g) of the
Securities  Exchange Act of 1934,  as amended,  or Exchange Act. The penny stock
rules apply to non-NASDAQ companies whose common stock trades at less than $5.00
per share or which have tangible net worth of less than  $5,000,000  ($2,000,000
if the company has been operating for three or more years).  Such rules require,
among other  things,  that brokers who trade "penny stock" to persons other than
"established   customers"  complete  certain  documentation,   make  suitability
inquiries of investors and provide investors with certain information concerning
trading  in  the  security,  including  a risk  disclosure  document  and  quote
information under certain circumstances.  Many brokers have decided not to trade
"penny  stock"  because of the  requirements  of the penny stock rules and, as a
result,  the number of  broker-dealers  willing to act as market  makers in such
securities is limited.  In the event that we remain  subject to the "penny stock
rules" for any  significant  period,  there may develop an adverse impact on the
market,  if any, for our  securities.  Because our securities are subject to the
"penny stock  rules,"  investors  will find it more  difficult to dispose of our
securities.  Further,  for  companies  whose  securities  are  traded in the OTC
Bulletin Board, it is more difficult: (i) to obtain accurate quotations, (ii) to
obtain coverage for significant news events because major wire services, such as
the Dow Jones News Service,  generally do not publish press  releases about such
companies, and (iii) to obtain needed capital.

Item 7. FINANCIAL STATEMENTS

All financial  information required by this Item is attached hereto beginning on
Page F-1.

                                       29
<PAGE>
<TABLE>
<CAPTION>

                                                                                                       Page
                                                                                                       ----
<S>                                                                                                       <C>
Report of Independent Registered Public Accounting Firm.................................................F-2

Consolidated Balance Sheet at July 31, 2005.............................................................F-3

Consolidated Statements of Operations for the years
     ended July 31, 2005 and 2004 and for the period
     from March 26, 1997 (Inception) through July 31, 2005..............................................F-4

Consolidated Statements of Accumulated Other Comprehensive Loss
     for the years ended July 31, 2005 and 2004 and for the period
     from March 26, 1997 (Inception) through July 31, 2005..............................................F-5

Statement of Changes in Shareholders' Deficit for the period from
     March 26, 1997 (Inception) through July 31, 2005...................................................F-6

Consolidated Statements of Cash Flows for the years
     ended July 31, 2005 and 2004 and for the period
     from March 26, 1997 (Inception) through July 31, 2005..............................................F-7

Notes to Consolidated Financial Statements..............................................................F-8

</TABLE>

<PAGE>


             Report of Independent Registered Public Accounting Firm

The Board of Directors
In Veritas  Medical  Diagnostics,  Inc.  (formerly In Vivo Medical  Diagnostics,
Inc.):

We have  audited  the  accompanying  consolidated  balance  sheet of In  Veritas
Medical  Diagnostics,  Inc. (a Colorado  corporation)  (formerly In Vivo Medical
Diagnostics,  Inc.) as of July 31, 2005, and the related consolidated statements
of operations,  shareholders'  deficit,  and cash flows for each of the years in
the two-year  period ended July 31, 2005, and for the period from March 26, 1997
(inception) through July 31, 2005. These consolidated  financial  statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audit  to  obtain  reasonable  assurance  about  whether  the
consolidated  financial statements are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the  consolidated  financial  statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the  financial  position of In Vivo Medical
Diagnostics,  Inc. as of July 31, 2005, and the results of their  operations and
their cash  flows for each of the years in the  two-year  period  ended July 31,
2005 and for the period from March 27, 1997  (inception)  through July 31, 2005,
in  conformity  with  accounting  principles  generally  accepted  in the United
States.

The accompanying  financial  statements have been prepared  assuming the Company
will  continue  as a going  concern.  As  discussed  in Note 1 to the  financial
statements,  the Company  has  incurred  losses  since  inception  and has a net
capital deficit at July 31, 2005.  These factors raise  substantial  doubt about
the  Company's  ability  to  continue  as a going  concern.  Management's  plans
regarding  those matters are also described in Note 1. The financial  statements
do not  include  any  adjustments  that might  result  from the  outcome of this
uncertainty.





/s/ Cordovano and Honeck, LLP
-----------------------------
Cordovano and Honeck, LLP
Denver, Colorado
October 31, 2005


                                      F-2


<PAGE>
                      IN VERITAS MEDICAL DIAGNOSTICS, INC.
                  (formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                           Consolidated Balance Sheet
                                  July 31, 2005
<TABLE>
<CAPTION>



                                     Assets
Current assets:
<S>                                                                                                      <C>
    Cash............................................................................................     $        2,015
    Accounts receivable.............................................................................             29,721
    Prepaid expenses and other......................................................................             65,922
                                                                                                          -------------
                 Total current assets...............................................................             97,658
Property and equipment, net (Note 3)................................................................             30,006
Intangible assets:
    Patent costs ...................................................................................             60,739
                                                                                                          -------------

                                                                                                         $      188,403
                                                                                                          =============

                               Liabilities and Shareholders' Deficit

Current liabilities:
    Accounts payable................................................................................     $      712,638
    Accrued liabilities ............................................................................            540,149
    Indebtedness to related parties (Note 2)........................................................             18,870
                                                                                                          -------------
                 Total current liabilities..........................................................          1,271,657

Long-term debt:
    Notes payable, related party (net of discount) (Note 2).........................................          1,685,440
                                                                                                          -------------
                 Total liabilities..................................................................          2,957,097
                                                                                                          -------------

Shareholders' deficit:
    Preferred stock, $.001 par value, 50,000,000 shares authorized (aggregate
      liquidation preference of $33,603,984)
      Series A Preferred stock, 33,042,484 shares issued and outstanding (Note 4)...................             33,043
      Series B Preferred stock, 863,844 shares issued and outstanding (Note 4)......................                864
    Common stock, $.001 par value, 500,000,000 shares authorized,
      54,261,301 shares issued and outstanding (Note 5).............................................             54,261
    Additional paid-in capital......................................................................          4,419,204
    Accumulated other comprehensive loss- foreign currency adjustment...............................           (369,492)
    Deficit accumulated during the development stage................................................         (6,906,574)
                                                                                                          -------------

                 Total shareholders' deficit........................................................         (2,768,694)
                                                                                                          -------------
                                                                                                         $      188,403
                                                                                                          =============
</TABLE>

          See accompanying notes to consolidated financial statements.


                                      F-3
<PAGE>
                      IN VERITAS MEDICAL DIAGNOSTICS, INC.
                  (formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                            Statements of Operations

<TABLE>
<CAPTION>

                                                                                                       March 26, 1997
                                                                                                         (Inception)
                                                                         Years Ended                       Through
                                                                           July 31,                        July 31,
                                                          ------------------------------------------
                                                                2005                  2004                  2005
                                                          -------------------   --------------------  ------------------

<S>                                                               <C>                  <C>                  <C>
Net sales and gross revenues:
    Net sales..........................................$          879,847     $           760,516    $       2,300,677
    Cost of sales.......................................            4,580                     823              242,097
                                                          -------------------   --------------------  ------------------

                   Gross profit.........................          875,267                 759,693            2,058,580
                                                          -------------------   --------------------  ------------------

Operating expenses:
    Research and development............................        1,160,175                867,629             2,898,882
    Depreciation........................................           27,928                 21,892               137,430
    Officers salaries...................................          555,153                428,424               983,577
    Legal and professional..............................          630,460                194,033               824,493
    Stock based compensation (Note 6):
       Stock options expense............................           52,698                     --                52,698
       Consulting expense...............................          526,778                 97,941               526,778
    General and administrative..........................          187,897                166,746             4,038,145
                                                         -------------------   --------------------  ------------------

                                                                3,141,089              1,776,665             9,462,003
                                                         -------------------   --------------------  ------------------

       Loss before other income.........................       (2,265,822)            (1,016,972)           (7,403,423)

Nonoperating income (expense):
    UK government grant (Note 1)........................          194,896                     --               194,896
    Interest expense....................................         (230,542)                    --              (230,542)
    Gain (loss) on foreign exchange.....................         (130,115)                    --              (130,115)
    Gain (loss) from extinguishments of debt............          (19,209)                    --               662,610
                                                          -------------------   --------------------  ------------------


       Loss before income taxes.........................       (2,450,792)            (1,016,972)           (6,906,574)

    Income tax provision................................               --                      --                   --
                                                          -------------------   --------------------  ------------------

                   Net loss............................. $     (2,450,792)     $       (1,016,972)    $     (6,906,574)
                                                         ====================  =====================  ==================

Basic and diluted loss per share........................ $          (0.05)     $            (0.09)
                                                         ===================   ====================

Weighted average common shares outstanding..............       51,123,139              11,864,058
                                                         ===================   ====================
</TABLE>


          See accompanying notes to consolidated financial statements.

                                      F-4
<PAGE>

                      IN VERITAS MEDICAL DIAGNOSTICS, INC.
                  (formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
         Consolidated Statements of Accumulated Other Comprehensive Loss

<TABLE>
<CAPTION>



                                                                                                       March 26, 1997
                                                                         Years Ended                    (Inception)
                                                                          July 31,                        Through
                                                         ------------------------------------------       July 31,
                                                                2005                  2004                  2005
                                                         -------------------   --------------------  --------------------

<S>                                                              <C>                   <C>                   <C>
Net loss...............................................  $      (2,450,792)    $        (1,016,972)  $        (6,906,574)

Other comprehensive loss, net of tax:
    Cumulative translation adjustment..................            274,643                (339,570)             (369,492)
                                                         -------------------   --------------------  --------------------

                   Comprehensive loss..................  $      (2,176,149)    $        (1,356,542)  $        (7,276,066)
                                                         ===================   ====================  ====================

</TABLE>



          See accompanying notes to consolidated financial statements.


