**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


Washington,
      D.C. 20549





**FORM
      10-QSB**





(Mark
      One)


**[X]**
            **QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**





For
      the
      quarterly period ended June 30, 2006





OR





**[_]**
            **TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**





For
      the
      transition period from ________ to ________





*Commission
      File No. 333-104132*





**Benacquista
      Galleries, Inc.**


(Exact
      name of Registrant as specified in its charter)





Nevada
            71-0928242(State
                or other jurisdiction of incorporation or organization)
            (I.R.S.
                Employer Identification Number)6477
                Lickton PikeGoodlettsville
                TN(858)
                525-5695(415)
                358-5548 Fax
            37072(Address
                of principal executive offices)
            (Zip/Postal
                Code)




(858)
      525-5695


(Telephone
      Number)





Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Exchange Act during the past 12 months (or for such period that
      the
      registrant was required to file such reports), and (2) has been subject to
      such
      filing requirements for the past 90 days.


[X]
      YES
 [  ] NO




State
      the
      number of shares outstanding of each of the Issuer's classes of common equity,
      as of the latest practicable date. There were 11,000,000 common stock shares,
      par value $0.001, as of August 18, 2006 .
























**TABLE
      OF CONTENTS**





PART
                I.
            FINANCIAL
                INFORMATION
            4Item
                1
            Financial Statements
            4Condensed
                Balance Sheets (unaudited) as of June 30, 2006 and September 30,
                2005
            4Condensed
                Statements of Operations (unaudited) for the three months
                ended June 30 ,2005 and June 30, 2006 and the nine months ended in
                June 30, 2005 and June 30, 2006
            5Condensed
                Statements of Cash Flows (unaudited) for the three months ended June
                30 ,2005 and June 30, 2006 and the nine months ended June 30, 2005
                and June 30, 2006
            6Notes
                to Financial Statements
            7Item
                2
            Plan
                of Operation
            10Item
                3
            Controls
                and Procedures
            12PART
                II
            OTHER
                INFORMATION
            13Item
                1
            Legal
                Proceedings
            13Item
                2
            Changes
                in Securities and Small Business Issuer Purchases of Equity
                Security
            13Item
                3
            Defaults
                Upon Senior Securities
            13Item
                4
            Submission
                of Matters to a Vote of Security Holders
            13Item
                5
            Other
                Information
            13Item
                6
            Exhibits
                and Reports on Form 8-K
            13Signature
            14
















2







FORWARD-LOOKING
      STATEMENTS







In
      addition to historical information, this Report contains forward-looking
      statements. Such forward-looking statements are generally accompanied by words
      such as "intends," "projects," "strategies," "believes," "anticipates," "plans,"
      and similar terms that convey the uncertainty of future events or outcomes.
      The
      forward-looking statements contained herein are subject to certain risks and
      uncertainties that could cause actual results to differ materially from those
      reflected in the forward-looking statements. Factors that might cause such
      a
      difference include, but are not limited to, those discussed in ITEM 2 of this
      Report, the section entitled "MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN
      OF
      OPERATION." Readers are cautioned not to place undue reliance on these
      forward-looking statements, which reflect management's analysis only as of
      the
      date hereof and are in all cases subject to the Company's ability to cure its
      current liquidity problems. There is no assurance that the Company will be
      able
      to generate sufficient revenues from its current business activities to meet
      day-to-day operation liabilities or to pursue the business objectives discussed
      herein.





The
      forward-looking statements contained in this Report also may be impacted by
      future economic conditions. Any adverse effect on general economic conditions
      and consumer confidence may adversely affect the business of the Company.





Benacquista
      Galleries, Inc. undertakes no obligation to publicly revise these
      forward-looking statements to reflect events or circumstances that arise after
      the date hereof. Readers should carefully review the risk factors described
      in
      other documents the Company files from time to time with the Securities and
      Exchange Commission, including without limitation those identified in the "Risk
      Factors" section of the Company's Registration Statement filed with the
      Securities and Exchange Commission (the "SEC") on May 14, 2003 on Form SB-2/A.


