                                      F-5
<PAGE>
                    IN VERITAS MEDICAL DIAGNOSTICS, INC.
                  (formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
           Consolidated Statement of Changes in Shareholders' Deficit
<TABLE>
<CAPTION>


                                                                           Preferred Stock
                                                                  Series A                  Series B               Common Stock
                                                            Shares      Par Value     Shares      Par Value     Shares    Par Value

                                                          -----------   -----------    ---------    ---------- ---------- ----------
<S>                                                       <C>           <C>           <C>           <C>
Balance, March 26, 1997 ...............................          --     $      --            --     $      --     --      $     --
October 2000, sale of stock, ($0.0035/share) ..........     4,366,377         4,366
December 2001, sale of stock, ($0.0035/share) .........     6,545,703         6,546          --            --     --            --
October 2001, sale of stock, ($0.0202/share) ..........    23,431,582        23,432          --            --     --            --

Foreign currency
   translation adjustment .............................          --            --            --            --     --            --
Net loss ..............................................          --            --            --            --     --            --
                                                          -----------   -----------    ---------    ---------- ---------- ----------
Balance, July 31, 2001 ................................    34,343,662        34,344          --            --     --            --

Foreign currency
   translation adjustment .............................          --            --            --            --     --            --
Net loss ..............................................          --            --            --            --     --            --
                                                          -----------   -----------    ---------    ---------- ---------- ----------
Balance, July 31, 2002 ................................    34,343,662        34,344          --            --     --            --

Foreign currency
   translation adjustment .............................          --            --            --            --     --            --
Net loss ..............................................          --            --            --            --     --            --
                                                          -----------   -----------    ---------    ---------- ---------- ----------
Balance, July 31, 2003 ................................    34,343,662        34,344          --            --     --            --


Merger with HEMP (Note 8) .............................          --            --            --            --  38,397,164    38,397
July 2004, merger with SIPC ...........................          --            --            --            --  10,550,000
July 2004, issuance of common
   stock for bridge loans, ($0.2750/share) ............          --            --            --            --   1,636,233     1,636
July 2004, issuance of common
   stock for services, ($0.4093/share) ................          --            --            --            --     239,289       239
Foreign currency
   translation adjustment .............................          --            --            --            --     --            --
Reclassification of gain from debt
   forgiveness by Westek (Notes 2 and 9) ..............          --            --            --            --     --            --
Net loss ..............................................          --            --            --            --     --            --
                                                          -----------   -----------    ---------    ---------- ---------- ----------
Balance, July 31, 2004 ................................    34,343,662        34,344          --            --  50,822,686    50,822

August 2004, additional paid in capital from
    bridge loans exchanged for shares..................          --            --            --            --     --            --
August 2004, offering costs adjustment.................          --            --            --            --     --            --
December 2004, issuance of stock for interest
    on bridge loan.....................................          --            --            --            --      60,096        60
February 2005, issuance of stock for services..........          --            --            --            --     694,550       695
March 2005, issuance of stock for services.............          --            --            --            --     100,000       100
April 2005, issuance of stock warrants for
    services...........................................          --            --            --            --     --            --
April 2005, sale of preferred Series B stock
    net of $97,995 offering costs ($.001 par),
    ($0.65/share)......................................          --            --       617,692            618    --            --
April 2005, issuance of stock for
    debt forgiveness...................................          --            --       246,152            246    --            --
June 2005, issuance of stock options for
    services...........................................          --            --            --            --     --            --
June 2005, issuance of common stock for
    convertible preferred shares.......................    (1,301,178)       (1,301)         --            --   1,301,178     1,301
July 2005, issuance of stock for services..............          --            --            --            --     120,000       120
July 2005, issuance of stock for conversion
    of debt............................................          --            --            --            --   1,162,791     1,163
Foreign currency translation adjustment................          --            --            --            --     --            --
Net loss...............................................          --            --            --            --     --            --

                                                          -----------   -----------    ---------    ---------- ---------- ----------
Balance July 31, 2005..................................    33,042,484   $    33,043     863,844     $      864 54,261,301   $54,261
                                                          ===========   ===========    =========    ========== ========== ==========
</TABLE>

          See accompanying notes to consolidated financial statements.

                                      F-6


<PAGE>


                      IN VERITAS MEDICAL DIAGNOSTICS, INC.
                  (formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
           Consolidated Statement of Changes in Shareholders' Deficit
<TABLE>
<CAPTION>


                                                                           Deficit
                                                                         Accumulated    Accumulated
                                                           Additional       During        Other
                                                             paid-in     Development   Comprehensive
                                                             capital        Stage         Income           Total
                                                          -----------    -----------    -----------    -----------
<S>                                                       <C>            <C>            <C>            <C>
Balance, March 26, 1997 ...............................   $      --      $      --      $      --      $      --
October 2000, sale of stock, ($0.0035/share) ..........        10,874           --             --           15,240
December 2001, sale of stock, ($0.0035/share) .........        16,301           --             --           22,847
October 2001, sale of stock, ($0.0202/share) ..........       448,906           --             --          472,338

Foreign currency
   translation adjustment .............................          --             --           21,203         21,203
Net loss ..............................................          --       (1,350,829)          --       (1,350,829)
                                                          -----------    -----------    -----------    -----------
Balance, July 31, 2001 ................................       476,081     (1,350,829)        21,203       (819,201)

Foreign currency
   translation adjustment .............................          --             --         (140,377)      (140,377)
Net loss ..............................................          --       (1,007,362)          --       (1,007,362)
                                                          -----------    -----------    -----------    -----------
Balance, July 31, 2002 ................................       476,081     (2,358,191)      (119,174)    (1,966,940)

Foreign currency
   translation adjustment .............................          --             --         (185,391)      (185,391)
Net loss ..............................................          --       (1,080,619)          --       (1,080,619)
                                                          -----------    -----------    -----------    -----------
Balance, July 31, 2003 ................................       476,081     (3,438,810)      (304,565)    (3,232,950)


Merger with HEMP (Note 8) .............................       (29,397)          --             --            9,000
July 2004, merger with SIPC ...........................       (10,688)          --             --             (138)
July 2004, issuance of common
   stock for bridge loans, ($0.2750/share) ............       448,364           --             --          450,000
July 2004, issuance of common
   stock for services, ($0.4093/share) ................        97,702           --             --           97,941
Foreign currency
   translation adjustment .............................          --             --         (339,570)      (339,570)
Reclassification of gain from debt
   forgiveness by Westek (Notes 2 and 9) ..............     2,030,298           --             --        2,030,298
Net loss ..............................................          --       (1,016,972)          --       (1,016,972)
                                                          -----------    -----------    -----------    -----------
Balance, July 31, 2004 ................................     3,012,360     (4,455,782)      (644,135)    (2,002,391)

August 2004, additional paid in capital from
    bridge loans exchanged for shares..................        17,495             --             --         17,495
August 2004, offering costs adjustment.................        (6,000)            --             --         (6,000)
December 2004, issuance of stock for interest
    on bridge loan.....................................        76,100             --             --         76,160
February 2005, issuance of stock for services..........       427,695             --             --        428,390
March 2005, issuance of stock for services.............        62,880             --             --         62,980
April 2005, issuance of stock warrants for
    services...........................................        17,295             --             --         17,295
April 2005, sale of preferred Series B stock
    net of $97,995 offering costs ($.001 par),
    ($0.65/share)......................................       302,887             --             --        303,505
April 2005, issuance of stock for
    debt forgiveness...................................       159,754             --             --        160,000
June 2005, issuance of stock options for
    services...........................................        35,403             --             --         35,403
June 2005, issuance of common stock for
    convertible preferred shares.......................            --             --             --             --
July 2005, issuance of stock for services..............        35,288             --             --         35,408
July 2005, issuance of stock for conversion
    of debt............................................       278,047             --             --        279,210
Foreign currency translation adjustment................            --             --        274,643        274,643
Net loss...............................................            --     (2,450,792)            --     (2,450,792)
                                                           ----------    ------------     ----------   ------------
Balance July 31, 2005..................................    $4,419,204    $(6,906,574)     $(369,492)   $(2,768,694)
                                                           ==========    ============     ==========   ============
</TABLE>

          See accompanying notes to consolidated financial statements.


                                      F-7

<PAGE>
                      IN VERITAS MEDICAL DIAGNOSTICS, INC.
                  (formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                      Consolidated Statements of Cash Flows


<TABLE>
<CAPTION>


                                                                                                       March 26, 1997
                                                                                Years Ended             (Inception)
                                                                                 July 31,                 Through
                                                                     --------------------------------     July 31,
                                                                           2005             2004            2005
                                                                     ----------------  --------------  --------------

<S>                                                                          <C>             <C>              <C>
Cash flows from operating activities:
    Net loss.......................................................  $    (2,450,792)    $(1,016,972)    $(6,906,574)
    Adjustments to reconcile net loss to net cash
       used by operating activities:
          Depreciation and amortization............................           27,928          21,892         135,098
          Intercompany interest income.............................          144,382              --         144,382
          Stock based compensation.................................          579,476              --         579,476
          Stock issued for interest................................           86,160              --          86,160
          Gain (loss) on debt forgiveness..........................           19,209              --        (662,610)
          Changes in operating assets and liabilities:
               Receivables.........................................          197,006         (58,018)        (53,439)
               Prepaid expenses and other current assets...........          (23,167)        (23,576)        (46,743)
               Accounts payable....................................          281,253         125,509         712,655.
               Accrued expenses....................................          377,748         102,000         550,682.
               Accounts payable (related party)....................          (56,458)             --         (56,458)
               Other...............................................           75,820          62,452          69,820
                                                                     ----------------  --------------  --------------
                      Net cash used in
                        operating activities.......................         (741,435)       (786,713)     (5,447,551)
                                                                     ----------------  --------------  --------------

Cash flows from investing activities:
    Acquisition of patents.........................................          (60,739)             --         (60,739)
    Acquisition of equipment.......................................          (16,642)        (25,387)       (151,208)
                                                                     ----------------  --------------  --------------
                      Net cash used in
                        investing activities.......................          (77,381)        (25,387)       (211,947)
                                                                     ----------------  --------------  --------------

Cash flows from financing activities:
    Advances from affiliates.......................................          (41,195)        416,394       4,378,963
    Repayments of advances from affiliates.........................               --        (160,623)       (728,426)
    Advances from related parties..................................           (5,445)             --          83,050
    Proceeds from issuance of preferred stock......................          303,505              --         813,930
    Discount on notes payable......................................          144,382              --         144,382
    Proceeds from issuance of notes payable........................          375,000         587,495         962,495
                                                                     ----------------  --------------  --------------
                      Net cash provided by
                        financing activities.......................          776,247         843,266       5,654,394
                                                                     ----------------  --------------  --------------

Effect on cash from foreign currency translation...................           (1,607)          1,393           7,119

                      Net change in cash and
                        cash equivalents...........................          (44,176)         32,559           2,015

Cash and cash equivalents:
    Beginning of period............................................           46,191          13,632              --
                                                                     ----------------  --------------  --------------

    End of period..................................................  $         2,015   $      46,191      $    2,015
                                                                     ================  ==============  ==============

Supplemental disclosure of cash flow information:
    Cash paid during the year for:
       Income taxes................................................  $            --   $          --      $       --
                                                                     ================  ==============  ==============
       Interest....................................................  $            --   $          --      $       --
                                                                     ================  ==============  ==============

Non-cash financing activities:
    Conversion of note payable to common stock.....................  $       250,000   $     450,000      $  700,000
    Conversion of interest to common stock.........................           86,160              --          86,160
                                                                     ----------------  --------------  --------------
                                                                     $       336,160   $     450,000      $  768,160
                                                                     ================  ==============  ==============
</TABLE>


          See accompanying notes to consolidated financial statements.

                                      F-8

<PAGE>

                      In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements


Note 1:  Summary of Significant Accounting Policies

Organization and Basis of Presentation

Background

Effective July 31, 2004, Hall Effect Medical Products, Inc. ("HEMP"), a Delaware
corporation, merged with Sports Information Publishing Corp. ("SIPC"), which was
incorporated  under the laws of Colorado on November 7, 2003.  Subsequent to the
merger SIPC changed its name to In Vivo Medical  Diagnostics,  Inc. and later In
Veritas Medical Diagnostics, Inc. ("IVMD" "we" "us" or "our")

SIPC was  originally  incorporated  for the  purpose of  engaging  in the sports
industry.  In 2002,  SIPC  filed a Form  SB-2  registration  statement  with the
Securities  and  Exchange  Commission  relating  to  the  registration  of up to
1,000,000  previously  issued  shares  of  common  stock at a price of $0.15 per
share. The SEC declared the offering effective in August 2003.

We are a  development-stage  enterprise located in Inverness,  Scotland.  We are
developing  medical  diagnostic  products  for personal  and  professional  use.
Certain of our products under  development are based on technology that utilizes
the Hall  Effect,  discovered  more than a hundred  years ago,  for which we are
developing  practical  applications.  Prior to the  merger,  we were funded by a
private UK company,  Westek  Limited,  and Abacus Trust Company  Limited was our
majority shareholder.

Shares of our  common  stock  trade in the Over the  Counter  ("OTCBB")  market.
Because  of the  nature of the  OTCBB  market  there was only a limited  trading
market for our stock  during the  periods  presented.  For  similar  reasons the
quoted  price of our stock was  inevitably  subject to  considerable  short term
volatility.  As a result,  management  has relied on the value of  consideration
received when reporting non-monetary  transactions in the accompanying financial
statements.

Principles of consolidation

Our consolidated  financial  statements include our accounts and the accounts of
our two wholly owned foreign  subsidiaries;  IVMD UK Limited ("IVMD") and Jopejo
Limited ("Jopejo"), both UK companies. The assets and liabilities of our foreign
subsidiaries  have been  translated  at the exchange  rate in effect at July 31,
2005 with the related translation  adjustments  reported as a separate component
of shareholders'  deficit.  Operating statement accounts have been translated at
the average exchange rate in effect during the period presented. All significant
intercompany transactions have been eliminated.

Change in fiscal year-end

We elected to change our year-end to July 31 in 2004.  The financial  statements
presented  herein cover the year ended July 31, 2004 and the year ended July 31,
2005 for Jopejo and the ten months  ended July 31,  2004 and the year ended July
31, 2005 for IVMD UK. In the 2004 financial  statements,  there were no material
intervening  events and the change in the fiscal  year of IVMD UK did not have a
material effect on the consolidated group. The use of different closing dates in
2003 was necessitated by the respective different year-ends of the subsidiaries.

Basis of presentation

Our research and  development  is conducted in Inverness,  Scotland  through our
subsidiaries:  IVMD UK Limited and Jopejo Limited.  Development-stage activities
consist of raising capital,  obtaining financing,  medical products research and
development  and  administrative  matters.  We plan to continue to raise capital
through stock sales and debt issuances to fund our development.  In addition, we
obtain cash from UK  government  grants that are designed to support  employment
and  enterprise and from  commercial  partners who  contribute  towards  certain
development projects. In due course, we expect our primary revenue to consist of
royalties  received  from  commercial  partners  in  respect  of the  commercial
exploitation of our products, once developed and successfully taken to market.



                                      F-9
<PAGE>


                      In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements


Inherent   in  our   development-stage   enterprise   are   various   risks  and
uncertainties,  including our limited operating  history,  historical  operating
losses,  dependence upon strategic alliances,  and market acceptance of the Hall
Effect  technology.  Our ability to generate  revenues  from  royalties  will be
dependent  upon  our  ability  to  enter  into   licenses,   joint  ventures  or
distribution  agreements  with  established  businesses  with existing sales and
marketing  structures.  Our future success will be dependent upon our ability to
develop  and  provide  new  medical   devices  that  meet   customers   changing
requirements,  including  the effective  use of the Hall Effect  technology,  to
continue to enhance our current products under development, and to influence and
respond to emerging  industry  standards  and other  technological  changes on a
timely and cost-effective basis.

In  common  with  most  development  stage  entities  we  have  incurred  losses
(principally  represented  by  research  and  development   expenditures)  since
inception  and we have an  inevitable  net capital  deficit at July 31, 2005. We
also had  substantial net current  liabilities at July 31, 2005.  These factors,
among others,  raise  substantial doubt about our ability to continue as a going
concern.  As explained  above,  in 2004, we merged with a public shell  company.
This merger  provides  us with  limited  access to the  capital  markets via the
OTCBB.  During fiscal years 2004 and 2005, we raised limited  amounts of capital
by virtue of our OTCBB  quote;  we need to  continue  to raise  capital  through
public or private  stock  offerings to finance our  development  activities  and
ultimately,  to achieve  profitability.  However,  there is no assurance that we
will be  successful  in our efforts to raise  capital or to become a  profitable
company.  Note 8 to these Financial Statements sets out details of the status of
certain capital raisings that have taken place since 31st July 2005.

Use of Estimates

The preparation of financial  statements in accordance  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect the reported  amounts of assets and  liabilities  and the  disclosure  of
contingent  assets and  liabilities at the date of financial  statements and the
reported  amounts of revenues and expenses during the reporting  period.  Actual
results could differ from those estimates.

Cash and Cash Equivalents

We consider all highly  liquid  securities  with  original  maturities  of three
months  or  less  when  acquired  to be  cash  equivalents.  There  were no cash
equivalents at July 31, 2005.

Accounts Receivable

We consider all trade receivables fully collectible.

Property and Equipment

Property and equipment are stated at cost.  Depreciation is calculated using the
straight-line  method over the  estimated  useful  lives of the related  assets,
generally ranging from three to five years. Property and equipment under capital
leases  are  stated at the  present  value of  minimum  lease  payments  and are
amortized using the  straight-line  method over the shorter of the lease term or
the estimated useful lives of the assets.  Leasehold  improvements are amortized
using the straight-line  method over the estimated useful lives of the assets or
the term of the lease, whichever is shorter.

Patent Costs

The legal,  professional and registration costs involved in registering  patents
which are  important  to our product  development  program are  capitalized  and
written off on a straight line basis over the lesser of the estimated commercial
life or legal life of the underlying  patents,  on a patent by patent basis.  We
adopted this  accounting  policy for the first time in the balance sheet at July
31, 2005 since we  previously  judged that the costs were  immaterial.  Prior to
July 31,  2005,  we expensed  patent costs as  incurred.  Capitalized  costs are
expensed if patents are not granted.

                                      F-10
<PAGE>


                      In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements


Impairment of Long-Lived Assets

In accordance with Statement of Financial  Accounting  Standards (SFAS) No. 144,
Accounting for the Impairment or Disposal of Long-Lived  Assets, we evaluate our
long-lived  assets,  including  related  intangibles,  of identifiable  business
activities for impairment when events or changes in circumstances  indicate,  in
management's  judgment,  that  the  carrying  value  of such  assets  may not be
recoverable.  The  determination of whether  impairment has occurred is based on
management's  estimate of  undiscounted  future cash flows  attributable  to the
assets as  compared  to the  carrying  value of the assets.  If  impairment  has
occurred, estimating the fair value for the assets and recording a provision for
loss if the carrying  value is greater than fair value  determine  the amount of
the  impairment  recognized.  For assets  identified  to be  disposed  of in the
future,  the carrying  value of these assets is compared to the  estimated  fair
value less the cost to sell to determine if  impairment  is required.  Until the
assets are  disposed  of, an  estimate of the fair value is  re-determined  when
related events or circumstances change.

When  determining  whether  impairment  of  one  of our  long-lived  assets  has
occurred, we must estimate the undiscounted cash flows attributable to the asset
or asset group.  Our estimate of cash flows is based on our  expectation  of the
future performance of the group.

Any significant variance in any of the above assumptions or factors could
materially affect our cash flows, which could require us to record an impairment
of an asset.

No impairment charges were recognized during each of the years ended July 31,
2005 and 2004.


Deferred Offering Costs

Costs incurred in connection  with proposed common stock offerings that straddle
the year end are  deferred  in the  accompanying  financial  statements  and are
offset  against the proceeds from the offering or written off against  earnings,
if the offering is unsuccessful, as appropriate, in future periods.

Income Taxes

We account for income  taxes under the  provisions  of  Statement  of  Financial
Accounting  Standards No. 109,  Accounting for Income Taxes (SFAS 109). SFAS 109
requires  recognition  of deferred tax  liabilities  and assets for the expected
future tax  consequences  of events  that have been  included  in the  financial
statements  or tax returns.  Under this method,  deferred  tax  liabilities  and
assets are determined  based on the difference  between the financial  statement
and tax bases of assets and  liabilities  using  enacted tax rates in effect for
the year in which the differences are expected to reverse.

Revenue Recognition

Our revenue has been generated through contribution to development projects from
commercial  partners and from UK government  grants.  We recognize  such revenue
based on the terms of the underlying agreement.

Financial Instruments and Concentration of Credit Risk

At July 31, 2005, the fair value of our financial instruments  approximate their
carrying value based on their terms and interest rates. Substantially all of our
trade receivables were from one customer as of July 31, 2005.