3






**Part
      I - Financial Information**





**Item
      1. Financial Statements**





**BENACQUISTA
      GALLERIES, INC.**


**CONDENSED
      BALANCE SHEETS**


**(UNAUDITED)**





**June
                30,**
            
            **September
                30,****2006**
            
            **2005****ASSETS****Current
                Assets**Cash
            
            $
            9,027
            
            $
            507Accounts
                Receivable
            
            
            337,695
            
            
            -Inventory
            
            
            906,131
            
            
            841,377Advanced
                Royalty Payment
            
            
            2,500
            
            
            -Accrued
                Interest Receivable
            
            
            9,840
            
            
            -**Total
                Assets**
            
            
            1,265,193
            
            
            841,884**LIABILITIES
                AND STOCKHOLDERS' EQUITY (DEFICIT)****Current
                Liabilities**Accounts
                Payable
            
            $
            71,805
            
            $
            26,385Accrued
                Interest
            
            
            52,822
            
            
            114,971Unearned
                Income
            
            
            2,889
            
            
            -Due
                to Shareholder
            
            
            17,865
            
            
            -Note
                Payable to Related Party
            
            
            1,012,127
            
            
            1,012,127**Total
                Current Liabilities**
            
            
            1,157,508
            
            
            1,153,483**Long-Term
                Liabilities**
            
            
            -
            
            
            -**Total
                Liabilities**
            
            
            1,157,508
            
            
            1,153,483**Stockholders'
                Equity (Deficit)**Common
                Stock- $0.001 par value; 50,000,000 shares auhorized; 11,000,000
                and
                10,000,000 shares issued and oustanding respectively
            
            
            11,000
            
            
            10,000Teasury Stock - at Cost
            
            
            (7,818
            )
            
            -Additional
                Paid-in-capital
            
            
            1,095,108
            
            
            93,058Stock
                Subscriptions Receivable
            
            
            (736,429
            )
            
            -Retained
                (Deficit)
            
            
            (254,176
            )
            
            (414,657
            )**Total
                Stockholders' Equity (Deficit)**
            
            
            107,685
            
            
            (311,599
            )**Total
                Liabilities and Stockholders' Equity (Deficit)**
            
            $
            1,265,193
            
            $
            841,884








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








4







**BENACQUISTA
      GALLERIES, INC.**


**CONDENSED
      STATEMENTS OF OPERATIONS**


**(UNAUDITED)**











**For
                the Three Months Ended**
            
            **For
                the Nine Months Ended****June
                30, 2006**
            
            **June
                30, 2005**
            
            **June
                30, 2006**
            
            **June
                30, 2005****Revenue**
            
            $
            343
            
            $
            -
            
            $
            422,618
            
            $
            -**Cost
                of Goods Sold**
            
            
            -
            
            
            -
            
            
            (154,982
            )
            
            -**Gross
                Margin**
            
            
            343
            
            
            -
            
            
            267,636
            
            
            -**General
                and Adminstrative Expense**
            
            
            (23,078
            )
            
            (19,205
            )
            
            (98,572
            )
            
            (53,072
            )**Income
                (Loss) From Operations**
            
            
            (22,735
            )
            
            (19,205
            )
            
            169,064
            
            
            (53,072
            )**Other
                Income and Expense:****Interest
                Expense**
            
            
            (12,617
            )
            
            (10,777
            )
            
            (37,851
            )
            
            (32,330
            )**Interest
                Income - Notes Receivable**
            
            
            9,728
            
            
            -
            
            
            20,418
            
            
            -**Forgiveness
                of Accounts Payable - Legal Fees**
            
            
            8,850
            
            
            -
            
            
            8,850
            
            
            -**Total
                Other Income and Expense**
            
            
            5,961
            
            
            (10,777
            )
            
            (8,853
            )
            
            (32,330
            )**Net
                Income (Loss)**
            
            
            (16,774
            )
            
            (29,982
            )
            
            160,481
            
            
            (85,402
            )**Basic
                and Diluted Income (Loss) per Share**
            
            $
            (0.002
            )
            $
            (0.003
            )
            $
            0.015
            