Stock based Compensation

We  account  for  stock-based  compensation   arrangements  in  accordance  with
Statement of Financial  Accounting  Standards ("SFAS") No. 123,  "Accounting for
Stock-Based  Compensation,"  which permits entities to recognize as expense over
the  vesting  period  the fair  value of all  stock-based  awards on the date of
grant.  Alternatively,  SFAS No. 123 allows  entities  to  continue to apply the
provisions of Accounting  Principle Board ("APB") Opinion No. 25 and provide pro


                                      F-11

<PAGE>


                      In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements


forma net earnings (loss) disclosures for employee stock option grants as if the
fair-value-based  method  defined  in SFAS  No.  123 had been  applied.  We have
elected to  continue to apply the  provisions  of APB Opinion No. 25 and provide
the pro forma disclosure provisions of SFAS No. 123.

Foreign Currency Translation

Our  assets and  liabilities,  which have the  British  Pound as its  functional
currency,  are  translated  into United States  Dollars at the foreign  currency
exchange rate in effect at the applicable  reporting date, and the statements of
operations  are  translated at the average rates in effect during the applicable
period.  The  resulting  cumulative  translation  adjustment  is  recorded  as a
separate component of Other Comprehensive Income.

Research and Development Costs

Research and development  costs are expensed as incurred.  During the year ended
July 31, 2005 we reexamined  the method used to calculate the  proportion of our
overheads that related to research and development and have refined the basis to
provide a more  accurate  reflection  of those costs.  Naturally  this  involves
estimates, but we believe that the method which we have used fairly reflects the
volume of  research  and  development  activity  of the Group.  For  comparative
purposes,  the Financial  Statements include  comparative 2004 data for research
and development  which has been calculated  using the same methods of estimation
as have been employed for the 2005 financial  statements.  This reclassification
does not impact the overall 2004 financial statements.

Reclassifications

The 2004 statements of operations has been reclassified to conform with the 2005
presentation.

Earnings (Loss) per Share

Basic net income or loss per share is  computed  by  dividing  the net income or
loss  available to common  shareholders  (the  numerator)  for the period by the
weighted average number of common shares  outstanding (the  denominator)  during
the period. The computation of diluted earnings is similar to basic earnings per
share,  except  that the  denominator  is  increased  to  include  the number of
additional  common  shares  that  would  have been  outstanding  if  potentially
dilutive common shares had been issued.

At July 31, 2005, there was no variance between basic and diluted loss per share
as the securities in our capital structure are antidilutive.

Note 2:  Related Party Transactions

We purchased  goods and  services  from related  parties  totaling  $120,492 and
$87,554 during the years ended July 31, 2005 and 2004, respectively.  As of July
31, 2005, $18,870 was due to related parties.

We received  advances  from Westek  Limited  totaling  $-0- and we repaid Westek
limited  a total of $-0-  during  the year  ended  July 31,  2005.  We  received
advances from Westek  Limited  totaling  $416,394 and we repaid Westek limited a
total of $160,623  during the year ended July 31, 2004. No  transactions of this
type  took  place in 2005.  In July  2004,  Westek  agreed  to  release  us from
$2,030,298  of the  accumulated  advances in exchange for a  noninterest-bearing
promissory  note  totaling  $1,800,000.  We  reflected  a  capital  contribution
totaling  $2,030,298 in the accompanying  financial  statements.  The promissory
note is payable in full by September  30, 2006.  Under the terms of the note, we
are obligated to make repayments of the principle  amount earlier that September
30,  2006 out of any equity or equity type  financings  made before that date by
applying an agreed  percentage  of the  aggregate  net  proceeds  from equity or
equity-type  financings.  The agreed percentage is 56% of any net proceeds which
exceed  $2,000,000 (up to  $3,000,000)  and 25% of all net proceeds in excess of
$3,000,000.  As of July 31,  2005,  we are  indebted  to Westek in the amount of
$1,685,440, net of discount of $114,560.


                                      F-12

<PAGE>


                      In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements


We paid affiliated  management  fees totaling  $48,764 and $37,399 for the years
ended July 31, 2005 and 2004, respectively.

We paid consulting fees totaling  $526,778 and $97,941 to related parties during
the years ended July 31, 2005 and 2004, respectively. See also Note 5.

Note 3:  Property and Equipment

Major classes of property and equipment as of July 31, 2005 are listed below:



Furniture and fixtures                                         $    16,478
Office equipment                                                    89,570
Plant and equipment                                                 17,747
                                                               ------------
                                                                   123,795
Less: accumulated depreciation                                      93,789
                                                               ------------
                                                               $    30,006
                                                               ============

Depreciation  expense  was $27,558 and $21,892 for the years ended July 31, 2005
and 2004, respectively.

Note 4:  Preferred Stock

We are authorized to issue 50,000,000 shares of preferred stock.

4% Convertible Preferred Stock

As of July 31,  2005,  the Company had  33,042,484  shares of Series A 4% voting
redeemable  convertible  preferred stock outstanding.  Such shares pay an annual
dividend of 4% and are  convertible at any time at the option of the holder into
Common Stock at the rate of one share Common Stock for each outstanding share of
Series A Preferred Stock commencing October 30, 2005,  provided the Common Stock
have  traded at a price of $3.00 per share for at least 30  consecutive  trading
days,  and at any time after  January  30,  2006.  Holders of Series A Preferred
Stock have  priority over all of the shares of In Veritas  Medical  Diagnostics,
Inc. on liquidation or sale at the rate of $1.00 per share. Holders are entitled
to vote on all matters as to which  Common  Stock  shareholders  are entitled to
vote.

The  aggregate and  per-share  amounts of  arrearages  in  cumulative  preferred
dividends on the Series A Preferred  Shares  through July 31, 2005,  are $20,697
and $-0-, respectively.

5% Convertible Preferred Stock

On April 15, 2005, we completed the sale of 863,845  units (the  "Units"),  each
Unit  consisting of one share of Series B 5% Convertible  Preferred  Stock,  one
warrant to purchase one share of the Company's common stock ("Stock  Warrants"),
and one warrant to purchase an additional  unit ("Unit  Warrants").  Such shares
pay an annual  dividend of 5% and are  convertible  at any time at the option of
the holder  into  Common  Stock at the rate of one share  Common  Stock for each


                                      F-13
<PAGE>

                      In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements

outstanding  share of Series B Preferred  Stock  commencing  April 15, 2005. The
Stock  Warrants are  exercisable  from April 15, 2005 until April 15, 2008 at an
exercise price of $1.50 per share, subject to adjustment.  The Unit Warrants are
exercisable for a period of 180 days from the effective date of the registration
statement at an exercise  price of $0.65 per unit,  subject to  adjustment.  All
preferential amounts to be paid to the holders of Series B Preferred Stock shall
be paid on a pari-passu  basis with any  preferential  amounts to be paid to the
holders of our Series A Preferred Stock, and prior to the common stock.

The aggregate and per-share amounts of arrearages in cumulative preferred
dividends on the Series B Preferred Shares through July 31, 2005, are $8,122 and
$0.01, respectively.

Note 5:  Common Stock

We are authorized to issue 100,000,000 shares of common stock. We issued the
following shares of common stock for services during the years ended July 31,
2005 and 2004, respectively:
<TABLE>
<CAPTION>

                                                                             July 31, 2005                     July 31, 2004
                                                                     ---------------------------       --------------------------
                                                                        Number       Fair Value          Number      Fair Value
                                                                      of Shares       of Shares         of Shares     of Shares
Employee/Consultant                                                      Issued         Issued           Issued         Issued
                                                                     -----------     -----------       -----------    -----------
<S>                                                                       <C>           <C>                 <C>        <C>
Brian Cameron................................................                 -      $        -            73,899     $   30,247
KDA Limited..................................................                 -               -            17,390          7,118
John Fuller..................................................                 -               -            98,050         40,132
Patricia Connelly............................................                 -               -            37,000         15,144
Robert Knowles...............................................             5,550               -            12,950          5,300
David Kagel..................................................           429,000         261,690                 -              -
Randall Lanham...............................................           125,000          76,250                 -              -
Martin E. Janis..............................................           145,000          56,457                 -              -
David Barnes.................................................           100,000          67,000                 -              -
Sichenzia Ross Friedman & Ference, LLP.......................           100,000          62,979                 -              -
Raymond Viscovitch...........................................             5,000           1,201                 -              -
Cormac Glenn.................................................             5,000           1,201                 -              -
                                                                     -----------     -----------       -----------    -----------
                                                                        914,550      $  526,778           239,289     $   97,941
                                                                     ===========     ===========       ===========    ===========
</TABLE>

Prior to the merger,  we valued the shares of common stock based on the value of
the  services.  After the merger,  we valued the shares of common stock based on
the quoted market price of the stock.

We issued the  following  shares of common stock for debt during the years ended
July 31, 2005 and 2004, respectively:

                                      F-14
<PAGE>

                      In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements
<TABLE>
<CAPTION>


                                                                             July 31, 2005                     July 31, 2004
                                                                      ---------------------------   -------------------------------
                                                                          Number      Fair Value        Number          Fair Value
                                                                        of Shares      of Shares       of Shares        of Shares
Note Holder                                                               Issued         Issued          Issued            Issued
                                                                      ------------   ------------   ------------       ------------
<S>                                                                       <C>            <C>            <C>                 <C>
Max Finkle.............................................................         -               -         35,000         $   10,000
David Pacher...........................................................         -               -         17,500              5,000
Eugene Hall............................................................         -               -         17,500              5,000
Benjamin Wilson........................................................         -               -         17,500              5,000
Spelman Research.......................................................         -               -         35,000             10,000
Fiserv Securities......................................................         -               -         52,500             15,000
Lynn Tanner............................................................         -               -        140,000             40,000
Robert Rubin...........................................................         -               -        227,500             65,000
Charles Warshaw Family Trust...........................................         -               -        350,000            100,000
First Global Services Corp.............................................         -               -         35,000             10,000
First Global Services Corp.............................................         -               -         52,500             15,000
Mark Bolanger..........................................................         -               -        175,000             50,000
Inverness & Nairn Enterprise...........................................    61,233          17,495        247,625             70,750
Steven Haggerty........................................................         -               -         35,000             10,000
Kenneth Dalglish.......................................................         -               -         35,000             10,000
Joe Frame..............................................................         -               -         35,000             10,000
Helen Goody............................................................         -               -         32,375              9,250
James Bell.............................................................         -               -         35,000             10,000
NITE Capital LP (interest).............................................    60,096          76,160              -                  -
NITE Capital LP (principal and interest)............................... 1,162,791         279,209              -                  -
                                                                      ------------   ------------   ------------       ------------
                                                                        1,284,120    $    355,369      1,575,000         $  450,000
</TABLE>

Prior to the merger, we valued the shares of common stock based on the amount of
debt converted.  After the merger, we valued shares of common stock based on the
quoted market price of the stock.