            $
            (0.009
            )**Weighted
                Average Number of Shares Oustanding**
            
            
            11,000,000
            
            
            10,000,000
            
            
            10,641,026
            
            
            10,000,000














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



















5











**BENACQUISTA
      GALLERIES, INC.**


**CONDENSED
      STATEMENTS OF CASH FLOWS**


**(UNAUDITED)**





**For
                the**
            
            **For
                the****Nine
                Months Ended**
            
            **Nine
                Months Ended****June
                30, 2006**
            
            **June
                30, 2005****Cash
                Flows From Operating Activities**Net
                Income (Loss)
            
            $
            160,481
            
            $
            (85,402
            )Forgiveness
                of Accounts Payable - Legal Fees
            
            
            (8,850
            )
            
            -Changes
                in Operating Assets and Liabilities:Accounts
                Receivable
            
            
            (337,695
            )
            
            -Advanced
                Royalty Payment
            
            
            (2,500
            )
            
            -Inventory
            
            
            (64,754
            )
            
            -Accrued
                Interest Receivable
            
            
            (9,840
            )
            
            -Accounts
                Payable
            
            
            54,269
            
            
            8,897Payable
                to Related Party
            
            
            -
            
            
            -Unearned
                Income
            
            
            2,889
            
            
            -Accrued
                Interest
            
            
            (62,148
            )
            
            32,330**Net
                Cash From Operating Activities**
            
            
            (268,148
            )
            
            (44,175
            )**Cash
                Flows From Investing Activities**
            
            
            -
            
            
            -**Cash
                Flows From Financing Activities**Payment
                on Stock Subscription Receivable
            
            
            263,572
            
            
            -Loan
                From Majority Shareholder
            
            
            17,864
            
            
            -Additional
                Paid-in-capital
            
            
            3,050
            
            
            15,524Purchase
              of Treasury Stock
            
            
            (7,818
            )
            
            -**Net
                Cash From Financing Activities**
            
            
            276,668
            
            
            15,524**Net
                Change in Cash**
            
            
            8,520
            
            
            (28,651
            )**Cash
                at Beginning of Period**
            
            
            507
            
            
            30,302**Cash
                at End of Period**
            
            $
            9,027
            
            $
            1,651**Non-Cash
                Transactions:**Stock
                Subscriptions Receivable
            
            $
            1,000,000
            
            $
            -











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








6


**BENACQUISTA
        GALLERIES, INC.**
 **NOTES
        TO FINANCIAL STATEMENTS**
 **JUNE
        30, 2006 AND 2005**
 **(UNAUDITED)**





**NOTE
      1 - NATURE OF BUSINESS**





***Organization
      and Nature of Operations —*** On
      January 17, 2003, Benacquista Galleries, Inc. (“the Company”) was organized
      under the laws of the State of Nevada. The Company is considered a development
      stage enterprise and is in the process of raising capital to fund operations.
      As
      such, the Company has since inception spent most of its efforts in developing
      its business plan, acquiring inventory, and in raising capital to fund its
      operations. The Company relied upon cash flows from equity issuances and capital
      contributions from its major shareholder to sustain operations. The planned
      operations of the Company consist of selling artwork through the Internet and
      in
      September 2005 obtained the exclusive publishing rights to the “Farmacist Desk
      Reference”. The Company’s revenue to date of $558,000 reflects $422,000 in the
      second quarter ending March 31, 2006. The Company’s fiscal year end is September
      30.







***Interim
      Financial Information*** **** -
      The
      accompanying un-audited condensed financial statements have been prepared in
      accordance with accounting principles generally accepted in the United States
      of
      America for interim financial information and pursuant to the rules and
      regulations of the Securities and Exchange Commission. Accordingly, they do
      not
      include all of the information and notes required by accounting principles
      generally accepted in the United States of America for complete financial
      statements. In the opinion of management, all adjustments and reclassifications
      considered necessary for a fair and comparable presentation have been included
      and are of normal recurring nature. Year to date results for the nine-month
      period ended June 30, 2006 are not necessarily indicative of the results that
      may be expected for the year ending September 30, 2006. The accompanying
      financial statements should be read in conjunction with the Company’s annual
      financial statements as of September 30, 2005.