Note 6:  Stock Options

Stock Options - Employees

During May 2004,  the Company  granted  9,659,000  common  stock  options to two
officers with an exercise price of $1.00 per share.  The Company's  common stock
had no traded  market value on the date of grant.  The market value of the stock
was determined to be $1.00 per share based on estimates made by the directors at
that time.  The value of these options as of July 31, 2005 was $.-0-.  3,219,666
options vest on May 26, 2006,  an additional  3,219,666  options vest on May 26,
2007, and the final 3,219,668 options vest on May 26, 2008.

The Company adopted and reserved  21,434,788 shares of Common Stock for issuance
under its 2005 Stock  Incentive  Plan.  Under the plan,  options  may be granted
which are intended to qualify as Incentive  Stock  Options  under Section 422 of
the Internal  Revenue Code of 1986 or options  which are not intended to qualify
as Incentive  Stock Options  under  Section 422 of the Internal  Revenue Code of
1986.


                                      F-15

<PAGE>

                     In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements


The 2005 Stock  Incentive Plan and the right of  participants  to make purchases
thereunder  are intended to qualify as an "employee  stock  purchase plan" under
Section 423 of the  Internal  Revenue Code of 1986,  as amended.  The 2005 Stock
Incentive  Plan is not a  qualified  deferred  compensation  plan under  Section
401(a) of the Internal  Revenue Code and is not subject to the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA").

On June 1, 2005, the Company issued 400,000  options to its employees  under the
plan,  with an exercise  price of $0.55 per share.  The market  price on June 1,
2005 was also $0.55 per share.  The weighted average exercise price and weighted
average fair value of these  warrants as of April 11, 2005 were $0.55 and $0.29,
respectively.

Pro forma information regarding net income and earnings per share is required by
SFAS 123 as if the Company had accounted for its granted stock options under the
fair value  method of that  Statement.  The fair value for the  options  granted
during the fiscal  year ended July 31, 2005 was  estimated  at the date of grant
using the Black-Scholes option-pricing model with the following assumptions:

For shares issued in May 2004:

                Risk-free interest rate...................        2.25%
                Dividend yield............................        0.00%
                Volatility factor.........................        0.00%
                Weighted average expected life............       5 years

For shares issued in June 2005:


                Risk-free interest rate...................        4.35%
                Dividend yield............................        0.00%
                Volatility factor.........................       55.10%
                Weighted average expected life............      5 years



The  Black-Scholes  options  valuation model was developed for use in estimating
the fair value of traded  options,  which have no vesting  restrictions  and are
fully  transferable.  In addition,  option valuation models require the input of
highly  subjective  assumptions  including the expected stock price  volatility.
Because the Company's stock options have characteristics significantly different
from  those of traded  options,  and  because  changes in the  subjective  input
assumptions  can  materially  affect the fair value  estimate,  in  management's
opinion,  the  existing  models do not  necessarily  provide a  reliable  single
measure of the fair value of its stock options.  Although the above options were
determined to have $-0- fair value,  the Company has presented the pro forma net
loss and pro forma basic and diluted loss per common share using the assumptions
noted above.


                                      F-16
<PAGE>

                     In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements

<TABLE>
<CAPTION>
                                                                      For The Years Ended
                                                                          July 31,
                                                        ----------------------------------------
                                                              2005                      2004
                                                        ---------------          ---------------
<S>                                                           <C>                      <C>
Net loss, as reported.................................  $   (2,483,429)          $   (1,016,972)
                                                        ===============          ===============
Pro forma net loss....................................  $   (2,483,429)          $   (1,016,972)
                                                        ===============          ===============
Basic and diluted net loss per common
   share, as reported.................................  $        (0.05)          $        (0.09)
                                                        ===============          ===============
Pro forma basic and diluted net loss
   per common share...................................  $        (0.05)          $        (0.09)
                                                        ===============          ===============
</TABLE>


Stock Options - Nonemployees

During the year ended  July 31,  2005,  the  Company  committed  to grant to two
non-employees 250,000 options to purchase its Common Stock. The options carry an
exercise price of $0.55 per share.  100,000 options vested July 1, 2005,  50,000
options vest May 16, 2006,  and 100,000  options vest July 1, 2006.  The options
were granted on June 1, 2005. No options have yet been exercised.

The Company's common stock's traded market value on the date of grant was $0.55.
The weighted  average  exercise  price and weighted  average fair value of these
warrants as of April 11, 2005 were $0.55 and $0.29, respectively.

The fair value for the warrants  granted  during the year ended May 31, 2005 was
estimated at the date of grant using the Black-Scholes option-pricing model with
the following assumptions:




         Risk-free interest rate.....................            4.35%
         Dividend yield..............................            0.00%
         Volatility factor...........................           55.10%
         Weighted average expected life..............          5 years


Stock Warrants

During the year ended  July 31,  2005,  the  Company  committed  to grant to its
financial  representative,  Westor  Capital  Group,  Inc.,  warrants to purchase
61,769 shares of the  Company's  common  stock.  The warrants  carry an exercise
price of $1.50  per  share,  vest on the date of grant  and  expire on April 15,
2008.  The warrants  were granted on April 11, 2005.  No warrants  have yet been
exercised.

The Company's common stock's traded market value on the date of grant was $1.01.
The weighted  average  exercise  price and weighted  average fair value of these
warrants as of April 11, 2005 were $1.50 and $0.29, respectively.

The fair value for the warrants  granted during the year ended July 31, 2005 was
estimated at the date of grant using the Black-Scholes option-pricing model with
the following assumptions:


                                      F-17

<PAGE>

                     In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements

         Risk-free interest rate.....................            4.35%
         Dividend yield..............................            0.00%
         Volatility factor...........................           55.10%
         Weighted average expected life..............          5 years

The following schedule summarizes the changes in the Company's outstanding stock
awards:
<TABLE>
<CAPTION>

                                                            Options Outstanding
                                                         ----------------------------   Weighted Average
                                                         Number of    Exercise Price     Exercise Price
                                                           Shares       Per Share           Per Share
                                                         ------------- --------------    --------------
<S>                                                           <C>             <C>            <C>
Balance at July 31, 2004.............................        9,659,000     $1.00         $         1.00
   Awards granted....................................          711,769  $0.55 - $1.50    $         0.63
   Awards exercised..................................                -     $0.00         $            -
   Awards cancelled/expired..........................                -     $0.00         $            -
                                                         -------------                   --------------
Balance at July 31, 2005.............................       10,370,769  $0.55 to $1.50   $         0.97
                                                         ==============                  ==============
</TABLE>

Note 7:  Income Taxes


A reconciliation of U.K. statutory income tax rate to the effective rate follows
for the years ended July 31, 2004 and 2005:


                                                                Years Ended
                                                                   July 31,
                                                       -------------------------
                                                           2005            2004
                                                       ---------         -------
U.K. statutory federal rate..........................     30.00%          30.00%
Net operating loss for which no tax
           benefit is currently available............    -30.00%         -30.00%
                                                       ---------         -------
                                                           0.00%           0.00%
                                                       =========         =======

At July 31, 2005, deferred U. K. income taxes were $-0-. U.K. pretax losses were
$1,080,619 and $1,216,606,  respectively,  for the years ended July 31, 2004 and
2005.

At July 31, 2005 and July 31st 2004, we had a net operating tax losses available
for  carryfoward  and offset against future taxable profits arising in the UK of
approximately $5.0 million and $4.0 million respectively.

Note 8:  Acquisitions

July 22, 2004

On July 22, 2004, Jopejo Limited and IVMD UK, Inc. and HEMP entered into a share
purchase  agreement  whereby  HEMP  purchased  100  percent  of the  issued  and
outstanding  preferred  and ordinary  shares of both Jopejo  Limited and IVMD UK
Limited  (formerly  Hall Effect  Technologies  Limited) for 8,000,000  shares of
convertible  Series A  preferred  stock,  $0.001 par value.  HEMP also agreed to
become a co-obligor of approximately $1.8 million in debt obligations to Westek.


                                      F-18
<PAGE>
                     In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements

As part of the acquisition, HEMP issued 3,000,000 shares of common stock to HEMP
TL, an employee  benefit plan valued at $3,000 by the Board of Directors  and an
addition  6,000,000  shares of common stock to certain  individuals for services
valued at $6,000 by the Board of Directors.

As a result of these transactions, Jopejo limited and IVMD UK, Inc. became
wholly owned subsidiaries of HEMP.

July 30, 2004

On July 30, 2004, HEMP exchanged 100 percent of its outstanding shares of common
stock  for  38,397,164  shares  of the  common  stock  and  100  percent  of its
outstanding  shares of preferred stock for 34,363,662  shares of preferred stock
of SIPC.  This  acquisition  has been treated as a  recapitalization  of HEMP, a
Delaware  corporation,  with SIPC the legal  surviving  entity.  Since SIPC has,
prior to the recapitalization,  minimal assets (consisting primarily of cash and
trade payables) and no operations,  the  recapitalization has been accounted for
as the sale of  10,550,000  shares of HEMP  common  stock for the net  assets of
SIPC. Costs of the transaction have been charged to the period.

Note 9: Subsequent finance raisings:

On September 7, 2005,  the Company  entered into a Standby  Equity  Distribution
Agreement  (the  "Distribution  Agreement")  with  Cornell  Capital  Partners LP
("Cornell")  providing for the sale and issuance to Cornell of up to $10,000,000
of  Common  Stock  over a period of up to 24 months  after  the  signing  of the
Distribution Agreement.  Under the Distribution Agreement,  the Company may sell
to Cornell up to $500,000  in shares of its common  stock (the  "Common  Stock")
once every five trading  days at a price of 97% of the lowest  closing bid price
(as reported by Bloomberg  L.P.),  of the Common Stock on the  principal  market
where the Common Stock is traded for the five consecutive trading days following
a notice by the Company to Cornell of its intention to sell shares.  The Company
will  also  pay  a 5%  commitment  fee  upon  each  sale  of  shares  under  the
Distribution  Agreement.  Cornell  has  agreed not to short any of the shares of
Common Stock.