**NOTE
      2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**





***Business
      Condition*** —
The
      Company is a new company with limited operating history. This situation raises
      substantial doubt about its ability to continue as a going concern. The Company
      plans to fund its operations with revenues from the sale of art inventory on
      its
      interim website and publication and wholesale sales of the “Farmacist Desk
      Reference”. The Company’s president has indicated that he will loan sufficient
      funds to cover operating needs for the next twelve months. However, there is
      no
      guarantee that these loans will be made. The financial statements do not include
      any adjustments relating to the recoverability and classification of asset
      carrying amounts or the amount and classification of liabilities that might
      result should the Company be unable to continue as a going concern.







7


**BENACQUISTA
        GALLERIES, INC.**
 **NOTES
        TO FINANCIAL STATEMENTS**
 **JUNE
        30, 2006 AND 2005**
 **(UNAUDITED)**





***Net
      Income (Loss) Per Share-Basic and Diluted*** —
Basic
      income (loss) per common share is computed on the basis of the weighted-average
      number of common shares outstanding during the period.





**NOTE
      3** - **INVENTORY**





***Value*** —
      Inventories are stated at the lower of cost or market. When there is evidence
      that the inventory value is less than the original cost, the inventory is
      reduced to market value. The Company determines market value from periodic
      professional appraisals. Appraisals are performed annually or more often as
      deemed appropriate. On September 30, 2005, Ted Robertson, appraiser, appraised
      the works of art and provided a current market value of $1,227,500.





An
      order
      was placed in December 2005 to have 5,000 Farmacist Desk References printed
      with
      a price of $25.90 per book; shipment was received in March 2006 and the total
      of
      $129,500 has been paid to the printer. Book sale orders have been filled and
      invoiced for 5,000 books at a price of $75 per book; balance of $317,545 is
      reflected as part of Accounts Receivable. A royalty payment of $1.00 per book
      for each book sold was paid to the author per the agreement. A Royalties advance
      of $2,500 was paid to the author in anticipation of more book orders. the
      Company has received a verbal agreement from Australia for another 10,000 books.





***Composition*** —
Art
      inventory is composed of 293 pieces of art consisting of oil-on-canvas,
      lithograph and pastel paintings, bronze and ceramic sculptures and other
      miscellaneous items.





**NOTE
      4- UNEARNED REVENUE**





Unearned
      revenue represents prepayments received on books not yet sent to the
      customer.





**NOTE
      5** - **STOCKHOLDERS’
      EQUITY AND WARRANTS**





***Common
      Stock*** —
In
      January 2003, the Company issued 10,000,000 shares of common stock to various
      individuals, including officers of the Company, for cash proceeds of $10,000
      or
      $0.001 per share. On January 7, 2006 1,000,000 warrants were converted at $1.00
      per share to common stock and reflects as an increase to Capital Stock of $1,000
      or $0.001 per share. The stock acquired on January 7, 2006 has only been
      partially paid for. The unpaid portion is shown as stock subscriptions
      receivable in the equity section of the balance sheet.





***Additional
      Paid-in Capital*** —
The
      majority shareholder made $3,050 cash contributions for the nine months ended
      June 30, 2006 for a total of $96,108 during the period January 17, 2003 (date
      of
      inception) through June 30, 2006. On January 7, 2006 1,000,000 warrants were
      converted at $1.00 per share to common stock of which $999,000 (Excess of
      par value) reflects as additional paid in capital.




***Treasury
        Stock*** —
During
        the quarter ended June 30, 2006, the Company purchased 19,000 shares of its
        common stock for $7,818 at an average price of $0.41 per share.