Also on  September  7, 2005,  the Company  entered  into a  Securities  Purchase
Agreement  (the  "Purchase  Agreement")  with  Montgomery  Equity  Partners Ltd.
("Montgomery"),  an  affiliated  fund of Cornell,  providing for the sale by the
Company to Montgomery of its 18% secured convertible debentures in the aggregate
principal amount of $750,000 (the  "Debentures") of which $300,000 was funded on
September  7,  2005;  $200,000  shall be funded two  business  days prior to the
Company's  completion of its audited  financial  statements  for the fiscal year
ended July 31, 2005, and;  $250,000 shall be funded within five business days of
the date the Registration  Statement is declared effective by the SEC. Under the
Purchase  Agreement,  the Company also issued to Montgomery  three-year warrants
(the "Warrants") to purchase 350,000 shares of Common Stock at $0.001 per share.

In addition to the  foregoing,  the Company  entered into a Securities  Purchase
Agreement (the "Accredited Investor Purchase Agreement") with the investors (the
"Accredited  Investors")  in its April 2005  financing  (which is  described  in
Footnote  5 to these  Financial  Statements)  pursuant  to which the  Accredited
Investors  agreed  to  exchange  the  securities  that  they  purchased  in such
financing  for  an  aggregate  of  $556,500   principal  amount  of  Debentures.
Specifically,  the  Accredited  Investors  agreed to  exchange an  aggregate  of
863,845 units (the "Units"), as well as a warrant to purchase an additional Unit
for an aggregate of $556,500 principal amount of Debentures. Each Unit consisted
of one share of 5% convertible  preferred stock of the Company,  $.001 par value
per share, and one warrant to purchase one share of the Company's common stock.

The Debentures  mature on the first anniversary of the date of issuance and bear
interest  at the annual  rate of 18% in cash.  The  Company is  required to make
monthly  interest  payments  commencing on October 7, 2005,  and to make monthly
principal payments commencing on March 7, 2006.


                                      F-19
<PAGE>

                     In Veritas Medical Diagnostics, Inc.
                  (Formerly In Vivo Medical Diagnostics, Inc.)
                          (A Development Stage Company)
                   Notes to Consolidated Financial Statements


Holders may convert,  at any time, the principal  amount  outstanding  under the
Debentures into shares of Common Stock, at a conversion price per share equal to
$0.144,  subject to adjustment.  Upon three-business day advance written notice,
the Company may redeem the  Debentures,  in whole or in part.  In the event that
the closing bid price of the Common Stock on the date that the Company  provides
advance  written notice of redemption or on the date  redemption is made exceeds
the conversion  price then in effect,  the redemption will be calculated at 112%
of the Debentures' face value.

As further  security for its obligations  under the above mentioned  facilities,
the Company has deposited into escrow 25,685,000  shares of common stock,  these
shares are deemed issued but not outstanding.

Subsequent to the  completion of the Standby Equity  Distribution  Agreement and
the sale of the 18% secured  convertible  debentures  pursuant to the Securities
Purchase  Agreement  in  September  2005,  the  Company  prepared  and  filed  a
registration  statement on Form SB-2 with the Securities and Exchange Commission
for  the  purpose  of  registering  the  securities  underlying  such  financing
transactions.  In connection  therewith,  the Company has received comments from
the  Commission  indicating  that,  in the  Commission's  view,  based  upon the
structure of the transactions,  the Company may not register the securities sold
in the financing transactions.  As a result, the Company has been in discussions
with the investors in the recent financing  transactions  regarding the possible
restructuring of these financing  transactions.  No assurance can be given as to
when, or if, the  transactions  will be  restructured,  or that the transactions
will be  restructured  in a manner that is acceptable to the Commission to allow
registration of the securities sold in these transactions.

                                      F-20

<PAGE>

Item  8.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURE

Not applicable.

Item 8a. CONTROLS AND PROCEDURES

As of the end of the period covered by this report,  we conducted an evaluation,
under the supervision and with the  participation of our chief executive officer
and chief  financial  officer,  of our  disclosure  controls and  procedures (as
defined in Rule 13a-15(e) and Rule  15d-15(e) of the Exchange  Act).  Based upon
this  evaluation,  our  chief  executive  officer  and chief  financial  officer
concluded  that the our  disclosure  controls and  procedures  are  effective to
ensure that  information  required to be  disclosed by us in the reports that we
file or submit under the Exchange Act is  recorded,  processed,  summarized  and
reported, within the time periods specified in the Commission's rules and forms.
There was no  significant  change in our internal  controls or in other  factors
that could  significantly  affect these  controls  subsequent to the date of the
evaluation.

                                    PART III

Item 9. DIRECTORS AND EXECUTIVE OFFICERS

Directors and Executive Officers

The  following  table sets forth  current  information  regarding  our executive
officers, senior managers and directors:



Name                           Age  Positions

John Fuller.................   44   President, Chief Executive Officer,
                                    Director
Martin Thorp................   53   Chief Financial Officer and Director

Brian Cameron...............   46   Chief Operating Officer and Director

Graham Cooper...............   55   Chairman



John Fuller has been our President, Chief Executive Officer and a director since
July 2001. Mr. Fuller has a considerable  track record in bringing  conventional
and new technology  products to market in class leading product lead times.  Mr.
Fuller  started  HET,  as its Chief  Executive  Officer,  in July 1999,  and was
responsible  for the  acquisition  of Jopejo in December  2001,  and  subsequent
growth of the  company.  From  September  1997 to November  1999,  was  Managing
Director of Highland  Distillers,  located in Scotland,  a $400 million  revenue
public company in the premium spirits  sector.  From June 1993 to August 1997 he
served as Executive Vice President of Mayflower Corporation, located in Detroit,
Michigan, a multinational company in the motor industry. Mr. Fuller received his
B.S. in Mechanical  Engineering  from  Southampton  University  and a Masters of
Business Administration from Warwick University.

                                       30
<PAGE>

Martin  Thorp has been our Chief  Financial  Officer and a Director  since April
2005.   From  2002  through  2005,  Mr.  Thorp  had  been  involved  in  various
entrepreneurial  activities  including,  the  establishment  of Biz-Bud  Ltd., a
private company which provides outsourcing solutions for the small and mid-sized
enterprises  ("SMEs") across the entire business support spectrum;  developing a
consulting  capability  for SMEs;  acting as a  consultant  to an  international
corporate finance and strategic advisory boutique; serving as strategic advisory
non-executive board member of Grant Thornton;  and serving in various short term
consulting and interim management positions. From 1996 to 2002, Mr. Thorp served
as Global Managing Partner,  Corporate  Finance for Arthur Andersen,  London and
New York.  Mr. Thorp  graduated  with first class honors from the  University of
Kent at  Canterbury  (UK) in  Accounting  and Business  Finance.  Mr. Thorp is a
Fellow of the  Institute  of  Chartered  Accountants  in England and Wales and a
member of the Securities Institute (in the UK).

Brian Cameron has been our Chief  Operating  Officer since  December  2003.  Mr.
Cameron joined HET and Jopejo,  as a consultant in March 2001, prior to which he
set up his own  consulting  business with customers such as BMW Gmbh and Snap On
Tools.  Mr.  Cameron  spent  two  and a half  years  on the  board  of  Highland
Distillers  from March 1998 to July 2000. From November 1995 to February 1998 he
was a managing  director of BMH Ltd., a subsidiary  of  BMW-Rover,  where he was
engaged in licensing and branding,  supplier and customer  partnership  building
and change  management.  From August 1992 to November 1995 Mr. Cameron served as
logistics  director of Rover Group, a $3.5 billion revenue  automotive  company.
Mr. Cameron is a Fellow of the Chartered  Management Institute with a background
in successful turn-around and business growth.

Graham  Cooper has been our Chairman of the Board since  January  2000.  For the
past five years, Mr. Cooper Graham has been the principal stockholder of Westek,
a computer  trading company located in Manchester,  England,  with a turnover of
approximately $192 million.  Westek has been the primary financing source to HET
and is a business "angel" to other technology development stage companies.

Audit Committee

We do not have a separately designated standing audit committee.

Code of Ethics

We have adopted our Code of Ethics and Business Conduct for Officers,  Directors
and Employees that applies to all of our officers,  directors and employees. The
Code of Ethics was filed with the Annual Report on Form 10-KSB dated February 3,
2005.

Item 10. DIRECTORS AND EXECUTIVE OFFICERS

Directors and Executive Officers

The  following  table sets forth  current  information  regarding  our executive
officers, senior managers and directors:



Name                           Age  Positions

John Fuller.................   44   President, Chief Executive Officer,
                                    Director
Martin Thorp................   53   Chief Financial Officer and Director

Brian Cameron...............   46   Chief Operating Officer and Director

Graham Cooper...............   55   Chairman



John Fuller has been our President, Chief Executive Officer and a director since
July 2001. Mr. Fuller has a considerable  track record in bringing  conventional
and new technology  products to market in class leading product lead times.  Mr.
Fuller  started  HET,  as its Chief  Executive  Officer,  in July 1999,  and was
responsible  for the  acquisition  of Jopejo in December  2001,  and  subsequent
growth of the  company.  From  September  1997 to November  1999,  was  Managing
Director of Highland  Distillers,  located in Scotland,  a $400 million  revenue
public company in the premium spirits  sector.  From June 1993 to August 1997 he
served as Executive Vice President of Mayflower Corporation, located in Detroit,
Michigan, a multinational company in the motor industry. Mr. Fuller received his
B.S. in Mechanical  Engineering  from  Southampton  University  and a Masters of
Business Administration from Warwick University.

                                       31
<PAGE>

Martin  Thorp has been our Chief  Financial  Officer and a Director  since April
2005.   From  2002  through  2005,  Mr.  Thorp  had  been  involved  in  various
entrepreneurial  activities  including,  the  establishment  of Biz-Bud  Ltd., a
private company which provides outsourcing solutions for the small and mid-sized
enterprises  ("SMEs") across the entire business support spectrum;  developing a
consulting  capability  for SMEs;  acting as a  consultant  to an  international
corporate finance and strategic advisory boutique; serving as strategic advisory
non-executive board member of Grant Thornton;  and serving in various short term
consulting and interim management positions. From 1996 to 2002, Mr. Thorp served
as Global Managing Partner,  Corporate  Finance for Arthur Andersen,  London and
New York.  Mr. Thorp  graduated  with first class honors from the  University of
Kent at  Canterbury  (UK) in  Accounting  and Business  Finance.  Mr. Thorp is a
Fellow of the  Institute  of  Chartered  Accountants  in England and Wales and a
member of the Securities Institute (in the UK).

Brian Cameron has been our Chief  Operating  Officer since  December  2003.  Mr.
Cameron joined HET and Jopejo,  as a consultant in March 2001, prior to which he
set up his own  consulting  business with customers such as BMW Gmbh and Snap On
Tools.  Mr.  Cameron  spent  two  and a half  years  on the  board  of  Highland
Distillers  from March 1998 to July 2000. From November 1995 to February 1998 he
was a managing  director of BMH Ltd., a subsidiary  of  BMW-Rover,  where he was
engaged in licensing and branding,  supplier and customer  partnership  building
and change  management.  From August 1992 to November 1995 Mr. Cameron served as
logistics  director of Rover Group, a $3.5 billion revenue  automotive  company.
Mr. Cameron is a Fellow of the Chartered  Management Institute with a background
in successful turn-around and business growth.

Graham  Cooper has been our Chairman of the Board since  January  2000.  For the
past five years, Mr. Cooper Graham has been the principal stockholder of Westek,
a computer  trading company located in Manchester,  England,  with a turnover of
approximately $192 million.  Westek has been the primary financing source to HET
and is a business "angel" to other technology development stage companies.

Audit Committee

We do not have a separately designated standing audit committee.

Code of Ethics

We have adopted our Code of Ethics and Business Conduct for Officers,  Directors
and Employees that applies to all of our officers,  directors and employees. The
Code of Ethics was filed with the Annual Report on Form 10-KSB dated February 3,
2005.

Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following  table  indicates  beneficial  ownership of our common stock as of
September 8, 2005 by each person or entity known by us to beneficially  own more
than 5% of the  outstanding  shares of our common  stock;  each of our executive
officers and  directors;  and all of our  executive  officers and directors as a
group. Unless otherwise  indicated,  the address of each beneficial owner listed
below is c/o The Green House, Beechwood Business Park North, Inverness, Scotland
IV2 3BL.

                                       32
<PAGE>


<TABLE>
<CAPTION>

      Name of Beneficial Owner              Number of Shares            Class of Stock       Percentage Outstanding (1)
                                           Beneficially Owned
------------------------------------- ------------------------------ ---------------------- --------------------------
<S>                                       <C>                         <C>                       <C>
Abacus Trust Company Limited (2)               19,328,381               Preferred Stock                24.1%
Unit 2, Taurus Park
Europa Boulevard
Warrington WA5 7YT
England
------------------------------------- ------------------------------ ---------------------- --------------------------

Rodney Philip Jackson                           6,392,695               Preferred Stock                8.0%
The Green House
Beechwood Business Park North
Inverness, Scotland IV2 3BL
------------------------------------- ------------------------------ ---------------------- --------------------------
HEMP Trustees Limited                          12,879,073                Common Stock                 22.8%
10 Foster Lane
London, England
EC2V 6HR
------------------------------------- ------------------------------ ---------------------- --------------------------
Rubin Family Irrevocable Stock                  4,674,541                Common Stock                  8.3%
Trust (3)
25 Highland Boulevard
Dix Hills, New York 11730
------------------------------------- ------------------------------ ---------------------- --------------------------
John Fuller (4)                                 8,147,345                Common Stock                 14.4%
Easter Shian, Glen Quaich
Amulree, Perthshire
PH8 0DB
Scotland
------------------------------------- ------------------------------ ---------------------- --------------------------
Brian Cameron (5)                               8,123,195                Common Stock                 14.4%
Campbell Cairns, Craigellachie
Aberlour, Banffshire
Scotland
------------------------------------- ------------------------------ ---------------------- --------------------------
Graham Cooper                                           0                Common Stock                   *
Rock Cottage
Finsthwaite
Cumbria
United Kingdom
LA12 8BH
------------------------------------- ------------------------------ ---------------------- --------------------------
Martin E. Thorp (6)                                     0                Common Stock                   *
7 Howard Bldg.
London
United Kingdom
SW8 4NN
------------------------------------- ------------------------------ ---------------------- --------------------------
All directors and executive                    16,270,540                                             28.9%
officers as a group (5 persons)
------------------------------------- ------------------------------ ---------------------- --------------------------
</TABLE>

* less than 1%

                                       33
<PAGE>

(1)  Applicable  percentage  ownership is based on  56,231,308  shares of common
stock outstanding as of September 9, 2005. Beneficial ownership is determined in
accordance  with  the  rules  of the  Securities  and  Exchange  Commission  and
generally includes voting or investment power with respect to securities. Shares
of common stock that are currently  exercisable or exercisable within 60 days of
September 9, 2005 are deemed to be beneficially owned by the person holding such
securities  for the purpose of  computing  the  percentage  of ownership of such
person,  but are not treated as  outstanding  for the purpose of  computing  the
percentage ownership of any other person.

(2) Consists of shares of 4% voting  preferred  stock,  convertible  on or after
October 31, 2005 into  19,328,381  shares of common stock.  Abacus Trust Company
Limited  is acting as trustee  for the Westek  Limited  Employee  Trust.  Graham
Cooper, Chairman of our Board of Directors,  and Bernard Turner, Chief Financial
Officer are beneficiaries of the Westek Limited Employee Trust.

(3) Excludes an  aggregate  of 2,785,310  shares of common stock owned by Andrew
Rubin,  Lynda  Rubin and Lisa Diaz,  the  children of Robert M. Rubin and by the
grandchild of Robert M. Rubin, the settlor of the Rubin Family Irrevocable Stock
Trust. Mr. Rubin disclaims  beneficial interest in the shares owned by the Rubin
Family Irrevocable Stock Trust or by his children and grandchild.

(4) Consists of (i) 6,439,437  shares held by the Hall Effect  Medical  Products
Employee  Benefit  Trust as to which Mr.  Fuller holds  options to purchase (ii)
98,050 shares  issued to Mr.  Fuller in  consideration  of his  cancellation  of
certain  obligations  owed to him by HET and Jopejo,  and (iii) 1,609,859 shares
underlying  options issued pursuant to Mr. Fuller's  employment  agreement which
are currently exercisable.

(5) Consists of (i) 6,439,436  shares held by the Hall Effect  Medical  Products
Employee  Benefit Trust as to which Mr.  Cameron holds options to purchase,  and
(ii) 73,899 shares issued to Mr. Cameron in consideration of his cancellation of
certain  obligations  owed to him by HET and Jopejo,  and (iii) 1,609,859 shares
underlying options issued pursuant to Mr. Cameron's  employment  agreement which
are currently exercisable.

(6) This does not include (i) 50,000  shares  underlying  options  which are not
exercisable within 60 days of September 14, 2005.

Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

In Vivo DE was formed in 2003 to  acquire  the  capital  stock of HET and Jopejo
from its  shareholders.  In Vivo DE's  founders,  including  Robert M. Rubin and
others (the "Founding  Shareholders")  received  6,000,000  shares of our common
stock in connection with its initial formation and capitalization.

In connection  with a share purchase  agreement with the former  stockholders of
HET and Jopejo,  such  stockholders,  including  Abacus  Trust  Company,  in its
capacity as trustee of the Westek Limited Employees Trust, received an aggregate
of 8,000,000  shares of In Vivo Series A Preferred  Stock, and the HEMP Employee
Benefit Trust received an additional  3,000,000  shares of In Vivo common stock.
Graham Cooper,  our Chairman of the Board, is a principal  stockholder of Westek
Limited, an affiliate of the Westek Limited Employees Trust, and John Fuller and
Brian  Cameron,  our  Chief  Executive  Officer  and  Chief  Operating  Officer,
respectively,  each owned a 50% beneficial interest in options to purchase,  for
nominal consideration, the 3,000,000 shares of In Vivo DE common stock issued to
the HEMP Employee Benefit Trust.

                                       34
<PAGE>
As a result of the share exchange  agreement with us, the Founding  Shareholders
received an aggregate of  25,757,747  shares of our common  stock;  the original
shareholders  of HET and Jopejo  received  34,343,662  shares of our 4% Series A
convertible  redeemable  voting  preferred  stock, and the HEMP Employee Benefit
Trust,  on behalf of Messrs.  Fuller  and  Cameron,  received  an  aggregate  of
12,878,873 shares of our common stock.

We issued 1,636,233 additional shares of our common stock to holders of $450,000
of promissory notes issued by In Vivo DE's wholly owned subsidiaries Hall Effect
Technologies  Ltd.  and Jopejo  Ltd. in exchange  for the  cancellation  of such
notes;  which notes were originally  convertible  into 750,000 shares of In Vivo
common stock.

In connection with the transactions  contemplated by the original share purchase
agreement  with the former  shareholders  of HET and Jopejo,  such  shareholders
received an option from Mr. Rubin and the other founding stockholders of In Vivo
DE to repurchase,  for $.01 per share, all or a pro-rata portion of their shares
of common  stock of our company in the event that our company does not raise for
the benefit of In Vivo DE and its  subsidiaries,  in  addition  to the  $500,000
previously  provided,  a  minimum  of  $2.5  million  of  additional  equity  or
equity-type  financing by December 31, 2004.  The number of our shares that will
be subject to such  repurchase  option will be pro-rated in the event we receive
one or more financings of less than the $2.5 million minimum amount.

In  connection  with  the  transactions   contemplated  by  the  share  purchase
agreement, In Veritas agreed to repay to Westek Limited a total of $1,800,000 in
advances  previously  made  to HET  and  Jopejo,  by  issuance  to  Westek  of a
$1,800,000  non-interest  bearing note payable on September 30, 2006.  Under the
terms of the note, we are obligated to:

o    apply 56% of all net  proceeds  from any one or more equity or  equity-type
     financings  in excess of  $2,000,000  and up to  $3,000,000 to prepay up to
     $560,000 of the note; and

o    apply 25% of all net proceeds in excess of $3,000,000 to prepay the note.

Graham  Cooper,  the Chairman of the Board of our company,  is also the Chairman
and principal stockholder of Westek Limited.

Item 13. EXHIBITS

(a) Exhibits

Exhibit
Number                                  Description
--------------------------------------------------------------------------------
2.1            Share Purchase Agreement, dated as of June 30, 2004, among Sports
               Information and Publishing Corp.,  Michael Tanner,  HEMP Trustees
               Limited (as the corporate  trustee of the HEMP Employees  Benefit
               Trust),  John Fuller,  Brian  Cameron,  Westek  Limited and other
               holders of securities of In Veritas Medical Diagnostics, Inc. (as
               incorporated  by reference to Form 8-K, filed with the Securities
               and Exchange Commission on August 10, 2004).