***Warrant*** —
In
      January 2003, the Company issued a warrant to purchase up to 1,000,000 shares
      of
      common stock to an unaffiliated company. The following summarizes the
      outstanding warrant at September 30, 2005:









8


**BENACQUISTA
        GALLERIES, INC.**
 **NOTES
        TO FINANCIAL STATEMENTS**
 **JUNE
        30, 2006 AND 2005**
 **(UNAUDITED)**





**Weighted-Average**
            
            **Weighted-Average****Exercise**
            
            **Remaining****Fixed
                Warrants**
            
            **Warrants**
            
            **Price**
            
            **Contractual
                Life**Outstanding
                at September 30, 2005
            
            
            1,000,000
            
            $
            1.00
            
            
            .34
                years





During
      January 2006, certain warrant holders exercised their rights and purchased
      1,000,000 shares of common stock at $1 per share by entering into note
      receivable agreements to pay the Company $1,000,000. The notes bear interest
      at
      5% and are due by January 2008 with no interim principal or interest payments
      required. As the notes are the result of issuing common stock, the $1,000,000,
      less amounts received, is recorded as an offset to equity as stock subscriptions
      receivable. During the period ended June 30, 2006, payments received were
      applied to accrued interest and principal thus reducing the principal balance
      to
      $736,429 as of June 30, 2006.





**NOTE
      6 - RELATED PARTY TRANSACTIONS**





In
      January 2003, the major shareholder sold certain of his works of art to the
      Company for $862,127 represented by an unsecured note payable. The note bears
      interest at 5% per annum and was due in full June 30, 2005 with no periodic
      payments required. The purchase price represents the shareholder’s original cost
      in the art, which was originally acquired for cash. The balance of the note
      plus
      accrued interest is currently unpaid and will remain on the books as a demand
      note continuing to bear the 5% per annum interest.





In
      September 2005, the Company acquired the website www.ynoteduk8.com for
      $150,000 represented by an unsecured note payable to the major
      shareholder.  The note bears interest at 5% per annum and is payable on
      demand with no periodic payments required. Along with the website acquisition,
      the Company obtained exclusive publishing rights to the “Farmacist Desk
      Reference” (FDR) from the president of YNOT Education, Inc.





During
      the nine months ending June 30, 2006 the majority shareholder loaned the Company
      $117,865 to acquire additional artwork and to pay certain operating expenses
      by
      issuance of a demand note with no periodic payments required. As of June 30,
      2006, $100,000 has been re-paid, leaving a current balance of $17,865. On March
      16, 2006 a partial accrued interest payment of $100,000 on the outstanding
      interest bearing note payables was made to the majority
      shareholder.





**NOTE
      7- PENDING OR THREATENED LITIGATION**





There
      is
      pending litigation against the Company. The Whole Food Farmacy filed a trademark
      infringement suit against the Company in Federal Court in Tennessee on March
      18,
      2006. In management’s and legal counsel’s opinion, there is no basis in fact for
      this litigation and it is frivolous. Legal counsel is of the opinion that the
      maximum liability to the Company will be no more than legal fees.




















9






**Item
      2. Plan of Operation**




The
      following discussion and analysis of our financial condition and results of
      our
      operations should be read in conjunction with our financial statements and
      related notes appearing elsewhere in this report. This discussion and analysis
      contains forward-looking statements that involve risks, uncertainties and
      assumptions. The actual results may differ materially from those anticipated
      in
      these forward-looking statements.




**Plan
      of Operation**




The
      following discussion regarding our plan of operations for the next 12 months
      contains forward-looking statements that involve risks, uncertainties and
      assumptions. The actual results may differ materially from those anticipated
      in
      these forward-looking statements as a result of certain factors, including,
      but
      not limited to, those set forth under "Risk factors" and elsewhere in this
      prospectus.





Overview




Benacquista
      Galleries, Inc. is a Nevada Corporation formed on January 17, 2003 for the
      purpose of offering collectable artwork and accessories through a chain of
      retail galleries and a fully interactive e-commerce and auction-enabled website.
      In September, 2005, the Company added to its available products through the
      acquisition of an interactive website, www.ynoteduk8.com. This website provides
      information and materials for purchase related to art and visual education
      as
      well as other aspects of education and cognitive science. the Company also
      acquired the publication rights to the Farmacist’s Desk Reference, a full-color
      guide to health and wellness written by Benacquista Director Don Tolman. To
      date, the Company does not have any retail galleries. The Company does have
      art
      and educational products available for sale on its www.benacquista.com and
      www.ynoteduk8.com websites. The Company has printed and sold 5000 copies of
      the
      Farmacist’s Desk Reference in Australia, selling out the first printing. It is
      anticipated that the second printing will be completed and sold out by September
      30, 2006.