2.2            Amendment No. 1 to Share Exchange Agreement, effective as of July
               31, 2004, among Sports Information and Publishing Corp.,  Michael
               D. Tanner, HEMP Trustees Limited (as the corporate trustee of the
               HEMP Employees Benefit Trust), John Fuller, Brian Cameron, Westek
               Limited and the other  holders of  securities  of In Vivo Medical
               Diagnostics,  Inc.  (formerly Hall Effect  Medical  Products) (as
               incorporated   by  reference  to  Form  8-K/A,   filed  with  the
               Securities and Exchange Commission on February 3, 2005).

3.1            Articles of  Incorporation  (as incorporated by reference to Form
               SB-2,  filed  with the  Securities  and  Exchange  Commission  on
               January 24, 2002).

3.2            Articles of Amendment of Articles of  Incorporation,  dated as of
               July 22, 2004 (as  incorporated by reference to the Annual Report
               on Form 10-KSB, filed with the Securities and Exchange Commission
               on February 3, 2005).

3.3            Articles of Amendment of Articles of  Incorporation,  dated as of
               September 20, 2004.

3.4            By-Laws (as  incorporated  by reference to Form SB-2,  filed with
               the Securities and Exchange Commission on January 24, 2002).

                                       35
<PAGE>
10.1           Employment  Agreement among Hall Effect  Technologies  Limited, a
               company  registered in England,  Jonathan  Andrew Fuller and Hall
               Effect  Medical  Products  Inc.,  a  Delaware  corporation.   (as
               incorporated  by reference  to the Annual  Report on Form 10-KSB,
               filed with the Securities and Exchange  Commission on February 3,
               2005).

10.2           Employment  Agreement among Hall Effect  Technologies  Limited, a
               company  registered  in  England,  Brian  Cameron and Hall Effect
               Medical Products Inc., a Delaware  corporation.  (as incorporated
               by reference to the Annual Report on Form 10-KSB,  filed with the
               Securities and Exchange Commission on February 3, 2005).

10.3           Research  and  Development  Agreement  dated July 1, 2002 between
               Hall  Effect  Technologies   Limited  and  Unipath  Limited.  (as
               incorporated  by reference to the Amended  Annual  Report on Form
               10-KSB/A,  filed with the Securities  and Exchange  Commission on
               August 15, 2005).

10.4           Patent  Licence  Agreement  dated  September 1, 2002 between Hall
               Effect Technologies Limited and Unipath Limited. (as incorporated
               by reference to the Amended Annual Report on Form 10-KSB/A, filed
               with the Securities and Exchange Commission on August 15, 2005).


10.5           Subscription  Agreement,  dated December 22, 2004 by and among In
               Vivo  Medical  Diagnostics,  Inc.  and  NITE  Capital,  L.P.  (as
               incorporated  by reference to Form 8-K, filed with the Securities
               and Exchange Commission on December 29, 2004).

10.6           Registration  Rights  Agreement,  dated  December 22, 2004 by and
               among In Vivo Medical  Diagnostics,  Inc. and NITE Capital,  L.P.
               (as  incorporated  by  reference  to Form  8-K,  filed  with  the
               Securities and Exchange Commission on December 29, 2004).

10.7           Form of 8%  Promissory  Note  issued to NITE  Capital,  L.P.  (as
               incorporated  by reference to Form 8-K, filed with the Securities
               and Exchange Commission on December 29, 2004).

10.8           Certificate of the Powers,  Designations,  Preferences and Rights
               of the Series B Preferred Stock (As  incorporated by reference to
               Form Form 8-K filed with the Securities  and Exchange  Commission
               on April 21, 2005).

10.9           Form of Subscription Agreement - April 2005 private placement (As
               incorporated  by  reference  to Form  Form  8-K  filed  with  the
               Securities and Exchange Commission on April 21, 2005).

10.10          Form of  Common  Stock  Purchase  Warrant  - April  2005  private
               placement  (As  incorporated  by reference to Form Form 8-K filed
               with the Securities and Exchange Commission on April 21, 2005).

10.11          Form  of  Unit  Warrant  -  April  2005  private   placement  (As
               incorporated  by  reference  to Form  Form  8-K  filed  with  the
               Securities and Exchange Commission on April 21, 2005).

10.12          Form  of  Registration  Rights  Agreement  - April  2005  private
               placement  (As  incorporated  by reference to Form Form 8-K filed
               with the Securities and Exchange Commission on April 21, 2005).


10.13          Secured   Convertible   Debenture   issued  to  Montgomery  dated
               September 7, 2005 (as  incorporated by reference to the Company's
               Current  Report  on Form  8-K,  filed  with  the  Securities  and
               Exchange Commission on September 13, 2005).

10.14          Warrant  issued  to  Montgomery   dated  September  7,  2005  (as
               incorporated by reference to the Company's Current Report on Form
               8-K,  filed  with  the  Securities  and  Exchange  Commission  on
               September 13, 2005).

10.15          Form  of  Convertible  Debenture  dated  September  7,  2005  (as
               incorporated by reference to the Company's Current Report on Form
               8-K,  filed  with  the  Securities  and  Exchange  Commission  on
               September 13, 2005).

                                       36
<PAGE>
10.16          Investor Registration Rights Agreement dated September 7, 2005 by
               and  between  the  Company and  Montgomery  (as  incorporated  by
               reference to the Company's Current Report on Form 8-K, filed with
               the Securities and Exchange Commission on September 13, 2005).

10.17          Pledge and Escrow  Agreement dated September 7, 2005 by and among
               the Company,  Montgomery  and David  Gonzalez as escrow agent (as
               incorporated by reference to the Company's Current Report on Form
               8-K,  filed  with  the  Securities  and  Exchange  Commission  on
               September 13, 2005).

10.18          Securities  Purchase  Agreement  dated  September  7, 2005 by and
               between the Company and Montgomery (as  incorporated by reference
               to the  Company's  Current  Report  on Form 8-K,  filed  with the
               Securities and Exchange Commission on September 13, 2005).

10.19          Security  Agreement  dated  September  7, 2005 by and between the
               Company and  Montgomery  (as  incorporated  by  reference  to the
               Company's  Current  Report on Form 8-K, filed with the Securities
               and Exchange Commission on September 13, 2005).

10.20          Standby Equity Distribution  Agreement dated September 7, 2005 by
               and between the Company and Cornell (as incorporated by reference
               to the  Company's  Current  Report  on Form 8-K,  filed  with the
               Securities and Exchange Commission on September 13, 2005).

10.21          Registration  Rights  Agreement  dated  September  7, 2005 by and
               between the and  Cornell (as  incorporated  by  reference  to the
               Company's  Current  Report on Form 8-K, filed with the Securities
               and Exchange Commission on September 13, 2005).

10.22          Placement  Agent Agreement dated September 7, 2005 by and between
               the  Company  and  Monitor  Capital,  Inc.  (as  incorporated  by
               reference to the Company's Current Report on Form 8-K, filed with
               the Securities and Exchange Commission on September 13, 2005).

10.23          Intercreditor  Agreement dated September 7, 2005 by and among the
               Company,  Montgomery  and the investors  identified in Schedule I
               thereto (as  incorporated  by reference to the Company's  Current
               Report  on Form  8-K,  filed  with the  Securities  and  Exchange
               Commission on September 13, 2005).

10.24          Investor Registration Rights Agreement dated September 7, 2005 by
               and between the Company and the investors  identified thereto (as
               incorporated by reference to the Company's Current Report on Form
               8-K,  filed  with  the  Securities  and  Exchange  Commission  on
               September 13, 2005).

10.25          Securities  Purchase  Agreement  dated  September  7, 2005 by and
               between  the  Company and the  investors  identified  thereto (as
               incorporated by reference to the Company's Current Report on Form
               8-K,  filed  with  the  Securities  and  Exchange  Commission  on
               September 13, 2005).

10.26          Security  Agreement  dated  September  7, 2005 by and between the
               Company and the investors  identified thereto (as incorporated by
               reference to the Company's Current Report on Form 8-K, filed with
               the Securities and Exchange Commission on September 13, 2005).

14.1           Code of Ethics and Business  Conduct for Officers,  Directors and
               Employees.  (as incorporated by reference to the Annual Report on
               Form 10-KSB, filed with the Securities and Exchange Commission on
               February 3, 2005).

21             List of Subsidiaries  (as incorporated by reference to the Annual
               Report on Form  10-KSB,  filed with the  Securities  and Exchange
               Commission on February 3, 2005).

31.1           Certification  by John  Fuller,  President  and  Chief  Executive
               Officer,  pursuant  to Section 302 of the  Sarbanes-Oxley  Act of
               2002.

31.2           Certification by Martin Thorp, Chief Financial Officer,  pursuant
               to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1           Certification  by John  Fuller,  President  and  Chief  Executive
               Officer,  pursuant  to Section 906 of the  Sarbanes-Oxley  Act of
               2002.

32.2           Certification by Martin Thorp, Chief Financial Officer,  pursuant
               to Section 906 of the Sarbanes-Oxley Act of 2002.


                                       37
<PAGE>

Item 14. Principal Accounting Fees and Services

Audit fees
----------

The aggregate fees billed for professional  services rendered by our independent
auditors  for the audit of our  financial  statements,  for the  reviews  of the
financial  statements included in our annual report on Form 10KSB, and for other
services normally provided in connection with statutory filings were $64,840 and
$74,226 for the years ended July 31, 2005 and July 31, 2004, respectively.

Audit-Related Fees
------------------

No  audit-related  fees were incurred for the years ended July 31, 2005 and July
31, 2004.

Tax Fees
--------

The aggregate fees billed for professional  services rendered by our independent
auditors  for tax  compliance,  tax advice,  and tax  planning  were $10,500 and
$17,807 for the years ended July 31, 2005 and July 31,  2004.  The  services for
which such fees were paid  consisted  of filing the 2003 and 2004 tax returns of
group companies

All Other Fees
--------------

We did not  incur  any fees for  other  professional  services  rendered  by our
independent auditors during the years ended July 31, 2005 and July 31, 2004.

                                       38
<PAGE>

                                   SIGNATURES

In accordance  with Section 13 or 15(d) of the Securities  Exchange Act of 1934,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                       IN VERITAS MEDICAL DIAGNOSTICS INC.





Dated:   November 2, 2005          By:  /s/ John Fuller
                                        -------------------------------------
                                        John Fuller
                                        President and Chief Executive Officer
                                        (Principal Executive Officer)



Dated:   November 2, 2005          By:  /s/ Martin Thorp
                                        -------------------------------------
                                        Martin Thorp
                                        Chief Financial Officer
                                        (Principal Financial and Accounting
                                        Officer)



                                       39