Currently,
      although we have only two employees, we utilize several distributors, printers,
      editors and consultants to help us conduct our business. Sole officer and
      director James Price and director Don Tolman currently manage both our art
      and
      our education sales and marketing. We are currently selling art on the internet
      through our website and affiliate websites, through our ebay store and through
      the personal efforts of our CEO James Price. In addition, we are still actively
      searching for appropriate physical gallery space and we are currently in the
      process of hiring additional personnel to support both our new artist program
      as
      well as product development and sales for our education products.





We
      have
      primary areas of our business that we intend to develop over the next six to
      twelve months:




•
            Relationships
                with several artists for exclusive artwork offerings through Benacquista
                Galleries;


•
            Publication
                and Sales of the Farmacist’s Desk Reference


•
            At
                least one gallery opening in a strategic
                location;


•
            Sales
                of additional educational products created by Don Tolman and related
                to
                various educational topics including art
                education


•
            A
                sales and marketing capability sufficient to handle all website inquiries
                and gallery traffic.





History
      and form of organization





Benacquista
      Galleries, Inc. is a Nevada Corporation formed on January 17, 2003 for the
      purpose of offering collectable artwork and accessories through a chain of
      retail galleries and a fully interactive e-commerce and auction-enabled website.
      In September, 2005, the Company added to its available products through the
      acquisition of an interactive website, www.ynoteduk8.com. This website provides
      information and materials for purchase related to art and visual education
      as
      well as other aspects of education and cognitive science. The Company also
      acquired the publication rights to the Farmacist’s Desk Reference (FDR), a
      full-color guide to health and wellness written by Benacquista Director Don
      Tolman. To date, the Company does not have any retail galleries. The Company
      does have art and educational products available for sale on its
      www.benacquista.com and www.ynoteduk8.com websites.








10








**Sales
      and marketing.** We
      expect sales and marketing expenses to increase sharply to between $100,000
      and
      $250,000 by September of 2006, assuming that we the launch of the FDR and
      related products is successful.




**General
      and administrative.** General
      and administrative expenses were $23,076 during the three months ending June
      30,
      2006 and $19,205 during the three months ending June 30, 2005.




**Financial
      Condition**




For
      the
      three-month period ended June 30, 2006 , Benacquista Galleries had a net loss
      of
      $16,774 while for the period ended June 30, 2005, the Company had a net loss
      of
      $29,982. Also, for the period ended June 30, 2006, the Company had retained
      earnings of $115,503 while for the period ended September 30, 2005, the Company
      had a working capital deficit of $311,599.




Benacquista
      Galleries' current financial condition makes it difficult to keep up with our
      desired rate of growth. Because of the demand for the FDR and the long lead
      time
      involved in printing, there are significant costs we must advance in order
      to
      continue to reprint the FDR. Although sales of the book are profitable, our
      lack
      of extensive cash reserves means we must grow only as we can finance printing
      of
      the book. We are currently unable to meet market demand of the FDR, but we
      anticipate that further sales will alleviate this problem.




**Liquidity
      and capital resources**




Net
      cash
      used in operating activities for the six-month period ended June 30, 2006 and
      2005 was $268,148 and $44,175 respectively. As of June 30, 2006 , we had $9,028
      in cash. Net cash used in operating activities for the period ended June 30,
      2006 was primarily the result of an increase in accounts receivable. Net cash
      used in operating activities for the period ended June 30, 2005 was primarily
      the result of a net loss offset by an increase in accrued interest
      payable.




Net
      cash
      provided by financing activities was $284,486 for the six-month period ended
      June 30, 2006. Net cash provided by financing activities was $15,524 for the
      period ended June 30, 2005. Net cash provided by financing activities for the
      period ended June 30, 2006 was attributable to a loan from our major shareholder
      and sales of our common stock.




As
      of
      June 30, 2006 our principal commitments consisted of our obligations outstanding
      under accounts payable, accrued interest and a note payable to our major
      shareholder. We have no material commitments for capital expenditures. We expect
      no significant capital expenditures or lease commitments during the next fiscal
      quarter.




We
      believe that our current cash balances, including cash and cash equivalents,
      are
      insufficient to meet our working capital and capital expenditure requirements.
      We have exhausted almost all of our working capital. We will need to receive
      an
      infusion of capital from our chief executive officer, collect accounts
      receivable, receive advance payment from distributors or otherwise increase
      our
      available cash.




We
      need
      to secure additional cash as soon as possible because the lack of cash limits
      our growth potential. We may seek to sell additional equity or debt securities
      or to obtain a credit facility; however, at the present time, we have not
      entered into any arrangements or understandings with respect to any such
      financings. The sale of additional equity or convertible debt securities could
      result in additional dilution to our stockholders. The incurrence of
      indebtedness would result in an increase in our fixed obligations and could
      result in operating covenants that would restrict its operations. There can
      be
      no assurance that financing will be available in amounts or on terms acceptable
      to us, if at all. If financing is not available when required or is not
      available on acceptable terms, we may be unable to grow at our desired rate
      of
      growth. In addition, we may be unable to take advantage of business
      opportunities or respond to competitive pressures. Any of these events could
      have a material and adverse effect on our business, results of operations and
      financial condition.






11







Benacquista
      Galleries's short-term prospects are good, although the lack of additional
      capital is slowing our growth somewhat Management feels very confident in the
      Company’s ability to continue to grow without additional financing, however,
      management also believes that growth would be accelerated with additional
      financing.




**Cash
      requirements**




Presently,
      we anticipate that sales of the FDR, our educational products and our art
      inventory will meet our cash needs, although we would be able to grow faster
      with additional cash. We do have very limited working capital currently. Our
      continued operation is therefore dependent upon our ability to secure additional
      cash, loans from our chief executive officer, collect accounts receivable or
      receive advances from our distributors. We presently have no arrangements or
      understandings with any investors or potential investors with respect to an
      investment in Benacquista Galleries. We have not decided at what price or under
      what terms we will raise such additional funds. The factors that we will utilize
      in making such a decision include: our success in developing strategic partners
      for Benacquista Galleries, the market valuation of our competitors, the
      availability of investments generally for development stage start-up companies,
      and the feedback that we receive from potential investors. We intend to target
      potential customers and potential strategic partners as possible investors
      in
      Benacquista Galleries, though we have not received any indications of interest
      so far.




**Research
      and development**




We
      have a
      present intention to spend substantial resources on research or development
      over
      the next 12 months, consisting primarily in the development of our website
      and
      the development of additional products for our YNOT EduK8 line. We anticipate
      that, funding permitting, we would spend up to $250,000 on the development
      of
      our website during the next 12 months.




**Plant
      and equipment**




We
      currently have an office in Goodletsville, Tennesee consisting of approximately
      1800 square feet of office space owned by Director Don Tolman. We do not pay
      anything for this space and do not have a lease. We believe our currently
      available space will be insufficient for our operations for the next 12 months,
      but do not anticipate leasing any additional space for at least 9 months.




**Employees**




We
      intend
      to hire additional personnel to staff our physical galleries and assist us
      in
      the marketing of our on-line gallery. We anticipate hiring such personnel in
      approximately 9 months and would hire no more than 9 people.




**ITEM
      3. Controls and Procedures**


Evaluation
        of disclosure controls and procedures
 The
        Company maintains disclosure controls and procedures designed to ensure that
        information required to be disclosed in the Company's reports filed under
        the
        Securities Exchange Act of 1934, as amended (the "Exchange Act"), is recorded,
        processed, summarized, and reported within the required time periods, and
        that
        such information is accumulated and communicated to the Company's management,
        including the Chief Executive Officer and Principal Financial Officer, as
        appropriate, to allow for timely decisions regarding disclosure.
 
 As
        required by Rule 13a-15 under the Exchange Act, the Company has completed
        an
        evaluation, under the supervision and with the participation of management,
        including the Chief Executive Officer/Principal Financial Officer, of the
        effectiveness and the design and operation of the Company's disclosure controls
        and procedures as of June 30, 2006. Based upon this evaluation and as a result
        of the deficiencies discussed below, management, including the Chief Executive
        Officer/Principal Financial Officer, have concluded that the Company's
        disclosure controls and procedures were not effective as of June 30,
        2006.
 
 The
        deficiencies in the Company's internal control over financial reporting in
        connection with the Company's filing of its 10-QSB for the period ended June
        30,
        2006 related primarily to the failure to properly record the purchase of
        treasury stock and certain cash flow transactions. The deficiencies were
        detected in the evaluation process and the transactions were appropriately
        recorded and disclosed in that Form 10-QSB. The Company is in the process
        of
        improving its internal control over financial reporting, in an effort to
        resolve
        these deficiencies through improved communication to outside bookkeepers,
        but
        additional effort is needed to fully remedy these deficiencies. The
        Company's management and officer will continue to work with their auditors
        and
        outside advisors to ensure that the Company's controls and procedures are
        adequate and effective for the interim as well as the annual
        periods.
 
 Based
        on
        the matters identified above, the Company's Chief Executive Officer/Principal
        Financial Officer concluded that the Company's disclosure controls and
        procedures were not effective. These deficiencies have been disclosed to
        the
        Company's Board of Directors.
 
 Changes
        in internal control over financial reporting
 As
        noted
        above, the Company is in the process of improving its internal control over
        financial reporting, in an effort to resolve these deficiencies through
        increased management involvement and improved communication, but additional
        effort is on-going and needed to fully remedy these deficiencies. The Company's
        management and officer will continue to work with their auditors and outside
        advisors to ensure that the Company's controls and procedures are adequate
        and
        effective.






12






**Part
      II**


**OTHER
      INFORMATION**





**Item
      1. Legal Proceedings**





On
      March
      18, 2006, we were sued in Federal District Court in Tennesee by The Wholefood
      Farmacy for using trademarks allegedly belonging to The Wholefood Farmacy.
      We
      have attempted to settle this lawsuit for nuisance value, because we believe
      the
      suit has no merit and no basis in fact. The Company intends to vigorously defend
      this lawsuit. We have been informed by counsel that it is unlikely there will
      be
      any material financial impact of this litigation aside from legal
      costs.





**Item
      2. Changes in Securities and Small Business Issuer Purchases of Equity
      Securities**





**Recent
      Sales of Unregistered Securities**





Not
      Applicable





**Item
      3. Defaults Upon Senior Securities**





Not
      Applicable





**Item
      4. Submission of Matters to a Vote of Security Holders**





Not
      Applicable





**Item
      5. Other Information**





Not
      Applicable





**Item
      6. Exhibits and Reports on Form 8-K**





(a)
      LIST
      OF EXHIBITS





List
      of Exhibits


3.1
            Articles
                of Incorporation of registrant as filed previously with the Commission
                on
                Form SB-2, dated April 12, 2002.


3.2
            Bylaws
                of registrant as filed previously with the Commission on Form SB-2,
                dated
                April 12, 2002.


31.1
            Certification
                of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley
                Act
                of 2002


32.1
            Certification
                of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section
                1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
                of
                2002




(b)
      REPORTS ON FORM 8-K





The
      following reports on Form 8-K were filed by the Company during the fiscal
      quarter ended June 30, 2006 :





None








13






**SIGNATURE**





In
      accordance with the requirements of the Exchange Act, the registrant caused
      this
      report to be signed on its behalf by the undersigned, thereunto duly
      authorized.





Benacquista
                Galleries, Inc.*/s/
                James
                Price**James
                Price**Chief
                Executive Officer**(Duly
                Authorized Officer and Principal**Financial
                and Accounting Officer)*












Dated:
      August 18, 2006








































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